We are investigating Enphase Energy, Inc. (ENPH) (“Enphase” or the “Company”) for potential violations of the federal securities laws.
On June 17, 2020, analyst Prescience Point Capital Management (“Prescience Point”) published a report asserting, among other allegations, that “the Company’s financial statements filed with the SEC are fiction.” Prescience Point “estimate[d] that at least $205.3m of [Enphase’s] reported US revenue in FY 2019 was fabricated” and further alleged that “based on statements provided by former employees and other solar industry participants, it appears that the Company inflated its international revenue significantly as well. We also believe that most, if not all, of the enormous 2,080 Bps expansion in the Company’s gross margin during [Badrinarayanan] Kothandaraman’s tenure as CEO—from 18.4% in Q2 2017 to 39.2% in Q1 2020—is fiction.” Following publication of the Prescience Point report, Enphase’s stock price fell $13.72 per share, or 26%, to close at $39.04 per share on June 17, 2020.