SolarEdge Technologies, Inc. (NASDAQ:SEDG) shares are trading higher. The company announced plans to cease all activities of its energy storage division and reduce its workforce by about 500 employees. Here's what you need to know.

What To Know: In a new press release Wednesday, SolarEdge stated it was shutting down its energy storage division to prioritize its solar operations. The move will result in a workforce reduction of approximately 500 employees, largely located in South Korea.

The closure is expected to result in quarterly operating expense savings of approximately $7.5 million, with full savings anticipated to be realized by the second half of 2025. In addition, the company plans to sell assets related to its storage division, including manufacturing facilities for battery cells and packs.

"The decision to close our Energy Storage division was the result of a thoughtful analysis of our portfolio of businesses and product lines, industry trends, and the competitive environment," said interim CEO Ronen Faier.

"The measures also represent continued execution of two of our main priorities: financial stability through cost reduction, return to cash flow positivity and profitability; and focus on our core business lines of solar, PV-attached storage and energy management capabilities. I wish to thank our Energy Storage division employees for all of their efforts in building this business."

SEDG Price Action: At the time of writing, SolarEdge stock was up 8.69% at $14.88, according to data from Benzinga Pro.

Image: via Pixabay