Daqo diversifies into storage as China solar installations drop 54%

Daqo New Energy reported third-quarter revenue of $194.2 million, a decline from $244.6 million in the same period last year. The company also posted a net loss of $52.9 million for the quarter.

The drop in revenue coincides with a 54% decrease in China solar installations, according to Saur Energy.

Production and Pricing

Despite the annual revenue decline, Daqo’s third-quarter sales rose to $194.2 million from $62.7 million in the prior quarter. This increase aligns with a shift in market dynamics, as India accounted for 32% of China’s nine-month solar installations in the first three quarters.

After delivering 53,469 tonnes in the third quarter, the company forecasts Q4 output between 35,000 and 45,000 tonnes. Chinese n-type polysilicon prices ended the period at RMB 40–43 per kg, a rise from the previous RMB 30.5–33 per kg range. Daqo’s realized price climbed 2% to $4.12 per kg.

Market Forecasts

The China National Energy Administration recorded 110.83 GW of AC capacity added between January and September, a 54% drop from the 240.27 GW installed in the same period last year. However, September activity showed signs of stabilization, with 13.64 GW added, up 41% year on year.

Metric	Figure
Jan–Sept 2025 solar added (AC)	110.83 GW
Jan–Sept 2024 solar added (AC)	240.27 GW
September 2025 solar added	13.64 GW
China Photovoltaic Industry Association 2025 forecast	180–240 GW

Looking ahead, the China Photovoltaic Industry Association expects full-year installations to land between 180 and 240 GW. Globally, SolarPower Europe predicts 2026 will mark the first year of declining installations in over two decades. For China specifically, the organization forecasts a 24% drop following 664 GW of worldwide installations in 2025.

Industry Response

• Daqo CEO Xiang Xu referenced "Beijing's campaign against below-cost selling" in response to market conditions.
• Eight manufacturers met in Hangzhou on 11 October to float a minimum polysilicon price of CNY 43 per kg.
• The same group proposed a minimum module price of CNY 0.79/W for TOPCon technology.
• OPIS reported Chinese TOPCon export modules remained unchanged for a second week at $0.107/W FOB.
• India added 35 GW of solar capacity from January to September, comprising 24.4 GW utility-scale and 9.8 GW rooftop.
• A China market regulator blocked a roughly $7 billion capacity-buyout fund in January as anti-competitive.

Supply-Side Price Discipline and Regulatory Hurdles

The recent price recovery in Chinese n-type polysilicon, which climbed to RMB 40–43 per kg from RMB 30.5–33, is attributed by Daqo CEO Xiang Xu to Beijing's campaign against below-cost selling. While Daqo’s realized price rose only 2% to $4.12 per kg due to pre-July order pricing, the broader market sees price discipline favored over capacity retirement. This regulatory stance follows a January decision by China's market regulator to block a roughly $7 billion capacity-buyout fund as anti-competitive. Consequently, OPIS notes that Chinese TOPCon export modules have remained flat at $0.107/W FOB for a second week, with tier-one manufacturers expecting prices to stay level or slip through year-end.

What to watch

Daqo intends to introduce solid-state circuit breakers, solid-state transformers, and energy storage systems. The firm aims to have its new facility operational by the first half of 2027, with sales starting that year.