Canadian Solar Reports Second Quarter 2022 Results

GUELPH,ON,Aug. 18,2022 --Canadian Solar Inc.("Canadian Solar" or the "Company") (NASDAQ: CSIQ) today announced financial results for the second quarter ended June 30,2022,with solar module shipments,revenue and gross margin all at or exceeding the high end of prior guidance.

Highlights

Solar module shipments of 5.06 GW,at the high end of 4.9 GW to 5.1 GW guidance range.

62% increase in revenue year-over-year ("yoy") to $2.31 billion,above the high end of $2.2 billion to $2.3 billion guidance range.

16.0% gross margin exceeds the guidance range of 14.5% to 15.5%.

Net income attributable to Canadian Solar of $74 million,or $1.07 per diluted share.

Accelerating upstream capacity expansion plans to further increase control over supply chain.

Global Energy solar project pipeline expands to 26 GWp and storage pipeline expands to over 31 GWh,as of June 30,2022.

Carve-out IPO of CSI Solar Co.,Ltd. ("CSI Solar" or the "CSI Solar subsidiary") remains on track awaiting completion of the CSRC registration.

Dr. Shawn Qu,Chairman and CEO,commented,"We achieved strong results in the second quarter of 2022,revenue and gross margin all at or exceeding the high end of prior guidance. Sequentially,we grew our module shipments by nearly 40% and battery storage solutions revenues by 2.8 times,while significantly expanding our profitability and completing a large volume of project sales. Our capacity growth strategy is also well on track,which we expanded per our recent announcement to invest in our own polysilicon capacity in a region rich in renewable energy resources. This will allow us to gain further control over sourcing,technology and supply chain,and is part of a long-term plan to increase our market share while meaningfully reducing the carbon footprint of our supply chain. We provide additional details of our environmental efforts and performance in our latest ESG Sustainability Report,published last month.

"We are also excited to see the Inflation Reduction Act,or IRA,in the U.S. coming into effect. We believe it will drive a big acceleration in demand for clean energy,especially for solar energy and battery storage.

"Separately,CSI Solar's carve-out IPO remains on track awaiting registration with the China Securities Regulatory Commission."

Yan Zhuang,President of Canadian Solar's CSI Solar subsidiary,said,"CSI Solar delivered strong results in the second quarter,significantly growing volume and increasing pricing,while taking cost control measures in a difficult environment as polysilicon prices continue to go up. Our performance in the second quarter was also boosted by a substantial foreign exchange gain from a strong U.S. Dollar relative to the Renminbi. From a market standpoint,we are encouraged by signs of a shift in customer behavior driven by a growing awareness of solar energy's attractive economics and its importance in energy security and climate change mitigation efforts,especially when paired with battery storage. Reflecting this positive trend,our battery storage shipments in the first half of 2022 have already exceeded 1 GWh,a record level for us. We will continue to build on our strong channels and relationships,especially in premium markets,and make capacity expansion preparations to accelerate our global market share gains in the coming years."

Ismael Guerrero,Corporate VP and President of Canadian Solar's Global Energy subsidiary,"We delivered significant growth in the second quarter by monetizing approximately 880 MWp of project sales across Australia,the U.S.,Japan and the U.K. We also continued to expand and diversify our global project pipeline,strengthening our leadership position in key markets while allowing us to be more selective in developing the highest quality assets. We are particularly encouraged by the passing of the IRA in the U.S. as our subsidiary,Recurrent Energy,has one of the largest and best quality project pipelines,with a total of 8 GWp of solar and 16.5 GWh of battery storage. Additionally,we are making progress executing on our O&M (operations and maintenance) growth strategy to increase the share of stable,recurring income,including a recent expansion of our platform in Europe,as we evaluate complementary growth opportunities worldwide."

Dr. Huifeng Chang,Senior VP and CFO,added,"In the second quarter,we achieved 85% sequential growth in revenue to $2.3 billion and doubled our gross profit to $371 million,achieving a 16% gross margin. We were able to support the accelerated growth rate and reduce the impact of inflation due to our prior strategic decision to increase inventory during the first quarter. We continue to prioritize cash generation and are pleased with the increase in net cash flow provided by operating activities to $293million in the second quarter of 2022,from $159million in the first quarter of 2022. We ended the second quarter with a total cash position of $1.9 billion,giving us significant financial flexibility to fund long-term growth opportunities,including accelerating our upstream capacity expansion."

Second Quarter 2022 Results

Total module shipments recognized as revenues in the second quarterof 2022 were 5.06 GW,up 37% yoy. Of the total,126 MWwere shippedto the Company's own utility-scale solar power projects.

Net revenues in the second quarter of 2022 were $2.31 billion,up 85%quarter-over-quarter ("qoq") and62% yoy. The sequential and yoy increases were mainly driven by higher project sales,higher solar shipment volumes and average selling price,and significant growth in the Company's battery storage solutions business.

Gross profit in the second quarter of 2022 was $371 million,up 105% qoq and 101% yoy.Gross margin in the second quarter of 2022 was 16.0%,above prior guidance,and compared to 14.5% in the first quarter of 2022. The sequential gross margin increase was mainly driven by higher module pricing,lower manufacturing costs from the depreciation of the Renminbi relative to the U.S. Dollar and scale benefits from higher volume.

Total operating expenses in the second quarter of 2022 were $255 million compared to$165 million in the first quarter of 2022 and $158 million in the second quarter of 2021.Thesequential increase was mainly driven by higher shipping and handling expenses and an impairment charge related to certain manufacturing assets.

Depreciation and amortization charges in the second quarter of 2022 were $63 million,compared to $66 million in the first quarter of 2022 and $66 million in the second quarter of 2021.

Net foreign exchange and derivative gain in the second quarter of 2022 was $6million,compared to a net gain of $3 million in thefirst quarter of 2022 and a net loss of $3 million in the second quarter of 2021.

Income tax expense in the second quarter of 2022 was $28million,compared to a $5million income tax benefit in thefirst quarter of 2022and a $2 million income tax benefit in the second quarter of 2021.The expense was a result of the Company's higher income before income tax.

Net income attributable to Canadian Solar in the second quarter of 2022 was $74 million,or $1.07 per diluted share ("diluted EPS"),compared to net income of $9 million,or $0.14 per diluted share,in the first quarter of 2022,and net income of $11 million,or $0.18 per diluted share,in the second quarter of 2021.

For the three months ended June 30,diluted EPS of $1.07 was calculated to include the dilution effect of the outstanding convertible notes. Diluted EPS of $1.07 was calculated from total earnings of $76 million,adding back the 2.5% coupon of $1.3 million,divided by 71.1 million diluted shares,including 6.3 million shares issuable upon the conversion of the convertible notes. For the three months ended March 31,diluted EPS of $0.14 was calculated from total earnings of $9 million divided by 64.7 million diluted shares. For the three months ended June 30,2021,diluted EPS of $0.18 was calculated from total earnings of $11 million divided by 61.3 million diluted shares.

Net cash flow provided by operating activities in the second quarter of 2022 was $293 million,compared to net cash flow provided by operating activities of $159 million in the first quarter of 2022. The increase in operating cash inflow was mainly driven by higher earnings and monetization of project assets.

Total debt was $2.7 billion as of June 30,unchanged from March 31,2022. Non-recourse debt used to finance solar power projects decreased to $264million as of June 30,from $550million as of March 31,mainly due to the monetization of project assets.

Corporate Structure

The Company has two business segments: Global Energy and CSI Solar,which operate as follows:

The Global Energy segment carries out the Company's global project development activities for both solar and battery storage project development,which include sourcing land,interconnection agreements,structuring PPAs and other permits and requirements. The Global Energy segment develops both stand-alone solar and stand-alone battery storage projects,as well as hybrid solar plus storage projects. Its monetization strategies vary between develop-to-sell,build-to-sell,and build-to-own,depending on business strategies and market conditions,with the goal of maximizing returns,accelerating cash turn,and minimizing capital risk.

The CSI Solar segment consists of solar module manufacturing and total system solutions,including inverters,solar system kits and EPC (engineering,procurement and construction) services. The CSI Solar segment also includes the Company's battery storage system integration business,delivering bankable,end-to-end,turnkey battery storage solutions for utility scale,commercial and industrial,and residential applications. These storage systems solutions are complemented with long-term service agreements,including future battery capacity augmentation services.

Global Energy Segment

Canadian Solar has one of the world's largest and most geographically diversified utility-scale solar and energy storage project development platforms,with a strong track record of originating,developing,financing,and building over 6.8 GWp of solar power plants across six continents. The Company has built a leadership position in solar project development with 26 GWp total pipeline,as well as in energy storage project development with over 31 GWh of aggregate pipeline.

The continued pipeline expansion and strong project development track record will support Global Energy's growth in three key areas:

1. Project sales: The Company plans to grow its volume of project sales by a compound annual growth rate of approximately 50% to 2026,while holding and accumulating assets through investment vehicles (see below) in order to better capture asset value.

2. Investment vehicles: The Company is optimizing its project monetization strategy by establishing local investment vehicles that will help maximize the value of its project assets. The Company also intends to retain minority ownership in these vehicles. By 2026,the Company plans to reach 1.3 GW of combined net ownership in solar power projects through these vehicles. This approach will help the Company build and grow a stable base of long-term cash flows from contracted electricity. The Company plans to recycle a large portion of the capital into developing new solar projects for growth. Meanwhile,Canadian Solar expects to capture additional operational value throughout the partial ownership period,including long-term cash flows from power sales,O&M,asset management and other services (see point 3). The Company currently owns a 15% stake in the Canadian Solar Infrastructure Fund ("CSIF",TSE: 9284),the largest Japanese infrastructure fundlisted on the Tokyo Stock Exchange,and has also established the CSFS Fund I,a closed-ended alternative investment fund of a similar nature in Italy. Through launching these localized vehicles,Canadian Solar is building its expertise in designing investment vehicles in local markets that will help maximize the value of its project assets.

3. Services: Canadian Solar currently manages over 3.1 GW of operational projects under long-term O&M agreements,and an additional 2.4 GW of contracted projects that will be operated and maintained by the Company once they are placed in operation. The Company's target is to reach 20 GW of projects under O&M agreements by 2026.

Management targets to achieve the following over the next few years:

Global Energy Targets

2021A

2022E

2023E

2024E

2025E

2026E

Annual Project Sales,GWp

2.1

2.1-2.6

2.8-3.3

3.5-4.0

4.0-4.5

4.3-4.8

Operational O&M Projects,GWp

2.1

4.5

7.5

11

15

20

Net Cumulative Projects Retained,MWp*

292

370

630

1,000

1,100

1,300

Gross Cumulative Projects Retained,MWp*

748

1,500

2,580

3,500

4,000

5,000

*Net projects retained represents CSIQ's net partial ownership of solar projects; the gross number represents the aggregate gross size of projects,including the share which is not owned by CSIQ.

Solar Project Pipeline

As of June 30,the Company's total project pipeline was 26.2 GWp,including 1.3 GWp under construction,3.9 GWp of backlog,and 21.0 GWp of projects in advanced and early-stage pipelines. We have updated our project pipeline classification as follows:

Backlog projects are late-stage projects that have passed their Risk Cliff Date and are expected to start construction in the next 1-4 years. A project's Risk Cliff Date is the date on which the project passes the last high-risk development stage and varies depending on the country where it is located. This is usually after the projects have received all the required environmental and regulatory approvals,and entered into interconnection agreements,feed-in tariff ("FIT") arrangements and PPAs. Over 90% of projects in backlog are contracted (i.e.,have secured a PPA or FIT),and the remaining are reasonably assured of securing PPAs.

Advanced pipeline projects are mid-stage projects that have secured or have more than 90% certainty of securing an interconnection agreement.

Early-stage Pipeline projects are early-stage projects controlled by Canadian Solar that are in the process of securing interconnection.

The following table presents Global Energy's total solar project development pipeline.

Total Project Pipeline (as of June 30,2022) – MWp*

Region

In

Construction

Backlog

Advanced

Pipeline

Early-Stage

Pipeline

Total

North America

-

601

2,767

4,736

8,104

Latin America

907**

2,469**

3,417

1,040

7,833

Europe,the Middle East and Africa ("EMEA")

21

379

4,033

1,811

6,244

Japan

145

157

-

105

407

Asia Pacific excluding Japan and China

-

38

137

1,762

1,937

China

250

300

-

1,170

1,720

Total

1,323

3,944

10,354

10,624

26,245

*All numbers are gross MWp.

**Including 311 MWp in construction and 517 MWp in backlog that are already sold to third parties

Battery Storage Project Pipeline

In addition to developing utility-scale solar power projects,the Global Energy segment has also been developing hybrid solar plus energy storage projects,as well as stand-alone battery storage projects. Since the first quarter of 2021,the Company has been co-hosting energy storage facilities with solar power plants on the same piece of land for nearly all projects under development. By using a single interconnection point per project,the Company expects to significantly enhance the efficiency of its development and the value of its assets under development.

Canadian Solar's storage development business model also includes signing storage tolling agreements with a variety of power purchasers,including community choice aggregators,investor-owned utilities,universities,and public utility districts. In addition,the Company has signed development services agreements to retrofit operational solar projects with battery storage,many of which were previously developed by the Company.

The table below sets forth Global Energy's total storage project development pipeline.

StorageProject Development Backlog and Pipeline(as of June 30,2022) – MWh

Region

In

Construction

Backlog

Advanced

Pipeline

Early-Stage

Pipeline

Total

North America

1,400

-

6,319

8,760

16,479

Latin America

-

1,300

2,806

970

5,076

EMEA

-

82

1,324

4,178

5,584

Japan

-

-

-

19

19

Asia Pacific,excluding Japan and China

20

-

-

2,320

2,340

China

-

300

100

1,400

1,800

Total

1,420

1,682

10,549

17,647

31,298

Solar Power Plants and Battery Storage Projects in Operation

As of June 30,the Company's solar power plants in operation totaled 311 MWp,with a combined estimated net resale value of approximately $270 million to CanadianSolar. The estimated resale value is based on selling prices that Canadian Solar is currently negotiating or comparable asset sales.

Solar Power Plants in Operation – MWp*

Latin America

Japan

Asia Pacific

ex. Japan and China

China

Total

166

48

15

82

311

*All numbers are net MWp owned by Canadian Solar; total gross MWp of projects is 577 MWp,including volume that is already sold to third parties.

Operating Results

The following table presents select unaudited results of operations data of the Global Energy segment for the periods indicated.

Global Energy Segment Financial Results

(In Thousands of U.S. Dollars,Except Percentages)

Three Months Ended

Six Months Ended

June 30,

2022

March 31,

2022

June 30,

2021

June 30,

2021

Net revenues

553,984

92,966

280,614

646,950

751,676

Cost of revenues

473,979

75,130

268,855

549,109

626,892

Gross profit

80,005

17,836

11,759

97,841

124,784

Operating expenses

24,326

18,847

15,632

43,173

43,576

Income (loss) from

operations*

55,679

(1,011)

(3,873)

54,668

81,208

Gross margin

14.4%

19.2%

4.2%

15.1%

16.6%

Operating margin

10.1%

-1.1%

-1.4%

8.5%

10.8%

* Income (loss) from operations reflects management's allocation and estimate as some services are shared by the

Company's two business segments.

CSI Solar Segment

CSI Solar's 2022 and 2023 capacity expansion targets are set forth below.

Manufacturing Capacity,GW*

Dec. 2021

Dec. 2023

Actual

Actual

Plan

Plan

Ingot

5.4

5.4

20.4

25.0

Wafer

11.5

11.5

20.0

25.0

Cell

13.9

13.9

19.8

35.0

Module

23.9

27.9

32.0

50.0

*Nameplate annualized capacities at said point in time. Capacity expansion plans are subject to change without notice based on market conditions and capital allocation plans.

Operating Results

The following table presents select unaudited results of operations data of the CSI Solar segment for the periods indicated.

CSI Solar Segment Financial Results*

(In Thousands of U.S. Dollars,

2022

March 31,

2022

June 30,

2021

Net revenues

1,816,410

1,209,994

1,183,958

3,026,404

1,879,110

Cost of revenues

1,526,755

1,034,165

1,028,470

2,560,920

1,656,164

Gross profit

289,655

175,829

155,488

465,484

222,946

Operating expenses

227,262

143,931

140,516

371,193

260,642

Income (loss) from operations

62,393

31,898

14,972

94,291

(37,696)

Gross margin

15.9%

14.5%

13.1%

15.4%

11.9%

Operating margin

3.4%

2.6%

1.3%

3.1%

-2.0%

*Includes effects of both sales to third-party customers and to the Company's Global Energy segment.Please refer to the

attached financial tables for intercompany transaction elimination information. Income (loss) from operations reflects

management's allocation and estimate as some services are shared by the Company's two business segments.

The table below provides the geographic distribution of the net revenues of CSI Solar:

CSI Solar Net Revenues Geographic Distribution* (In Millions of U.S. Dollars,Except Percentages)

Q2 2022

% of Net

Revenues

Q1 2022

% of Net

Revenues

Q2 2021

% of Net

Revenues

Asia

587

33

473

41

527

46

Americas

742

42

453

39

421

37

Europe and others

431

25

231

20

201

17

Total

1,760

100

1,157

100

1,149

100

*Excludes sales from CSI Solar to Global Energy.

CSI Solar shipped 5.06 GW of modules to more than 70countries in the secondquarter of 2022.The top five markets ranked by shipments were China,Spain,Brazil and Germany.

Battery Storage Solutions

Within CSI Solar,the battery storage solutions team provides customers with competitive turnkey,integrated battery storage solutions,including bankable and fully wrapped capacity and performance guarantees. These guarantees are complemented with long-term service agreements,which include future battery capacity augmentation services and bring in long-term,stable income.

The table below sets forth CSI Solar's battery storage system integration's project pipeline as of June 30,2022.

LTSA (Long

Term Service

Agreement)

Contracted/

In Construction

Forecast

Pipeline

Total

Storage (MWh)

861

1,892

40

8,242

11,035

LTSA projects are operational battery storage projects delivered by CSI Solar that are under multi-year long-term service agreements and generate recurring earnings. Contracted/in construction projects are expected to be delivered within the next 12 to 18 months. Forecast projects include those that have more than 75% probability of being contracted within the next 12 months,and the remaining pipeline includes projects that have received exclusivity agreements or have been shortlisted,but still have a below 75% probability of being contracted.

Business Outlook

The Company's business outlook is based on management's current views and estimates given factors such as existing market conditions,order book,production capacity,input material prices,foreign exchange fluctuations,anticipated timing of project sales,and the global economic environment. This outlook is subject to uncertainty with respect to,among other things,customer demand,project construction and sale schedules,product sales prices and costs,the global impact of the ongoing COVID-19 pandemic and shutdowns,supply chain constraints,and geopolitical conflicts. Management's views and estimates are subject to change without notice.

For the third quarter of 2022,the Company expects total revenues to be in the range of $2.0 billion to $2.1 billion. Gross margin is expected to be between 15.0% and 16.5%. Total module shipments recognized as revenues by CSI Solar are expected to be in the range of 6.0 GW to 6.2 GW,including approximately 140 MW to the Company's own projects.

For the full year of 2022,the Company raises total revenue guidance to $7.5 billion to $8.0 billion,from $7.0 billion to $7.5 billion previously. The Company expects full year volume targets for CSI Solar and Global Energy to remain unchanged from the ranges communicated in the prior quarter: total module shipments of 20 GW to 22 GW and battery storage shipments of 1.8 GWh to 1.9 GWh(CSI Solar),and total project sales of 2.1 GW to 2.6 GW (Global Energy).

Dr. Shawn Qu,Chairman and CEO, commented,"We are off to a strong first half for 2022,and expect continued solar module volume growth through the remainder of the year as we ramp up capacity towards 2023 volume growth targets. The second quarter will likely be the largest quarter of the year for us due to the timing of project sales and battery storage shipments. However,we expect profitability to remain healthy through the second half of the year,driven by continued manufacturing processing cost reductions and lower logistics costs partially offset by higher polysilicon prices. We continue to build on our long track record of innovation,and we are excited to officially introduce our long-awaited battery storage products for utility and residential applications in the upcoming Solar Power International exhibition in California. In a gradually improving market backdrop aided by strong policies such as the recently passed Inflation Reduction Act,Canadian Solar is strongly positioned to achieve profitable growth as we continue to focus on long-term investments and create lasting value for shareholders."

Recent Developments

On August 10,Canadian Solar announced that a wholly owned subsidiary of CSI Solar entered into an investment agreement with the municipal government of Haidong City in Qinghai Province to invest in a polysilicon manufacturing facility. Under the agreement,CSI Solar plans to build a facility with an annual capacity of approximately 50,000 tons of high-purity polysilicon later in 2022 and the facility is expected to commence production in mid-2024. Subject to market conditions and approvals from its board of directors,CSI Solar may also build other manufacturing facilities,including ingots,wafers,cells,modules,and other auxiliary materials in Haidong.

On July 25,Canadian Solar completed the sale of two fully permitted and construction ready solar and battery energy storage projects in the U.K. to specialist alternative asset manager,Gresham House.The two projects comprise a collocated solar and battery energy storage project inDurham,with 50 MWp solar capacity and 38 MW (or 76 MWh) of battery energy storage,and a standalone solar project inWarwickshireof 28 MWp.

On July 25,Canadian Solar published its latest ESG Sustainability Report,which highlights the Company's progress in advancing its sustainability strategy from an environmental,social,and governance perspective.

On July 7,Canadian Solar completed the sale of two solar farms,Suntop and Gunnedah totaling 345 MWp in New South Wales,Australia to CalEnergy Resources (Australia) Limited,a subsidiary ofNorthern Powergrid Holdings Company. Both projects have reached substantial completion.

On June 16,Canadian Solar acquired two standalone energy storage projects in the South Load Zoneof the Texas ERCOT market from Black Mountain Energy Storage. The projects are each anticipated to store up to 200 MWh of energy,with notice to proceed expected in 2023 and commercial operation in the second quarter of 2024.

On June 15,Canadian Solar secured 136 million Brazilian reais (approximately US$28 million) non-recourse project financing from Banco do Nordeste doBrasil S.A.to support construction and operation of its 79 MWp Lavras II solar power project inBrazil.

On June 6,Canadian Solar signed an agreement with SPIC Brasil,a leading power generation company in Brazil to sell 70% stake in the Company's 738 MWp Marangatu and Panati-Sitia solar projects in Brazil. Both projects are expected to begin construction in late 2022 and reach commercial operation in late 2023.

On May 27,Canadian Solar announced that its wholly owned subsidiary Recurrent Energy successfully completed the construction on the 100 MW Sunflower solar power plant in Mississippi. Recurrent Energy developed and built the solar power plant under a Build Transfer Agreement for Entergy Mississippi which owns the plant for the life of the facility after the completion of construction.

Conference Call InformationThe Company will hold a conference call on Thursday,August 18,2022 at 8:00 a.m. U.S. Eastern Daylight Time (8:00 p.m.,Thursday,2022 in Hong Kong) to discuss its second quarter 2022 results and business outlook. The dial-in phone number for the live audio call is +1-877-704-4453(toll-free from the U.S.),800-965-561 (toll-free from Hong Kong),400-1202-840 (local dial-in from Mainland China) or +1-201-389-0920 from international locations. The conference ID is 13731878. A live webcast of the conference call will also be available on the investor relations section of Canadian Solar's website atwww.canadiansolar.com

A replay of the call will be available 2 hours after the conclusion of the call until 11:00 p.m. U.S. Eastern Daylight Time on Thursday,September 1,2022 (11:00 a.m.,September 2,in Hong Kong) and can be accessed by +1-844-512-2921 (toll-free from the U.S.),or +1-412-317-6671from international locations. The replay pin number is 13731878. A webcast replay will also be available on the investor relations section of Canadian Solar's website at www.canadiansolar.com.

AboutCanadian Solar Inc.

Canadian Solar was founded in 2001 in Canada and is one of the world's largest solar technology and renewable energy companies. It is a leading manufacturer of solar photovoltaic modules,provider of solar energy and battery storage solutions,and developer of utility-scale solar power and battery storage projects with a geographically diversified pipeline in various stages of development. Over the past 21 years,Canadian Solar has successfully delivered around 76 GWof premium-quality,solar photovoltaic modules to customers across the world. Likewise,since entering the project development business in 2010,Canadian Solar has developed,built and connected over 6.8 GWp in over 20 countries across the world. Currently,the Company has 311 MWp of projects in operation,5.3 GWp of projects under construction or in backlog (late-stage),and an additional 21 GWp of projects in advanced and early-stage pipeline. Canadian Solar is one of the most bankable companies in the solar and renewable energy industry,having been publicly listed on the NASDAQ since 2006.For additional information about the Company,follow Canadian Solar onLinkedInor visitwww.canadiansolar.com.

Safe Harbor/Forward-Looking Statements

Certain statements in this press release,including those regarding the Company's expected future shipment volumes,revenues,gross margins and project sales are forward-looking statements that involve a number of risks and uncertainties that could cause actual results to differ materially. These statements are made under the "Safe Harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. In some cases,you can identify forward-looking statements by such terms as "believes," "expects," "anticipates," "intends," "estimates," the negative of these terms,or other comparable terminology. Factors that could cause actual results to differ include general business,regulatory and economic conditions and the state of the solar and battery storage market and industry; geopolitical tensions and conflicts,including impasses,sanctions and export controls; volatility,uncertainty,delays and disruptions related to the COVID-19 pandemic; supply chain disruptions; governmental support for the deployment of solar power; future available supplies of high-purity silicon; demand for end-use products by consumers and inventory levels of such products in the supply chain; changes in demand from significant customers; changes in demand from major markets such as Japan,China,Brazil and India; changes in effective tax rates; changes in customer order patterns; changes in product mix; changes in corporate responsibility,especially environmental,social and governance ("ESG") requirements; capacity utilization; level of competition; pricing pressure and declines in or failure to timely adjust average selling prices; delays in new product introduction; delays in utility-scale project approval process; delays in utility-scale project construction; delays in the completion of project sales; continued success in technological innovations and delivery of products with the features that customers demand; shortage in supply of materials or capacity requirements; availability of financing; exchange and inflation rate fluctuations; uncertainties related to the CSI Solar carve-out listing; litigation and other risks as described in the Company's filings with the Securities and Exchange Commission,including its annual report on Form 20-F filed on April 28,2022. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable,it cannot guarantee future results,level of activity,performance,or achievements. Investors should not place undue reliance on these forward-looking statements. All information provided in this press release is as of today's date,unless otherwise stated,and Canadian Solar undertakes no duty to update such information,except as required under applicable law.

Investor Relations Contacts:

Isabel Zhang

Investor Relations

Canadian Solar Inc.

investor@canadiansolar.com

David Pasquale

Global IR Partners

Tel: +1-914-337-8801

csiq@globalirpartners.com

FINANCIAL TABLES FOLLOW

The following tables provide unaudited select financial data for the Company's CSI Solar and Global Energy businesses.

Select Financial Data – CSI Solar and Global Energy

Three Months Ended June 30,2022

(In Thousands of U.S. Dollars,Except Percentages)

CSI Solar

Global

Energy

Elimination

and

unallocated

items (1)

Total

Net revenues

1,410

553,984

(56,208)

2,314,186

Cost of revenues

1,755

473,979

(57,598)

1,943,136

Gross profit

289,655

80,005

1,390

371,050

Gross margin

15.9%

14.4%

—

16.0%

Income from operations (2)

62,393

55,679

(1,955)

116,117

Select Financial Data – CSI Solar and Global Energy

Six Months Ended June 30,Except Percentages)

CSI Solar

Global

Energy

Elimination

and

unallocated

items (1)

Total

Net revenues

3,404

646,950

(108,819)

3,564,535

Cost of revenues

2,920

549,109

(97,435)

3,012,594

Gross profit

465,484

97,841

(11,384)

551,941

Gross margin

15.4%

15.1%

—

15.5%

Income from operations (2)

94,291

54,668

(17,327)

131,632

Select Financial Data – CSI Solar and Global Energy

Three Months Ended June 30,2021

(In Thousands of U.S. Dollars,958

280,614

(34,911)

1,429,661

Cost of revenues

1,470

268,855

(52,451)

1,244,874

Gross profit

155,488

11,759

17,540

184,787

Gross margin

13.1%

4.2%

—

12.9%

Income (loss) from

operations (2)

14,972

(3,873)

15,281

26,380

Select Financial Data – CSI Solar and Global Energy

Six Months Ended June 30,2021

(In Thousands of U.S. Dollars,110

751,676

(111,786)

2,519,000

Cost of revenues

1,164

626,892

(143,445)

2,139,611

Gross profit

222,946

124,784

31,659

379,389

Gross margin

11.9%

16.6%

—

15.1%

Income (loss) from

operations (2)

(37,696)

81,208

26,351

69,863

(1) Includes inter-segment elimination,and unallocated corporate costs not considered part of management's evaluation of reportable segment operating performance.

(2) Income (loss) from operations reflects management's allocation and estimate as some services are shared by the Company's two business segments.

Select Financial Data - CSI Solar and Global Energy

Three Months

Ended

June 30,2022

Three Months

Ended

March 31,2022

Three Months

Ended

June 30,2021

(In Thousands of U.S. Dollars)

CSI Solar Revenues:

Solar modules

1,350,495

963,045

843,463

Solar system kits

150,765

90,456

88,057

Battery storage solutions

227,438

82,500

68,890

China energy/EPC (incl. electricity

sales)

5,397

5,323

94,347

Others

26,107

16,059

54,290

Subtotal

1,760,202

1,157,383

1,149,047

Global Energy Revenues:

Solar and battery storage power

projects

540,056

78,392

266,598

O&M and asset management

services

7,745

7,948

8,607

Others (incl. electricity sales)

6,183

6,626

5,409

Subtotal

553,984

92,966

280,614

Total net revenues

2,186

1,250,349

1,661

Select Financial Data - CSI Solar and Global Energy

Six Months Ended

June 30,2022

Six Months Ended

June 30,2021

(In Thousands of U.S. Dollars)

CSI Solar Revenues:

Solar modules

2,313,540

1,395,710

Solar system kits

241,221

124,128

Battery storage solutions

309,938

71,248

China energy/EPC (incl. electricity sales)

10,720

101,442

Others

42,166

74,796

Subtotal

2,917,585

1,767,324

Global Energy Revenues:

Solar and battery storage power projects

618,448

719,445

O&M and asset management services

15,693

18,573

Others (incl. electricity sales)

12,809

13,658

Subtotal

646,950

751,676

Total net revenues

3,535

2,000

Canadian Solar Inc.

Unaudited Condensed Consolidated Statements of Operations

(In Thousands of U.S. Dollars,Except Share and Per Share Data)

Three Months Ended

Six Months Ended

June 30,

March 31,

June 30,

June 30,

2022

2022

2021

2022

2021

Net revenues

$ 2,186

$ 1,349

$ 1,661

$ 3,535

$ 2,000

Cost of revenues

1,136

1,069,458

1,874

3,594

2,611

Gross profit

371,050

180,891

184,787

551,941

379,389

Operating expenses:

Selling and distribution

expenses

158,017

108,845

83,581

266,862

167,661

General and

administrative expenses

87,920

62,810

68,578

150,730

136,035

Research and

development expenses

18,050

13,280

13,158

31,330

25,608

Other operating income,

net

(9,054)

(19,559)

(6,910)

(28,613)

(19,778)

Total operating expenses

254,933

165,376

158,407

420,309

309,526

Income from operations

116,117

15,515

26,380

131,632

69,863

Other income (expenses):

Interest expense

(19,709)

(15,302)

(14,795)

(35,011)

(29,468)

Interest income

4,216

4,212

2,837

8,428

6,085

Gain (loss) on change in

fair value of derivatives,

net

(4,869)

(24,738)

(12,150)

(29,607)

422

Foreign exchange gain

(loss),net

11,333

27,862

8,884

39,195

(10,764)

Investment income (loss)

6,984

(5,524)

5,154

1,460

6,417

Other expenses,net

(2,045)

(13,490)

(10,070)

(15,535)

(27,308)

Income before income taxes

and equity in earnings of

unconsolidated investees

114,072

2,025

16,310

116,097

42,555

Income tax benefit (expense)

(27,731)

5,183

1,645

(22,548)

(12,207)

Equity in earnings of

unconsolidated investees

2,214

1,726

585

3,940

1,788

Net income

88,555

8,934

18,540

97,489

32,136

Less: Net income (loss)

attributable to non-

controlling interests

14,093

(273)

7,279

13,820

(1,904)

Net income attributable to

Canadian Solar Inc.

$ 74,462

$ 9,207

$ 11,261

$ 83,669

$ 34,040

Earnings per share - basic

$ 1.16

$ 0.14

$ 0.19

$ 1.30

$ 0.57

Shares used in computation -

basic

64,262,556

64,919

60,288,824

64,146,383

60,077,039

Earnings per share - diluted

$ 1.07

$ 0.14

$ 0.18

$ 1.21

$ 0.54

Shares used in computation -

diluted

71,103,568

64,720,107

61,339,043

71,067,215

67,580,787

Canadian Solar Inc.

Unaudited Condensed Consolidated Statement of Comprehensive Income (Loss)

(In Thousands of U.S. Dollars)

Three Months Ended

Six Months Ended

June 30,

2022

2022

2021

2022

2021

Net Income

$ 88,555

$ 8,934

$ 18,540

$ 97,489

$ 32,136

Other comprehensive income

(loss) (net of tax of nil):

Foreign currency translation

adjustment

(126,367)

7,511

9,629

(118,856)

(22,073)

Gain on changes in fair value of

available-for-sale debt securities

229

—

—

229

—

Gain on changes in fair value of

derivatives

160

190

—

350

—

Comprehensive income (loss)

(37,423)

16,635

28,169

(20,788)

10,063

Less: comprehensive income

(loss) attributable to non-

controlling interests

(3,960)

1,127

8,760

(2,833)

(6,932)

Comprehensive income (loss)

attributable to Canadian Solar

Inc.

(33,463)

15,508

19,409

(17,955)

16,995

Canadian Solar Inc.

Unaudited Condensed Consolidated Balance Sheets

(In Thousands of U.S.Dollars)

June 30,

December31,

2022

2021

ASSETS

Current assets:

Cash and cash equivalents

$ 1,053,567

$ 869,831

Restricted cash

888,262

560,633

Accounts receivable trade,net

832,967

651,372

Accounts receivable,unbilled

15,839

37,244

Amounts due from related parties

162,086

73,042

Inventories

1,622,297

1,192,374

Value added tax recoverable

101,904

125,882

Advances to suppliers

277,820

225,879

Derivative assets

17,236

7,286

Project assets

328,937

594,107

Prepaid expenses and other current assets

431,621

434,177

Total current assets

5,732,536

4,771,827

Restricted cash

6,525

3,818

Property,plant and equipment,net

1,353,870

1,401,877

Solar power systems,net

103,908

108,263

Deferred tax assets,net

252,235

236,503

Advances to suppliers

33,515

34,239

Prepaid land use rights

66,416

71,011

Investments in affiliates

104,528

98,819

Intangible assets,net

16,345

18,992

Project assets

498,043

433,254

Right-of-use assets

31,005

35,286

Other non-current assets

181,164

174,453

TOTAL ASSETS

$ 8,380,090

$ 7,388,342

Canadian Solar Inc.

Unaudited Condensed Consolidated Balance Sheets (Continued)

(In Thousands of U.S.Dollars)

June 30,

2022

2021

Current liabilities:

Short-term borrowings

$ 1,367,616

$ 1,271,215

Long-term borrowings on project assets -

current

153,934

321,655

Accounts payable

855,861

502,995

Short-term notes payable

1,413,380

881,184

Amounts due to related parties

701

143

Other payables

649,544

667,854

Advance from customers

151,460

135,512

Derivative liabilities

10,478

2,622

Operating lease liabilities

10,366

12,185

Other current liabilities

170,207

242,783

Total current liabilities

4,783,547

4,038,148

Accrued warranty costs

61,552

45,146

Long-term borrowings

780,149

523,634

Convertible notes

225,271

224,675

Liability for uncertain tax positions

7,776

7,448

Deferred tax liabilities

46,382

48,150

Loss contingency accruals

14,088

15,148

Operating lease liabilities

20,652

23,215

Financing liabilities

44,998

53,641

Other non-current liabilities

284,254

282,699

TOTAL LIABILITIES

6,268,669

5,261,904

Equity:

Common shares

835,543

835,543

Additional paid-in capital

(13,657)

(19,428)

Retained earnings

1,119,221

1,035,552

Accumulated other comprehensive loss

(152,208)

(50,584)

Total Canadian Solar Inc. shareholders'

equity

1,788,899

1,801,083

Non-controlling interests in subsidiaries

322,522

325,355

TOTAL EQUITY

2,111,421

2,126,438

TOTAL LIABILITIES AND EQUITY

$ 8,342

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