Canadian Solar (CSIQ) stock is surging 5.05% in intraday trading on Friday, following the release of its first-quarter 2025 financial results and second-quarter guidance. The solar panel and battery storage company's performance has exceeded market expectations, despite reporting a net loss for Q1.

Canadian Solar reported Q1 revenue of $1.2 billion, surpassing analysts' expectations of $1.096 billion. While the company posted a net loss of $34 million, or $0.69 per share, for the quarter, it was narrower than anticipated. The primary driver behind the stock's rally appears to be the company's optimistic Q2 outlook. Canadian Solar expects total revenue for the second quarter to be in the range of $1.9 billion to $2.1 billion, significantly above analysts' estimates of $1.76 billion.

Adding to the positive sentiment, Canadian Solar highlighted the growing potential of its battery energy storage business. The company reported an expansion of its e-STORAGE pipeline to a record 91 GWh, including a $3.2 billion contracted backlog as of March 31, 2025. This robust pipeline in the energy storage segment has likely contributed to investor enthusiasm, as it represents a promising growth avenue for the company in the evolving renewable energy landscape. Despite ongoing industry challenges, the market appears to be focusing on Canadian Solar's ability to navigate current headwinds and capitalize on future opportunities in the solar and energy storage sectors.