It has been a difficult year for Capstone Turbine (NASDAQ:CPST) on the stock market as weak oil prices have put pressure on the business. In fact, in the last reported quarter, Capstone had seen a tremendous drop of over 28% in the top line, while its loss came in at $0.34 per share. Though the loss was less than expected, it cannot be denied that the company is mired in deep trouble due to low oil prices that have led to spending cuts by oil and gas companies, therefore leading to lower orders for its turbines. However, Capstone is making changes to its business strategy that could help the company improve its financial performance in the future. Let's see what strategies Capstone is adopting. Shifting focus toward a more sustainable business …show more content…
This is shown in the chart given below: Source: Capstone Turbine The good thing is that the increasing traction for Capstone's energy efficiency products has helped it improve its financial performance on a sequential basis. This is because the company has seen a rise in sales of its energy-efficiency platform products such as the C30, the C65, and the C200 platforms. As a result, Capstone saw its revenue increase almost 20% on a sequential basis in the last quarter. Looking ahead, it is likely that this trend will continue as Capstone is increasing its focus on this segment. Better times ahead In December last year, Capstone launched its C1000 signature product series. On the back of this C1000 signature product series, Capstone has been able to increase the addressable size of its business in different verticals such as combined heat and power, or CHP, and energy …show more content…
The most important part is that these markets carry potential market opportunities worth $440 million, $340 million, $250 million, $90 million, and $100 million, respectively. Moreover, Capstone is already making good use of the end-market opportunity as its bookings in the last reported quarter increased to $12.3 million, a sequential increase of over 46%. Going forward, Capstone is focused on increasing its reach as it is looking to increase its base of tier 1 suppliers, while outsourcing and consolidating its manufacturing units so that it can focus on marketing. In fact, it plans to add 100 new distributors globally in the future, which will play a key role in enhancing its sales. Reducing costs will help improve