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SolarCity Corp. (SCTY)
Q1 2013 Earnings Call
May 13, 2013 5:00 pm ET
Aaron Chew – Vice President-Investor Relations
Lyndon Rive – Founder and Chief Executive Officer
Robert Kelly – Chief Financial Officer
Peter Rive – Founder, Chief Operations Officer and Chief Technology Officer
Satya Kumar – Credit Suisse Securities LLC
Krish Sankar – Bank of America Merrill Lynch
Brian K. Lee – Goldman Sachs & Co.
Y. Edwin Mok – Needham & Co. LLC
Phil L. Shen – ROTH Capital Partners LLC
Pavel S. Molchanov – Raymond James & Associates, Inc.
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At this time, I would like to turn the conference call over to Mr. Aaron Chew, Vice President of Investor Relations at SolarCity. Thank you, Mr. Chew, you may begin.
Thank you and good afternoon and good evening to all those joining us from further East. I’d like to thank everyone for joining us for SolarCity’s first quarter 2013 earnings conference call. Leading the presentation today will be a discussion from our two founders both CEO, Lyndon Rive and COO, Peter Rive, as well from our Chief Financial Officer, Bob Kelly. After which point in time, we will open up to the call to questions. We end to limit the duration of the call today to 45 minutes.
But just as we’re geared up and ready to go, I have to of course in object with customary disclaimers, as a reminder, today’s discussion will contain forward-looking statements that involve risks and uncertainties, including forecasts regarding SolarCity’s 2013 financial and operational results. Words such as we believe, may, estimate, continue, anticipate, intend, expect, predict, potential and similar expressions as they relate to SolarCity, its business and its management are intended to identify forward-looking statements.
Forward-looking statements should not be considered a guarantee of future performance or results, and will not necessarily be accurate indications of the time at or by which such performance or results will be achieved if at all. Forward-looking statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed and/or suggested by the forward looking statements, including risks identified in SolarCity’s earnings press release issued today and in the slides accompanying this presentation, as well as additional risks and uncertainties identified in the section entitled Risk Factors in our annual report on Form 10-K, which has been filed with the Securities and Exchange Commission. We do not undertake any obligation to publicly update or revise any forward looking statement whether as a result of new information, future development or otherwise.
In addition, during the course of this call we will use a number of especially defined terms relating to our business metrics and financial results. We referred to definitions on these terms included in the slides accompanying this presentation, which are available on our investor relations website at investors.solarcity.com.
And with that finally behind us, I would like to introduce SolarCity Chief Executive Officer, Mr. Lyndon Rive.
Thank you, Aaron. Now that SolarCity has been public almost 6 months, we have many new investors. I want to reiterate what SolarCity is building. We're creating the most compelling energy company of the 21 century by delivering cleaner, cheaper power through distributed generation.
Give us a second; it looks like the slides are getting stuck. I apologize for that. Good thing we’re not selling software and we’re selling energy. So on that note, I am just going to get started. I am going to go through the slides as if we are going through and when it comes up, we’ll catch up.
As I was mentioning, we are creating the most compelling energy company of the 21st century and let me walk you through the value proposition. So the value proposition to our customer is extremely simple. We sell cheaper, cleaner electricity. On average we save our customer’s 10% to 15% of their electric bill. There is no cost. We install the system for free and sell the electricity at a lower rate than you can buy it from the utility. Our customers also can lock in their energy rates for 20 years. And our customers have control of their energy bill, as before they had no option but to pay whatever the utility gave them.
We also make it easy for home owners to transfer their agreement to the new home owner. We expect that most of our home owners during the 30 year life of the relationship will move. At the size that we are today, a customer moves almost every other day or every day. The solar system actually adds additional value to the house as it is reducing its energy cost. At the same time as we create value for our customers, we are also creating value for our shareholders. Every customer is a highly predictable income stream for the next thirty years. Let’s go into some highlight for Q1.
We added little over 7,000 customers in Q1 with now over 57,000 customers. We expanded our New York market into Long Island. We like Long Island as Long Island’s cost of electricity is extremely high. In fact it’s one of the highest in the U.S. We have announced 1000th customer with Shea Homes. Shea Homes is a new home builder. We’re excited about the new home builder market. Just for reference, the new home builder market and the market that we service install roughly 120,000 to 150,000 new homes a year. The entire solar industry does not install that amount of systems. So when you look at the size of our market, rooftop solar, it is massive. In fact the market is growing and becoming bigger every year at the current installation rate.