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VI

Velo3D, Inc. (VLDX)·Q3 2024 Earnings Summary

Executive Summary

  • Q3 2024 revenue was $8.2M with gross margin of 49.4%; GAAP operating expenses were $22.8M (including $6.7M bad debt), and GAAP net loss was $22.8M. Management did not provide EPS in the release. The company said 2025 outlook would be provided with Q4/FY results .
  • Sequentially, revenue declined vs Q2 2024 ($10.3M) while gross margin improved markedly from negative 28.0% in Q2; Q1 2024 revenue was $10.0M with gross margin of negative 29% .
  • The company filed an 8‑K Item 2.02 on Nov 15, citing “significant reduction in revenue” and substantial doubt about going concern amid strategic review and resource constraints, and was unable to estimate Q3 results at that time .
  • A Dec 24 debt-for-equity exchange cancelled ~$22.4M of senior secured notes (81.7%) in exchange for equity; Arrayed Notes Acquisition Corp. now holds ~95% of common stock. New CEO Arun Jeldi appointed; company remains public on OTCQX .

What Went Well and What Went Wrong

What Went Well

  • Gross margin improved sharply to 49.4% (from negative 28.0% in Q2), indicating better mix/absorption in the quarter .
  • Structural deleveraging: 81.7% of senior secured notes cancelled; “significantly delevers balance sheet” and allows focus on operations .
  • Management transition and strategic reset: “Completing the strategic review is a significant milestone…we have taken a number of steps to accelerate our path to profitability” — Arun Jeldi (CEO) .

What Went Wrong

  • Revenue fell to $8.2M as orders slowed due to uncertainty around the strategic review; management earlier flagged a “significant reduction in revenue” vs prior year .
  • Elevated non-operating and credit costs: GAAP net loss of $22.8M included $10.9M interest expense and $6.7M bad debt expense, despite a $9.2M non-cash gain on fair value changes .
  • Operational strain and reporting delays: 8‑K cited “lack of staff,” “lack of financial resources,” and “substantial doubt” as to going concern, causing the company to miss the 10‑Q deadline and withhold estimates for Q3 at filing time .

Financial Results

MetricQ1 2024Q2 2024Q3 2024
Revenue ($USD Millions)$10.0 $10.3 $8.2
Gross Margin (%)(29.0)% (28.0)% 49.4%
GAAP Operating Expenses ($USD Millions)$18.6 $17.6 $22.8 (incl. $6.7M bad debt)
GAAP Net Loss ($USD Millions)$(28.3) $(0.2) $(22.8)
GAAP EPS (Basic/Diluted, $)— (not disclosed) $(0.02) — (not disclosed)

Notes: Q2 GAAP net loss reflected a $27.1M non-cash gain on fair value changes; Q3 GAAP net loss reflected a $9.2M non-cash gain offset by $10.9M interest and $6.7M bad debt .

KPIs

KPIQ1 2024Q2 2024Q3 2024
Bookings ($USD Millions)$17 $21 YTD (orders) — (not disclosed)
Backlog ($USD Millions)$22 $17 — (not disclosed)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY 2024$80–$95M (May 15 guidance) Not provided in Q3; 2025 outlook to be provided with Q4/FY results Withdrawn/not reiterated
Gross MarginQ4 2024~30% (excluding non-recurring charges) Not provided Withdrawn/not reiterated
Non‑GAAP OpExFY 2024$40–$50M Not provided Withdrawn/not reiterated

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2/Q1 2024)Current Period (Q3 2024)Trend
Strategic Review / LiquidityQ1: Realignment priorities; intent to maximize shareholder value; strong bookings/backlog 8‑K flagged reporting delays, staff/resource constraints, substantial doubt as to going concern; “significant reduction in revenue” Deterioration in near-term liquidity; decisive restructuring steps announced post-quarter
Cost Actions / OpEx DisciplineQ2: OpEx down 37% YoY; ~30% headcount reduction; improved operating cash flow Q3: GAAP OpEx $22.8M with $6.7M bad debt expense; no forward OpEx guidance Mixed: structural OpEx actions vs elevated credit costs in Q3
End-Market / Defense ExposureQ2: >20% of 1H’24 shipments to defense; healthy backlog Q3: orders slowed due to strategic review uncertainty Momentum interrupted by review uncertainty
Financing / Capital StructureQ1: targeting FCF breakeven in H2’24; no structural financing actions disclosed Dec 24: Debt-for-equity exchange; new majority owner; deleveraging Positive structural change post-quarter

Note: No Q3 2024 call transcript was available in our document catalog; we searched and did not find a Q3 2024 earnings call transcript for VLDX [ListDocuments results show none for earnings-call-transcript 2024].

Management Commentary

  • “Completing the strategic review is a significant milestone for Velo3D…we have taken a number of steps to accelerate our path to profitability and execute on a sustainable, long term business model.” — Arun Jeldi, CEO .
  • “With the majority of our senior secured notes cancelled, we are now in a stronger financial position, enabling us to focus our efforts on the future of Velo3D and delivering unparalleled large-format metal 3D printing capabilities to our global customer base.” — Brad Kreger, COO .
  • Q2 execution: “We added to our year-to-date bookings, maintained a healthy backlog and reduced our operating expenses.” — Brad Kreger, CEO (at the time) .

Q&A Highlights

  • No Q3 2024 earnings call transcript was available; the company filed its Q3 10‑Q in January and provided results via press release without a transcript accessible in our document set [ListDocuments showed no transcripts for 2024].

Estimates Context

  • We attempted to retrieve S&P Global consensus estimates for Q3 2024 (EPS and Revenue), but data access limits prevented retrieval. Wall Street consensus from S&P Global was unavailable for inclusion in this recap. If your access allows, please pull “Primary EPS Consensus Mean” and “Revenue Consensus Mean” for Q3 2024 to quantify beats/misses.
  • Given the OTC transition and limited coverage during the strategic review, sell-side estimates may have been sparse; therefore, we anchor this recap on company disclosures and SEC filings .

Key Takeaways for Investors

  • Revenue softness and delayed orders in Q3 were directly linked to uncertainty around the strategic review; expect normalization only after the December deleveraging and leadership transition .
  • The quarter showed a stark gross margin improvement (49.4%) despite lower revenue; however, elevated interest and bad debt charges drove a large GAAP loss, highlighting residual balance sheet and credit risks .
  • Structural deleveraging and new governance should reduce financial risk and could catalyze renewed customer engagement; monitor order momentum and backlog rebuild in subsequent periods .
  • Near-term trading: headlines around the debt-for-equity exchange and completion of the strategic review are key catalysts; lack of guidance in Q3 suggests volatility until the company provides 2025 outlook with Q4/FY results .
  • Medium-term thesis: watch defense/aerospace program traction (a prior growth vector in H1’24) and the company’s ability to execute on cost discipline without credit losses; margin sustainability is the critical driver .
  • Risk guardrails: going concern language in the 8‑K underscores liquidity fragility; confirm cash runway, capital plan, and working capital discipline in subsequent disclosures before sizing positions .

Appendix: Source Documents Read

  • 8‑K Item 2.02 (Results of Operations and Financial Condition), Nov 15, 2024 .
  • Q3 2024 results press release and strategic review completion, Jan 15, 2025 .
  • Debt-for-equity exchange press release, Dec 24, 2024 .
  • Q2 2024 results press release, Aug 14, 2024 .
  • Q1 2024 results press release, May 15, 2024 .