JinkoSolar Holding Co. Ltd. (JKS) is having the kind of year that makes you wonder how bad things can get before they start getting better. The solar module maker just reported third-quarter results that show its core business still getting hammered by overcapacity and collapsing prices, but there are some glimmers of hope if you squint hard enough.

Here's the damage: JinkoSolar shipped 21.57 GW of solar modules, cells, and wafers in Q3, down 16.7% from last year. That's not great, but the real pain shows up in the revenue line. Sales plummeted 34.1% year-over-year to 16.2 billion yuan ($2.28 billion), which tells you everything about what's happening to pricing in this industry. When your shipments fall by 17% but your revenue drops by twice that rate, you've got a serious price problem.

The company swung to a net loss of 750 million yuan in the quarter, compared to a 22.5 million yuan profit a year ago. This is what happens when an entire industry builds too much capacity and everyone races to keep factories running even as prices crater. The Chinese government has been trying to help by encouraging consolidation and shutting down older facilities, but so far those efforts haven't moved the needle much.

Now for the slightly better news: JinkoSolar's gross margin of 7.3% in Q3, while still way down from 15.7% a year earlier, represents meaningful improvement from the 2.9% margin in Q2 and the downright ugly negative 2.5% margin in Q1. When you're climbing out of negative gross margin territory, every percentage point counts.

The company also threw out a fourth-quarter shipment forecast ranging from 18 GW to 33 GW, which is such a wide range it basically tells you management has no idea what's coming next. That's the reality of operating in an extremely volatile industry right now.

But here's where things get interesting: JinkoSolar is betting on energy storage systems as its ticket out of this mess. These systems let solar farms store excess electricity generated during sunny periods and sell it back to the grid when the sun isn't shining, making solar power more practical and valuable.

"With scale efficiency and competitiveness improving, we expect our energy storage business to become our second growth engine and contribute to our profit in 2026," said Chairman Li Xiande. The company shipped more than 3.3 GWh of energy storage systems in the first nine months of 2025 and expects to hit 6 GWh for the full year.

Investors seemed to like the story. JinkoSolar's U.S.-listed shares jumped 13.1% on Monday after the earnings release, bringing the stock's year-to-date gain to 23%. Not bad for a company that's still losing money and facing brutal industry conditions.