Sunrun Q2 2025 slides: Record margins drive 40% subscriber value growth

Introduction & Market Context

Sunrun Inc (NASDAQ:RUN) presented its Q2 2025 operating and financial results on August 6, 2025, showcasing record margins and substantial year-over-year growth across key metrics. The solar company’s presentation highlighted its continued transition to a storage-first business model and expansion of its home-to-grid distributed power plant programs.

Following the release, Sunrun’s stock declined 1.52% in aftermarket trading to $9.28, despite the strong quarterly performance. This modest pullback comes after the company’s shares have traded between $5.38 and $22.26 over the past 52 weeks, reflecting ongoing volatility in the renewable energy sector.

Quarterly Performance Highlights

Sunrun reported significant financial improvements in Q2 2025, with Aggregate Subscriber Value reaching $1.6 billion, representing a 40% year-over-year increase. Contracted Net Value Creation surged 316% year-over-year to $376 million, equivalent to $1.64 per share.

As shown in the following financial highlights chart, the company achieved its fifth consecutive quarter of positive cash generation, generating $27 million in Q2 and $119 million over the trailing four quarters:

The company demonstrated record margins in Q2 2025, with Upfront Net Subscriber Value reaching $5,711, representing an 11% margin. This marks a substantial improvement from negative margins throughout most of 2023 and early 2024. Customer additions grew 15% year-over-year, while customer additions with storage increased by 50%, achieving a storage attachment rate of 70%.

The following chart illustrates Sunrun’s margin improvement trajectory over the past two years:

Strategic Initiatives

Sunrun has positioned itself as the nation’s largest home-to-grid distributed power plant operator, with customer enrollments in these programs growing more than 300% year-over-year to over 71,000 customers. The company currently operates 17 active programs and delivered 354 MW of power during dispatches over the last year.

The following slide details Sunrun’s current home-to-grid programs and future growth opportunities:

The company demonstrated the real-world impact of its distributed power plants through recent examples in California and Puerto Rico. In June 2025, Sunrun dispatched 325 MW of capacity during peak demand in California, while in July 2025, the company’s systems helped address a generation shortfall in Puerto Rico following the failure of centralized fossil fuel plants.

As illustrated in the following graphs of actual grid events, Sunrun’s distributed resources provided critical support during periods of high demand and system stress:

Detailed Financial Analysis

Sunrun’s Net Subscriber Value increased to $17,004 per subscriber in Q2 2025, with 28,823 subscriber additions representing a 15% year-over-year increase. The company’s presentation broke down the components of this value creation:

Total (EPA:TTEF) Net Value Creation increased to $490 million in Q2, representing $2.14 per share. This figure represents the average unit economics multiplied by the number of units and reflects enterprise-level gross value:

The company’s Net Earning Assets reached $7.6 billion ($33.13 per share), with Contracted Net Earning Assets at $3.0 billion ($13.03 per share). This represents significant growth from $5.7 billion in Q2 2024:

On the capital management front, Sunrun ended Q2 with $618 million in unrestricted cash and $815 million of recourse debt. The company plans to allocate $100 million or more of cash generation to repaying parent debt in 2025, targeting a total recourse debt to cash generation ratio of approximately 2x by year-end.

Forward-Looking Statements

Sunrun provided guidance for both Q3 and full-year 2025. For Q3, the company expects Aggregate Subscriber Value of $1.5 to $1.6 billion (8% growth year-over-year), Contracted Net Value Creation of $275 to $375 million (58% growth year-over-year), and Cash Generation of $50 to $100 million.

For the full year 2025, Sunrun projects Aggregate Subscriber Value of $5.7 to $6.0 billion (14% growth year-over-year), Contracted Net Value Creation of $1.0 to $1.3 billion (67% growth year-over-year), and Cash Generation of $200 to $500 million.

The following slide details the company’s guidance for both periods:

Looking beyond 2025, Sunrun expressed confidence in its ability to grow in 2026 despite industry headwinds related to the solar ITC (NSE:ITC) sunset for cash and loan customers. The company emphasized that subscription offerings now represent over 50% of industry install volumes, an area where Sunrun maintains a strong position.

The company also addressed the impact of 48E Investment Tax Credits, noting that while the solar portion of ITCs will be maintained through 2027, the storage portion (which represents 70% of Sunrun’s current business) will be maintained at 30%+ through 2033. This positions Sunrun favorably as a storage-first company with a 70% storage attachment rate in Q2 2025.

Sunrun’s market share data shows its strong position in the storage segment, with a 42% share of storage install volume in Q1 2025, while maintaining a 17% share of solar install volume:

This strategic positioning in both storage and subscription models appears designed to help Sunrun weather upcoming regulatory changes while continuing to generate value for shareholders through improved unit economics and positive cash generation.

Full presentation:

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