* Sees gross margin at 2-5 pct vs prior view of 9-12 pct
* Reaffirms Q3 shipments forecast (Follows alerts)
Oct 17 (Reuters) - Solar panel maker Canadian Solar Inc cut its third-quarter gross margin forecast, hurt by weak average selling prices and lower demand earlier in the period.
The company now expects its gross margin to be 2-5 percent, compared with the previous outlook of 9-12 percent.
Steep declines in the prices of the renewable energy systems have pressured margins at Canadian Solar, which has been one of the fastest-growing companies in the solar sector in recent years.
Subsidy cuts in Europe and an oversupply of panels have sent prices into a tailspin and squeezed margins across the nascent industry, prompting several key manufacturers such as Suntech Power Holdings Co Ltd , SunPower Corp and Trina Solar Ltd to pare their profit forecasts.
However, the company reaffirmed its prior shipments forecast of 350 MW-360 MW.
The Ontario, Canada-based company’s shares closed at $3.79 on Nasdaq.
(Reporting by Sumit Jha in Bangalore; Editing by Sriraj Kalluvila)