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5. Consolidated Balance Sheet Details (Tables)
 9 Months Ended
Sep. 30, 2019
Balance Sheet Related Disclosures [Abstract]  
Schedule of Accounts Receivable
Accounts receivable trade, net

Accounts receivable trade, net consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
Accounts receivable trade, gross
 
$
369,295

 
$
129,644

Allowance for doubtful accounts
 
(1,989
)
 
(1,362
)
Accounts receivable trade, net
 
$
367,306

 
$
128,282



At September 30, 2019 and December 31, 2018, $63.2 million and $8.5 million, respectively, of our accounts receivable trade, net were secured by letters of credit, bank guarantees, surety bonds, or other forms of financial security issued by creditworthy financial institutions.

Accounts receivable, unbilled and retainage

Accounts receivable, unbilled and retainage consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
Accounts receivable, unbilled
 
$
136,734

 
$
441,666

Retainage
 
28,279

 
16,500

Accounts receivable, unbilled and retainage
 
$
165,013

 
$
458,166
Schedule of Inventories, Current and Noncurrent
Inventories consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
Raw materials
 
$
241,305

 
$
224,329

Work in process
 
51,926

 
41,294

Finished goods
 
436,113

 
252,372

Inventories
 
$
729,344

 
$
517,995

Inventories – current
 
$
576,770

 
$
387,912

Inventories – noncurrent
 
$
152,574

 
$
130,083
Schedule of Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
Prepaid expenses
 
$
128,776

 
$
90,981

Prepaid income taxes
 
76,613

 
59,319

Restricted cash
 
32,416

 
19,671

Indirect tax receivables
 
28,238

 
26,327

Notes receivable (1)
 
23,440

 
5,196

Derivative instruments (2)
 
2,299

 
2,364

Other current assets
 
27,653

 
39,203

Prepaid expenses and other current assets
 
$
319,435

 
$
243,061


——————————
(1)
In November 2014 and February 2016, we entered into a term loan agreement and a convertible loan agreement, respectively, with Clean Energy Collective, LLC (“CEC”). Our term loan bears interest at 16% per annum, and our convertible loan bears interest at 10% per annum. In November 2018, we amended the terms of the loan agreements to (i) extend their maturity to June 2020, (ii) waive the conversion features on our convertible loan, and (iii) increase the frequency of interest payments, subject to certain conditions. In January 2019, CEC finalized certain restructuring arrangements, which resulted in a dilution of our ownership interest in CEC and the loss of our representation on the company’s board of managers. As a result of such restructuring, CEC no longer qualified to be accounted for under the equity method. As of September 30, 2019, the aggregate balance outstanding on the loans was $23.1 million and was presented within “Prepaid expenses and other current assets.” As of December 31, 2018, the aggregate balance outstanding on the loans was $22.8 million and was presented within “Notes receivable, affiliate.”

(2)
See Note 6. “Derivative Financial Instruments” to our condensed consolidated financial statements for discussion of our derivative instruments.
Schedule of Property, Plant and Equipment, Net
Property, plant and equipment, net consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
Land
 
$
14,176

 
$
14,382

Buildings and improvements
 
658,510

 
567,605

Machinery and equipment
 
2,166,391

 
1,826,434

Office equipment and furniture
 
186,852

 
178,011

Leasehold improvements
 
49,018

 
49,055

Construction in progress
 
406,056

 
405,581

Property, plant and equipment, gross
 
3,481,003

 
3,041,068

Accumulated depreciation
 
(1,374,035
)
 
(1,284,857
)
Property, plant and equipment, net
 
$
2,106,968

 
$
1,756,211
Schedule of PV Solar Power Systems, Net
Photovoltaic (“PV”) solar power systems, net consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
PV solar power systems, gross
 
$
531,869

 
$
343,061

Accumulated depreciation
 
(47,276
)
 
(34,421
)
PV solar power systems, net
 
$
484,593

 
$
308,640
Schedule of Project Assets
Project assets consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
Project assets – development costs, including project acquisition and land costs
 
$
297,753

 
$
298,070

Project assets – construction costs
 
274,321

 
200,359

Project assets
 
$
572,074

 
$
498,429

Project assets – current
 
$
5,557

 
$
37,930

Project assets – noncurrent
 
$
566,517

 
$
460,499
Schedule of Capitalized Interest
The cost of constructing project assets may include interest costs incurred during the development and construction period. The components of interest expense and capitalized interest were as follows during the three and nine months ended September 30, 2019 and 2018 (in thousands):
 
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
 
2019
 
2018
 
2019
 
2018
Interest cost incurred
 
$
(5,239
)
 
$
(5,023
)
 
$
(26,348
)
 
$
(19,080
)
Interest cost capitalized – project assets
 
263

 
1,825

 
2,330

 
4,635

Interest expense, net
 
$
(4,976
)
 
$
(3,198
)
 
$
(24,018
)
 
$
(14,445
)
Schedule of Other Assets, Noncurrent
Other assets consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
Operating lease assets (1)
 
$
176,785

 
$
—

Indirect tax receivables
 
9,209

 
22,487

Note receivable (2)
 
8,003

 
8,017

Income taxes receivable
 
4,103

 
4,444

Equity method investments (3)
 
2,917

 
3,186

Derivative instruments (4)
 
449

 
—

Deferred rent
 
—

 
27,249

Other
 
46,249

 
33,495

Other assets
 
$
247,715

 
$
98,878

——————————
(1)
See Note 7. “Leases” to our condensed consolidated financial statements for discussion of our lease arrangements.

(2)
In April 2009, we entered into a credit facility agreement with a solar power project entity of one of our customers for an available amount of €17.5 million to provide financing for a PV solar power system. The credit facility bears interest at 8.0% per annum, payable quarterly, with the full amount due in December 2026.

(3)
In June 2015, 8point3 Energy Partners LP (the “Partnership”), a limited partnership formed by First Solar and SunPower Corporation (collectively the “Sponsors”), completed its initial public offering (the “IPO”). As part of the IPO, the Sponsors contributed interests in various projects to 8point3 Operating Company, LLC (“OpCo”) in exchange for voting and economic interests in the entity, and the Partnership acquired an economic interest in OpCo using proceeds from the IPO.

In June 2018, we completed the sale of our interests in the Partnership and its subsidiaries to CD Clean Energy and Infrastructure V JV, LLC, an equity fund managed by Capital Dynamics, Inc. and certain other co-investors and other parties, and received net proceeds of $240.0 million after the payment of fees, expenses, and other amounts. We accounted for our interests in OpCo, a subsidiary of the Partnership, under the equity method of accounting as we were able to exercise significant influence over the Partnership due to our representation on the board of directors of its general partner and certain of our associates serving as officers of its general partner. During the nine months ended September 30, 2018, we recognized equity in earnings, net of tax, of $39.7 million from our investment in OpCo, including a gain of $40.3 million, net of tax, for the sale of our interests in the Partnership and its subsidiaries. During the nine months ended September 30, 2018, we received distributions from OpCo of $12.4 million.

In connection with the IPO, we also entered into an agreement with a subsidiary of the Partnership to lease back one of our originally contributed projects, Maryland Solar, until December 31, 2019. Under the terms of the agreement, we make fixed rent payments to the Partnership’s subsidiary and are entitled to all of the energy generated by the project. Due to certain continuing involvement with the project, we accounted for the leaseback agreement as a financing transaction until the sale of our interests in the Partnership and its subsidiaries in June 2018. Following the sale of such interests, the Maryland Solar project qualified for sale-leaseback accounting, and we recognized net revenue of $32.0 million from the sale of the project.

(4)
See Note 6. “Derivative Financial Instruments” to our condensed consolidated financial statements for discussion of our derivative instruments.
Schedule of Goodwill
Goodwill for the relevant reporting unit consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
December 31,
2018

Acquisitions (Impairments)

September 30,
2019
Modules
 
$
407,827

 
$
—

 
$
407,827

Accumulated impairment losses
 
(393,365
)
 
—

 
(393,365
)
Goodwill
 
$
14,462

 
$
—

 
$
14,462
Schedule of Intangible Assets, Net
The following tables summarize our intangible assets at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30, 2019
 
 
Gross Amount
 
Accumulated Amortization
 
Net Amount
Developed technology
 
$
97,964

 
$
(39,977
)
 
$
57,987

Power purchase agreements
 
6,486

 
(892
)
 
5,594

Patents
 
7,408

 
(4,204
)
 
3,204

Intangible assets, net
 
$
111,858

 
$
(45,073
)
 
$
66,785

 
 
December 31, 2018
 
 
Gross Amount
 
Accumulated Amortization
 
Net Amount
Developed technology
 
$
97,714

 
$
(33,093
)
 
$
64,621

Power purchase agreements
 
6,486

 
(648
)
 
5,838

Patents
 
7,408

 
(3,705
)
 
3,703

Intangible assets, net
 
$
111,608

 
$
(37,446
)
 
$
74,162
Schedule of Accrued Expenses
Accrued expenses consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
Accrued project costs
 
$
85,285

 
$
147,162

Accrued property, plant and equipment
 
77,628

 
89,905

Accrued compensation and benefits
 
59,396

 
41,937

Accrued inventory
 
50,092

 
53,075

Product warranty liability (1)
 
19,526

 
27,657

Other
 
85,437

 
81,844

Accrued expenses
 
$
377,364

 
$
441,580

——————————
(1)
See Note 10. “Commitments and Contingencies” to our condensed consolidated financial statements for discussion of our “Product warranty liability.”
Schedule of Other Current Liabilities
Other current liabilities consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
Operating lease liabilities (1)
 
$
11,221

 
$
—

Derivative instruments (2)
 
3,239

 
7,294

Contingent consideration (3)
 
350

 
665

Other
 
13,612

 
6,421

Other current liabilities
 
$
28,422

 
$
14,380

——————————
(1)
See Note 7. “Leases” to our condensed consolidated financial statements for discussion of our lease arrangements.

(2)
See Note 6. “Derivative Financial Instruments” to our condensed consolidated financial statements for discussion of our derivative instruments.

(3)
See Note 10. “Commitments and Contingencies” to our condensed consolidated financial statements for discussion of our “Contingent consideration” arrangements.
Schedule of Other Liabilities
Other liabilities consisted of the following at September 30, 2019 and December 31, 2018 (in thousands):
 
 
September 30,
2019
 
December 31,
2018
Product warranty liability (1)
 
$
118,379

 
$
193,035

Operating lease liabilities (2)
 
142,256

 
—

Other taxes payable
 
88,786

 
83,058

Transition tax liability
 
68,851

 
77,016

Deferred revenue
 
40,995

 
48,014

Derivative instruments (3)
 
8,706

 
9,205

Contingent consideration (1)
 
5,250

 
2,250

Other liabilities — noncurrent
 
51,126

 
55,261

Other liabilities
 
$
524,349

 
$
467,839

——————————
(1)
See Note 10. “Commitments and Contingencies” to our condensed consolidated financial statements for discussion of our “Product warranty liability” and “Contingent consideration” arrangements.

(2)
See Note 7. “Leases” to our condensed consolidated financial statements for discussion of our lease arrangements.

(3)
See Note 6. “Derivative Financial Instruments” to our condensed consolidated financial statements for discussion of our derivative instruments.