8-K: Velo3D Announces Q1 2025 Financial Results, Reaffirms Optimistic Outlook

Velo3D reports Q1 2025 financial results, highlighting revenue of $9.3 million, a gross margin of 7.5%, and reaffirms its expectation for 2025 annual revenue growth of over 30% and EBITDA positivity in the first half of 2026.

Summary

• Velo3D announced its Q1 2025 financial results, reporting revenue of $9.3 million.
• The company's gross margin improved to 7.5% compared to -28.8% in Q1 2024.
• Velo3D's backlog as of March 31, 2025, was $18 million.
• The company reaffirmed its expectation for 2025 annual revenue growth of more than 30% and expects to be EBITDA positive in the first half of 2026.
• A shift towards Rapid Production Services (RPS) is underway, with the RPS backlog increasing threefold compared to year-end 2024.
• New customers accounted for over 75% of Q1 2025 bookings, with 50% of demand coming from the defense sector.
• Velo3D signed a five-year, $15 million master services agreement with Momentus, Inc. to leverage its RPS offering.
• The company also entered into a five-year exclusive supply agreement with Amaero Advanced Materials & Manufacturing, Inc.
• Velo3D received an order for a fourth Sapphire XC printer from Mears Machine Corporation.
• The company announced an agreement with Ohio Ordinance Works, Inc. to provide RPS as part of its 3D Printed Military Weapons Development initiative.
• GAAP net loss for the first quarter was $25.4 million, compared to a loss of $28.3 million in the first quarter of 2024.
• Non-GAAP net loss was $8.9 million in the three months ended March 31, 2025.
• Management expects revenue in the range of $50 million to $60 million for the full year 2025.
• They also anticipate sequential improvement in gross margin, targeting greater than 30% in Q4 2025.
• Non-GAAP operating expenses are projected to be in the range of $40 million to $50 million, with CapEx between $15 million and $20 million.

Sentiment

Score: 7

Explanation: The sentiment is cautiously optimistic. While the company is still reporting losses, there are clear signs of improvement in gross margin and a strategic shift towards higher-growth areas like RPS. The reaffirmed guidance and positive management comments contribute to the positive outlook, but the low cash position remains a concern.

Positives

• Gross margin improved significantly to 7.5% from -28.8% in Q1 2024 due to BOM cost reduction and manufacturing process optimization.
• RPS backlog increased threefold compared to year-end 2024, indicating strong demand for this service.
• New customer acquisition is strong, representing over 75% of Q1 bookings.
• The company is making progress towards its goal of achieving EBITDA profitability in the first half of 2026.
• Operating expenses decreased from $18.6 million to $12.6 million year-over-year.
• The company's cash and cash equivalents increased from $1.2 million to $3.9 million during the quarter.

Negatives

• The company reported a GAAP net loss of $25.4 million for Q1 2025, although this is an improvement from the $28.3 million loss in Q1 2024.
• System revenue decreased compared to Q1 2024 due to a slight decrease in printer sales.
• The company had only $3.9 million in cash and cash equivalents as of March 31, 2025, which may raise concerns about liquidity.

Risks

• The company's ability to achieve its revenue and profitability targets depends on the successful execution of its business plan.
• Competition in the additive manufacturing market could impact Velo3D's ability to grow and maintain market share.
• The company's liquidity position and ability to raise additional capital in the near term are key risks.
• Economic, business, and/or competitive factors could adversely affect the company's performance.
• Changes in applicable laws and regulations could impact the company's operations.

Future Outlook

Management expects revenue in the range of $50 million to $60 million for the full year 2025, with sequential improvement in gross margin to over 30% by Q4 2025. They anticipate achieving EBITDA profitability in the first half of 2026.

Management Comments

• Arun Jeldi, CEO of Velo3D, stated that momentum is building across the business as they implement strategic initiatives.
• Jeldi highlighted the early results from the new go-to-market strategy, gaining traction with new and existing customers, particularly in the defense and aerospace industries.
• Jeldi believes the company is in a strong position to execute its strategy and reclaim its leadership in additive manufacturing.

Industry Context

Velo3D's focus on the defense and aerospace industries aligns with the increasing demand for domestic supply chain resiliency. The company's Rapid Production Services (RPS) offering addresses the need for scalable, high-quality parts production, which is a growing trend in the additive manufacturing market.

Comparison to Industry Standards

• It is difficult to compare Velo3D directly to industry standards without specific competitor data in this release.
• However, the focus on aerospace and defense aligns with companies like Stratasys and 3D Systems, which also target these high-value sectors.
• The emphasis on reshoring manufacturing capabilities is a common theme among additive manufacturing companies seeking to capitalize on supply chain disruptions.
• The goal of achieving EBITDA profitability in the first half of 2026 is a key milestone, as many additive manufacturing companies are still working towards sustainable profitability.

Management Changes

Stakeholder Impact

• Shareholders: The results show improvement in gross margin and a path towards profitability, which could positively impact shareholder value.
• Employees: The company's strategic initiatives and growth plans could create new opportunities for employees.
• Customers: The focus on Rapid Production Services (RPS) and the defense and aerospace industries could lead to improved product offerings and customer service.
• Suppliers: The exclusive supply agreement with Amaero could strengthen the company's supply chain and relationships with key suppliers.

Next Steps

• The company will host a conference call on May 13, 2025, to discuss the Q1 2025 financial results.
• Velo3D will continue to focus on expanding its Rapid Production Services (RPS) offering and strengthening its presence in the defense and aerospace industries.
• The company aims to achieve sequential improvement in gross margin throughout 2025 and reach EBITDA profitability in the first half of 2026.

Key Dates

Keywords

Velo3D, additive manufacturing, 3D printing, financial results, Q1 2025, revenue, gross margin, EBITDA, Rapid Production Services, defense, aerospace