Following a period of consecutive losses, TCL Zhonghuan Renewable Energy Technology Co.,Ltd. is placing a significant wager on BC technology, and the outcome of this gamble remains uncertain.
The name TCL Zhonghuan Renewable Energy Technology Co.,Ltd. has been added once more to the list of companies reporting sustained financial losses.
On the evening of July 13, the leading photovoltaic wafer manufacturer disclosed its performance forecast for the first half of 2026, projecting a net profit attributable to shareholders in the range of a 3 to 3.3 billion yuan loss. This comes on top of a 9.8 billion yuan loss in 2024 and a 9.2 billion yuan loss in 2025, amounting to over 22 billion yuan in evaporated profits within just two and a half years.
However, a mere ten days before this earnings forecast was released, TCL Zhonghuan Renewable Energy Technology Co.,Ltd. announced a massive 2.6 billion yuan investment to completely shift its 45GW TOPCon production capacity towards the BC technology path. This move represents a bold bet on next-generation technology, even as the company continues to hemorrhage cash.
Identifying the Sources of Loss
The losses at TCL Zhonghuan Renewable Energy Technology Co.,Ltd. are not a recent development. The company has now reported losses for nine consecutive quarters since the fourth quarter of 2023.
The most immediate cause is the price collapse in the main photovoltaic supply chain.
In 2025, the gross profit margin for its core photovoltaic wafer business plummeted to -19.44%. This means that for every 100 yuan worth of products sold, the company not only fails to make a profit but loses nearly 20 yuan. Although non-silicon costs for wafers decreased by over 13% year-on-year in the first half of 2026, prices fell even more sharply, making cost reductions insufficient to stem the bleeding.
A heavier burden comes from asset impairments. In 2024, TCL Zhonghuan Renewable Energy Technology Co.,Ltd. recorded impairment losses of 5.2 billion yuan. In 2025, this figure remained high at 4.622 billion yuan, which included 3.185 billion yuan for inventory write-downs and 502 million yuan for fixed asset impairments.
Overseas subsidiary Maxeon represents another source of losses. In 2019, TCL Zhonghuan Renewable Energy Technology Co.,Ltd. invested $298 million to acquire a stake in this company, which was spun off from SunPower, aiming to leverage its patents and overseas channels to tap into the global market. However, impacted by subsidy reductions in Europe and the US, as well as high interest rates, Maxeon reported a $275 million loss in 2023. By 2025, its production was largely halted, leading the parent company to record a 560 million yuan goodwill impairment related to this investment.
Can the Acquisition of Yidao New Energy Stem the Bleeding?
In March 2026, TCL Zhonghuan Renewable Energy Technology Co.,Ltd. spent 1.258 billion yuan to acquire a controlling 59.14% stake in Yidao New Energy, gaining de facto control over 66.34% of voting rights through entrusted agreements.
The context of this deal is that Yidao New Energy itself was in a state of insolvency at the time.
Reportedly, as of the end of 2025, its liabilities stood at 14.189 billion yuan against negative net assets of -1.292 billion yuan, with a net loss attributable to shareholders of 1.97 billion yuan for that year. Its pre-investment valuation was a mere 800 million yuan, a significant discount compared to its nearly 8 billion yuan post-investment valuation during its Pre-IPO round in 2023.
The rationale for the acquisition lies in TCL Zhonghuan Renewable Energy Technology Co.,Ltd.'s strengths in wafers and its weakness in modules. In the first half of 2025, its module capacity was only 24GW, leaving it with limited bargaining power at the end of the value chain.
In contrast, Yidao New Energy possesses integrated cell and module production capacity. By the end of 2025, its N-type high-efficiency cell and module capacity had each been increased to 40GW, and it had also accumulated BC cell technology reserves.
Data from the first half of 2026 shows some improvement in the module business: revenue grew by nearly 40% year-on-year, module revenue accounted for over 50% of total photovoltaic business revenue for the first time in Q2, and overseas module shipments reached approximately 2GW, a fourfold increase year-on-year.
However, the "volume" of this improvement is still far from sufficient to offset the "price"-related losses in the wafer segment. The projected net loss of 3 to 3.3 billion yuan for the first half of 2026, while representing a reduction of over 20% year-on-year, is attributed mainly to cost reductions and increased module shipments, rather than any fundamental transformation brought about by the acquisition itself.
A Seat at the BC Table?
The true intention behind acquiring Yidao New Energy was to pave the way for BC production capacity.
On July 2, TCL Zhonghuan Renewable Energy Technology Co.,Ltd. initiated a 45GW BC technology upgrade project. This involves a 1.4 billion yuan investment to upgrade 20GW of cell capacity and a 1.2 billion yuan investment to upgrade 25GW of module capacity. The project is expected to reach full production capacity by the end of the first quarter of 2027. Upon completion, all of the company's cell capacity will be switched to the BC route, and approximately 50% of its module capacity will be upgraded to BC.
However, the market may not have much space left for it.
Global BC module shipments in 2026 are estimated to be around 50-80GW. LONGi's own HPBC2.0 capacity stands at 46GW, with collaborative capacity of 11GW, targeting shipments of about 52GW in 2026. Aiko Solar plans to reach 35GW of ABC capacity by the end of 2026.
The top two players have already carved up most of the pie. By the time TCL Zhonghuan Renewable Energy Technology Co.,Ltd.'s 45GW capacity comes online, it will face intense competition in a red ocean market.
Cost is an even more critical issue.
During the May 2026 earnings conference, LONGi's Chairman Zhong Baoshen stated that BC product costs had already become essentially on par with TOPCon by March of this year. Recently, LONGi's ACM cell project commenced mass production in Xixian, with data indicating it can increase cell conversion efficiency by another 0.2% to 0.3% and reduce overall production costs by 3% to 4%.
TCL Zhonghuan Renewable Energy Technology Co.,Ltd.'s chips in this game are the over 1,600 BC patents held by Maxeon and its own technological achievement of breaking the 27% efficiency barrier with its self-developed TBC cells. However, patents and technology do not automatically translate into market success. Variables such as mass production yield rates, conversion efficiency, and brand recognition collectively present significant challenges for a latecomer to overcome.
The Era of Scale Benefits is Over
The predicament facing TCL Zhonghuan Renewable Energy Technology Co.,Ltd. is, in essence, a microcosm of the shifting logic within the photovoltaic industry.
Over the past decade, this wafer leader ascended to the top position by employing a "scale strategy." In 2025, its wafer sales volume reached 13.35 billion pieces, maintaining its number one market share.
But in today's industry, overcapacity has become its heaviest burden. Simply adding up gigawatts of capacity no longer automatically translates into competitiveness.
In the first half of 2026, TCL Zhonghuan Renewable Energy Technology Co.,Ltd. reported net operating cash flow of 300 million yuan, while financial expenses amounted to 362 million yuan. Its cash flow is barely positive, yet debt repayment pressure remains significant. As of the end of 2025, the company's asset-liability ratio stood at 66.73%, and its net assets had declined by 28.92% year-on-year.
BC is the direction TCL Zhonghuan Renewable Energy Technology Co.,Ltd. has chosen for itself, and the method remains the "scaling up" it knows best. However, whether this path is viable depends on two fundamental questions: whether BC yield rates can be stabilized and whether the cost structure can be made viable. The answers will not be revealed until the end of the first quarter of 2027.
Until then, TCL Zhonghuan Renewable Energy Technology Co.,Ltd. must continue to bear the weight of its losses. The credit backing from its parent company and the support from its semiconductor materials business may prevent an immediate collapse, but between merely "surviving" and "thriving" lies the entire stake of this BC gamble.
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