Velo3D, Inc. (NYSE: VLD), a leading company in additive manufacturing technology for crucial metal parts, has announced its financial results for the second quarter ending June 30, 2024. Despite ongoing industry challenges, the company highlights continued progress in strategic realignment and cost reduction.
"Our second quarter performance reflects a commitment to our strategic priorities," stated Brad Kreger, Velo3D's Chief Executive Officer. "We saw an increase in year-to-date bookings, maintained a robust backlog, and successfully reduced operating expenses." Kreger specifically mentioned continued expansion in the defence and space sectors, contributing over 20% of the first half of 2024 shipments. "We further executed on our realignment efforts, achieving a 37% year-over-year reduction in quarterly operating costs and improvements in manufacturing and operational efficiency. However, given the challenging industry conditions expected to persist into the second half of 2024, we have made the difficult decision to streamline the business."
Kreger explained that delays in funding for certain government projects, impacting system orders expected in the second half of the year, have negatively influenced the company's revenue projections. To address these challenges and manage liquidity, Velo3D has implemented substantial cost reduction programmes, including a 30% reduction in workforce. These programmes are anticipated to deliver significant annual operating savings, while the company continues to explore various options to support its balance sheet during the ongoing strategic review process.
"Looking ahead, we believe our unwavering focus on key priorities will position us well to capitalise on the growing demand for cutting-edge additive manufacturing solutions," concluded Kreger.
Second Quarter 2024 Highlights:
Year-to-date bookings reached £16.5 million, with over 40% of orders originating from existing customers.
Backlog exiting the second quarter totalled £12.6 million.
Defence and space sector growth continued, representing over 20% of first half of 2024 shipments.
Quarterly operating expenses were reduced.
Operating cash flow for the second quarter showed year-over-year improvement.
Financial Performance:
Revenue for the second quarter was £8.1 million. System revenue increased compared to the first quarter, driven primarily by a shift towards the company's higher-priced Sapphire XC systems. Support services and recurring payment revenue experienced a sequential decline from the first quarter, attributed to the expiry of certain lease contracts and a slight reduction in customers with active field service agreements.
Gross margin for the second quarter was -28%, primarily reflecting the impact of lower fixed cost absorption due to the postponement of some system orders to the second half of 2024.
GAAP operating expenses for the second quarter were £13.8 million, compared to £22.2 million in the second quarter of 2023. Non-GAAP operating expenses, excluding stock-based compensation expense of £3 million, amounted to £10.8 million, down 37% compared to the second quarter of 2023.
The company reported a net loss of £0.2 million for the quarter, influenced by a non-cash gain of £21.3 million on the change in fair value of warrants and contingent earnout liabilities. Non-GAAP net loss was £17.1 million in the three months ended June 30, 2024. Adjusted EBITDA for the quarter was -£11.8 million.
Cash flow for the second quarter, excluding financing activities, was in line with forecasts and improved by more than 70% year-over-year. The company concluded the quarter with £2.3 million in cash and cash equivalents.
Outlook:
Due to the uncertainty surrounding the timing of deferred orders and other factors, Velo3D has withdrawn its previously issued financial guidance for fiscal year 2024.
About Velo3D:
Velo3D is a company specialising in metal 3D printing technology. 3D printing, also known as additive manufacturing (AM), offers a unique approach to building high-value metal parts. However, traditional metal AM has been hindered in its capabilities since its inception nearly three decades ago, restricting its use to specific niches where these limitations were acceptable.
Velo3D has addressed these limitations, enabling engineers to design and print the parts they envision. The company's solution unlocks significant design freedom, empowering innovators in space exploration, aviation, power generation, energy, and the semiconductor industry to shape the future of their respective fields. Velo3D empowers these customers to build mission-critical metal parts that were previously impossible to manufacture.
The company's fully integrated solution comprises the Flow print preparation software, the Sapphire family of printers, and the Assure quality control system. All are powered by Velo3D's Intelligent Fusion manufacturing process. The company delivered its first Sapphire system in 2018 and has established itself as a strategic partner for innovators such as SpaceX, Aerojet Rocketdyne, Lockheed Martin, Avio, and General Motors. Velo3D was recognised as one of *Fast Company's Most Innovative Companies for 2023*.
For more information, visit Velo3D.com, or connect with the company on LinkedIn or Twitter.