Core Insights - Xometry, Inc. has launched its Teamspace solution in Europe, the UK, and Turkey, enhancing collaboration for customers on projects and custom part orders [1][2] - The Teamspace solution has already seen success in the US with over 7,000 teams created by Q1 2025, indicating strong enterprise engagement and potential for viral growth [2] - The expansion of Teamspace reflects a shift in customer needs towards more advanced, integrated solutions for manufacturing operations [3] Company Overview - Xometry operates an AI-powered marketplace that connects enterprise buyers with suppliers of manufacturing services, aiming to digitize the manufacturing industry [5] - The company provides critical resources for manufacturers and streamlines procurement processes through real-time pricing and lead time data [5] Teamspace Features - Teamspace offers real-time visibility and control over orders, allowing all team members to see shared quoting activity and order history, which enhances transparency and accountability [6] - The solution includes personalized user notifications for updates on quotes, order shipments, payments, and invoices, ensuring critical steps are not missed [6] - Designed to boost operational efficiency, Teamspace is particularly beneficial for distributed teams managing high-volume and complex custom part orders [6]

Core Viewpoint - Xometry, Inc. successfully closed a $250 million offering of 0.75% Convertible Senior Notes due 2030, enhancing its financial flexibility and supporting its growth initiatives in the manufacturing sector [1][2]. Transaction Overview - The offering included the full exercise of an option for an additional $25 million, aimed at qualified institutional buyers under Rule 144A of the Securities Act [1][3]. - The proceeds will be used to retire approximately $202 million of existing convertible notes due in 2027, effectively refinancing the company's debt at improved terms [4][5]. - The transaction lowers the coupon rate to 0.75% and minimizes potential future dilution for equity shareholders with a 75% conversion premium over the market price on the transaction date [2][4]. Financial Details - The Notes have an interest rate of 0.75% per annum, payable semiannually starting December 15, 2025 [5]. - The initial conversion rate is set at 21.2495 shares of Class A common stock per $1,000 principal amount of Notes, with a conversion price of approximately $47.06, representing a 30% premium to the last reported sale price [5]. - A capped call hedge was purchased with a cap price of $63.35, which is a 75% premium over the last reported sale price on June 9, 2025 [4][5]. Use of Proceeds - Approximately $216.7 million in cash was utilized to repurchase about $201.7 million of outstanding 1.00% Convertible Senior Notes due 2027 [5]. - Around $17.5 million of the net proceeds funded the cost of capped call transactions, and approximately $8 million was used to repurchase 220,994 shares of common stock [5]. Company Background - Xometry operates an AI-powered marketplace that is digitizing the manufacturing industry, providing critical resources for manufacturers and facilitating instant pricing and lead times for buyers [8].

Core Viewpoint - Xometry, Inc. has announced the pricing of $225 million in 0.75% Convertible Senior Notes due 2030, aimed at qualified institutional buyers, with expected net proceeds of approximately $217 million for various corporate purposes [1][4]. Group 1: Offering Details - The offering includes an option for initial purchasers to buy an additional $25 million in Notes within 13 days of issuance [2] - The Notes will accrue interest at a rate of 0.75% per year, payable semiannually, and will mature on June 15, 2030 [3] - The initial conversion rate is set at 21.2495 shares of Class A common stock per $1,000 principal amount of Notes, equating to a conversion price of approximately $47.06 per share, representing a 30% premium over the last reported sale price [5] Group 2: Use of Proceeds - Xometry plans to use the net proceeds to cover the cost of capped call transactions ($15.7 million), repurchase approximately $8 million of its Class A common stock, and repurchase about $201.7 million of its outstanding 1.00% Convertible Senior Notes due 2027 [4] - Additional proceeds, if the option is exercised, may be used for further capped call transactions, working capital, and potential acquisitions or strategic investments [4] Group 3: Redemption and Conversion Terms - The Notes cannot be redeemed before June 20, 2028, and can be redeemed under specific conditions related to the stock price [6] - In the event of a "fundamental change," noteholders may require Xometry to repurchase their Notes at 100% of the principal amount plus accrued interest [7] - The conversion rate may be adjusted in certain corporate events or upon redemption [8] Group 4: Capped Call Transactions - Xometry has entered into capped call transactions to mitigate potential dilution from the conversion of the Notes, with an initial cap price of $63.35, a 75% premium over the last reported sale price [9][10] - The capped call transactions are expected to reduce cash payments required upon conversion and are subject to customary adjustments [9] Group 5: Market Impact - The initial purchasers may engage in derivative transactions and stock purchases that could influence the market price of Xometry's Class A common stock and the Notes [11][12] - Concurrently with the offering, Xometry repurchased approximately $8 million of its Class A common stock, which may affect the market price [13] - Xometry also repurchased approximately $216.7 million of its 2027 notes, which could lead to further market activity affecting stock prices [14][15] Group 6: Regulatory Information - The Notes are offered only to qualified institutional buyers under Rule 144A and are not registered under the Securities Act [16] - This offering does not constitute an offer to sell or a solicitation of an offer to buy any securities [17] Group 7: Company Overview - Xometry operates an AI-powered marketplace that connects buyers with suppliers of manufacturing services, aiming to digitize the manufacturing industry [19]

Core Viewpoint - Xometry, Inc. plans to offer $225 million in Convertible Senior Notes due 2030, with an option for an additional $25 million, to qualified institutional buyers, aiming to enhance its financial flexibility and support various corporate activities [1][3]. Group 1: Offering Details - The offering consists of $225 million in Convertible Senior Notes, with a potential additional $25 million, aimed at qualified institutional buyers under Rule 144A [1]. - The Notes will be unsecured obligations of Xometry, accruing interest payable semiannually, with conversion options including cash, shares, or a combination [2]. - The interest rate and conversion terms will be determined at the time of pricing [2]. Group 2: Use of Proceeds - Xometry intends to use the net proceeds for capped call transactions, repurchasing up to $25 million of its Class A common stock, and repurchasing a portion of its outstanding 1.00% Convertible Senior Notes due 2027 [3][9]. - Additional proceeds from the offering may be allocated for working capital, strategic investments, or further repurchases of the 2027 notes, although no specific agreements are in place for acquisitions at this time [3]. Group 3: Capped Call Transactions - Xometry plans to enter capped call transactions to mitigate potential dilution from the conversion of the Notes, which will cover the shares underlying the Notes [4]. - These transactions are expected to reduce cash payments required upon conversion and are subject to customary adjustments [4]. Group 4: Market Impact - The initial purchasers may engage in derivative transactions or purchase shares of Xometry's Class A common stock, potentially influencing the market price of the stock and the Notes [5][6]. - Activities by hedged holders of the 2027 notes may also affect the market price of Xometry's Class A common stock, impacting the effective conversion price of the Notes [9].

Xometry (XMTR) FY Conference Summary Company Overview - **Company**: Xometry - **Industry**: Custom Manufacturing Marketplace - **Founded**: 2013 - **IPO**: 2021 - **CEO**: Randy Altshuler - **CFO**: James Milne Key Points Industry Dynamics - Custom manufacturing is a significant subsegment of the overall manufacturing market, estimated to exceed $2 trillion [9][10] - The market is highly fragmented, consisting of millions of small and medium-sized manufacturers globally [6][10] Company Growth and Performance - Xometry has tripled its customer base and doubled its manufacturing partner base since its IPO [3][14] - The marketplace revenue has tripled, with gross margins increasing from the mid-twenties to the mid-thirties percentage range [3][14] - In Q1, Xometry reported a 23% year-over-year revenue growth, with marketplace revenue growing 27% year-over-year [14][37] - Active buyers reached over 71,000, marking a 22% year-over-year increase [30][14] - Active suppliers numbered approximately 4,375, with a significant focus on enterprise accounts [30][31] Technology and Innovation - Xometry utilizes machine learning and AI to optimize the manufacturing process, providing instant pricing and lead time options [6][7][15] - The AI analyzes CAD models and matches them with suitable suppliers, enhancing efficiency and profitability for both buyers and suppliers [7][8][15] - The company has integrated with major ERP systems to streamline purchasing processes for large enterprises [53] Market Opportunity and Strategy - Xometry's market penetration is currently less than 1%, indicating substantial growth potential [18] - The company aims to deepen relationships with enterprise customers, with over 100 accounts generating more than $500,000 in revenue [24][31] - International revenue has grown from 2% to 18% of total marketplace revenue from 2020 to 2024, with expansion efforts in Europe and Asia [34] Financial Metrics - Total revenue for the last twelve months (LTM) reached $600 million, with a gross profit of $224 million [14][37] - Gross margins improved from 23.5% in 2020 to 33.5% in 2024, with a long-term target of 35% to 40% [41][42] - The company maintains a strong balance sheet with $231 million in cash and cash equivalents [46] Challenges and Resilience - Xometry has demonstrated durable growth across various economic conditions, including during COVID-19 and periods of supply chain disruptions [57] - The company is positioned to benefit from market uncertainties, as customers seek reliable manufacturing solutions [58] Future Outlook - Xometry plans to continue expanding its technology offerings and marketplace capabilities, aiming for sustained growth and profitability [45][48] - The focus will remain on organic growth, enhancing buyer and supplier networks, and exploring potential acquisitions to accelerate growth [48] Additional Insights - The company has a clear strategy for growth, emphasizing the importance of technology and customer engagement [22][24] - Xometry's approach to supplier engagement and customer satisfaction is designed to optimize profitability and operational efficiency [8][15][40]

Core Insights - NSF has become the preferred certification body for Xometry's Thomasnet, enabling suppliers to earn certifications from NSF's extensive portfolio [1][9] - The collaboration aims to enhance supply chain resilience and flexibility for manufacturers amid ongoing supply chain pressures [2][9] - Thomasnet connects over 500,000 suppliers across the US and Canada, serving diverse industrial sectors and facilitating connections between buyers and suppliers [4][6] Industry Impact - The agreement highlights the increasing importance of supplier certifications in manufacturing, industrial, and B2B sectors, particularly in the context of supply chain disruptions [2][3] - NSF's certifications cover a wide range of globally recognized standards, including ISO 9001, IATF 16949, AS9100, and others, which are critical for maintaining quality and safety in various industries [2][5] - The partnership will promote NSF certifications as essential tools for American manufacturers to grow their businesses and strengthen domestic sourcing strategies [2][9] Company Overview - NSF has over 40,000 clients in 110 countries and has been dedicated to improving public health and safety for more than 80 years [5] - Xometry's AI-powered marketplace and Thomasnet platform are digitizing the manufacturing industry, providing resources for manufacturers to grow and enabling buyers to access instant pricing and lead times [6][4] - The collaboration will also focus on promoting certifications like Cybersecurity Maturity Model Certification (CMMC), which is increasingly required for U.S. Department of Defense contracts [9]

Group 1 - The article discusses the evolving macroeconomic landscape, highlighting a temporary agreement between the US and another entity as of May 12th [1] - Bert Hochfeld, a seasoned analyst with a background in economics and an MBA from Harvard, has a notable career in the tech sector, having worked for major companies like IBM and Raytheon [1] - Hochfeld founded his own research company, Hochfeld Independent Research Group, which provided services to significant institutions and hedge funds, and his hedge fund was recognized as the best performing small-cap fund for five years ending in 2011 [1] Group 2 - Hochfeld has published over 500 articles on Seeking Alpha, focusing on information technology companies, and is highly regarded for his investment insights [1] - The article does not provide any specific financial data or performance metrics related to Hochfeld's research or the companies he covers [1]

Summary of Xometry Conference Call Company Overview - **Company**: Xometry - **Industry**: Custom Manufacturing - **Market Size**: Estimated at over $2 trillion, heavily fragmented with hundreds of thousands of small to medium-sized manufacturers [5][6] Core Business Model - **Marketplace**: AI-powered platform for custom manufacturing, providing instant pricing and optimal manufacturer matching [6][9] - **Global Presence**: Operates 18 localized marketplaces across the U.S., Europe, and Asia [6][12] Key Market Insights - **Addressable Market**: Custom manufacturing is complex, making it difficult for customers to find suitable manufacturers [8][9] - **Buyer Profiles**: Includes engineers and procurement professionals, with a shift towards larger projects and assemblies [13][14] - **Supplier Profiles**: Suppliers are attracted to Xometry due to its ability to fill capacity with high-value jobs [15][17] Growth Metrics - **Buyer and Supplier Base**: Over 71,000 buyers and nearly 4,500 suppliers [13] - **Cohort Growth**: Over 1,500 accounts spending more than $50,000 annually, with 100 accounts exceeding $500,000 [20][21] - **Marketplace Growth**: 27% year-over-year growth in Q1, with a focus on increasing production work [22][24] Strategic Initiatives - **TeamSpace**: Software for organizing and buying entire products or assemblies, gaining traction with over 7,000 teams created [21][35] - **WorkCenter**: A manufacturing execution system for suppliers, enhancing visibility and operational efficiency [36][39] - **Instant Quoting**: Expansion of instant quoting capabilities expected to drive order volume and margin growth [40][42] Market Dynamics - **Tariffs and Supply Chain**: Increased awareness of supply chain resilience due to tariffs, with Xometry positioned to help companies diversify sourcing [24][27] - **Macro Environment**: Despite macroeconomic challenges, Xometry has maintained positive momentum and market share growth [31][32] International Expansion - **Current Footprint**: International business accounts for about 15% of revenue, with plans to grow this to over 30% [50] - **Geographic Focus**: Strong presence in Europe and expanding into Asia, particularly China [52][53] Financial Performance - **Revenue Outlook**: Raised revenue outlook based on consistent growth and strong execution [56][58] - **Marketplace Gross Margin**: Aiming for 35-40% long-term gross margin, with recent investments temporarily impacting margins [63][64] - **EBITDA**: Positive adjusted EBITDA achieved, with a target of 20-30% long-term margins [66][67] Competitive Landscape - **Main Competitor**: Traditional manufacturing methods and local suppliers [48][49] - **Differentiation**: Xometry's digital platform offers a more efficient and reliable solution for custom manufacturing [49][75] Future Outlook - **Transformative Initiatives**: Continued execution on AI-driven quoting, global marketplace expansion, and enhanced tools for buyers and suppliers [76][77]

Xometry's (NASDAQ: XMTR ) Q1 results were strong, and the company gave solid forward guidance, particularly given the uncertain macro environment. The full impact of tariffs likely won't be known for some time, though, and the fact that Xometry recently conducted Richard Durant is the leader of Narweena, an asset manager focused on finding market dislocations that are the result of a poor understanding of a businesses long-term prospects. Narweena believes that excess risk adjusted returns can be achieved b ...

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents the unaudited condensed consolidated financial statements for Xometry, Inc. for the quarter ended March 31, 2025, including balance sheets, statements of operations, changes in stockholders' equity, and cash flows, along with accompanying notes, showing a 23% year-over-year revenue increase to $151.0 million, a net loss of $15.1 million (an improvement from a $16.6 million loss in the prior year), and a cash and marketable securities balance of $231.4 million [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets were $690.1 million, a slight increase from $680.1 million at year-end 2024, with cash and cash equivalents decreasing to $15.5 million from $22.2 million, while marketable securities stood at $215.9 million, and total liabilities increased to $379.1 million, primarily due to a rise in accounts payable and accrued cost of revenue Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Current Assets** | | | | Cash and cash equivalents | $15,507 | $22,232 | | Marketable securities | $215,874 | $217,603 | | Accounts receivable, net | $85,529 | $73,962 | | Total current assets | $334,618 | $327,540 | | **Total Assets** | **$690,110** | **$680,129** | | **Current Liabilities** | | | | Accounts payable and accrued cost of revenue | $50,218 | $35,023 | | Total current liabilities | $89,428 | $74,787 | | **Total Liabilities** | **$379,077** | **$364,533** | | **Total Equity** | **$311,033** | **$315,596** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For the three months ended March 31, 2025, revenue grew 23% year-over-year to $151.0 million, gross profit increased to $56.3 million from $47.9 million, and the company reported a net loss of $15.1 million, or ($0.30) per share, an improvement from the $16.6 million net loss, or ($0.34) per share, in the same period of 2024 Statement of Operations Highlights (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $150,971 | $122,690 | | Gross Profit | $56,331 | $47,902 | | Loss from operations | ($15,391) | ($17,857) | | Net loss attributable to common stockholders | ($15,078) | ($16,616) | | Net loss per share, basic and diluted | ($0.30) | ($0.34) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities significantly improved to $3.7 million in Q1 2025 from $11.7 million in Q1 2024, while net cash used in investing activities was $3.7 million, a shift from $2.9 million provided in the prior-year period, mainly due to higher purchases of property and equipment, with cash and cash equivalents ending the period at $15.5 million Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($3,691) | ($11,734) | | Net cash (used in) provided by investing activities | ($3,686) | $2,927 | | Net cash provided by financing activities | $510 | $1,233 | | **Net decrease in cash and cash equivalents** | **($6,725)** | **($7,723)** | | **Cash and cash equivalents at end of period** | **$15,507** | **$45,701** | [Notes to Condensed Consolidated Financial Statements (Unaudited)](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20%28Unaudited%29) The notes detail the company's accounting policies and provide further information on financial statement items, including the disaggregation of revenue into Marketplace and Supplier Services, segment reporting for U.S. and International operations, details on the $287.5 million convertible notes, and a Q1 2025 restructuring action that incurred $1.5 million in costs - The company operates a global AI-powered online manufacturing marketplace (Xometry) and an industrial sourcing platform (Thomasnet®), connecting buyers with a network of manufacturers[27](index=27&type=chunk) Disaggregated Revenue and Gross Profit (Q1 2025, in thousands) | Line of Business | Revenue | Cost of Revenue | Gross Profit | | :--- | :--- | :--- | :--- | | Marketplace | $136,353 | $93,046 | $43,307 | | Supplier Services | $14,618 | $1,594 | $13,024 | Segment Revenue (Q1 2025 vs Q1 2024, in thousands) | Segment | Q1 2025 Revenue | Q1 2024 Revenue | | :--- | :--- | :--- | | U.S. | $127,820 | $103,363 | | International | $23,151 | $19,327 | - In Q1 2025, the company initiated a restructuring, incurring **$1.5 million** for employee termination costs related to reducing its workforce[112](index=112&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the financial results for Q1 2025, highlighting a 23% revenue growth driven by a 27% increase in Marketplace revenue, achieving positive Adjusted EBITDA of $0.1 million, a significant improvement from a loss of $7.5 million in Q1 2024, attributed to operating efficiencies, with key operational metrics like Active Buyers and high-value accounts continuing to grow, and covering components of operating results, liquidity, and capital resources, including the status of the 2027 convertible notes [Key Marketplace Operational and Business Metrics](index=37&type=section&id=Key%20Marketplace%20Operational%20and%20Business%20Metrics) The company's marketplace showed strong growth in user engagement and value, with Active Buyers increasing 22% year-over-year to 71,454, high-value accounts growing 12% to 1,545, and existing accounts contributing 98% of revenue in the quarter - Active Buyers reached **71,454** as of March 31, 2025, a **22% increase** from 58,504 a year prior[136](index=136&type=chunk) - Accounts with LTM spend of at least **$50,000** grew **12%** to **1,545** as of March 31, 2025, from 1,381 a year ago[141](index=141&type=chunk) - For the quarter ended March 31, 2025, **98% of revenue** was generated from existing accounts, indicating strong customer retention and repeat business[139](index=139&type=chunk) [Non-GAAP Financial Measures](index=40&type=section&id=Non-GAAP%20Financial%20Measures) Xometry achieved positive Adjusted EBITDA of $0.1 million in Q1 2025, a significant turnaround from a $(7.5) million loss in Q1 2024, and Non-GAAP Net Income was $0.8 million, compared to a Non-GAAP Net Loss of $(5.7) million in the prior-year quarter, reflecting improved operating efficiency and margin expansion Adjusted EBITDA Reconciliation (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss | $(15,076) | $(16,604) | | Adjustments | $15,154 | $9,145 | | **Adjusted EBITDA** | **$78** | **$(7,459)** | Non-GAAP Net Income (Loss) Reconciliation (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss | $(15,076) | $(16,604) | | Adjustments | $15,904 | $10,862 | | **Non-GAAP Net Income (Loss)** | **$828** | **$(5,742)** | [Results of Operations](index=45&type=section&id=Results%20of%20Operations) Total revenue for Q1 2025 increased by 23% to $151.0 million, driven by a 27% growth in Marketplace revenue, while Supplier Services revenue saw a 6% decline, with gross profit rising 18% to $56.3 million, though gross margin slightly decreased to 37.3% from 39.0% due to revenue mix shift, and operating expenses as a percentage of revenue decreased from 53.6% to 47.5%, demonstrating improved operating leverage Revenue by Line of Business (in thousands) | Line of Business | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Marketplace | $136,353 | $107,186 | +27% | | Supplier services | $14,618 | $15,504 | -6% | | **Total Revenue** | **$150,971** | **$122,690** | **+23%** | - Gross margin for Marketplace was relatively stable at **31.8%** in Q1 2025 vs **32.0%** in Q1 2024, while Supplier Services gross margin improved to **89.1%** from **87.9%**[180](index=180&type=chunk)[181](index=181&type=chunk) - Sales and marketing expense decreased by **3%** to **$26.4 million**, primarily due to lower commissions and advertising spend[182](index=182&type=chunk) - Operations and support, product development, and general and administrative expenses all increased in absolute dollars but decreased as a percentage of revenue, indicating scaling efficiency[184](index=184&type=chunk)[185](index=185&type=chunk)[186](index=186&type=chunk) [Liquidity and Capital Resources](index=50&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company held $231.4 million in cash, cash equivalents, and marketable securities, which management believes is sufficient for at least the next twelve months, with the primary source of financing being equity sales and the $287.5 million in 1% convertible senior notes due 2027, and net cash used in operations significantly improving to $3.7 million for the quarter - The company has **$231.4 million** in cash, cash equivalents, and marketable securities as of March 31, 2025[194](index=194&type=chunk) - The company has **$287.5 million** in aggregate principal amount of **1% convertible senior notes** due in 2027, with a carrying value of **$284.1 million** as of March 31, 2025[196](index=196&type=chunk)[203](index=203&type=chunk) Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(3,691) | $(11,734) | | Net cash (used in) provided by investing activities | $(3,686) | $2,927 | | Net cash provided by financing activities | $510 | $1,233 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=54&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are foreign currency exchange risk and inflation risk, with international operations, mainly in Euros, accounting for about 15% of revenue in Q1 2025, where a hypothetical 10% unfavorable change in the Euro exchange rate would have decreased revenue by 1.2%, and the company does not believe inflation has had a material effect on its business to date - International operations generate approximately **15% of revenues**, with a majority in Euros. A **10% unfavorable change** in the Euro exchange rate would have decreased Q1 2025 revenues by **1.2%**[217](index=217&type=chunk) - Management does not believe that inflation has had a material effect on the business, but notes that an inability to pass on significant inflationary pressures could harm future results[218](index=218&type=chunk) [Item 4. Controls and Procedures](index=54&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective at a reasonable assurance level as of March 31, 2025, with no material changes to the internal control over financial reporting identified during the quarter - Based on an evaluation as of March 31, 2025, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective[220](index=220&type=chunk) - There were no changes to internal control over financial reporting during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[221](index=221&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=57&type=section&id=Item%201.%20Legal%20Proceedings) The company states that it is not a party to any legal proceedings that are reasonably expected to have a material adverse effect on its financial condition or operations, and there were no material legal proceedings or developments in Q1 2025 - As of March 31, 2025, the company is not party to any material legal proceedings[225](index=225&type=chunk)[226](index=226&type=chunk) [Item 1A. Risk Factors](index=57&type=section&id=Item%201A.%20Risk%20Factors) The company notes that there have been no material changes to its risk factors as disclosed in its 2024 Annual Report on Form 10-K, except for an expanded discussion on the risks associated with changes in U.S. and international trade policies, highlighting potential impacts from tariffs and other restrictive measures on raw material costs, supply chain stability, and customer demand - The company highlights the risk that changes in U.S. and international trade policies, such as new tariffs, could adversely impact the business by increasing costs, disrupting supply chains, and reducing customer demand[229](index=229&type=chunk) - Trade disputes and political tensions may exacerbate unfavorable macroeconomic conditions, including inflation and market instability, which could negatively impact customer demand and the company's stock price[230](index=230&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=59&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In January 2025, the company issued 16,716 shares of Class A common stock, valued at $0.6 million, as contingent consideration related to the 2023 acquisition of Tridi, with the issuance exempt from registration under Section 4(a)(2) of the Securities Act - In January 2025, the company issued **16,716 shares** of Class A common stock (**$0.6 million** value) as contingent consideration for the acquisition of Tridi[234](index=234&type=chunk) [Other Items (3, 4, 5, 6)](index=59&type=section&id=Other%20Items) This section confirms there were no defaults upon senior securities (Item 3) and no mine safety disclosures (Item 4), and under Item 5, it is noted that no directors or officers adopted or terminated securities trading plans during the last fiscal quarter, with Item 6 listing the exhibits filed with the report - Item 3 (Defaults Upon Senior Securities) and Item 4 (Mine Safety Disclosures) are not applicable[235](index=235&type=chunk)[236](index=236&type=chunk) - No directors or executive officers adopted or terminated any securities trading plans during the last fiscal quarter[237](index=237&type=chunk)