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Nuburu, Inc. (BURU)·Q2 2023 Earnings Summary

Executive Summary

  • Q2 2023 revenue was $1,054,062, up 2,125% year over year, with gross margin improving to (136)% from (2,574)% in Q2 2022; GAAP net loss was $(6,106,712) or $(0.18) per share, and EBITDA was $(6,007,916) .
  • Management reiterated FY 2023 guidance in Q2 (revenue >$3M; EBITDA $(21)-$(23)M; FCF $(24)-$(26)M), driven by BL product launch and blue-chip interest (NASA); subsequently in Q3 the company lowered FY 2023 outlook to revenue $2.1M; EBITDA $(18)-$(21)M; FCF $(17)-$(20)M due to shipment delays .
  • Operationally, Q2 units delivered to Essentium and GE Additive under multi-year partnerships; introduced the BL-1000 series targeting EV batteries, additive manufacturing, and electronics; supply chain bottlenecks (scanner and lens components) expected to abate by year-end .
  • Near-term catalyst and risk: management flagged Q3 sales compression with a 4Q rebound cadence; inventory write-off (~$0.6M) on AO product line pressured Q2 gross profit but aids product transition to BL series; cash ended Q2 at $6,624,736 following $9.2M private placement .

What Went Well and What Went Wrong

What Went Well

  • Revenue inflection: Q2 revenue of $1.1M (+2,125% YoY) on increased laser system sales and improved product/customer mix; gross margin % improved to (136)% from (2,574)% YoY as scale increases .
  • Strategic wins: BL-1000 series introduced targeting EV battery welding and additive manufacturing; continued deliveries to Essentium and first blue area printing head delivered to GE Additive under AFWERX; NASA contract for blue laser power beaming validates technology breadth .
  • Management tone: “We are pleased to report another period of strong financial performance… Our heads-down approach in delivering the highest quality and energy efficient manufacturing solutions remains our top priority,” said CEO Dr. Mark Zediker .

What Went Wrong

  • Gross profit pressure: Q2 total gross profit was $(1,431,202), impacted by a one-time write-off of ~$(0.6)M for excess and obsolete AO inventory; gross margin still negative given early-stage scale .
  • Opex elevation: Total operating expenses rose to $5,009,830 (from $2,677,541 in Q2 2022) due to one-time public company costs, professional fees post-merger, and increased R&D for BL product line .
  • Supply chain headwinds: Scanner and lens component procurement bottlenecks constrained deliveries; management anticipated Q3 sales compression before a 4Q recovery, increasing execution risk to FY guidance (later revised down in Q3) .

Financial Results

Core Financials vs Prior Periods

MetricQ4 2022Q1 2023Q2 2023
Revenue ($)$435,000 $469,989 $1,054,062
Net Loss ($)$(4,022,000) $(4,767,517) $(6,106,712)
Net Loss per Share (EPS, $)N/A$(0.19) $(0.18)
Total Gross Margin ($)$(771,000) $(742,448) $(1,431,202)
Gross Margin (%)N/A(158)% (136)%
Total Operating Expenses ($)N/A$4,558,820 $5,009,830
EBITDA ($)$(3,859,000) $(4,673,829) $(6,007,916)
Free Cash Flow ($)$(3,194,000) $(4,395,374) $(5,130,306)
Capital Expenditures ($)$(254,000) $(344,801) $(481,071)
Cash & Equivalents ($)$2,880,254 $1,523,046 $6,624,736
Weighted Avg SharesN/A25,515,164 34,776,044

Year-over-Year and Quarter-over-Quarter Highlights

  • Revenue YoY: Q2 2023 $1.1M vs $47k in Q2 2022 (+2,125%) .
  • Gross Margin % YoY: (136)% in Q2 2023 vs (2,574)% in Q2 2022, aided by revenue scale; partially offset by AO inventory write-off (~$0.6M) .
  • Q/Q trajectory: Revenue rose from $469,989 (Q1) to $1,054,062 (Q2); management signaled Q3 compression before 4Q rebound .

Segment/Product Mix (disclosed items)

Product/AreaQ2 2023 Detail
BL-250 Units Sold3 units sold; mix expected to shift towards BL-250 and BL-1000-F over time
AO-650“Predominantly” AO-650 sales in Q2; exact unit counts not disclosed
Government/DefenseDelivered first blue area printing head to GE Additive under AFWERX; NASA contract announced for power beaming feasibility

KPIs (Non-GAAP and Operating)

KPIQ2 2023Q2 2022
Revenues ($)$1,054,062 $47,375
Total Gross Margin ($)$(1,431,202) $(1,219,517)
EBITDA ($)$(6,007,916) $(3,751,569)
Free Cash Flow ($)$(5,130,306) $(2,910,144)
Capital Expenditures ($)$(481,071) $(83,091)

Guidance Changes

MetricPeriodPrevious Guidance (Q1 2023)Current Guidance (Q2 2023)Change
Total RevenueFY 2023>$3M >$3M Maintained
EBITDAFY 2023$(21)M to $(23)M $(21)M to $(23)M Maintained
Free Cash FlowFY 2023$(24)M to $(26)M $(24)M to $(26)M Maintained

Subsequent update (post-Q2):

MetricPeriodRevised Guidance (Q3 2023)Change vs Q2
Total RevenueFY 2023$2.1M Lowered
EBITDAFY 2023$(18)M to $(21)M Raised (less negative)
Free Cash FlowFY 2023$(17)M to $(20)M Raised (less negative)

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2022 and Q1 2023)Current Period (Q2 2023)Trend
Product Roadmap (BL-250/BL-1000/SML)BL-Series launch at Photonics West; shipments to begin Q2; outlined roadmap including 1kW BL and Single-Mode Laser (SML) for 2025 BL-1000 series introduced; validating BL-1000 capabilities for EV batteries; BL-250 integration with scanners; SML targeted for 2025 Expanding capability; near-term commercialization progressing
Supply Chain & IntegrationTransition to higher-performance diodes; early-stage manufacturing ramp; no scanner constraint flagged yet Scanner/lens procurement bottlenecks; alternative sourcing expected to abate late H2; anticipate Q3 sales compression then 4Q rebound Temporary headwinds, mitigation underway
Government/DefenseAFWERX deliveries; DoD multi-party award ceiling $75M; role not yet defined Delivered first blue area printing head to GE Additive under AFWERX; NASA contract for lunar/Martian power beaming feasibility Growing validation via government projects
Customer Pipeline (Blue-Chip Interest)Essentium multi-year partnership; expanding customer engagement Increased interest from blue chips incl. NASA; ongoing Essentium deliveries; GE Additive JDA Broadening commercial traction
Manufacturing CapacityScaling operations; public-company transition and capex investments Capacity ramp “module a day” by year-end; equipment arriving to support 2024 Capacity building for scale
Revenue CadenceFY 2023 >$3M reiterated; initial Q1 ramp Confident in >$3M for FY (Q2); later signaled Q3 compression and 4Q pull-through Shift to 4Q-weighted; later revised down in Q3

Management Commentary

  • “Our top line improved over 2,000% on a year-over-year basis, supported by the strong market adoption of our transformational blue laser technology and continued execution of product deliveries to our commercial customers, Essentium and GE Additive” — Dr. Mark Zediker, CEO .
  • “We remain cognizant of the supply chain conditions… believe such material constraints will abate toward the end of the second half of this year… reinforces our confidence in achieving Full Year sales in excess of $3 million” — Dr. Mark Zediker .
  • “Our net loss was $6.1 million or $0.18 per share… primarily related to the mentioned one-time expenses… EBITDA was a negative $6 million; free cash flow usage of $5.1 million” — CFO commentary .
  • “We anticipate third quarter sales to compress but rebound… with the majority of revenue recognition pulling through during the fourth quarter of 2023” — Dr. Mark Zediker .

Q&A Highlights

  • Blue-chip engagement and technical validation: Management highlighted strong interest from government and commercial customers; application center validations for BL-250 and BL-1000 underway .
  • Product mix: Q2 was “predominantly” AO-650 with three BL-250 sales; mix expected to shift towards BL-250 and BL-1000-F as adoption increases .
  • Supply constraints: Scanner delivery lead times are the primary bottleneck; not constraining laser production capacity .
  • Capacity ramp: Targeting “module a day” production capability by year-end 2023; final equipment arriving to support 2024 scaling .
  • Revenue cadence clarification: Expect Q3 compression and 4Q rebound despite near-term constraints .

Estimates Context

  • Wall Street consensus for Q2 2023 EPS and revenue via S&P Global was unavailable at time of retrieval due to request limit; therefore, comparison to consensus cannot be provided. Values would be retrieved from S&P Global if available.*

Where estimates may need to adjust:

  • Post-Q2, management revised FY 2023 outlook lower in Q3 (revenue to $2.1M; EBITDA and FCF less negative), implying sell-side models should reflect shipment delays and a heavier 4Q weighting .

Key Takeaways for Investors

  • Q2 marked a significant revenue inflection ($1.05M, +2,125% YoY) as BL series commercialization progresses, but profitability remains negative with EBITDA $(6.0)M and gross margin still below zero due to scale and the AO inventory write-off (~$0.6M) .
  • Near-term risk flagged: scanner/lens supply bottlenecks and customer integration issues drove expected Q3 sales compression; management targeted a Q4 rebound, later revising FY guidance lower in Q3 — monitor delivery cadence into 4Q .
  • Strategic validation is building: NASA contract (power beaming feasibility), AFWERX progress with GE Additive, and Essentium deliveries support medium-term demand narratives across EV batteries, additive manufacturing, and electronics .
  • Product roadmap milestones (BL-1000 and future SML in 2025) expand addressable market and should improve margins over time as mix shifts from AO to BL products .
  • Liquidity improved: Q2 cash was $6.62M, aided by ~$9.2M private placements; management believes sufficient capital access to fund the plan, but ongoing losses necessitate close monitoring of financing and burn .
  • Actionable: Focus on 4Q execution (scanner supply resolution, BL-250/BL-1000 deliveries), government milestones, and new blue-chip orders as potential stock catalysts; conversely, further integration delays or funding gaps are downside risks .
  • Longer-term thesis: If BL-1000/SML adoption progresses and manufacturing capacity scales (“module a day”), margin improvement and revenue expansion into EV and additive could meaningfully de-risk the story through 2024–2025 .