On February 27th, Daqo Energy released its preliminary earnings report stating that in 2024, the company achieved total operating revenue of RMB 7.411 billion, a year-on-year decrease of 54.62%, with a net loss of RMB 2.718 billion compared to a net profit of RMB 5.763 billion in the same period last year.
The announcement indicated that in 2024, the domestic polysilicon industry continued to face a supply-demand imbalance, with prices in the industry chain falling continuously and even dropping below companies’ cash costs, causing the entire industry to incur losses. During the reporting period, the company directly bore the erosive pressure on profitability from price declines, with performance significantly lower than in the previous year. Affected by market factors during the reporting period, the prices of the company’s main polysilicon products continued to fall. Based on the principle of prudence, the company accrued provisions for inventory impairment and asset impairment for long-term assets such as old production lines, significantly impacting its performance during this reporting period.
To address severe market challenges, regulate its own behavior, and prevent vicious “internal competition,” the company established an efficient and flexible production adjustment mechanism combined with maintenance windows, achieving orderly production reductions for some production lines. During the reporting period, the company achieved polysilicon production of 205,068 tonnes and sales of 181,362 tonnes, with product inventory consistently maintained at a reasonable level. Additionally, the proportion of N-type polysilicon production increased from 40% in 2023 to 70%. Furthermore, although the company’s unit costs fluctuated slightly due to production controls during the reporting period, thanks to the digital “intelligent” manufacturing strategy and cost reduction and efficiency enhancement initiatives, the company’s unit cash costs still declined steadily.
