ENPH Stock Sinks On Disappointing Q1 — But AI Pivot Keeps Retail Traders Charged Up

• The company said it has already engaged more than 20 prospective customers in discussions about its power conversion platform. 
• Enphase also said that a demo of the power platform is due this year, with pilots targeting 2027 and commercialization by 2028.
• Even as Enphase’s U.S. revenue fell, Europe proved to be a strong market for the company.

Enphase Energy Inc. (ENPH) is positioning itself to gain from the artificial intelligence-driven infrastructure boom even as demand for its U.S. residential solar business weakens. And that is keeping retail traders bullish even as the stock tanked following gloomy quarterly earnings.

The energy technology company has announced the development of IQ Solid-State Transformer (SST), a distributed solid-state transformer platform for AI data centers.

The company’s stock plunged more than 10% in overnight trading on Tuesday after Enphase posted a first-quarter (Q1) revenue decline and swung to a net loss amid weaker U.S. residential solar demand, dragged by the expiry of federal tax credits. However, its revenue in Europe rose, with the company adding that demand for batteries in the region is expected to grow.

Enphase’s AI Pivot

President and CEO Badri Kothandaraman emphasized the AI opportunity for Enphase in a call with investors.  “AI is driving rack power from roughly 150 kilowatts to more than 1 megawatt. The industry is moving towards higher voltage DC architectures, including 800 volt DC, as outlined in NVIDIA’s white paper last September,” he said.

Enphase’s SST is designed to convert medium-voltage AC directly to low-voltage DC in a single step, aimed at improving efficiency and reducing system complexity. It is expected to deliver approximately 1.25 megawatts of power through a supercluster of 342 power modules with an 800-volt DC output for next-generation AI racks.

The SST platform is also designed to scale from a single 1.25-megawatt rack to multi-megawatt systems, supporting multiple grid voltages that could extend beyond AI data centers into other adjacent high-power markets.

The company said that it has already engaged with more than 20 prospective customers. With a demo due this year, pilots in 2027, and commercialization by 2028, this marks a major strategic pivot beyond solar for Enphase Energy.

“We believe this architecture is the right way to power the next-gen of AI infrastructure and are positioning Enphase to lead in this transition,” Kothandaraman said.

Enphase’s Europe Prospects

Even as Enphase’s Q1 U.S. revenue fell about 23% due to the tax-credit expiration and 48% decline in sell-through demand for its American solar products, Europe proved to be a strong market for the company.

Quarterly revenue in the region increased 36% driven by higher demand despite undershipment. Battery demand across the Netherlands, France, and Germany gained due to policy shifts toward self-consumption.

“We are beginning to see green shoots in April, with solar and battery activations up healthy double digits across multiple European markets compared with the monthly averages in Q1. This is being driven by rising power prices and increasing battery adoption,” Kothandaraman said.

However, the company said that competition from low-cost providers continued, and that it plans to cut battery prices by about 10%.

Retail Stance On ENPH

On Stocktwits, retail sentiment around ENPH stock jumped from ‘neutral’ to ‘extremely bullish’ over the past 24 hours. Message volumes jumped from ‘low’ to ‘extremely high’ levels.

One bullish user said that by focusing on the weak results, the markets were missing the bigger picture of the pivot to an AI infrastructure play. “Market focused on weak Q2 guide, missing the bigger picture: IQ Solid-State Transformer targets AI data centers (98.5% efficiency), demos 2026, volume 2028. If execution works, ENPH could rerate from solar stock to power infra play. My 5Y view: EPS $5+ / PT $130 base, EPS $9 / $300 bull.”

Another said, “$ENPH almost a billion cash, $4B market cap and $1.5b revenue and getting into data centers !! Looks like it is not too far from bottom !”

ENPH stock has declined by more than 26% over the past year.

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