Sunrun (RUN)

Patrick Jobin Vice President-Investor Relations
Lynn Jurich Co-Founder and Chief Executive Officer
Bob Komin Chief Financial Officer
Ed Fenster Co-Founder and Executive Chairman
Michael Weinstein Credit Suisse
Joe Osha JMP Securities
Sophie Karp Guggenheim Securities
Colin Rusch Oppenheimer
Brian Lee Goldman Sachs
Philip Shen Roth Capital Partners
Julien Dumoulin-Smith Bank of America
Call transcript
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Good day, ladies and gentlemen and welcome to the Q1 2018 Sunrun Inc. Earnings Conference Call. At this time all our participants are in a listen only mode. Later we will conduct a question and answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference maybe recorded. to conference like host to now Mr. would turn over the your I President Investor Jobin of Patrick Vice Relations. may you Sir, begin.

Patrick Jobin

Thank you, for call those on operator and thank joining you us to the today.

make note statements. remarks begin, constitute that we conference call please we Before will on this forward-looking certain

that also these and actual made adversely. our to best statements risks factors believe revise the the filings Please we our factors other may refer on judgment any or may results SEC results reflect us, update and more with of being to them. differ to known actual cause in statements inclusive disclaim for differ we based the Although currently made forward-looking materially are discussion to any as today from note projections of a and statements. obligation Please company’s these

On are the let our Co-Founder today the Bob over available which Co-Founder Komin, Fenster, and call me Executive are CFO; Sunrun’s will Chairman. CEO; Lynn. Jurich, Sunrun’s And and to now, The at presentation investors.sunrun.com. Ed slides, and call Sunrun’s turn Lynn use website today on

Lynn Jurich

Thanks, Patrick.

We along you control our and progress their quarter Sunrun’s priorities. are to strategic with freedom willing family's People to against of and operating their to pleased take share financial with energy lives. results improve first

position value, per of last the over per industry. XX clean decades. solutions find way and XX home energy proud put representing solar, We with a our $X.XX We and leadership customers. megawatts and In We have helping in have created million in The NPV XXXX more deployment worrying a watt our first the added want year-over-year. reliable about for are XXX,XXX quarter customer. nearly savings relationship pave energy quarters customers of Sunrun's delivered to than present net XX% for to we meaningful solidified $XXX generated or million they few $XXX,XXX them the first, up customers of

strong support value. expand opportunity massive market to growth customer and Our to continues increasing

We providing new well and utilities to times grid. home when geographies provide peak cost-effective service to solar to proposition service as BrightBox energy by and our stored and entering customers resiliency energy battery a value way the is as during cost are to reliability two increases our store reduce

year are in XX% reiterating cash We our in rate. of and above growth growth full this guidance deployments generation

that keeping just Our and above launched $X while sales. annual we cost for will watt. isn’t customers allows more proving month even achieved for cities. more Technology NPV service growth be coastal to us Last innovation solar continued improvements serve and and Illinois in targets

of ago last We in our received are Florida heartland a to growing the eight-market entry we America. few just Also, solar light from weeks regulators early in green This offer a the marks lease. year. since

service additional allowing other the for accessible of new makes millions owners. solar ownership markets energy California to all many Today have to for homes home homes party As over XXX,XXX XXXX. solar unanimously builds starting the approved mandate have in new California annually. third demonstrated solar commission

service California can solar cost. because model XXX,XXX suited and For XXXX. upfront context market customers builders for solar solar particularly there a as well added it is approximately The in homeowners new add this to no were in help

Massachusetts exceed opting been XX% battery service solar and of time six choosing of a above southern markets direct low rate is generators. upturn cost to This a expectations. energy of ago, service this in customers to certain months our served the customers already directly California than demand Brightbox. cost to are we the launched now add gain customer add superior continues Brightbox continues battery. launched less and and a nearly a We Our of are home is to traction. fraction In the has diesel alternative, XX% states California dirty, in three With Brightbox to in noisy the XX%. Brightbox over In time

market base more and $X an has to partnership natural grid Regulators our today created to traditional our be nurtures that expansion June Grid. in prior from more that residential deliver services details. long-term National to is this initiatives responsive National the jointly fuller to a provided full is way targeted for new we per arrive for infrastructure. loyalty. value along of shared and revenues these are paving customer. from I with quick market, and To the a National efforts. discuss unlock over now lease arrive contracts customer strong bid announce to investment that make clean, to on our strength XXXX. review million grid and and superior increasing CFO approximately are our turn and await. to opportunities Grid. the pleased National that base I’m QX us to guidance has acquisition Sunrun the This Sunrun that near-term Bob, spending of call customer performance signal utilities the accelerate Our with will can partner services value grid even home are Grid Grid's services batteries recognizing

Bob Komin

the quarter by increased we in aggregate first $XX NPV year-over-year. XX% Lynn, million Thanks or

value position also systems over We lives. remaining our net earning to adding assets Sunrun increased shareholders cash our to their for while metric for

per this of an $X.XX approximately to nearly over or per value customer unit customer and value customer We relationships. year. was cost to per watt. per we customer of improvement addition $X,XXX in $X,XXX creation NPV reflecting watt, $X.XX compared and per is prior per a or economics the project the customer also cost $XX,XXX QX our express to are decade-long including project quarter value meaningful This is believe watt. NPV, by way

tax very to channel fund in sensitive modest changes geographic As a equity value reminder, and mix. project is

costs short more, run We time quarterly expect over there project fluctuations. the slightly will value decline but with can in although be declining

value now creation mix. supports channel watt $XX,XXX changes strong quarter growth. CX project QX, geographic to costs creation primarily cost total Creation per Slide installation X% to QX by In customer driven to was in watt. fluctuate per activity sales costs creation on per were $X.XX quarter that can higher year-over-year to and Turning Similar in cost or X. due approximately

declines We expect to module services. continue show cost tariff in with we for and creation impact this the new year, grid will and invest geographies even as modest

home continue also rate expect We which per NPV. to adoption also but batteries carries strong increase, of cost, delivers to the a higher watt

sales were per our marketing to Installation of watt, by increase volume watt. $X.XX as deployed QX per a cost stack Blended $X.XX solar incurred partners unit current year-over-year deployed a QX cost includes improved majority as As directly costs period. $X.XX installation and in this marketing by the not to The which by based projects of on comparable Sunrun business. marketing in while our per reflecting channel costs deployment cost systems selling built increase $X.XX or expenses XX% of reminder, channel year-over-year sales watt, partner significant the in $X.XX will Sunrun because we of our recorded systems, the improvement. was lead calculate in cost were cost our well and built watt, per is in for peers activities installation In and to the quarter those QX. sales for

were per as deployment were sales to In unit compared and G&A $X.XX watt XXXX. cost in increase. In approximately litigation for related decline an marketing and a expect channel G&A construction that ceased million that X QX, QX, watt flat to to operations. We approximately for totaling a QX costs solar reserve excluded items costs per charges establishing assets impairment of by under partners non-recurring to

between systems This QX $X.X margin business Brightbox services. faster MW while realized includes quarter our our We the don’t particular platform we In gas rate. of and our to XXXX. a business slightly and and channel have from sell our direct, XX a we and in racking to calculate creation above achieved growing Comcast platform where as than businesses behind initial watt, direct growth volume cash our deployed sales margin gross XX we guidance of overall is is per when installation solar the our Finally, in third-party contribution partner platform focused and the services we cost, gross we ramp lead for for manage generation we $X.XX the partnership efforts well subtract distribution, compared loan. mix MW, as first

loan third-party levels of our with in outlook to line and with recent mix in XX% mid-teens. and cash Our QX, low consistent was

balance our to sheet. now Turning

slight Our strong. We remains from liquidity last a QX position increase quarter. ended cash, with million in total XXX

continue We we faster XXXX, cash generation our will $XX generated on than an grow to cash XXXX. in estimate our In in adjusted basis. million deployments

debt working optimize progresses. to on As project to existing expect generation cash describe our change the cash year in Ed accelerate our call our the as as total generation We more cash and beyond entries call. cash our will define any our debt. strategy the will accelerated capital less please we're later excludes recourse market Ed our or Also, that in strategic on change detail current this the structure in generation discuss opportunities outlook plan. note later

This accounting GAAP and quarter, prior these to for required financial recast conform recognition reported results standards. we us new lease to new accounting, adopted which revenue standards with also

year, amount with While revenue change both this limit to to interest on effects chose no and mandatory next recognition cash. of changes financials. impact beginning reported we implement are the expense, our standards the year to The primarily

recap financials improved less EPS represents only which only XXXX X% higher $X.XX. revenue, Our than in resulted impact. million by $X

website. For presentation impacts, a provided relations investor we a have discussion supplemental these of our deeper on

deployment trajectory reflecting reiterating increase we Moving the QX for MW, XX in are year-over-year. XX% onto a full In deploy expect and growth growth of guidance on Slide confident XX. guidance XX% We remain our are year. to

our target per we NPV expect earlier, mentioned I As to of our watt above of full economics $X for year. the unit maintain

it Ed. turn me let over Now, to

Ed Fenster

to plan I four Today Bob. Thanks address topics.

our pipeline, quarter changes to approach net generating strategy general Our assets. during capital our earning and and rate gross interest to finally the near-term cash strategy, and flow,

exceeds equity average by report newly debt We equity Project tax equity project debt project and quarter tax mentioned, Tax customer upfront value and primarily solar Bob raising monetizes project for volume. these turn sometimes into credit. against cash As value project systems. investment monetize recurring by the equity, earning the value constructed cash expected finance we as project estimate upfront generate capital. the we rebates the Sunrun project cash overall Net payments, flows. project these cash. of this be items shareholders level our received represents of overall after expenditures When customers to and servicing assets sum

in the investor realize when employ on because asset interest remain in conviction a XX% These we tax deepen last debt As year despite spreads when and continues rates. we of stable the capital add roughly lowering alone, quality, to project high of to XX% treasuries numbers XX, Slide require. residential performance that upfront increase the the solar we is over providers value, XXX%. This project equity long-term realize to equity an contracted project we shown strong US

overall capital are such improving slightly. costs As flat to

are instance, one and valuable. options projects between rate we overall. lowered we've about lower to XXX public maturities cost cost, $X pivot facilities, to costs second three we in debt increased call see principally far currently do hopeful capital commitments. flow the value, yet year, more XX would amended bank extend financed to loan a to proceeds decline. and loan debt market value more the on the XXXX XXXX now this In service anticipation interest these Despite over callable in these and callable debt bank billion and/or expect increased that both markets. with have the So and capital of year we we to points reduction over have that In we debt assets better We resulting in early can the upfront half time. in cash after are when increase in could basis are accomplishments the commercial debt our past debt have and They of

We’re markets taking the to debt a fashion. scalable approach early public in steps

is existing to transactions instance, over rates. coming customary we several expect we to in in bases the believe years. asset-backed deductible most assets, QX, in policy as as tax We ensure securities service those closed related of place our in are well well-positioned as an For interest all without to we the insurance

us cost is electric strong most interest three residential, basis of retail to are pay XX spreads we will note and curve of exists pricing. to the distribution I amortizing to a The current rates historical long-term years. the capital the between that have the electric generation in expectations there cost the to rather long-term than interest growth capital customer rates. correlation points rates interest expects rates electricity rise matter and less indicates pass that will continue. we earlier cost. mentioned than interest interest forward since allow regulators very long-term customers energy market transmission Although correlation rates to is rise over If rate our election contrary through Increasing the longer rise rates Meanwhile, and presidential because to that This next that as in residential were to declining. increased of trend business meaningfully treasuries changes retail utility customarily market no

existing interest We've years also we to XX XX used As swaps. rate assets debt. our rate typically fixed in using lock to

even years swap more the Our XX rate is interest subject of credit debt to We capital we our debt the than gears the service XX% strategy. when our provides of swaps our earlier, to upcoming to achieve public individual first next or XX protection facilities XX fixed over rate execution mature Switching transactions expected sequencing will best loans. senior in possible by market. believe years

extent the finally, Next is And applicable equity desired market. subordinated to the debt in market. the in project

quarter concentrate This a the equity to refinance operating markets fourth for generation to expect assets, least those X at As earlier such XXXX. We into meaning expect the year. we the any seasoned don’t still may project year. QX any transaction and of in execute than years, so this of cash early public wouldn't

Our XXXX growth project equity support than capacity commitments debt and tax capital plans capacity this more into we of year. XXXX QX our and into have

for term financing closed signed consistent terms new equity since previously now the We shared expectations. sheets with our three at year or have tax

in private the have base Finally, but of earning a that the billion, Last I variations net installed I as from tax I’ll back X% Lynn. quarter on and received to occur call quarter reflecting return XX% that timing quarter increase. over those assets asset timing equity mentioned With to was year-over-year XX. to resolved may on QX, Slide to the impacted Net $X.X cash earning our future. assets. issues as not turn similar financings shown

Lynn Jurich

Thanks Ed.

open Let's up for questions. line the


question Credit from of first Our comes Weinstein Instructions] Suisse. Michael [Operator

Your open. is line

Michael Weinstein

what Could expectations new in bit like it is your California the how as rules of your business you will in effect the that affect what's the that for quantify a in whole? a are little in from and volumes better at California, opportunity business point increase portion

Lynn Jurich

We and the amount results. XXX,XXX over level market new thrilled there homes were from home little into of retrofit, installed the just about year bought a XXX,XXX are was home over put were last new it the I context and a just script new permits. solar that the just

So last that’s but doubling. year its a little over roughly

it's build and it home solar that a cost-effective also huge a is California think. confidence I serious to for do it’s really So, important vote because cleaner can is the I market about system customer Strategically more batteries generally. what showing and centric

So that’s a huge point there.

market The as well the other market very reason Sunrun is particularly model. well-positioned because in solar is the solar a or this new business for works service home leasing

One been, want. past consumers new add another with kitchen to the to I I on hesitation my that in of new builders homes for so has that house or have or if the the conflicts XX,XXX

than And offers. builder are amount so, cheaper spend buyer with home rates the the as what a solar the any model and neither have to solar service of upfront the to get nor money the the utility

really it a is is compromise there better service. just no So,

there recently some of the could about that and the versus California service discussion generally. the has part of model share this loan lease think share as I I been of increases the in market do something be So, think where

are The other in compliance interesting kind of seeing already rates also California for that mandate that with consumers about the it very offer use is we’re credit storage. thing adopting storage, in the does again, some interested

prepared already as getting adding comments battery. XX% said many a I in Southern people California the in So, than of more in it's for places

market National to the is to opportunities efforts. and invested terms California way leading those be so today then million And we were excited that's they a I market the in bid similarly, partnerships will this the Grid help partnership $X grid that where really an contract services of And think announce attractive we accelerate year. on next get return on and the to over finally

the California battery that confidence for opportunity, So utility. there are a in aggregating of the of is vote that means services the to that sign those near-term and the lot

market is percent many new of But are I different that think to zone. somewhere this another answer California over one those somewhere market, you the just to So, think up quarter and year. if home going help don't currency I very XXish early -- out is share of question market is -- in specific your and we its around the the it's overall efforts, break look encouraging our be market to state-by-state service open are we last markets sharing great that this at accelerate us this for and the

Michael Weinstein

Grid And National can of services you was the partnership disclose earnings? to sold the what for percentage grid

Lynn Jurich

any of formal a not contracts the No, over it's JV sort long-term that or it's so for as any share year, signed that. of ownership the like or anything revenues, ownership just next structured are or

Michael Weinstein

there Is it about can a talk of revenues you the percent percent, being?

Lynn Jurich

not. That’s

Michael Weinstein

you deal question, actually is at signing if homebuilder just time Got with the agrees last and who a building the house. one the a the to of lease do Sunrun,

Lynn Jurich

the take buyer. a just point has fact So, the other market, note important really just the I I that the be thing a to help -- time going the is, but going every homeowner will other home I the the awareness proof to lease solar help so for this, portion it's the may resale that’s this it's the about to huge this whole of of the believe value, home too normalization is business. that will across for mean

a acquisition. will in So, term it customer big overall lift be of


question Osha comes of next Securities. Joe JMP Our

open. Your line is

Joe Osha

questions. Two

I discussing debt, the there. talk that LTV cost going are sure when up what of or you assets go make to public the want just for to you the you to I dropping just as are is of understand part transaction Ed about going debt First, markets on

Bob Komin

relates assets. to seeing Joe, in the Great so as placed mature newly service question public we’re markets

equity around the leasing previously caused more and significant tax issues a advance in interest change rates or So, where rates.

in are lower at LTV and compress markets interest in fact that now seeing cost. debt many comparable the public are We and respects

So, our debt expectation data points, public at current we be heavily market this is security at are expecting or moving even towards to near point.

Joe Osha

placed assets it's in as service much So, more about really newly to refinancing? opposed

Bob Komin

market be was refinancing assets, the in The that that just with call post the you're seasoned So, that I is instance make we is in expect both. about the opportunities we to to to have for for reiterate are just asking trying attacking the point that assets strong XXXX.

Joe Osha

a then And homebuyer system a on potentially of am to a this the of questions. the lease? homebuyers the that part signing if optionality I’m or Or either Lynn just I builder have? to I for home going the are am I buying lease to what a going the or question previous about I’m just -- is homeowner If following how that have outright going decided has option house much as be get? curious

Lynn Jurich

builder both my builder done today, the done ways will by understanding model. so market It really It's majority that owned be it the new of party through specific. the and homes is is third today

statistics solar the had through third-party XX,XXX I that seen and again home the year new are have homes recent I the about in last think press So, those majority of that done quoted I were model. believe


Guggenheim comes next Karp Sophie from Our Securities. question of

open. Your line is

Sophie Karp

I’m on in option wondering sort Two the new is purchases to imposed new is or follow of questions, on solar that that a them? or is usage California. homebuyers of for an out one opt up rule

Lynn Jurich

that that home offerings think I new home it’s has the it. every that of believe it's most so there residential about mandated on have will other wind geothermal matter much almost I solar that is No, it's technically like have think to alternatives that how home practical believe kind are mean emission a this or niche I I more the has mandate creates or so possible a solar.

Sophie Karp

seeing couple salesforce X% costs reported or in California, the into competition getting more the into it And your state. true moved DG then the to Are maybe the of California you competitors have ground? have to the their and and like residential far renew trying so what aggressive? seems aggressively And their more in is so another even again on on who a competitor and in refocus

Lynn Jurich

as returning it's companies. we fantastic Yes, helps awareness underpenetrated are I still and industry is see the more to growth, think generally as so that, often all to it's story to mention we

and in So, the focus we is there, is California the so it. are that encouraging. is their the We excited demand that really DG and focus on we're consumer renewed testament a about think interest there

Sophie Karp

not cost far But pressure acquisition so big the any you’re the dynamic, so seeing from is market everybody? from this for enough

Lynn Jurich

to consumer we right recorded just as end pricing that That look really project little a because period acquisition looks what given denominator you Bob slower strong. costs on higher reflection tends have the are be and in deployments if with smaller QX very but to of coming growth this like the is basis. value was a acquisition a was QX the it, consistent fairly are the like it that in quarter staying strong for seasonally Absolutely, at at in discussed the on cost, we like and

in So, advertising, industry consumer for the stage that on the of lower we’re and acquisition awareness cost. believe generally not go everyone's while more a to I and seeing will that category, that do again more

Sophie Karp

how you than basis should One what so batteries last if the BrightBox we I cost likely, more and as may, that have think out pointed rate, one attachment more for increases as it on per a BrightBox watt basis? a our versus maybe, does What's differential for BrightBox cost what about without there this increase system a a purposes. modeling the system for a with

Lynn Jurich

given think across the your you have portfolio, penetration high modeling the hold a still year. significant that I for the For not number nationwide guideline is we BrightBox the hugely purpose, again,

that of going the declines back creation slightly on with slight those hold battery by the value, dollar of cost in and of will So, and NPV project going guidance we’re cost to increase the this that to see operating repeat declining coming dollar hold all that Those project plus value the around the patterns and but installation. in are declines offset to cost, slight efficiencies through plus. generally lot the are year through and slightly leverage the declining as of well. the a out year some on just again Again,


you. Thank

of comes Our from Rusch Oppenheimer. next question Colin

now Your line open. is

Colin Rusch

somewhere I disclosing and rates Did miss the going sales and what's with not team? some and not why metrics give someplace through close bookings you’re anymore walk the you on could us them if around us numbers

Bob Komin

Hi this is Bob.

stop was it to So, the the converging that installation to bookings so time basically providing and able because was was to from number number we we really we a it to leading think install, good not decided as the been indicator have NPP didn't collapse providing additional information.

close That's As like been and rates that that far as things that. disclosing. not we've something

Lynn Jurich

QX going where And end then the gives indication up. you guidance of an we’re to

Colin Rusch

a then Okay into tight markets know deployed six additional that? growing marketing impacts and cadence three and months, and are on months, impact the how are move When nine you of can that the kind quarter you expenses we new be. sales months here of think resources seeing have should the couple what and your and spending around grip you is guys I a very

Bob Komin

we actually when sales kind that’s compare and related at we marketing time we when are when and they of same-store, are seeing are our to that we at happen of the look volume sales The costs own that seeing Lynn we channel. it the when actually that like to direct actually tax, the performance look kind are over managed for that and look Sunrun consistent channel said, the deployment and then cost same

We are improve slightly. seeing them actually

what describe channel we the a of of include it's total the because an for it's because what costs cost we to report systems we and we When have firm and consider. we to blend selling can overall thing report partners. actually mix, deploy so we the towards for purchase, through we multichannel channel sensitive mix and effect one our do that And more versus sell that costs sales strategy costs. that's marketing Sunrun, channel that, when actually think I marketing So, partner

we than blended suggested that as So, that growing marketing a sales the in comments little direct costs we in my growing and that makes direction we we higher. Sunrun as and faster faster mix piece mix bit is are


question next of Lee Goldman Brian Sachs. Our comes from

Your line is open.

Brian Lee

can maybe of needle focus year the it the lot a seems ruling on on fresh some move you faster for be it an your that you happen like this you A quickly could that How be? just out? big to refocus then being year scenario for California what with that’s the opportunity where for Florida guidance for could color upside market. to you plays to ramp? to in on your because it How drive has moment, And can going guys. think it volume view Maybe but maybe

Lynn Jurich

does So, the for not guidance the contemplate Florida. contribution big from deployment year

as model we third the soon and you seen there will be active So, have owned approved. party

into and other we the does optimistic that are that We but premature have believe the plan growth we in It owned to seen becomes unlock that bake certainly available. markets that entered it's party do wasn’t in initial plan.

it’s over and XX% the helping a are these up as we for this XX% that get a of growth targeting set running. But to I decade. and think term next markets rate about again long while takes little stage this think So the it we

yet that's not product in huge anticipated We haven’t officially launched so the there. to contributor a be Florida it's

Brian Lee

services, grid bit national you just can grid us question that understand better. help the a little investment on Second

target how that then toward -- the So a potentially count million QX? flows for flow toward is Is the for is in being it the And this And year? recurring your cash does the does cash X structured? investment? that

Lynn Jurich

QX The so one, it's all QX, announced a in -- the that that just does But a around at question, end period. share that Good grid it today, is services on QX because revenue we so have contract things closed it a technically the these it's June it’s relatively is based X it’s it. disclosed not event. small it not it's And is way what million not it it in today, so -- the any we is it this of of there and year ends specifics that. XXXX next bid so and of we over considered

this So a have opportunity contemplated the there to over of a and real work and that that opportunity been we and the it's its the confidence together year. doing currently some expansion next a on of really what are how done bunch over testament an the thats as year vote size we and market's last out and market have of the

In how for the of a there cost of the lot building business cost X in creation so services. terms is it grid financial our we effects services funds the the out, for the goods right profile million are that now year,

that So yes cost guidance flow business million outlook. cash on but R&D is ramp in creation also I X guess the but we to spending are the in technically amount the

Brian Lee

investment the on there anything, have there contingency I had the XX we don’t the say opportunity, months guess does the let’s bid revenue balance win is through and happen made, services grid how investment they zero being is is carried that on you on June it sheet? where that you anything no share XXXX, Okay over to

Ed Fenster

do do, grid to better no the not amount Ed we fact shares, is very One, we scenario the variable. disclosing the a of we’re the service so Its are here, we smaller what there share its national to refund would contracts. there in reason the not unlikely have that part is grid,

adjust very talking I of finalizing that revenue good still be the suspect later we’re but quarter. terms we In we’re accounting that. next it in can for it, won't

Brian Lee

bigger seem be right going companies kind your platforms, know one for last good is the targeting to the chain well. supply days push involve, in leave offer services and publicly maybe then services early the opportunity companies so to grid curious entity others of a one think has of terms There on these be it's picture pass the I that the inverter again view in what be it you’re about and of me, as would some on will here. it's and you. how aggregator Okay but or from servicing battery why as Sunrun to an I Thank versus ecosystem. the to been how

Lynn Jurich

be the long-term relationship think and us Sure believe have great a have about what are customers customers assets. and their to the others trust that the very to for and with the capabilities vis-à-vis that that, building, their estate customers I are addition year. use question, in position strong somebody investing and chain someone it's you also we and the all and over for supply will relationship in to advantage durable that’s the of personal have competitive that's is we a acquisition real part Sunrun strong we are has why own utilities customers They there you,


you. Thank

Our question comes Capital from Roth Shen of Philip Partners. next

now Your open. line is

Philip Shen

give half some last deployment we’re to The first strength know feel Thanks. your Can one around now results going just us I color to for see if where guidance the and the back you can a during of talked as XX% give but growth would you call guide, with year-over-year. provide a great. half that back you number details some That additional you QX grew us but be the coming just this QX to geographies, from. close is there. the

Lynn Jurich

we strong the absolutely seeing longer-term board growth are very showing and Sure, across California strong are really, markets growth. the of our northeast

due rebuilds. offered had back Illinois as last Florida year Nevada in didn’t also market wasn’t that is last where Arizona pipeline and so seven like this a one in a quite brief we contribute call, Texas year, window starting market was significantly QX is And coming last year. be big results last that to have coming and last that markets we new the described the coming strong. but metering back but pulled strong forward ramped back also are We being year launch successful into entered very is part as of March. the Nevada markets including described to that Arizona we as

So all really been a and half. whole from country entering year last nicely we across we work the good have new distributed the very now and eight the through contributions markets over are seeing and foundational a

Philip Shen

more be Ed. for might one, Just

There relates that becoming flip. to more this be able AVS it you coming mature, before are down. spreads be its market to chance in may refinancing do sheet balance assets to on your As the a addition might

you that about some has that think us all preflip at an you be that quarter great. and last might potentially expectation give is XXX changed or ABS. there of assets with post million you then ABS if on would whether guys I talked an also flip. giving update anticipation color do Can on

Ed Fenster

the billion about condition debt refinance hinting or term $X potentially prepared is other this into Great at ABS almost we is debt And current balance remarks callable markets. all is could assets our out market what current that in hold existing was of preflipped I public at the a assets mostly all The question. point.

and a base pricing So XXXX the that be that market project case. XXXX. But and at XXXX be to likely portion in is with the significant would current point this given

Philip Shen

Digging a little bit there deeper Ed.

basis said we a what $X see rate XX a that that of the to remarks result of potentially points kind so or to in XXX of outlook expense actually be interest kind you refinancing could as could improvement improvements, it's interest your billion. back think I

Ed Fenster

would of on forward year that create XXX a life simply of out doesn't that year cash replace million obviously obviously the $X assets then would pull of So thing I then basis the equity obviously against points point is immediate year a asset interest as will be rule billion thumb. credit amortized facility your XX a course we the over $XX over One should that if that that And cash, caution period. a unless to XX which cost create savings. replace would project

Philip Shen

thinking well. over just of year the XX mentioned about XX some period million that you about then as rest cash So and

Ed Fenster

basis XX at The XXX was million points. a

So so as we use to was round XX the per just to and points, basis said that’s I trying numbers year. XXX

Lynn Jurich

Per year.

generation. we still which are we way And us, terms that about lot the cash have a believe attention modeling there to been for in to about the that just flow folks so exciting fortunate thinking is paying maybe that and people another of think and so of

the value of with offer still debt equity XX% upfront that with that the believe to we contracted getting project that in we the get XXX. So up the and slide then and equity leverage we are we tax

still is and have the as that seeing its and available things because earlier bought. like we’re we strategy market interest we’re insurance us So articulated in one policy this -- to is become matured, is we’re which seeing also environment public of the rate you ask know environment questions mix because rate that the the holding, that improvement whole that's things communicating debt people we new asset many interest to about actually employ a and the is of class

that the gives to the we’re assets so plan our wanted us. We I refinancing is flexibility in of what it well. we’re assets that also more that it's period guidance optionality we us in is happen by operating our a to saying Joe but then generate QXX, not developing still available to our assets of the not it to will as the season cash So -- all about year, anticipate plan asked by be and clear generate that this not refinancing is well have of to lot flow that

Philip Shen

last call Certainly sense something kind question billion If quarter, it give seems and next magnitude X of Thank you. the great. of would what about about see might or of time you of us quarter and one topic. be, -- could like a kind first we timing this sense be what can some this timing tranche of

Bob Komin

project the thereafter. the we’re Fair yes, a subordinated so in activities question, sequence so potentially in think to with senior I then potentially equity said, first looking market I as market

play if I the before equity, know You QX. the likely be we comment it made project, wouldn't project that

these you of happening assume of they So sorts I the see therefore likely probably the year. half would that transactions -- would would second more in


you. Thank

of next Julien Bank Our comes question from America. of Dumoulin-Smith

is open. line Your now

Julien Dumoulin-Smith

mentioned couple I of to wanted come already. back that's things to a

remainder to in earlier XX,XXX of choose about us First market party but I understand opportunity. the you California. third perhaps Can homes how the help latest metric do to developments like the some kind opting would more into go the be to option, that the the and there. strategy the you little Perhaps of think you customer tapping entering market know new bit on want mentioned Because a you that developers counterparty certain maybe is the market. imagine you what’s dealing I would with will. extent home on as if to asking

Lynn Jurich

exactly So question you’re great right.

our fast, we the and base and homebuilders positioned news So huge well it, focus new a but channel appropriate we have is the about peak because of. are well huge so last right what relationship, going already we a a hasn’t permits home of that it we we’re we it’s contract customer so you certainly lines where have to are felt markets have positioned for not to again its And we gives just -- homebuilder to other different have size you’re this with been for year, customer go. to area base, pursued a that those is were that more the its take a business for business, sense to the something already XXX,XXX new so sell this attractive advantage and several

correct believe. we you are So and well positioned we are

Julien Dumoulin-Smith

do services you you like exclusivity of goes it already them if as And a extent be element kind have and/or that any you deals clarify under this -- be with just you them think it? engaging about to to segment a it would about as business think of with would as which are any this the like

Lynn Jurich

as because out way. are way -- you be that Again that of this, PPAs. can't NPV. it will reason think out would it a look project strategy see so type lower a in see we homeowners bit don’t again, little the We it’s a -- it financials bit current pretty segment see product wouldn’t way play no why be pricing cost is carved margin It bit or to a to we probably this see similar in little the attractive. to be ramp looks fairly it And certainly we able I anticipate and would our of this any to that’s we think would you our going wouldn’t that line. rates will to lower value, believe of so business we type cost But hold much Likely lower reflect would a the will the XXXX. different were committed dollar to we you are PPA I lower customers in lower term the because offer acquire that of cost. of

before couple bank. So to it and the going now, market ahead are goes there certainly billers will but years of go of there opportunities is it it, into be a

we have but we disclose interesting relationship, relationships. strong not the something exclusive of terms In that’s

Julien Dumoulin-Smith

one we see the timing to here the in of sort I not cost of on about a an comments structure? like talked XQ XQ in customer at XQ given quarter direct what acquisition. costs alluded the How think seems marketing to, you to issues on I’m guys related offset this sure timing, versus who you this can corresponding the much discrepancy

Bob Komin

think in and sales do were we So marketing the in with had to from that we've the normalized they costs like QX. will pretty kind where come past more the of recent significantly down volumes return

Julien Dumoulin-Smith

And full-year year then at you or annualized million the in were talked maybe just finally, did last think XX you have about do if about I growth you the deployment above and trends If about could cash target? about I how to quickly, feel cash.

planning. that? to vis-à-vis that generation So about your component own against if here, give take are mentioned you you flow you cash how know were in well would imply or year. interest would I this be tracking savings a think that much XX about of million as thinking and that How

Lynn Jurich

in can and there. I’ll think operating finance the I talk Ed on about chime

going in is much You NPV really you so are And of XX% that know are how are so we to its It's cash development we see we are efforts we to well best that that value financing quote. plus are growth targets creating that. top rate growth going talking to in rate our XX strong are we NPV and going and to on above target holding much And the drive. how creating we is the above see then that. growth that’s metric operating the margins The volume see and to just see. that there leverage opportunity

Ed Fenster

of half would half were and than this see that half, reasons. material cash two One substantial initial well in the the I clear than as year savings we a more And overall occur driver would shareholders year expense. would and a wouldn't in XXXX, but interest occur substantially certainly the ’XX accrue very, of what that Sunrun for flow. and two, transaction interest savings about second the be more very refinancing the that's then be so material time is the something to those common will portion definitely to to not earlier talking activities, over

Lynn Jurich

important an in the want thrilled generation make that we’re that it. we’re been the potential the cash business I clear sure on with to this make we sure and point, is

faster is We year as project than and the not grow due generation sort financing for going the going consistently operating be of due continue years. business to market deployments in strong and in finance any to the and heroics, part the XX strong this it is estimate to that to of cash that’s time is to has one growth been the pretty

expect that. So do we

because that the then to we’re debt end private more mentioned of the As the cash. generates come structure place to cash and capital order lot equity of a because year, of generation and of the type going structure, of call going of Ed the flow the upfront first on attacking is pursue operations senior how year, the that in we’re towards end

the the year but we feeling more that of will end that. of the positive it are hit in So may we shape have

today, the two and we’re of the plus course that leverage a great QX operating in getting time be they than should are well growing we’re higher significantly the has because it. Of QX deployment, effects deployments real

Julien Dumoulin-Smith

XX at some tailwind, excellent, it's of that of it obviously way is growth seems target your on tailwind. the million that is it there against 'XX growth cash kind in or know financing but been annualizing XXXX, you’re Got just similar well because I like itself, in that kind not fair? full

Lynn Jurich

is and service rate. market see helps. reason the But I can positive rate you also business no And even, grow for be a and to growth ended growing given that quarter that we offering nice that we’re having to XX% year, we’re see again a and our the higher it expecting sustain, we’re where growth setting mean structurally up why XX first this cash closure that's with yes at foundation flow expansions. can’t Well, expansion

So top then big refinancing story and is it. that’s of on the


I remarks. would closing Jurich call no showing over I’m you. any to Thank like this turn for at questions Lynn back to time. the further

Lynn Jurich

Well guys seeing you forward that said thanks for the great question quarter. to next and we look


Thank Ladies have day. you. wonderful a you today’s and and participation for conclude conference. gentlemen, Thank does this your

disconnect. all may You