SolarMax Technology, Inc. reported significant financial challenges in its 10-Q filing for the nine months ended September 30, 2024. The company experienced a dramatic decline in revenue, with total revenues of $16.5 million, a 60.5% decrease from $41.9 million in the same period of 2023. This decline was primarily attributed to a 67.2% drop in solar energy sales, which fell from $39.4 million to $12.9 million. The decrease in sales was exacerbated by the California Public Utilities Commission's NEM 3.0 regulations, which reduced export rates by 75%, negatively impacting revenue and gross margins.

The company's gross profit also suffered, plummeting to $1.4 million for the nine months ended September 30, 2024, down 83.2% from $8.2 million in the prior year. Operating expenses surged to $32.7 million, a 197.5% increase from $7.7 million in 2023, largely due to stock-based compensation expenses related to the company's initial public offering (IPO) and increased general and administrative costs.

SolarMax reported a net loss of $31.1 million for the nine months ended September 30, 2024, compared to a net income of $0.3 million in the same period of 2023. The net loss per share was $(0.71), a stark contrast to the previous year's earnings of $0.01 per share. The company also recognized a goodwill impairment charge of $7.5 million related to its China segment, which has not generated revenue since 2022 and currently has no active projects or agreements.

In terms of strategic developments, SolarMax completed its IPO on February 27, 2024, raising approximately $18.6 million in net proceeds. However, the company is facing significant debt obligations, including $32 million in total borrowings as of September 30, 2024. The company is actively seeking to refinance approximately $19.9 million of debt due within the next twelve months into five-year convertible notes.

Additionally, the company laid off approximately 25% of its residential solar system design and installation team in January 2024 due to decreased demand following the implementation of NEM 3.0. As of September 30, 2024, SolarMax reported total assets of $43 million, down from $48.7 million at the end of 2023, while total liabilities decreased to $54 million from $64.5 million.

Overall, SolarMax Technology, Inc. is navigating a challenging financial landscape marked by declining revenues, increased operating costs, and strategic adjustments in response to market conditions.