Leadership Profile: Tom Werner (Part 6)
Check other articles in the series...The later half of 2004 marked the beginning of production operations. SunPower began producing solar cells, a result of $150M of capital investments. On the books, this timeframe represents the greatest period of loss in the company’s history, due largely to the development of the new production lines. It was, of course, necessary.
SM: What did the P&L look like at Q1 2004? TW: In 2003 we finished the year with $4M in revenues, and had significant losses due to our investment in research. In 2004 revenues were $11M, and again significant losses. In 2005 we did $79M, it was the year we switched gears and began growing as fast as we could. It was Q4 2005 that we were able to break even. We hit the deep point in terms of profits and losses in Q4, 2004. That is when we were ramping the facility. You can plot the profit before tax and see a valley between Q4 2004 and Q1 of 2005, and we have since built our way out of that valley. Our peak loss was $7M or $8M loss in a single quarter.
SM: All of this was still being financed by Cypress? TW: Correct. We went back to Cypress twice for funding. TJ Rogers and Fred Bylick, who was a founder at National Semiconductor, and who was famous for cost reducing the people who were mowing the lawn and replacing them with goats, both have reputations as being hard drivers. We did, however, successfully raise money from them twice, and it turned out to be fair and equitable.
SM: Until the point you went public, how much money was invested in SunPower? TW: It was somewhere near $175M.
SM: Your fabrication was $150M, and the rest was working capital? TW: It has been a few years now, and we get a lot of questions about what we are doing today, but I would have to guess that is right.
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