Sign in

    Xometry (XMTR)

    XMTR Q2 2024: 33.5% Gross Margin and 27% Buyer Growth

    Reported on Aug 5, 2025 (Before Market Open)
    Pre-Earnings Price$11.39Last close (Aug 7, 2024)
    Post-Earnings Price$15.53Open (Aug 8, 2024)
    Price Change
    $4.14(+36.35%)
    • Strong Underlying Growth Metrics: Q&A participants emphasized robust market performance with active buyers increasing 27% and over 3,000 new buyers added, supporting a guidance of at least 20% marketplace growth for 2024 despite an uncertain macro environment.
    • AI-Driven Gross Margin Expansion: Executives highlighted that the AI-powered pricing model drove the marketplace gross margin to a record 33.5% in Q2, with a target to reach 35% by year-end, underpinning improved profitability through advanced tech enhancements.
    • Enhanced Customer Engagement & Platform Innovation: The call noted strong adoption of innovation initiatives such as Teamspace (over 3,300 teams) and accelerated auto-quote capabilities via Google Vertex AI, driving deeper enterprise engagement and paving the way for further market share gains.
    • Narrowing Margins and Slower Growth: Q3 guidance implies a potential slowdown in growth with revenue and margin improvements not matching the first-half momentum, which could delay the path to profitability.
    • Decline in Supplier Services Revenue: The outlook expects supplier services revenue to be down 5%-10% YoY due to the wind down of non-core services, signaling pressure on revenue diversification.
    • Dependence on AI-Driven Optimization: The anticipated gross margin expansion towards 35% hinges on the successful deployment of AI models and new auto-quote technologies; any delays or underperformance in these initiatives could adversely impact margins.
    1. Margin Outlook
      Q: Expected marketplace margin performance?
      A: Management highlighted a strong quarterly marketplace gross margin of 33.5% and expressed confidence in reaching 35% by year end driven by AI improvements.

    2. EBITDA Guidance
      Q: Why adjust Q3 EBITDA guidance?
      A: Leadership explained that disciplined investments and controlled operating expenses are supporting Q3 adjusted EBITDA in the $1.5M to $3.5M range, paving the path toward profitability as revenue nears $600M.

    3. Q3 Outlook
      Q: How is early Q3 performing?
      A: Executives noted strong early Q3 trends with consistent marketplace growth of at least 20%, despite challenging year-over-year comparisons.

    4. Outperformance Drivers
      Q: What drove results above guidance?
      A: Management attributed the outperformance to disciplined expense control and robust gross profit gains, with quarterly gross profit improving by 33%, reflecting solid operational execution.

    5. Buyer & S&M
      Q: How are buyer trends and spending evolving?
      A: The team reported a 27% increase in active buyers with healthy net additions while keeping sales and marketing spend efficient, as seen with advertising at 6.9% of revenue.

    6. Instant Quoting
      Q: How is instant quoting affecting conversions?
      A: Leaders indicated that the integration of Vertex AI has streamlined auto-quoting, reducing friction and enhancing conversion rates, which contributes to margin expansion.

    7. Intl & Semis Trends
      Q: What are the trends internationally versus U.S.?
      A: Management noted that while international revenue growth experienced a strong comp effect, it remains healthy, and robust domestic semiconductor demand is buoyed by renewed investments.

    8. Macro Impact
      Q: How does the macro environment affect operations?
      A: Executives stressed that the current economic uncertainty reinforces the need for resilient, digitized supply chains, benefiting both buyers and suppliers.

    9. Teamspace Engagement
      Q: What is the feedback on Teamspace usage?
      A: Management shared that customer feedback on Teamspace has been highly positive with over 3,300 teams engaging actively, highlighting improved procurement collaboration.

    Research analysts covering Xometry.