Executive Summary

Q2 2024 revenue was $10.3M, down 58.9% year-over-year but up sequentially; GAAP gross margin was -28.0% and GAAP net loss was $0.2M (benefiting from a $27.1M non-cash gain on fair value changes), with diluted EPS of -$0.02 .
Management withdrew FY 2024 guidance due to delays in government project funding impacting system order timing, and announced ~30% headcount reduction to preserve liquidity and reduce OpEx .
Backlog exited Q2 at $17M and year-to-date bookings were $21M, with >40% of orders from existing customers; defense expansion continued (>20% of 1H’24 shipments) .
Cash and cash equivalents ended Q2 at $3M per the release (balance sheet shows $2.462M), highlighting tight liquidity and the importance of strategic review and cost actions .

What Went Well and What Went Wrong

What Went Well

Sequential system revenue improvement, driven by mix shift to higher-priced Sapphire XC units; demonstrated execution on realignment priorities and cost reductions (OpEx down 37% YoY; non-GAAP OpEx $13.8M) .
Bookings and backlog support near-term visibility: $21M YTD bookings, $17M backlog; with >40% of orders from existing customers and >20% shipments to defense in 1H’24 .
CEO tone on strategic re-alignment and operational efficiency was constructive: “We reduced our quarterly operating costs by 37% year over year and improved our manufacturing and operational efficiency.” .

What Went Wrong

Withdrawal of FY 2024 guidance given deferred orders and funding delays in government projects; headcount reduction of ~30% enacted to manage liquidity .
Gross margin remained negative (-28%) due to lower fixed cost absorption as system orders shifted to H2 2024; support services/recurring revenue declined sequentially due to lease expirations and fewer active field service contracts .
Liquidity tightened: cash ended quarter at $3M (release) vs $2.462M on the balance sheet, with current debt rising and overall balance sheet showing pressure .

Financial Results

Summary Financials vs Prior Periods and Estimates

Metric	Q2 2023 (oldest)	Q1 2024	Q2 2024 (newest)
Revenue ($USD Millions)	$25.1	$9.786	$10.3
Gross Margin (%)	10.1%	-28.8%	-28.0%
GAAP Net Income (Loss) ($M)	$(23.201)	$(28.314)	$(0.172)
GAAP Net Income Margin (%)	(92.3)%	(289.3)%	(1.7)%
Diluted EPS ($)	$(4.10)	$(0.11)	$(0.02)
Adjusted EBITDA ($M)	$(17.527)	$(11.701)	$(14.976)
GAAP Operating Expenses ($M)	$28.242	$18.635	$17.623
Non-GAAP Operating Expenses ($M)	$22.151	$14.132	$13.802
Cash & Equivalents ($M)	—	$7.754	$2.462

Estimates comparison: Wall Street consensus from S&P Global was unavailable via our tool; therefore, estimate comparisons cannot be provided at this time.

Segment/Revenue Mix

Revenue Category ($USD Thousands)	Q2 2023 (oldest)	Q1 2024	Q2 2024 (newest)
3D Printer	$23,190	$7,660	$8,679
Recurring Payment	$35	$470	$292
Support Services	$1,909	$1,656	$1,373
Total Revenue	$25,134	$9,786	$10,344

KPIs and Balance Sheet Indicators

KPI / Metric	Q2 2023 (oldest)	Q1 2024	Q2 2024 (newest)
Backlog ($M)	—	$22	$17
YTD Bookings ($M)	—	$17 (Q1 bookings)	$21 (YTD)
Defense Shipment Mix	—	3 new defense customers added	>20% of 1H’24 shipments
Cash & Equivalents ($M)	—	$7.754	$2.462 (balance sheet) / $3 (press release)
Total Current Liabilities ($M)	—	$60.858	$48.554
Debt – current portion ($M)	—	$34.300	$24.592

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue ($)	Q2 2024	“>30% sequential revenue growth” (from Q1 release)	Actual revenue $10.3M; timing of orders deferred; no forward Q3 guide provided	—
FY Revenue ($)	FY 2024	$80M–$95M (Q4 2023; reiterated Q1 2024)	Withdrawn due to deferred orders/funding delays	Lowered (withdrawn)
Gross Margin (%)	FY 2024	20%–30%, with ~30% in Q4 2024 (Q4 2023; reiterated Q1)	Withdrawn with FY guidance; Q2 gross margin -28%	Lowered (withdrawn)
Non-GAAP OpEx ($)	FY 2024	$40M–$50M (Q1 2024)	Continuing cost reductions; ~30% headcount reduction; no formal FY range reaffirmed	Implicitly maintained reduction efforts; formal guidance withdrawn
Strategic Actions	FY 2024	Realignment, bookings growth, margin/cash flow improvements	~30% headcount reduction; strategic review remains ongoing	Intensified cost actions

Earnings Call Themes & Trends

Note: A Q2 2024 earnings call transcript could not be retrieved via document tools; themes below reflect quarter press releases and prior disclosures.

Topic	Q4 2023 (oldest)	Q1 2024	Q2 2024 (newest)	Trend
Realignment & Cost Reduction	Re-aligned priorities; >15% sequential OpEx reduction; bookings recovery	OpEx down 30% YoY; targeting further 10% sequential OpEx decline; breakeven FCF H2’24	OpEx down 37% YoY; instituted ~30% headcount reduction	Intensifying cost actions
Defense & Government	New defense customers; DoD funding cited as catalyst	Added 3 new defense customers; strong defense demand	Defense expansion; >20% of 1H shipments; funding delays impact timing	Demand strong; timing uncertain
Bookings & Backlog	$15M bookings since mid-Dec; bookings growth resuming	$17M Q1 bookings; $22M backlog exiting Q1	$21M YTD bookings; $17M backlog exiting Q2	Backlog down; bookings steady
Gross Margin	Q4 GM deeply negative from inventory/realignment charges	Expect positive GM in Q2; -28.8% reported in Q1	GM -28.0%; lower fixed cost absorption from deferred orders	Improvement delayed
Liquidity	Cash/investments $31M at Q4; strategic review underway	Cash $11M at Q1 end	Cash $3M (release) / $2.462M (BS); strategic review ongoing	Tightening; actions escalated

Management Commentary

“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.” — Brad Kreger, CEO .
“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.” .
“Delays in the funding of certain governmental projects…have negatively impacted our revenue forecast for the balance of the year…including a headcount reduction of approximately 30%.” .
“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.” .

Q&A Highlights

The Q2 2024 earnings call transcript was not available via our document tools and external transcript sources were not accessible for full-text review. As a result, Q&A highlights and any guidance clarifications from the live call cannot be provided at this time. We searched for “earnings-call-transcript” documents for VLD in the relevant date window and found none; external links identified the Q2 press release and 10-Q but no accessible full transcript.

Estimates Context

S&P Global consensus estimates were not available due to a mapping issue in our estimates tool. We attempted to retrieve “Primary EPS Consensus Mean” and “Revenue Consensus Mean” for Q2 2024, Q1 2024, and Q2 2023, but the request failed because of missing CIQ mapping for VLD. Therefore, we cannot provide a comparison to Wall Street consensus at this time.
Implication: Without consensus benchmarks, the focus shifts to internal guidance vs actuals and sequential/YoY trends from company disclosures .

Key Takeaways for Investors

Guidance withdrawal and ~30% headcount reduction signal near-term revenue timing risks and liquidity caution; expect investor focus on backlog conversion, bookings cadence, and cash runway through H2 2024 .
Sequential revenue improved and system mix favored higher-priced Sapphire XC, but negative gross margin from fixed cost under-absorption shows sensitivity to shipment timing; upside requires clearer government funding timelines .
Backlog fell from $22M (Q1 exit) to $17M (Q2 exit), while YTD bookings hit $21M with strong existing-customer contribution—positive for product-market fit but highlights the importance of execution and delivery scheduling .
Defense demand remains a structural positive (>20% of 1H shipments), but funding and award timing introduce volatility; monitoring H2 backlog additions is critical .
Cost actions materially reduced OpEx (non-GAAP OpEx down ~37% YoY), supporting eventual margin recovery once volumes normalize; track OpEx trajectory and manufacturing efficiency progress .
Liquidity is tight (Q2 cash ~$3M in release vs $2.462M on balance sheet); strategic review and additional balance sheet options referenced by management will be a key stock narrative driver .
Near-term trading: stock likely reacts to visibility on deferred orders and any strategic review outcomes; medium-term thesis hinges on defense/government conversion, cost discipline, and stabilizing gross margins .

Sources: Q2 2024 earnings 8-K and press release ; Q1 2024 earnings 8-K and press release ; Bookings update (April 4, 2024) ; Q4 2023 earnings 8-K and press release .

Velo3D, Inc. (VLD)·Q2 2024 Earnings Summary