Velo3D, Inc. (VLDX)·Q4 2024 Earnings Summary

Executive Summary

• Q4 2024 revenue was $12.6M, up sharply year over year from $2.5M, with gross margin at -3.5% and GAAP net loss of $21.7M; non-GAAP OpEx fell to $18.7M and adjusted EBITDA improved to -$14.6M, reflecting early benefits from restructuring and the new go‑to‑market strategy .
• Management introduced FY2025 guidance: revenue $50–$60M, sequential gross margin improvement to >30% exiting Q4 2025, non‑GAAP OpEx $40–$50M, capex $15–$20M, and EBITDA positive targeted in 1H 2026 .
• Backlog exited 2024 at $16M, supported by increased Sapphire XC system sales and the launch of Rapid Production Solutions (RPS) aimed to diversify revenue and expand margins .
• Balance sheet was delevered via a December 2024 debt-for-equity exchange (cancelling ~81.7% of senior secured notes; holder now owns ~95% of shares), reducing leverage and interest burden but leaving limited cash ($1.2M at year-end) as a near-term risk factor and execution constraint .
• Wall Street consensus from S&P Global for Q4 2024 and FY2025 was unavailable; near-term stock reaction catalysts likely center on evidence of RPS ramp, margin trajectory toward >30% by Q4 2025, and liquidity actions to fund capex and operations (S&P Global estimates unavailable).

What Went Well and What Went Wrong

What Went Well

• Systems sales improved with more Sapphire XC shipments; company exited 2024 with $16M backlog and sees sequential operational improvement across 2025 as RPS ramps .
• Operating discipline: Q4 GAAP OpEx fell to $21.1M (non-GAAP $18.7M), with 2024 operating expenses down ~25% YoY, reflecting realignment and cost reductions; adjusted EBITDA improved to -$14.6M from -$49.6M in Q4 2023 .
• Strategic repositioning: management launched RPS to deliver scalable parts production, expecting up to 40% of 2026 revenue, with focus on defense and aerospace reshoring; “new go‑to‑market strategy is gaining significant traction” .

What Went Wrong

• Profitability remains weak: Q4 gross margin -3.5% on lower fixed-cost absorption; GAAP net loss of $21.7M and cash declined to $1.2M at year-end, underscoring near-term liquidity constraints .
• Services/recurring revenue declined YoY due to fewer customers with active field service contracts, tempering mix benefits until RPS scale offsets .
• Prior-quarter disclosure limitations: Q3 2024 filings indicated significant revenue reduction and going concern challenges amid strategic review, limiting quantitative sequential comparison and highlighting execution risk into 2025 .

Financial Results

Note: Q3 2024 quantitative results were not provided due to delayed filings and going concern evaluation; the company disclosed significant revenue reduction, limiting sequential analysis .

Segment revenue mix (quarterly):

KPIs and balance sheet highlights:

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• CEO: “Our new go‑to‑market strategy is gaining significant traction… integrating internal parts production capabilities… expected to account for up to 40 percent of our revenue in 2026” .
• CEO: “We completed the debt for equity exchange… laying the foundation for our new business model… expect sequential quarterly improvement in our operational performance in 2025” .
• CFO: “Gross margin for the fourth quarter was negative 3.5%… we expect gross margin to improve as we go through 2025… Non‑GAAP OpEx… $18.7M… adjusted EBITDA… negative $14.6M… guidance: revenue $50–$60M; >30% GM exiting 2025; non‑GAAP OpEx $40–$50M; capex $15–$20M” .

Q&A Highlights

• The call did not include an active Q&A session; the operator noted no questions before handing back to management .
• Management reiterated the strategic pivot to a hybrid model (systems + RPS), focus on defense/aerospace reshoring, and the path to EBITDA profitability in 1H 2026 .

Estimates Context

• S&P Global consensus estimates for Q4 2024 revenue and EPS, and FY2025 revenue/EPS were unavailable for VLDX at the time of this analysis; therefore, beat/miss vs consensus cannot be determined (S&P Global estimates unavailable).
• Investors should anchor expectations on company guidance and near-term execution milestones (RPS ramp, margin progression, OpEx discipline), with potential for sell-side coverage to expand following improved disclosures and strategic updates .

Key Takeaways for Investors

• Revenue inflected in Q4 2024 ($12.6M) with improved adjusted EBITDA (-$14.6M vs -$49.6M YoY) amid a pivot to higher-value system sales and the RPS launch; backlog is supportive ($16M) .
• Margin recovery is central: Q4 gross margin was -3.5%, but management targets >30% by Q4 2025 through operational efficiencies and RPS scaling; sequential improvement is explicitly guided .
• Liquidity remains the key near-term risk: year-end cash was $1.2M despite leverage reduction; execution on bridge financing, working capital, and capex ($15–$20M in FY2025) will be critical .
• Strategy has clear catalysts: RPS contribution growth, defense/aerospace demand from reshoring, and higher ASP systems should drive mix upgrade and margin expansion if execution stays on plan .
• FY2025 guide ($50–$60M revenue; non-GAAP OpEx $40–$50M) implies operating leverage potential; track quarterly gross margin trajectory and backlog conversion to validate path to EBITDA positive in 1H 2026 .
• Prior disclosure constraints (Q3 2024) highlight execution sensitivity; watch for consistent quarterly reporting and improved coverage as financial processes stabilize .
• Trading lens: absent consensus estimates, stock moves likely key off tangible progress on RPS program wins, margin beats vs internal milestones, and capital actions to underpin the ramp .