Continued Focus on Realignment Priorities
Company Institutes Additional Cost Reduction
Programs
Strategic Review Process Remains Ongoing
- Q2 2024 sales update
- 2024 year to date bookings of $21 million; >40% of orders
from existing customers
- $17 million in backlog exiting Q2 2024
- Continued defense sector expansion – >20% of 1H’24
shipments
- Reduced quarterly operating expenses
- Down 37% year over year
- Instituted additional cost control programs - ~30% headcount
reduction
- Improved year over year operating cash flow in Q2 2024
- Operating and financial conditions remain challenging
Velo3D, Inc. (NYSE: VLD), a leading additive manufacturing
technology company for mission-critical metal parts, today
announced financial results for its second quarter ended June 30,
2024.
“Our second quarter results reflected continued execution on our
strategic priorities as we added to our year-to-date bookings,
maintained a healthy backlog and reduced our operating expenses,”
said Brad Kreger, CEO of Velo3D. “Specifically, we continued to
expand our defense and space sector footprint during the quarter
and expect to add to our backlog in these important industries in
the second half of the year. We also further executed on our
re-alignment efforts as we reduced our quarterly operating costs by
37% year over year and improved our manufacturing and operational
efficiency. However, while we have made significant financial and
operational progress year to date, we have made the difficult
decision to right size the business as we expect industry
conditions to remain challenging into the second half of 2024.”
“Our second quarter results also reflected the impact of delays
in the funding of certain governmental projects with those system
orders now expected in the second half of the year. While we still
expect to close these transactions, these delays have negatively
impacted our revenue forecast for the balance of the year. As a
result, we have instituted a number of material cost reduction
programs to reduce expenses and manage our liquidity, including a
headcount reduction of approximately 30%. We expect these programs
to drive significant annual operating savings and we continue to
look at various options to support our balance sheet during our
ongoing the strategic review process.”
“Looking forward, we believe the continued focus on our key
priorities will position us well to capitalize on the increasing
industry demand for leading-edge additive manufacturing solutions,”
concluded Kreger.
($ in Millions, except percentages and
per-share data)
2nd Quarter 2024
2nd Quarter 2023
GAAP revenue
$10.3
$25.1
GAAP gross margin
(28.0)%
10.1%
GAAP net loss1
($0.2)
($23.2)
GAAP net loss per share - basic and
diluted
($0.02)
($4.10)
Non-GAAP net loss2
($21.7)
($19.3)
Non-GAAP net loss per basic and diluted
share2
($2.57)
($3.42)
- Information about Velo3D’s use of non-GAAP information,
including a reconciliation to U.S. GAAP, is provided at the end of
this release under “Non-GAAP Financial Information”. The non-GAAP
financial measures presented in this release should not be
considered as the sole measure of the company’s performance and
should not be considered in isolation from, or as a substitute for,
comparable financial measures calculated in accordance with
generally accepted accounting principles accepted in the United
States.
- Non-GAAP net loss and non-GAAP net loss per diluted share
exclude stock-based compensation expense, fair value adjustments
for the Company’s warrants, and contingent earnout.
Summary of Second Quarter 2024 Results
Revenue for the second quarter was $10.3 million. System revenue
increased compared to the first quarter of 2024, primarily driven
by a mix shift to the company’s higher priced Sapphire XC systems.
Support services and recurring payment revenue declined
sequentially compared to the first quarter of 2024 due to the
expiration of certain lease contracts as well as a slight reduction
in customers with active field service contracts.
Gross margin for the second quarter was negative 28% and
primarily reflected the impact of lower fixed cost absorption as
certain systems orders were delayed to the second half of 2024.
GAAP operating expenses for the second quarter were $17.6
million compared to $28.2 million in the second quarter of 2023.
Non-GAAP operating expenses, excluding stock-based compensation
expense of $3.8 million, was $13.8 million, down 37% compared to
the second quarter of 2023.
Net loss for the quarter was $0.2 million and reflected a
non-cash gain of $27.1 million on the change in the fair value of
warrants and contingent earnout liabilities. Non-GAAP net loss was
$21.7 million in the three months ended June 30, 2024. Adjusted
EBITDA for the quarter, was negative $15.0 million. For more
information regarding the company’s non-GAAP financial measures,
see “Non-GAAP Financial Information” below.
Second quarter cash flow, excluding financing activities, was in
line with the company's forecast and improved more than 70% on a
year over year basis. The company ended the quarter with $3 million
in cash and cash equivalents.
Guidance
Given the uncertainty of timing of the company’s deferred orders
and other factors, the company is withdrawing its previously
announced financial guidance for fiscal year 2024.
About Velo3D:
Velo3D is a metal 3D printing technology company. 3D
printing—also known as additive manufacturing (AM)—has a unique
ability to improve the way high-value metal parts are built.
However, legacy metal AM has been greatly limited in its
capabilities since its invention almost 30 years ago. This has
prevented the technology from being used to create the most
valuable and impactful parts, restricting its use to specific
niches where the limitations were acceptable.
Velo3D has overcome these limitations so engineers can design
and print the parts they want. The company’s solution unlocks a
wide breadth of design freedom and enables customers in space
exploration, aviation, power generation, energy, and semiconductor
to innovate the future in their respective industries. Using
Velo3D, these customers can now build mission-critical metal parts
that were previously impossible to manufacture. The fully
integrated solution includes the Flow print preparation software,
the Sapphire family of printers, and the Assure quality control
system—all of which are powered by Velo3D’s Intelligent Fusion
manufacturing process. The company delivered its first Sapphire
system in 2018 and has been a strategic partner to innovators such
as SpaceX, Aerojet Rocketdyne, Lockheed Martin, Avio, and General
Motors. Velo3D has been named as one of Fast Company’s Most
Innovative Companies for 2023. For more information, please visit
Velo3D.com, or follow the company on LinkedIn or Twitter.
VELO, VELO3D, SAPPHIRE and INTELLIGENT FUSION, are registered
trademarks of Velo3D, Inc.; and WITHOUT COMPROMISE, FLOW, FLOW
DEVELOPER, and ASSURE are trademarks of Velo3D, Inc. All Rights
Reserved © Velo3D, Inc.
Amounts herein pertaining to June 30, 2024 represent a
preliminary estimate as of the date of this earnings release and
may be revised upon filing our Quarterly Report on Form 10-Q with
the Securities and Exchange Commission (the “SEC”). More
information on our results of operations for the three months ended
June 30, 2024 will be provided upon filing our Quarterly Report on
Form 10-Q with the SEC.
Forward-Looking Statements:
This press release includes “forward-looking statements” within
the meaning of the “safe harbor” provisions of the Private
Securities Litigation Reform Act of 1996. The company’s actual
results may differ from its expectations, estimates and projections
and consequently, you should not rely on these forward-looking
statements as predictions of future events. Words such as “expect”,
“estimate”, “project”, “budget”, “forecast”, “anticipate”,
“intend”, “plan”, “may”, “will”, “could”, “should”, “believes”,
“predicts”, “potential”, “continue”, and similar expressions are
intended to identify such forward-looking statements. These
forward-looking statements include, without limitation, the
company's expectations regarding its performance during the
remainder of 2024, the company's strategic realignment and
initiatives, the company’s expectations regarding its liquidity and
capital requirements, the company’s expectations regarding the
timing of deferred orders, the company’s expectations regarding its
potential cost savings, and the company’s other expectations,
beliefs, intentions or strategies for the future. These
forward-looking statements involve significant risks and
uncertainties that could cause the actual results to differ
materially from the expected results. You should carefully consider
the risks and uncertainties described in the “Risk Factors” section
of the company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2023 (the “FY 2023 10-K”), which was filed by
the company with the SEC on April 4, 2024, the “Risk Factors”
section of the company’s Quarterly Report on Form 10-Q for the
quarter ended June 30, 2024, which will be filed by the company
with the SEC no later than August 19, 2024 (the “Q2 2024 10-Q"),
and the other documents filed by the company from time to time with
the SEC. These filings identify and address other important risks
and uncertainties that could cause actual events and results to
differ materially from those contained in the forward-looking
statements. Most of these factors are outside the company’s control
and are difficult to predict. Factors that may cause such
differences include, but are not limited to: (1) the inability of
the company to execute its business plan, which may be affected by,
among other things, competition, the company’s liquidity
position//lack of available cash, the ability of the company to
grow and manage growth profitably, maintain relationships with
customers and suppliers and retain its key employees; (2) the
company’s ability to continue as a going concern; (3) the company’s
ability to maintain its listing on the New York Stock Exchange; (4)
the company’s ability to service and comply with its indebtedness;
(5) the company’s ability to raise additional capital in the
near-term; (6) the possibility that the company may be adversely
affected by other economic, business, and/or competitive factors;
and (7) other risks and uncertainties described in the FY 2023 10-K
and the Q2 2024 10-Q, including those under “Risk Factors” therein,
and in the company’s other filings with the SEC. The company
cautions that the foregoing list of factors is not exclusive and
not to place undue reliance upon any forward-looking statements,
including projections, which speak only as of the date made. The
company does not undertake or accept any obligation to release
publicly any updates or revisions to any forward-looking statements
to reflect any change in its expectations or any change in events,
conditions or circumstances on which any such statement is
based.
Non-GAAP Financial Information
The information in the table below sets forth the non-GAAP
financial measures that the company uses in this release. Because
of the limitations associated with these non-GAAP financial
measures, “Non-GAAP Net Loss”, “EBITDA”, “Adjusted EBITDA” and
“Non-GAAP Operating Expenses”, should not be considered in
isolation or as a substitute for performance measures calculated in
accordance with GAAP. The company compensates for these limitations
by relying primarily on its GAAP results and using Non-GAAP Net
Loss, EBITDA, Adjusted EBITDA, and Non-GAAP Operating Expenses on a
supplemental basis. You should review the reconciliation of the
non-GAAP financial measures below and not rely on any single
financial measure to evaluate the company's business.
The following tables reconcile Net income (loss) to Non-GAAP Net
Loss, EBITDA, and Adjusted EBITDA and Total Operating Expenses to
Non-GAAP Operating Expenses during the periods below:
Velo3D, Inc.
NON-GAAP Net Loss
Reconciliation
(Unaudited)
Three months ended
Six months ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
(In thousands, except for
percentages)
% of Rev
% of Rev
% of Rev
% of Rev
Revenue
$
10,344
100.0
%
$
25,134
100.0
%
$
20,130
100.0
%
$
51,821
100.0
%
Gross Profit
(2,897
)
(28.0
)%
2,536
10.1
%
(5,712
)
(28.4
)%
5,068
9.8
%
Net Income (Loss)
$
(172
)
(1.7
)%
$
(23,201
)
(92.3
)%
$
(28,486
)
(141.5
)%
$
(59,526
)
(114.9
)%
Stock-based compensation
4,247
41.1
%
6,535
26.0
%
9,334
46.4
%
12,771
24.6
%
(Gain) Loss on fair value of warrants
(25,310
)
(244.7
)%
(828
)
(3.3
)%
(22,690
)
(112.7
)%
1,725
3.3
%
(Gain) Loss on fair value of contingent
earnout liabilities
(1,824
)
(17.6
)%
(1,843
)
(7.3
)%
(1,387
)
(6.9
)%
7,810
15.1
%
Non-cash cost of issuance of common stock
warrants on BEPO Offering
1,313
12.7
%
—
—
%
1,313
6.5
%
—
—
%
Non-GAAP Net Loss
$
(21,746
)
(210.2
)%
$
(19,337
)
(76.9
)%
$
(41,916
)
(208.2
)%
$
(37,220
)
(71.8
)%
Velo3D, Inc.
NON-GAAP Adjusted EBITDA
Reconciliation
(Unaudited)
Three months ended
Six months ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
(In thousands, except for
percentages)
% of Rev
% of Rev
% of Rev
% of Rev
Revenue
$
10,344
100.0
%
$
25,134
100.0
%
$
20,130
100.0
%
$
51,821
100.0
%
Net Income (Loss)
(172
)
(1.7
)%
(23,201
)
(92.3
)%
(28,486
)
(141.5
)%
(59,526
)
(114.9
)%
Interest expense
5,463
52.8
%
344
1.4
%
9,360
46.5
%
564
1.1
%
Provision for income taxes
(4
)
(0.0
)%
—
—
%
—
—
%
—
—
%
Depreciation and amortization
1,311
12.7
%
1,466
5.8
%
2,707
13.4
%
3,026
5.8
%
EBITDA
$
6,598
63.8
%
$
(21,391
)
(85.1
)%
$
(16,419
)
(81.6
)%
$
(55,936
)
(107.9
)%
Stock-based compensation
4,247
41.1
%
6,535
26.0
%
9,334
46.4
%
12,771
24.6
%
(Gain) Loss on fair value of warrants
(25,310
)
(244.7
)%
(828
)
(3.3
)%
(22,690
)
(112.7
)%
1,725
3.3
%
(Gain) Loss on fair value of contingent
earnout liabilities
(1,824
)
(17.6
)%
(1,843
)
(7.3
)%
(1,387
)
(6.9
)%
7,810
15.1
%
Non-cash cost of issuance of common stock
warrants on BEPO Offering
1,313
12.7
%
—
—
%
1,313
6.5
%
—
—
%
Adjusted EBITDA
$
(14,976
)
(144.8
)%
$
(17,527
)
(69.7
)%
$
(29,849
)
(148.3
)%
$
(33,630
)
(64.9
)%
Velo3D, Inc.
NON-GAAP Adjusted Operating
Expenses Reconciliation
(Unaudited)
Three months ended
Six months ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
(In thousands, except for
percentages)
% of Rev
% of Rev
% of Rev
% of Rev
Revenue
$
10,344
100.0
%
$
25,134
100.0
%
$
20,130
100.0
%
$
51,821
100.0
%
Operating expenses
Research and development
4,545
43.9
%
12,238
48.7
%
9,588
47.6
%
22,655
43.7
%
Selling and marketing
4,273
41.3
%
6,108
24.3
%
9,082
45.1
%
12,282
23.7
%
General and administrative
8,823
85.3
%
9,896
39.4
%
17,606
87.5
%
20,087
38.8
%
Total operating expenses
17,641
170.5
%
28,242
112.4
%
36,276
180.2
%
55,024
106.2
%
Stock-based compensation in operating
expenses
3,839
37.1
%
6,091
24.2
%
8,342
41.4
%
12,060
23.3
%
Adjusted operating expenses
$
13,802
133.4
%
$
22,151
88.1
%
$
27,934
138.8
%
$
42,964
82.9
%
Velo3D, Inc.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Unaudited)
(In thousands, except share
and per share data)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Revenue
3D Printer
$
8,679
$
23,190
$
16,339
$
47,638
Recurring payment
292
35
762
610
Support services
1,373
1,909
3,029
3,573
Total Revenue
10,344
25,134
20,130
51,821
Cost of revenue
3D Printer
10,744
20,052
20,138
42,220
Recurring payment
232
335
547
782
Support services
2,265
2,211
5,157
3,751
Total cost of revenue
13,241
22,598
25,842
46,753
Gross profit (loss)
(2,897
)
2,536
(5,712
)
5,068
Operating expenses
Research and development
4,545
12,238
9,588
22,655
Selling and marketing
4,273
6,108
9,082
12,282
General and administrative
8,805
9,896
17,588
20,087
Total operating expenses
17,623
28,242
36,258
55,024
Loss from operations
(20,520
)
(25,706
)
(41,970
)
(49,956
)
Interest expense
(5,463
)
(344
)
(9,360
)
(564
)
Gain (loss) on fair value of warrants
25,310
828
22,690
(1,725
)
Gain (loss) on fair value of contingent
earnout liabilities
1,824
1,843
1,387
(7,810
)
Other income, net
(1,327
)
178
(1,233
)
529
Income (loss) before provision for income
taxes
(176
)
(23,201
)
(28,486
)
(59,526
)
Provision for income taxes
4
—
—
—
Net income (loss)
$
(172
)
$
(23,201
)
$
(28,486
)
$
(59,526
)
Net income (loss) per share:
Basic
$
(0.02
)
$
(4.10
)
$
(3.55
)
$
(10.63
)
Diluted
$
(0.02
)
$
(4.10
)
$
(3.55
)
$
(10.63
)
Shares used in computing net income (loss) per share: Basic
8,475,386
5,659,601
8,015,722
5,598,386
Diluted
8,475,386
5,659,601
8,015,722
5,598,386
Velo3D, Inc.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited)
(In thousands, except share
and per share data)
June 30,
December 31,
2024
2023
Assets
Current assets:
Cash and cash equivalents
$
2,462
$
24,494
Short-term investments
699
6,621
Accounts receivable, net
8,338
9,583
Inventories
59,521
60,816
Contract assets
8,861
7,510
Prepaid expenses and other current
assets
2,289
4,000
Total current assets
82,170
113,024
Property and equipment, net
14,186
16,326
Equipment on lease, net
3,958
6,667
Other assets
16,338
17,782
Total assets
$
116,652
$
153,799
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
14,008
$
15,854
Accrued expenses and other current
liabilities
5,864
6,491
Debt – current portion
24,592
21,191
Contract liabilities
4,090
5,135
Total current liabilities
48,554
48,671
Long-term debt – less current portion
—
11,941
Contingent earnout liabilities
69
1,456
Warrant liabilities
4,933
11,835
Other noncurrent liabilities
10,977
11,556
Total liabilities
64,533
85,459
Commitments and contingencies (Note
13)
Stockholders’ equity:
Common stock, $0.00001 par value -
500,000,000 shares authorized at June 30, 2024 and December 31,
2023, 8,611,219 and 7,502,478 shares issued and outstanding as of
June 30, 2024 and December 31, 2023, respectively
2
2
Additional paid-in capital
437,642
425,471
Accumulated other comprehensive loss
(2
)
(96
)
Accumulated deficit
(385,523
)
(357,037
)
Total stockholders’ equity
52,119
68,340
Total liabilities and stockholders’
equity
$
116,652
$
153,799
Velo3D, Inc.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
Six Months Ended June
30,
2024
2023
Cash flows from operating
activities
Net loss
$
(28,486
)
$
(59,526
)
Adjustments to reconcile net loss to net
cash used in operating activities
Depreciation and amortization
2,707
2,983
Amortization of debt discount and deferred
financing costs
8,281
43
Stock-based compensation
9,334
12,771
(Gain) loss on fair value of warrants
(22,690
)
1,725
(Gain) loss on fair value of contingent
earnout liabilities
(1,387
)
7,810
Non-cash cost of issuance of common stock
warrants on BEPO Offering
1,313
—
Realized loss on available for sale
securities
21
—
Changes in assets and liabilities
Accounts receivable
1,245
(5,099
)
Inventories
3,891
3,538
Contract assets
(1,351
)
(8,323
)
Prepaid expenses and other current
assets
1,871
3,609
Other assets
1,369
292
Accounts payable
(2,391
)
(1,716
)
Accrued expenses and other liabilities
(595
)
(6,249
)
Contract liabilities
(345
)
(9,422
)
Other noncurrent liabilities
(1,279
)
(1,214
)
Net cash used in operating activities
(28,492
)
(58,778
)
Cash flows from investing
activities
Purchase of property and equipment
(8
)
(690
)
Production of equipment for lease to
customers
—
(3,694
)
Sales of available for sale securities
2,474
—
Proceeds from maturity of
available-for-sale investments
3,500
29,984
Net cash provided by investing
activities
5,966
25,600
Cash flows from financing
activities
Proceeds from ATM offering, net of
issuance costs
—
15,591
Proceeds from revolver facility
—
14,000
Proceeds from equipment loans
—
1,600
Repayment of equipment loans
—
(1,467
)
Proceeds from BEPO Offering, net of
issuance costs
10,675
—
Repayment of secured notes
(10,500
)
—
Issuance of common stock upon exercise of
stock options
315
350
Net cash provided by financing
activities
490
30,074
Effect of exchange rate changes on cash
and cash equivalents
4
(11
)
Net change in cash and cash
equivalents
(22,032
)
(3,115
)
Cash and cash equivalents and restricted
cash at beginning of period
25,294
32,783
Cash and cash equivalents and restricted
cash at end of period
$
3,262
$
29,668
The following table provides a reconciliation of cash, cash
equivalents, and restricted cash reported within the condensed
consolidated balance sheets to the total of such amounts shown on
the condensed consolidated statements of cash flows:
June 30,
2024
2023
Cash and cash equivalents
$
2,462
$
28,868
Restricted cash (Other assets)
800
800
Total cash and cash equivalents and
restricted cash
$
3,262
$
29,668
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240814795329/en/
Investor Relations: Velo3D Bob Okunski, VP Investor Relations
investors@velo3d.com
Media Contact: Velo3D Dan Sorensen, Senior Director of PR
dan.sorensen@velo3d.com
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