Enphase Engergy swung to a loss in its first quarter as the expiration of a residential solar panels led to a decline in revenue.

Enphase Engergy shares sank 11.4% in extended trading.

The company that specializes in solar energy for homes reported a loss of $7.4 million, or 6 cents a share, compared with $29.7 million, or 22 cents a share, a year earlier.

Adjusted earnings were 47 cents a share, above the forecast by analysts of 43 cents a share, according to analysts surveyed by FactSet.

Revenue fell to $282.9 million from $356.1 million a year earlier. Analysts were expecting revenue of $282.3 million, according to FactSet.

The company said it shipped 1.39 million microinverters from Texas and South Carolina facilities. The company also said it is developing a 1.25 MW IQ$(R)$ solid-state transformer product for data centers, tailored for servers that power artificial intelligence models. The company has more than 80 engineers working on the program, it said.

Enphase expects second-quarter revenue of $280 million to $310 million. Analysts are expecting revenue of $294.9 million.

At the end of 2025, a federal tax credit for homeowner-owned residential solar panels--one of Enphase's primary markets--expired. The company said the expiration caused its revenue to decline 23% compared to the fourth quarter of 2025.

In January, the reduced demand for residential solar panels prompted Enphase to restructure part of its organization and plan to cut about 6% of its workforce, The Wall Street Journal reported.