SolarEdge Technologies (NASDAQ:SEDG) saw its stock soar 10.6% in pre-market trading following the release of its second-quarter 2025 financial results, which surpassed analysts' expectations on multiple fronts. The company's performance, coupled with a promising outlook for the third quarter, has ignited investor optimism in the face of ongoing challenges in the solar energy sector.

SolarEdge reported Q2 revenue of $289.4 million, beating the IBES estimate of $273.9 million. The company's adjusted earnings per share (EPS) came in at a loss of $0.81, narrower than the expected loss of $0.86. Despite posting an operating loss, SolarEdge's adjusted operating profit of -$48.3 million was significantly better than the estimated -$68.4 million, demonstrating the company's efforts in cost management and operational efficiency.

Looking ahead, SolarEdge provided an encouraging outlook for the third quarter. The company projects Q3 revenues to be within the range of $315 million to $355 million, signaling potential growth. Additionally, SolarEdge expects its Q3 non-GAAP gross margin to be between 15% and 19%, including about 2% impact from new tariffs. This forward-looking guidance, combined with the better-than-expected Q2 results, appears to have bolstered investor confidence, driving the substantial pre-market rally in SolarEdge's stock price.