SouthernCo and NextEra Energy are key First Solar customers

So far, First Solar’s (FSLR) customer base has mostly concentrated in the US. In fiscal 2014, three companies accounted for around 60% ($2.1 billion) of First Solar’s net revenue. While First Solar hasn’t disclosed its revenue by customer, it has noted that the following three companies accounted for over 10% of its fiscal 2014 net revenues:

1. Southern Company (SO)
2. NextEra Energy (NEE)
3. MidAmerican Energy, a Berkshire Hathaway (BRK-B) company

Southern Company (SO) is an electric utility holding company headquartered in Atlanta, Georgia. It’s involved mostly in the regulated utility business in the southeastern United States. It serves a 120,000-square-mile territory in Alabama, Florida, Georgia, and Mississippi.

First Solar is currently undergoing two projects exclusively for Southern Company. Southern Company is rated A/Negative by S&P and Baa1/Stable by Moody’s.

Headquartered in Juno Beach, Florida, NextEra Energy (NEE) is the largest renewable electricity generator in the US. NextEra operates approximately 17% of installed wind capacity and 14% of installed solar capacity in the US. NextEra Energy is rated A-/Stable by S&P and Baa1/Stable by Moody’s. First Solar is constructing two projects exclusively for NextEra Energy with a combined capacity of 500 MW to complete in 2016.

MidAmerican Energy Company is located in Des Moines, Iowa, and it serves parts of Iowa, Illinois, South Dakota, and Nebraska. It’s a Berkshire Hathaway portfolio company, along with other companies—like PacifiCorp and NV Energy. MidAmerican is rated A3/Stable by Moody’s.

NEE, and BRK-B are part of the S&P 500 index (SPY). While First Solar’s customer and geographical concentrations are high, all its key customers are investment-grade companies, partially mitigating the company’s concentration risk.