Velo3D Secures Department of War Contract Valued at $32.6M to Eliminate Critical Defense Manufacturing Bottleneck

Rhea-AI Summary

Velo3D (NASDAQ: VELO) secured an Other Transaction Agreement with the U.S. Department of War's Defense Innovation Unit worth $32.6 million to support Project FORGE, aimed at removing production bottlenecks for a major weapon system program.

The work funds prototyping and qualification of additively manufactured components using Velo3D's Rapid Production Solution and includes an option to explore the largest-format Laser Powder Bed Fusion capability in the U.S. All Velo3D Sapphire printers are assembled domestically and print parts up to 600mm diameter × 1m height.

Positive

• $32.6M OTA contract awarded to Velo3D
• Work supports Project FORGE to remove defense manufacturing bottlenecks
• Rapid Production Solution to prototype and qualify AM components
• Option to explore largest-format LPBF capability in the U.S.
• All Sapphire printers assembled in the U.S. and print up to 600mm×1m

Negative

• Award funds prototyping and qualification, not a confirmed production contract
• Contract scope targets a single major weapon system program, limiting broader near-term revenue visibility

Key Figures

DoW contract value $32.6M Total value of Department of War DIU Project FORGE contract

Q3 2025 revenue $13.6M Third quarter 2025 revenue reported Nov 10, 2025

Backlog $21.1M Backlog as of Sept 30, 2025

Equity offering proceeds $17.5M Public offering of 5,833,333 shares, gross proceeds

2025 revenue guidance $50M–$60M Full‑year 2025 revenue guidance reaffirmed

GAAP net loss $11.8M Net loss for Q3 2025

Cash and equivalents $11.8M Cash position at Sept 30, 2025

Sale-leaseback value $10M Aggregate proceeds from equipment sale-leaseback reported Dec 12, 2025 8-K

Market Reality Check

$10.83 Last Close

Volume Volume 1,593,940 is 1.29x the 20-day average of 1,237,057, indicating elevated trading ahead of this news. normal

Technical Shares at $10.83 were trading above the 200-day MA of $7.81 while sitting 27.8% below the 52-week high of $15 and well above the 52-week low of $2.81.

Peers on Argus

While VELO was down 5.41% pre-news, key peers like UAVS (+14.09%), OSS (+2.23%), and others in the computer hardware / special machinery group showed modest gains. With no peers in the momentum scanner and no same-day peer headlines, VELO’s move appeared more stock-specific than sector-driven.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Nov 10	Earnings and uplisting	Positive	+4.0%	Reported 3Q revenue, backlog growth, Nasdaq uplisting and equity raise.
Oct 31	Earnings date notice	Neutral	+11.2%	Announced timing and access details for Q3 2025 earnings call.
Oct 27	Defense conference	Positive	+24.1%	Investor conference presentation focused on mission-critical parts and defense ties.
Oct 15	A&D partnership	Positive	-3.5%	Expanded iRocket partnership for launch vehicle and defense hardware production.
Oct 01	Tech integration	Positive	+9.4%	Integrated Dyndrite LPBF Pro to enhance toolpath control and automation.

Pattern Detected

VELO has generally reacted positively to corporate and strategic updates, with four of the last five news items followed by gains, and one partnership update seeing a modest decline.

Recent Company History

Over the last few months, VELO has highlighted Nasdaq uplisting, a public equity raise, and growing defense and aerospace relationships. Earnings on Nov 10, 2025 showed $13.6M in 3Q revenue and a $21.1M backlog alongside reaffirmed $50M–$60M 2025 revenue guidance. Defense-focused visibility was reinforced through the Starting 5 conference and partnerships with iRocket and Dyndrite. Today’s $32.6M Department of War contract extends that defense-manufacturing narrative and builds on prior RPS and Navy program references.

Market Pulse Summary

The stock is surging +30.2% following this news. A strong positive reaction aligns with VELO’s history of favorable responses to strategic and defense-related news, where most prior announcements were followed by gains. The $32.6M Department of War DIU contract adds to a growing backlog that was $21.1M as of Sept 30, 2025, and builds on recent defense partnerships. Investors would likely weigh this against past equity raises and ongoing net losses of $11.8M when assessing durability of any upside.

Key Terms

additive manufacturing technical

"through advanced additive manufacturingFREMONT, Calif., Dec. 22, 2025 -- Velo3D, Inc."

Additive manufacturing, often called 3D printing, builds physical parts by laying down material layer by layer from a digital design, rather than cutting or molding from a solid block. It matters to investors because it can cut production time and waste, enable cheaper prototypes and customized products, and reshape supply chains—changes that can lower costs, speed new products to market, and create competitive advantages that affect a company's revenue and margins.

LPBF technical

"benefits of LPBF technology, such as higher fidelity printing and Velo3D's best in"

LPBF stands for laser powder bed fusion, a 3D metal-printing process where a laser melts fine metal powder layer by layer to build precise parts. For investors, LPBF matters because it can lower manufacturing costs, speed product development and enable complex, customized designs—factors that affect a company’s competitiveness, production scalability and regulatory pathway for safety-critical products like medical implants or aerospace components.

AI-generated analysis. Not financial advice.

Award supports DIU's Project FORGE to accelerate production of a critical munitions program through advanced additive manufacturing

FREMONT, Calif., Dec. 22, 2025 /PRNewswire/ -- Velo3D, Inc. (NASDAQ: VELO), a leading additive manufacturing technology company for mission-critical metal parts has entered into an Other Transition Agreement (OTA) contract with the U.S. Department of War's (DoW) Defense Innovation Unit (DIU) in support of a major weapon system program of record. The contract, with a total value of $32.6 million, supports DIU's Foundry for Operational Readiness and Global Effects or "Project FORGE."

Project FORGE is charged with identifying solutions to the current problem of major manufacturing bottlenecks for certain traditionally manufactured parts and platforms within the U.S. defense industrial base. These production bottlenecks prevent the throughput necessary to scale a critical DoW weapon system program. Velo3D will work with DIU, the U.S. Navy and a key industry prime to prototype and qualify additively manufactured (AM) components that will allow the DoW to efficiently scale the AM solution to remove the bottleneck and increase production rates for this critical program.

"We are excited for the collaboration between DIU and industry partners like Velo3D to develop and qualify the AM solution needed to resolve a critical production backlog," said Mr. Derek McBride, Program Manager, DIU. "The combination of DIU's expertise in rapidly responding to some of the DoW's most difficult challenges and Velo3D's capabilities as an advanced additive manufacture, is the type of close collaboration we need with our Defense Industrial Base to support the warfighter."  

The contract leverages Velo3D's Rapid Production Solution (RPS) to quickly prototype alternatives to traditional subtractive manufacturing methods. Additionally, the agreement includes an option to explore development of the largest format Laser Powder Bed Fusion (LPBF) printing capability within the U.S. to support AM needs not currently possible within the U.S. industrial base. Velo3D's RPS leverages its systems, expertise and surge capacity solutions to enable scalable production of mission-critical components that would significantly enable the DoW's efforts to reduce manufacturing bottlenecks.

"As the only U.S.-based industrial scale OEM with domestically developed Laser Powder-Bed Fusion technology, Velo3D is absolutely honored for the opportunity to collaborate with the DoW, DIU, the Navy to ultimately deliver a solution that supports the warfighter," said Dr. Arun Jeldi, CEO of Velo3D. "Through our Rapid Production Solution, we are providing faster part delivery, enhanced reliability and the surge capacity needed to meet evolving defense demands."

All Velo3D Sapphire® printers are assembled in the United States and capable of printing parts up to 600mm in diameter and one meter in height repeatably across the entire fleet of Velo3D Sapphire® printers. This advancement significantly expands addressable applications, enabling larger part production while offering the many benefits of LPBF technology, such as higher fidelity printing and Velo3D's best in class layer-by-layer in-situ process monitoring.

Velo3D's systems meet DoD cybersecurity standards and can connect securely to military networks, ensuring integrity and security for critical manufacturing operations.

About the Department of War's (DoW) Defense Innovation Unit (DIU):

The Defense Innovation Unit (DIU) plays a pivotal role in accelerating the adoption of cutting-edge commercial technologies across the U.S. military while strengthening the nation's defense industrial base. Through rapid contracting pathways and close engagement with non-traditional companies, DIU expands the pool of qualified suppliers and drives critical innovation into priority capability areas. By identifying emerging technology gaps, fostering partnerships with commercial industry and enabling faster prototyping and fielding, DIU helps build a more resilient, diverse and modernized industrial base that can meet the evolving needs of the warfighter. For more information, visit https://www.diu.mil/

About Velo3D:

Velo3D is a metal 3D printing technology company. 3D printing—also known as additive manufacturing (AM)—has a unique ability to improve the way high-value metal parts are built. However, legacy metal AM has been greatly limited in its capabilities since its invention almost 30 years ago. This has prevented the technology from being used to create the most valuable and impactful parts, restricting its use to specific niches where the limitations were acceptable.

Velo3D has overcome these limitations so engineers can design and print the parts they want. The company's solution unlocks a wide breadth of design freedom and enables customers in space exploration, aviation, power generation, energy, and semiconductor to innovate the future in their respective industries. Using Velo3D, these customers can now build mission-critical metal parts that were previously impossible to manufacture. The fully integrated solution includes the Flow print preparation software, the Sapphire® family of printers, and the Assure quality control system—all of which are powered by Velo3D's Intelligent Fusion® manufacturing process. The company delivered its first Sapphire system in 2018 and has been a strategic partner to innovators such as SpaceX, Honeywell, Honda, Chromalloy, and Lam Research. Velo3D has been named as one of Fast Company's Most Innovative Companies for 2024. For more information, please visit Velo3D.com, or follow the company on LinkedIn or X.

Forward-Looking Statements:

This press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. The Company's actual results may differ from its expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as "expect", "estimate", "project", "budget", "forecast", "anticipate", "intend", "plan", "may", "will", "could", "should", "believes", "predicts", "potential", "continue", and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, statements regarding the  expected benefits and gross proceeds of the OTA agreement and the Company's other expectations, hopes, beliefs, intentions, or strategies for the future. These statements are based on current expectations, estimates and projections made by management about the Company's business, industry and other conditions affecting its financial condition, results of operations and business prospects. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict and that could cause the actual results to differ materially from the expected results. You should carefully consider the risks and uncertainties described in the documents filed by the Company from time to time with the Securities and Exchange Commission. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Most of these factors are outside the Company's control and are difficult to predict. The Company cautions not to place undue reliance upon any forward-looking statements, including projections, which speak only as of the date made. The Company does not undertake or accept any obligation to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions, or circumstances on which any such statement is based, except as required by applicable law.

VELO, VELO3D, SAPPHIRE and INTELLIGENT FUSION, are registered trademarks of Velo3D, Inc.; and WITHOUT COMPROMISE, FLOW and ASSURE are trademarks of Velo3D, Inc. All Rights Reserved © Velo3D, Inc.

All Rights Reserved © Velo3D, Inc.

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SOURCE Velo3D, Inc.

FAQ

What is the value and date of Velo3D's Department of War contract (VELO)?

Velo3D announced a $32.6 million Other Transition Agreement on December 22, 2025.

What will Velo3D deliver under the VELO contract for Project FORGE?

Velo3D will prototype and qualify additively manufactured components using its Rapid Production Solution to reduce a defense manufacturing bottleneck.

Does the VELO contract include development of larger 3D printing capabilities?

Yes, the agreement includes an option to explore developing the largest-format Laser Powder Bed Fusion capability within the U.S.

How large are parts Velo3D Sapphire printers can produce for the VELO project?

Velo3D Sapphire printers can print parts up to 600mm in diameter and 1 meter in height across the fleet.

Will the VELO contract immediately scale production for Velo3D?

The contract funds prototyping and qualification; it does not guarantee immediate full-scale production awards.