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VI

Velo3D, Inc. (VLDX)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $9.3M with a positive GAAP gross margin of 7.5% (from -28.8% a year ago), while GAAP net loss improved to $25.4M; non-GAAP net loss was $8.9M and adjusted EBITDA was -$6.9M .
  • Backlog rose to $18M at quarter-end, with management highlighting a demand mix shift to Rapid Production Services (RPS); new customers were >75% of Q1 bookings and ~50% of demand came from defense .
  • Guidance reaffirmed: FY25 revenue $50–$60M, sequential gross margin improvement to >30% in Q4 2025, non-GAAP OpEx $40–$50M, CapEx $15–$20M; target EBITDA profitability in H1 2026 .
  • Strategic catalysts: launch of RPS in March; $15M five-year MSA with Momentus; exclusive supply agreement with Amaero; additional Sapphire XC printer order to Mears; Ohio Ordnance Works RPS agreement; leadership and board additions .

What Went Well and What Went Wrong

What Went Well

  • RPS launch and traction: “Backlog for this offering has tripled compared to the prior quarter…more than 75% of first quarter bookings were from new customers” and ~50% of demand from defense .
  • Gross margin inflection: GAAP gross margin reached 7.5% vs -28.8% YoY, driven by BOM cost reductions and manufacturing optimization; management expects continued improvement through 2025 as RPS ramps .
  • Strengthened commercial pipeline with strategic agreements (Momentus $15M MSA; Amaero exclusive supply; Ohio Ordnance Works agreement; Mears’ fourth Sapphire XC), positioning for higher-margin recurring revenue .

Quote: “Momentum is building across our business…particularly in the defense and aerospace industries where domestic supply chain resiliency is a priority” — CEO Arun Jeldi .

What Went Wrong

  • System revenue decreased YoY (strategy shift to maintain ASPs while targeting high-value customers) and overall revenue declined sequentially from Q4 2024’s $12.6M to $9.3M .
  • Continued losses: GAAP net loss of $25.4M; adjusted EBITDA remained negative (-$6.9M), though improved vs Q4 2024 (-$14.6M) .
  • Cash constrained but improved: cash & equivalents $3.9M at Q1-end (up from $1.2M at FY-end), supported by $15M secured convertible notes; warrant cancellation reduced future liabilities but underscores capital structure complexity .

Financial Results

Core P&L vs prior periods and consensus

Note: Wall Street consensus estimates from S&P Global were unavailable for VLDX at this time.

MetricQ1 2024Q4 2024Q1 2025
Revenue ($USD Millions)$9.786 $12.626 $9.320
GAAP Gross Margin (%)-28.8% -3.5% 7.5%
GAAP Net Loss per Share (EPS) ($)($3.81) ($0.84) ($0.13)
MetricQ1 2024Q4 2024Q1 2025
Adjusted EBITDA ($USD Millions)($14.873) ($14.611) ($6.916)
Non-GAAP Operating Expenses ($USD Millions)$14.132 $18.735 $8.752
GAAP Net Loss ($USD Millions)($28.314) ($21.686) ($25.411)

Segment Revenue Breakdown

Segment ($USD Millions)Q1 2024Q4 2024Q1 2025
3D Printer$7.660 $7.980 $7.523
Recurring Payment$0.470 $0.100 $0.000
Support Services$1.656 $4.546 $1.790
Other$0.000 $0.000 $0.007
Total Revenue$9.786 $12.626 $9.320

KPIs and Balance Sheet Highlights

KPI/MetricQ1 2024Q4 2024Q1 2025
Backlog ($USD Millions)n/a$16 $18
Cash & Equivalents ($USD Millions)$7.754 $1.212 $3.870
Inventories, net ($USD Millions)$—$49.953 $46.133
Operating Cash Flow ($USD Millions)($20.523) $—($12.349)

Guidance Changes

MetricPeriodPrevious Guidance (as of Q4 2024)Current Guidance (Q1 2025)Change
RevenueFY 2025$50–$60M $50–$60M Maintained
Gross MarginFY 2025 exit>30% in Q4 2025 >30% in Q4 2025 Maintained
Non-GAAP Operating ExpensesFY 2025$40–$50M $40–$50M Maintained
CapExFY 2025$15–$20M $15–$20M Maintained
EBITDAH1 2026Positive Positive Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024 & Q4 2024)Current Period (Q1 2025)Trend
RPS launch/recurring revenue modelStrategic review created order uncertainty in Q3; planning for model shift; backlog $16M exiting Q4 Official RPS launch in March 2025; backlog up 3x; >75% bookings new customers; ~50% demand defense; aim for 40% of revenue by 2026 Strong acceleration
Defense/aerospace focus & reshoringEmphasis on U.S. domestic supply chain, defense primes, aerospace OEMs (Q4 slides and call) ~50% of RPS demand from defense; multiple defense/aero wins (OOW agreement, Mears XC printer order) Strengthening
Gross margin trajectoryNegative GM with plan to improve via efficiencies (Q4: -3.5%) Positive GM 7.5% and expecting sequential improvement through 2025 Improving
Balance sheet restructuringDebt/warrant exchanges; $15M bridge financing; reduced overhang (Q4) Warrant cancellation completed; $15M secured notes; cash up to $3.9M Stabilizing, still tight
Strategic partnerships/supply chainPipeline growth; set-up for partnerships (Q4 slides) Momentus MSA ($15M), Amaero exclusive supply, OOW RPS agreement, further XC orders Expanding

Management Commentary

  • “Momentum is building across our business…gaining significant traction with both new and existing customers, particularly in the defense and aerospace industries where domestic supply chain resiliency is a priority.” — CEO Arun Jeldi .
  • “We believe RPS could account for up to 40% of our revenue by 2026.” — CEO Arun Jeldi .
  • “We are reiterating our 2025 full-year guidance…revenue $50–$60M…gross margin…exiting 2025 at or above 30%…non-GAAP operating expenses $40–$50M…and capital expenditure of $15–$20M.” — CFO Hull Xu .
  • On margin drivers: “The improvement is a result of continued BOM cost reduction as well as manufacturing process optimization.” — Company press release .

Q&A Highlights

  • No analyst questions were received; management closed with reiteration of guidance and strategic focus on RPS and margin improvement . In Q4 2024, similarly, there were no questions .
  • Clarifications emphasized sequential gross margin improvement and the path to EBITDA profitability in H1 2026 .

Estimates Context

  • Wall Street consensus estimates from S&P Global for revenue and EPS were unavailable for VLDX for Q1 2025, Q4 2024, and FY 2025 at the time of this analysis. As a result, we cannot benchmark beats/misses versus consensus for this quarter [Values retrieved from S&P Global]*.

Key Takeaways for Investors

  • RPS is the core growth narrative: triple backlog, strong defense demand, and recurring revenue potential; look for conversion of backlog to revenue starting 2H 2025 .
  • Margin inflection has begun; continued BOM and process optimization plus RPS mix should drive sequential gross margin gains toward >30% exiting 2025 .
  • Revenue trajectory depends on system sales plus RPS ramp; Q1 decline vs Q4 reflects sales timing and ASP-focused strategy; monitor Q2/Q3 order flow .
  • Balance sheet actions reduce overhang (warrant cancellation; bridge financing), but cash remains tight, making execution on RPS ramp and cost discipline critical near-term .
  • Strategic partnerships (Momentus, Amaero, OOW) and XC fleet expansion at customers are tangible validations of market demand in aerospace/defense; watch for additional multi-year agreements .
  • Guidance credibility improving: management maintained FY25 targets; next few quarters will test margin and RPS scalability narrative .
  • Trading lens: stock narrative likely pivots on evidence of RPS revenue conversion, backlog growth sustainability, and gross margin trajectory; absence of consensus may limit “beat/miss” trading catalysts in near term, shifting focus to qualitative execution milestones .