On August 8, 2024, Xometry Inc (XMTR, Financial) released its 8-K filing for the second quarter of 2024, showcasing significant growth and improvements in key financial metrics.
Xometry Inc is engaged in providing AI-enabled manufacturing equipment. Its buyers include engineers, product designers, procurement and supply chain personnel, inventors, and business owners. The manufacturing processes offered by the company include CNC Machining, Injection Molding, Urethane Casting, 3D Printing, and Die Casting. The company is organized into two segments referred to as the U.S. and the International. The majority of the revenue is earned from the U.S. segment.
Performance Overview
For Q2 2024, Xometry Inc reported a record revenue of $133 million, surpassing the analyst estimate of $128.65 million. This represents a 19% year-over-year increase, driven by a 25% growth in marketplace revenue. The company also achieved a record gross profit of $52.9 million, up 21% year-over-year, with a gross margin of 39.9%.
Despite these achievements, Xometry Inc reported a net loss attributable to common stockholders of $13.7 million, which is a significant improvement from the $26.6 million loss in Q2 2023. The adjusted EBITDA loss also improved by 70% year-over-year to $2.6 million, representing 2.0% of revenue.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 | % Change |
|---|---|---|---|
| Total Revenue | $133 million | $111 million | 19% |
| Gross Profit | $52.9 million | $43.6 million | 21% |
| Net Loss | $(13.7) million | $(26.6) million | 48% |
| Adjusted EBITDA | $(2.6) million | $(8.7) million | 70% |
Business Highlights
Xometry Inc's marketplace saw a 27% increase in active buyers, reaching 61,530 as of June 30, 2024. The number of accounts with last twelve-months spend of at least $50,000 also grew by 24% to 1,436. However, the number of active paying suppliers decreased by 7% to 6,992.
In terms of geographical expansion, Xometry Inc has made significant strides in the Asia Pacific region, including new offerings in Australia, Singapore, and New Zealand. The company also enhanced its European marketplace with new materials and finishes.
Financial Achievements and Challenges
The company's focus on high-margin services, such as the Thomas marketing and advertising services, has led to a 910 basis point increase in supplier services gross margin to 88.9%. This strategic shift is crucial for improving overall profitability.
However, challenges remain, particularly in the supplier services segment, which saw a 13% year-over-year decline in revenue due to the exit from lower-margin tools and materials business. This could impact the company's ability to maintain its growth trajectory in this segment.
Commentary
“We delivered record revenue, record gross profit and record gross margins as our AI-powered marketplace continues to gain market share,” said Randy Altschuler, Xometry’s CEO. “The combination of data-driven AI and supplier network expansion will fuel robust growth and continued margin improvement.”
“We delivered another strong quarter with better-than-expected results driven by improving marketplace gross margin and significant operating leverage,” said James Miln, Xometry’s CFO. “This resulted in a 70% improvement in our Adjusted EBITDA loss to $2.6 million, or 2.0% of revenue. We remain focused on our path to Adjusted EBITDA profitability.”
Analysis
Xometry Inc's Q2 2024 performance highlights the company's ability to leverage its AI-powered marketplace to drive revenue and gross profit growth. The significant improvement in adjusted EBITDA loss indicates effective cost management and operational efficiency. However, the decline in supplier services revenue and active paying suppliers suggests potential challenges in maintaining a balanced growth across all segments.
Overall, Xometry Inc's strategic initiatives and focus on high-margin services position it well for future growth, but the company must address the challenges in its supplier services segment to sustain its upward trajectory.
Explore the complete 8-K earnings release (here) from Xometry Inc for further details.
