Xometry(US:XMTR)2025-05-06 13:32Financial Data and Key Metrics Changes - In Q1 2025, revenue increased by 23% year over year to $151 million, marking a 700 basis point acceleration from 16% year over year revenue growth in Q4 2024 [7][18] - Adjusted EBITDA was $100,000 compared to a loss of $7.4 million in Q1 2024, reflecting a significant improvement driven by revenue growth and operating efficiencies [24] - Q1 gross profit was $56.3 million, an increase of 18% year over year, with a gross margin of 37.3% [21][22] Business Line Data and Key Metrics Changes - Marketplace revenue was $136 million in Q1, up 27% year over year, while supplier services revenue was $14.6 million, down 6% year over year [18][20] - Q1 active buyers increased by 22% year over year to 71,454, with a net addition of 3,187 active buyers [19] - Marketplace revenue per active buyer increased by 4% year over year, driven by strong enterprise growth in the US [19] Market Data and Key Metrics Changes - US marketplace revenue growth accelerated to nearly 30% year over year, the strongest since Q4 2023, while international revenue increased by 20% year over year [19] - The number of accounts with at least $50,000 in spend increased by 12% year over year to 1,545 [20] - Supplier services revenue increased by 4% quarter over quarter, primarily driven by financial services products [21] Company Strategy and Development Direction - The company is focused on building 18 localized marketplaces in the US, Europe, and Asia to support domestic manufacturing [9] - Investments are being made in technology to enhance the digital marketplace experience and improve sourcing strategies [12][13] - The company aims to provide a compelling triad of price, selection, and speed for buyers while enabling suppliers to access demand effectively [15][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving faster revenue growth in 2025 compared to 2024, driven by strong demand and a shift towards domestic sourcing [9][14] - The current volatile international trade environment validates the company's marketplace model, which allows for real-time responses to customer needs [9] - Management expects continued growth in adjusted EBITDA profitability and a focus on balancing growth with operating leverage [27][30] Other Important Information - The company initiated a restructuring action in March 2025, reducing its workforce by approximately 5% to improve efficiency [25] - Cash and cash equivalents at the end of Q1 were $231 million, a decrease of approximately $8 million from Q4 2024, primarily due to capital expenditures [26] Q&A Session Summary Question: Comments on customer behavior since the April 2 tariff announcements - Management noted robust growth and an increase in enterprise customers discussing sourcing strategies, with a slight shift towards domestic sourcing [33] Question: Incremental EBITDA margin expectations - Management indicated that the midpoint for Q2 guidance would be slightly under the long-term target of 20% but expects low 20s for the first half of the year [34][36] Question: Improvement in supplier services - The improvement was attributed to financial services offerings supporting suppliers' cash flow needs, alongside enhancements in advertising and search capabilities [40][41] Question: Insights on tariffs and long-term structural changes - Management highlighted a potential trend towards multi-sourcing as companies seek to build resilient supply chains, which aligns with the company's marketplace model [51] Question: Gross profit and gross margin concerns - Management explained that the gross margin was impacted by a mix shift and investments in global sourcing, with expectations for improvement in Q2 [52][53] Question: Updates on TeamSpace and enterprise focus - TeamSpace has grown to over 7,000 teams, with enhancements in collaboration features well-received by enterprise customers [45][46] Question: Production versus prototyping revenues - Management emphasized ongoing growth in production capabilities and the extensibility of the platform to support various manufacturing processes [78][82] Question: Percentage of revenues from overseas marketplace partners - The majority of US marketplace revenue is fulfilled domestically, with approximately 80% sourced from US partners [85]