Xometry (XMTR) grows Q1 2026 revenue 36% while trimming net loss
Rhea-AI Filing Summary
Xometry, Inc. reported strong top-line growth but remained unprofitable for the quarter ended March 31, 2026. Revenue rose to $205.1 million from $151.0 million a year earlier, while net loss narrowed to $5.3 million from $15.1 million, or $(0.10) per share.
Gross profit increased to $78.5 million and operating cash flow swung to a positive $14.6 million from a use of cash previously. Xometry ended the quarter with $21.0 million of cash and $202.9 million of marketable securities, alongside $335.8 million of convertible senior notes outstanding.
Positive
- None.
Negative
- None.
Insights
Revenue growth is strong and losses are narrowing, but profitability is not yet achieved.
Xometry delivered revenue of $205.1M in Q1 2026, up from $151.0M. Gross profit rose to $78.5M, reflecting a larger marketplace scale. Operating expenses also increased, but loss from operations improved to $(5.2M) from $(15.4M).
Net loss attributable to common stockholders was $(5.3M), or $(0.10) per share, versus $(0.30) a year earlier. Positive operating cash flow of $14.6M suggests better working-capital management, though sustained profitability will depend on maintaining growth while controlling sales, marketing, and overhead costs.
Balance sheet is cash-rich but levered with sizable convertible notes outstanding.
The company held $21.0M in cash and $202.9M in marketable securities at March 31, 2026, against total assets of $740.3M. Total liabilities were $457.1M, including $335.8M in principal of 2027 and 2030 convertible notes.
Current portion of convertible notes rose to $85.3M, highlighting an upcoming maturity in 2027. Interest expense on the convertibles was modest at $1.3M for the quarter, but future cash or equity needed for repayment or conversion remains a key consideration for capital allocation and dilution.
Key Figures
Key Terms
Active Buyers financial
Adjusted EBITDA financial
convertible senior notes financial
marketable securities financial
capped call transactions financial
ASC 606 regulatory
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from __________ to __________
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Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of April 27, 2026, the registrant had
Table of Contents
Table of Contents
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PART I. |
FINANCIAL INFORMATION |
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Item 1. |
Financial Statements (Unaudited) |
1 |
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Condensed Consolidated Balance Sheets (Unaudited) |
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Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) |
2 |
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Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) |
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Condensed Consolidated Statements of Cash Flows (Unaudited) |
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Notes to Condensed Consolidated Financial Statements (Unaudited) |
5 |
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
22 |
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk |
37 |
Item 4. |
Controls and Procedures |
38 |
PART II. |
OTHER INFORMATION |
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Item 1. |
Legal Proceedings |
39 |
Item 1A. |
Risk Factors |
39 |
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds |
39 |
Item 3. |
Defaults Upon Senior Securities |
39 |
Item 4. |
Mine Safety Disclosures |
39 |
Item 5. |
Other Information |
39 |
Item 6. |
Exhibits |
40 |
Signatures |
41 |
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Table of Contents
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “can,” “will,” “would,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “forecasts,” “potential,” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:
You should not rely on forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition and operating results. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described in the section titled “Risk Factors” in Part II, Item 1A, and elsewhere in this Form 10-Q. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Form 10-Q. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.
In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Form 10-Q. And while we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.
The forward-looking statements made in this Form 10-Q relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this Form 10-Q to reflect events or circumstances after the date of this Form 10-Q or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments.
ii
Table of Contents
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements.
XOMETRY, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except share and per share data)
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December 31, |
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2026 |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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Marketable securities |
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Accounts receivable, less allowance for credit losses of $ |
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Inventory |
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Total current assets |
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Software development and property and equipment, net |
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Investment in unconsolidated joint venture |
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Intangible assets, net |
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Goodwill |
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Other assets |
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Total assets |
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Liabilities and stockholders’ equity |
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Current liabilities: |
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Accounts payable and accrued cost of revenue |
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Other accrued expenses |
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Contract liabilities |
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Income taxes payable |
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Convertible notes, current portion |
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Operating lease liabilities, current portion |
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Total current liabilities |
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Convertible notes, net of current portion |
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Operating lease liabilities, net of current portion |
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Deferred income taxes |
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Other liabilities |
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Total liabilities |
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(Note 9) |
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Stockholders’ equity |
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Preferred stock, $ |
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Class A Common stock, $ |
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Class B Common stock, $ |
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Additional paid-in capital |
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Treasury stock, at cost, |
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Accumulated other comprehensive income |
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Accumulated deficit |
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Noncontrolling interest |
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Total equity |
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Total liabilities and stockholders’ equity |
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$ |
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See accompanying notes to the unaudited condensed consolidated financial statements.
1
Table of Contents
XOMETRY, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
(In thousands, except share and per share data)
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Three Months Ended |
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2026 |
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2025 |
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Revenue |
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$ |
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$ |
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Cost of revenue |
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Gross profit |
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Operating expenses: |
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Sales and marketing |
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Operations and support |
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Product development |
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General and administrative |
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Total operating expenses |
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Loss from operations |
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Other (expenses) income: |
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Interest expense |
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Interest and dividend income |
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Other expenses |
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Income from unconsolidated joint venture |
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Total other income |
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Loss before income taxes |
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Provision for income taxes |
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— |
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Net loss |
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Net income attributable to noncontrolling interest |
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Net loss attributable to common stockholders |
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$ |
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Net loss per share, basic and diluted, of Class A and Class B common stock |
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$ |
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$ |
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Weighted-average number of shares outstanding used to compute net loss per share, basic and diluted, of Class A and Class B common stock |
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Net loss |
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$ |
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Comprehensive loss: |
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Foreign currency translation |
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Total other comprehensive (loss) income |
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Comprehensive loss |
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Comprehensive income (loss) attributable to noncontrolling interest |
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Total comprehensive loss attributable to common stockholders |
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$ |
( |
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$ |
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See accompanying notes to the unaudited condensed consolidated financial statements.
2
Table of Contents
XOMETRY, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Changes in Stockholders’ Equity
(Unaudited)
Three months ended March 31, 2026 and 2025
(In thousands, except share and per share data)
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Class A - Common Stock |
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Class B - Common Stock |
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Additional Paid-In |
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Treasury Stock |
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Accumulated Other Comprehensive |
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Accumulated |
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Total Stockholders’ |
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Noncontrolling |
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Total |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Shares |
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Amount |
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Income |
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Deficit |
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Equity |
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Interest |
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Equity |
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Balance, December 31, 2025 |
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$ |
— |
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$ |
— |
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$ |
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$ |
( |
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$ |
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$ |
( |
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$ |
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$ |
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$ |
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Exercise of common stock options |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Vesting of restricted stock units |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Donated common stock |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Stock-based compensation |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Comprehensive loss: |
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Foreign currency translation |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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( |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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( |
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Total comprehensive loss |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
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( |
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( |
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Balance, March 31, 2026 |
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$ |
— |
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$ |
— |
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$ |
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$ |
( |
) |
$ |
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$ |
( |
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$ |
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$ |
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$ |
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Class A - Common Stock |
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Class B - Common Stock |
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Additional Paid-In |
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Treasury Stock |
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Accumulated Other Comprehensive |
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Accumulated |
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Total Stockholders’ |
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Noncontrolling |
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Total |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Shares |
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Amount |
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(Loss) Income |
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Deficit |
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Equity |
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Interest |
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Equity |
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Balance, December 31, 2024 |
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$ |
— |
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$ |
— |
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$ |
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— |
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$ |
— |
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$ |
( |
) |
$ |
( |
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$ |
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$ |
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$ |
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Exercise of common stock options |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Vesting of restricted stock units |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Shares issued in business combination |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Donated common stock |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Stock-based compensation |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Comprehensive loss: |
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Foreign currency translation |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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( |
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Total comprehensive loss |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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( |
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( |
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Balance, March 31, 2025 |
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$ |
— |
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$ |
— |
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$ |
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— |
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$ |
— |
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$ |
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$ |
( |
) |
$ |
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$ |
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$ |
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See accompanying notes to the unaudited condensed consolidated financial statements.
3
Table of Contents
XOMETRY, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)
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Three Months Ended March 31, |
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2026 |
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2025 |
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Cash flows from operating activities: |
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Net loss |
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$ |
( |
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$ |
( |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
|
|
|
||
Reduction in carrying amount of right-of-use asset |
|
|
|
|
|
|
||
Lease termination |
|
|
|
|
|
( |
) |
|
Stock-based compensation |
|
|
|
|
|
|
||
Income from unconsolidated joint venture |
|
|
( |
) |
|
|
( |
) |
Donation of common stock |
|
|
|
|
|
|
||
Amortization of deferred costs on convertible notes |
|
|
|
|
|
|
||
Changes in other assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable, net |
|
|
( |
) |
|
|
( |
) |
Inventory |
|
|
|
|
|
( |
) |
|
Prepaid expenses |
|
|
|
|
|
( |
) |
|
Other assets |
|
|
( |
) |
|
|
( |
) |
Accounts payable and accrued cost of revenue |
|
|
|
|
|
|
||
Other accrued expenses |
|
|
|
|
|
( |
) |
|
Contract liabilities |
|
|
|
|
|
|
||
Lease liabilities |
|
|
( |
) |
|
|
( |
) |
Other liabilities |
|
|
( |
) |
|
|
( |
) |
Income taxes payable |
|
|
|
|
|
( |
) |
|
Net cash provided by (used in) operating activities |
|
|
|
|
|
( |
) |
|
Cash flows from investing activities: |
|
|
|
|
|
|
||
Purchases of marketable securities |
|
|
( |
) |
|
|
( |
) |
Proceeds from sale of marketable securities |
|
|
|
|
|
|
||
Capitalization of software development and purchases of property and equipment |
|
|
( |
) |
|
|
( |
) |
Distributions in excess of earnings |
|
|
|
|
|
|
||
Net cash used in investing activities |
|
|
( |
) |
|
|
( |
) |
Cash flows from financing activities: |
|
|
|
|
|
|
||
Proceeds from stock options exercised |
|
|
|
|
|
|
||
Net cash provided by financing activities |
|
|
|
|
|
|
||
Effect of foreign currency translation on cash and cash equivalents |
|
|
( |
) |
|
|
|
|
Net increase (decrease) in cash and cash equivalents |
|
|
|
|
|
( |
) |
|
Cash and cash equivalents at beginning of the period |
|
|
|
|
|
|
||
Cash and cash equivalents at end of the period |
|
$ |
|
|
$ |
|
||
Supplemental cash flow information: |
|
|
|
|
|
|
||
Cash paid for interest |
|
$ |
|
|
$ |
|
||
Cash paid for income taxes |
|
|
|
|
|
|
||
Non-cash investing and financing activities: |
|
|
|
|
|
|
||
Stock-based compensation included in capitalized software development costs |
|
|
|
|
|
|
||
Non-cash consideration in connection with business combination |
|
|
|
|
|
|
||
See accompanying notes to the unaudited condensed consolidated financial statements.
4
Table of Contents
XOMETRY, INC. AND SUBSIDIARIES
Notes to Unaudited Condensed Consolidated Financial Statements
(Unaudited)
(1) Organization and Description of Business
Xometry, Inc. (“Xometry”, the “Company”, “we”, or “our”) was incorporated in the State of Delaware in
(2) Basis of Presentation and Summary of Significant Accounting Policies
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K filed with the SEC on February 24, 2026.
The Condensed Consolidated Balance Sheet as of December 31, 2025, included herein, was derived from the audited financial statements as of that date, but may not include all disclosures including certain notes required by U.S. GAAP on an annual reporting basis. In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, comprehensive loss, stockholders’ equity and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the full year 2026 or any future period. The Company has
Foreign Operations and Comprehensive Loss
The U.S. dollar (“USD”) is the functional currency for Xometry’s consolidated subsidiary operating in the U.S. The primary functional currency for the Company’s consolidated subsidiaries operating in Germany, United Kingdom, Turkey, China, Japan and India is the Euro, British Pound Sterling, Turkish Lira, Yuan, Yen and Indian Rupee, respectively. For the Company’s consolidated subsidiaries whose functional currencies are not the USD, the Company translates their financial statements into USD. The Company translates assets and liabilities at the exchange rate in effect as of the financial statement date. Revenue and expense accounts are translated using an average exchange rate for the period. Foreign currency remeasurement and transaction gains and losses are recorded in other expenses, in the Condensed Consolidated Statements of Operations and Comprehensive Loss. Gains and losses resulting from translation are included in accumulated other comprehensive income (loss), as a separate component of equity.
Noncontrolling Interest
We have a
The preparation of the Company’s unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates.
5
Table of Contents
The Company measures certain assets and liabilities at fair value on a recurring basis based on an expected exit price, which represents the amount that would be received on the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability.
The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis, whereby inputs used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value:
Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2 - Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means.
Level 3 - Unobservable inputs reflecting the Company’s own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available.
The carrying amounts of certain of the Company’s financial instruments, which include cash and cash equivalents, accounts receivable, prepaid expenses, other assets, accounts payable, accrued expenses and contract liabilities approximate their fair values due to their short maturities. The Company’s marketable securities are recorded at fair value. As of December 31, 2025 and March 31, 2026, we have no assets or liabilities that we measure on a recurring basis using Level 2 or Level 3 inputs.
Cash and cash equivalents consist of cash held in checking accounts. These investments are stated at cost, which approximates fair value.
The Company measures its marketable securities at fair value. The Company’s marketable securities represent our investments in a short-term money market fund. These marketable securities have maturities of three months or less. As of March 31, 2026 and December 31, 2025, the Company’s marketable securities of $
Accounts receivable are stated at the amount the Company expects to collect from outstanding balances. The Company’s accounts receivable do not bear interest. Amounts collected on accounts receivable are included in net cash used in operating activities in the Condensed Consolidated Statements of Cash Flows. For buyers for which the Company provides credit, the Company performs credit inquiries, including reference checks, and queries credit ratings services and other publicly available information. Management provides for probable uncollectible amounts through a provision for bad debt expense and an adjustment to a valuation allowance based on the age of the outstanding amounts, each customer’s expected ability to pay and collection history and current market conditions. The Company reviews its valuation allowance monthly. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable.
Allowance for Credit Losses
The allowance for credit losses related to accounts receivable and changes were as follows (in thousands):
|
|
2026 |
|
|
2025 |
|
||
Allowance for credit losses |
|
|
|
|
|
|
||
Balance at beginning of year, January 1 |
|
$ |
|
|
$ |
|
||
Charge to provision accounts |
|
|
|
|
|
|
||
Write-offs or other |
|
|
( |
) |
|
|
( |
) |
Balance at period end, March 31 and December 31, respectively |
|
$ |
|
|
$ |
|
||
6
Table of Contents
Software development and property and equipment are stated at cost. Depreciation is calculated on the straight-line method over the estimated useful life of the assets, which range from to
Software development, property and equipment and intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary.
Goodwill represents the excess purchase price over the estimated fair value of net assets acquired in a business combination. As of March 31, 2026 and December 31, 2025, the Company’s goodwill is attributable to both the U.S. and International reporting units. Goodwill is not amortized. The Company tests goodwill for impairment annually in the fourth quarter, or more frequently, if events or changes in circumstances indicate that the carrying value of a reporting unit, including goodwill, might be impaired.
In testing for goodwill impairment, we first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. These qualitative factors assessed may include the following: (i) significant changes in the manner of our use of the assets or the strategy of our overall business, (ii) certain restructuring initiatives, (iii) significant negative industry or economic trends and (iv) significant decline in our share price for a sustained period. If, after assessing the totality of events or circumstances, we determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then additional impairment testing is not required. However, if we conclude otherwise, we proceed to the quantitative assessment.
The Company derives the majority of its U.S. and International marketplace revenue from the sale of parts and assemblies fulfilled using a vast network of suppliers. The Company recognizes revenue from the sales to our customers pursuant to the Financial Accounting Standard Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”).
The Company determines that a contract exists between the Company and the customer when the customer accepts a quote and places an order. The process is governed by the Company’s standard terms and conditions or other agreed upon terms with Xometry’s buyers. Upon receiving an order through Xometry’s platform, the Company identifies the underlying performance obligation(s) necessary for revenue recognition. Using Xometry’s in-house technology, the Company determines the transaction price for the manufactured part(s) or assembly on a stand-alone basis at order initiation. The Company recognizes revenue as control is transferred to the customer, either at a point in time or over time.
Marketplace revenue is primarily recognized from sales to Xometry’s customers upon shipment, at which point control over the part(s) or assembly has transferred. The Company has elected to treat shipping and handling as a fulfillment activity and not as a separate performance obligation.
In certain contracts, when we create or enhance an asset that the customer controls, marketplace revenue is recognized over time. Marketplace revenue is recognized over time using the cost-to-cost input method as this measure most accurately depicts the progress of our work and transfer of control to our customers. Changes in estimates affecting sales, costs and profits are recognized in the period in which the change becomes known using the cumulative catch-up method of accounting, resulting in the cumulative effect of changes reflected in the current period.
7
Table of Contents
The Company has concluded that it is the principal in the sale of part(s) and assemblies that use the Xometry marketplace because the Company controls the manufacturing by obtaining a right to direct a third-party manufacturer to fulfill the performance obligation Xometry has with the Company’s customers on Xometry’s behalf. The Company has considered the following conditions of the sale: (i) the Company has the obligation of providing the specified product to the customer, (ii) the Company has discretion with respect to establishing the price of the product and margin risk from the price the Company pays the suppliers, (iii) the Company has discretion in determining how to fulfill each order, including selecting the supplier and (iv) Xometry bears certain risk for product quality to the extent the customer is not satisfied with the final product.
Xometry also derives revenue from its services (previously referred to as “supplier services”) which includes the sale of marketing and advertising services and financial service products. This revenue is generally recognized as control is transferred to the customer, in an amount reflecting the consideration we expect to be entitled to in exchange for such product or service. From time to time, a purchase order with a customer may involve multiple performance obligations, including a combination of some or all of our products. Judgment may be required in determining whether products are considered distinct performance obligations that should be accounted for separately or as one combined performance obligation. Revenue is recognized over the period or at the point in time in which the performance obligations are satisfied, as applicable. Consideration is typically determined based on a fixed unit price for the service or product provided. For purchase orders involving multiple performance obligations, the transaction price is allocated to each performance obligation based on the relative standalone selling price, and recognized as revenue when each individual product or service is transferred to the customer.
The Company has certain contracts with variable consideration in form of returns, refunds and allowances, which may affect the transaction price used as the basis for revenue recognition. At March 31, 2026 and December 31, 2025, the Company has a provision for estimated returns, refunds or allowances of approximately $
Sales tax collected from customers and remitted to governmental authorities is excluded from revenue.
Contract Liabilities
Contract liabilities are primarily derived from payments received in advance or at the time an order is placed, for which the associated performance obligations have not been satisfied and revenue has not been recognized based on the Company’s revenue recognition criteria described above.
The following table presents contract liabilities as of December 31, 2025 and March 31, 2026 (in thousands):
Rollforward of contract liabilities: |
|
|
|
|
Contract liabilities at December 31, 2025 |
|
$ |
|
|
Revenue recognized |
|
|
( |
) |
Payments received in advance |
|
|
|
|
Contract liabilities at March 31, 2026 |
|
$ |
|
|
During the three months ended March 31, 2026, the Company recognized approximately $
Sales Contract Acquisition Costs
The Company’s incremental costs to obtain a contract may include a sales commission which is generally determined on a per-order basis. For marketplace contracts, sales commissions are generally expensed as incurred. When applicable, for supplier service contracts in excess of one year, the Company amortizes such costs on a straight-line basis over the average customer life of
8
Table of Contents
Cost of revenue for marketplace primarily consists of the cost of the products that are manufactured or produced by the Company’s suppliers for delivery to buyers on the Company’s platform, internal and external production costs, shipping costs, and certain internal depreciation.
Cost of revenue for supplier services primarily consists of internal and external production costs and website hosting.
The Company determines if an arrangement contains a lease and the classification of that lease, if applicable, at its inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liabilities, current portion and operating lease liabilities, net of current portion in the Condensed Consolidated Balance Sheets. For leases with terms of twelve months or less, the Company does not recognize ROU assets or lease liabilities on the Condensed Consolidated Balance Sheets. Additionally, the Company elected to use the practical expedient to not separate lease and non-lease components for leases of real estate, meaning that for these leases, the non-lease components are included in the associated ROU asset and lease liability balances on the Company’s Condensed Consolidated Balance Sheets.
ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments under the lease. Operating lease ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The implicit rate within the Company’s operating leases is generally not determinable, as such the Company uses its incremental borrowing rate at lease commencement to determine the present value of lease payments. The operating lease ROU asset also includes any lease prepayments, offset by lease incentives. Certain of the Company’s leases include options to extend or terminate the lease. The expected lease term includes options to extend or terminate the lease when it is reasonably certain the Company will exercise such option.
Lease expense is recognized on a straight-line basis over the term of the lease.
Sales and marketing expenses are expensed as incurred and include the costs of digital marketing strategies, branding costs and other advertising costs, certain depreciation and amortization expense, contract acquisition costs and compensation expenses, including stock-based compensation, to the Company’s sales and marketing employees. For the three months ended March 31, 2026 and 2025, the Company’s advertising costs were $
Operations and support expenses are the costs the Company incurs in support of the customers and suppliers on Xometry’s platforms which are provided by phone, email and chat for purposes of resolving customer and supplier related matters. These costs primarily consist of compensation expenses of the support staff, including stock-based compensation, certain depreciation and amortization expense and software costs used in delivering customer services.
Product development costs which are not eligible for capitalization are expensed as incurred. These costs primarily consist of compensation expenses, including stock-based compensation to the Company’s employees performing routine improvements and maintenance on our platforms not related to a specific capitalizable project, software costs and certain depreciation and amortization expense.
General and administrative expenses primarily consist of compensation expenses, including stock-based compensation expenses, for executive, finance, legal and other administrative personnel, professional service fees and certain depreciation and amortization expense.
All stock-based compensation, including stock options, restricted stock units ("RSUs") and performance restricted stock units (“PRSUs”), are measured at the grant date fair value of the award. The fair value of the restricted stock units and PRSUs is determined using the fair value of the Company’s Class A common stock on the date of grant. The Company estimates grant date fair value of stock options using the Black-Scholes option-pricing model. The fair value of stock options, RSUs and PRSUs are recognized as compensation
9
Table of Contents
expense on a straight-line basis over the requisite service period, which is typically three to four years. Forfeitures are recorded in the period in which they occur.
The Black-Scholes model considers several variables and assumptions in estimating the fair value of stock-based awards.
These variables include:
For all stock options granted, the Company calculated the expected term using the simplified method for “plain vanilla” stock option awards. The risk-free interest rate is based on the yield available on U.S. Treasury issuances similar in duration to the expected term of the stock-based award. The Company estimates its expected share price volatility based on the historical volatility of publicly traded peer companies and/or its own volatility and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded share price. The Company utilized a dividend yield of zero, as it had no history or plan of declaring dividends on its common stock.
The fair value for PRSUs is recognized on a ratable basis over the requisite service period of three years when it is probable the performance conditions of the awards will be met. The Company reassesses the probability of vesting at each reporting period and adjusts the total compensation expense of the award based on this probability assessment.
The Company computes net loss per share using the two-class method required for multiple classes of common stock and participating securities. The two-class method requires income available to common stockholders for the period to be allocated between common stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. Certain unvested share-based payment awards that contain nonforfeitable rights to dividends are treated as participating securities and therefore included in computing net income per share using the two-class method. The rights, including the liquidation and dividend rights, of the Class A common stock and Class B common stock are substantially identical, other than voting rights. Accordingly, the Class A common stock and Class B common stock share proportionately in the Company’s net losses.
In November 2024, the FASB issued ASU No. 2024-04, Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments (“ASU 2024-04”), which clarifies the assessment of whether certain settlements of convertible debt instruments should be accounted for as an inducement conversion or extinguishment of convertible debt. The Company
In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which amends ASC 326-20 to provide a practical expedient (for all entities) and an accounting policy election (for all entities, other than public business entities that elect the practical expedient) related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606. The Company
10
Table of Contents
In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”). Under ASU 2024-03, a PBE would be required to disclose information about purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depletion for each income statement line item that contains those expenses. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. ASU 2024-03 allows for early adoption and requires either prospective adoption to financial statements issued for reporting periods after the effective date of ASU 2024-03 or retrospective adoption to any or all prior periods presented in the financial statements. The Company is currently assessing the impact of ASU 2024-03 on our consolidated financial statements and related disclosures.
In May 2025, the FASB issued ASU No. 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity (“ASU 2025-03”), which requires that in a business combination involving a variable interest entity (“VIE”) where equity interests are issued as consideration, the determination of the accounting acquirer should follow the general guidance under ASC 805-10-25 rather than default to the conclusion that the acquirer is primary beneficiary of the VIE. The amendments are intended to improve consistency in applying the acquisition method to business combinations. The new guidance is effective for annual reporting periods beginning after December 15, 2026, and interim periods within those annual periods. The Company is currently assessing the impact of ASU 2025-03 on our consolidated financial statements and related disclosures, including the potential impact on the accounting for any future business combinations involving VIEs.
In September 2025, the FASB issued ASU No. 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which improves the operability of the guidance by removing all references to software development project stages so that the guidance is neutral to different software development methods. The new guidance is effective for annual periods beginning after December 15, 2027, and interim periods within those annual periods. The Company is currently assessing the impact of ASU 2025-06 on our consolidated financial statements and related disclosures.
(3) Software Development, Property and Equipment and Long-Lived Assets
Software development and property and equipment consist of the following as of March 31, 2026 and December 31, 2025 (in thousands):
|
|
|
|
March 31, |
|
|
December 31, |
|
||
|
|
Useful Life |
|
2026 |
|
|
2025 |
|
||
Technology hardware |
|
|
$ |
|
|
$ |
|
|||
Manufacturing equipment |
|
|
|
|
|
|
|
|||
Capitalized software development |
|
|
|
|
|
|
|
|||
Leasehold improvements |
|
|
|
|
|
|
|
|||
Furniture and fixtures |
|
|
|
|
|
|
|
|||
Total |
|
|
|
|
|
|
|
|
||
Less accumulated depreciation |
|
|
|
|
( |
) |
|
|
( |
) |
Software development and property and equipment, net |
|
|
|
$ |
|
|
$ |
|
||
Depreciation and amortization expense for the three months ended March 31, 2026 and 2025 was as follows (in thousands):
|
Three Months Ended March 31, |
|
|||||
|
2026 |
|
|
2025 |
|
||
Cost of revenue |
$ |
|
|
$ |
|
||
Sales and marketing |
|
|
|
|
|
||
Operations and support |
|
|
|
|
|
||
Product development |
|
|
|
|
|
||
General and administrative |
|
|
|
|
|
||
Total depreciation and amortization expense |
$ |
|
|
$ |
|
||
11
Table of Contents
(4) Disaggregated Revenue and Cost of Revenue Information
The following tables present our revenues disaggregated by line of business. Revenue from our marketplace primarily reflects the sales of parts and assemblies on our platform. Revenue from services includes the sale of digital advertising and marketing services and financial service products.
Revenue and cost of revenue is presented in the following tables for the three months ended March 31, 2026 and 2025, respectively (in thousands):
|
|
Three Months Ended March 31, |
|
|||||
Marketplace |
|
2026 |
|
|
2025 |
|
||
Revenue |
|
$ |
|
|
$ |
|
||
Cost of revenue |
|
|
|
|
|
|
||
Gross Profit |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Services |
|
|
|
|
|
|
||
Revenue |
|
$ |
|
|
$ |
|
||
Cost of revenue |
|
|
|
|
|
|
||
Gross Profit |
|
$ |
|
|
$ |
|
||
(5) Segments
Xometry is organized in
The Company evaluates the performance of the operating segments primarily based on revenue and segment Adjusted EBITDA.
Segment Adjusted EBITDA excludes interest expense, interest and dividend income, other expenses, provision for income taxes, and certain other non-cash or non-recurring items impacting Net loss from time to time, principally comprised of depreciation and amortization, amortization of lease intangible, stock-based compensation, payroll tax expense related to stock-based compensation, charitable contributions of common stock, income from an unconsolidated joint venture, restructuring charges and acquisition and other adjustments not reflective of our ongoing business, such as adjustments related to purchase accounting, the revaluation of contingent consideration, transaction costs and executive severance.
The CODM monitors assets of the consolidated Company, but does not use assets, by operating segment when assessing performance or making operating segment resource decisions.
12
Table of Contents
The following tables reflect certain segment information for the three months ended March 31, 2026 and 2025 (in thousands):
|
|
Three Months Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Segment Revenue |
|
|
|
|
|
|
||
U.S. |
|
$ |
|
|
$ |
|
||
International |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
Segment Cost of Revenue |
|
|
|
|
|
|
||
U.S. |
|
$ |
|
|
$ |
|
||
International |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
Segment Adjusted Operating Expense(1) |
|
|
|
|
|
|
||
U.S. |
|
$ |
|
|
$ |
|
||
International |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
Other Segment Items(2) |
|
|
|
|
|
|
||
U.S. |
|
$ |
|
|
$ |
|
||
International |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
Segment Adjusted EBITDA |
|
|
|
|
|
|
||
U.S. |
|
$ |
|
|
$ |
|
||
International |
|
|
( |
) |
|
|
( |
) |
Adjusted EBITDA |
|
$ |
|
|
$ |
|
||
(Add) deduct: |
|
|
|
|
|
|
||
Interest expense, interest and dividend income and other expenses |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
( |
) |
|
|
( |
) |
Amortization of lease intangible |
|
|
|
|
|
( |
) |
|
Provision for income taxes |
|
|
( |
) |
|
|
|
|
Stock-based compensation |
|
|
( |
) |
|
|
( |
) |
Payroll tax expense related to stock-based compensation |
|
|
( |
) |
|
|
( |
) |
Acquisition and other |
|
|
|
|
|
( |
) |
|
Charitable contribution of common stock |
|
|
( |
) |
|
|
( |
) |
Income from unconsolidated joint venture |
|
|
|
|
|
|
||
Restructuring charges |
|
|
( |
) |
|
|
( |
) |
Net Loss |
|
$ |
( |
) |
|
$ |
( |
) |
(1) Amount excludes stock-based compensation and the related payroll taxes, depreciation and amortization, restructuring charges, acquisition and other costs, amortization of lease intangible, lease termination and charitable contributions of common stock.
(2) Addback to Segment Cost of Revenue to calculate Segment Adjusted EBITDA.
The following tables reflect long-lived asset information as of March 31, 2026 and December 31, 2025 (in thousands):
|
|
March 31, |
|
|
December 31, |
|
||
|
|
2026 |
|
|
2025 |
|
||
Segment Software development and property and equipment, net |
|
|
|
|
|
|
||
U.S. |
|
$ |
|
|
$ |
|
||
International |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Segment Operating lease right-of-use assets |
|
|
|
|
|
|
||
U.S. |
|
$ |
|
|
$ |
|
||
International |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
13
Table of Contents
(6) Stock-Based Compensation
In 2016, the Company adopted a stock compensation plan (the “2016 Equity Incentive Plan”) pursuant to which the Company may grant stock options, stock purchase rights, restricted stock awards, or stock awards to employees, directors and consultants (including prospective employees, directors, and consultants).
In connection with the Company’s initial public offering on July 2, 2021, the Company’s board of directors adopted the 2021 Equity Incentive Plan (the “2021 Equity Incentive Plan”). The 2021 Equity Incentive Plan provides for the grant of incentive stock options (“ISOs”), non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance-based awards and other awards, or collectively, awards. Awards may be granted to Xometry employees, Xometry’s non-employee directors and consultants/contractors and the employees and consultants/contractors of Xometry affiliates. ISOs may be granted only to Xometry employees and the employees of Xometry affiliates.
As of March 31, 2026, there were
Stock Options
A summary of the status of the Company’s stock option activity and the changes during the three months ended March 31, 2026, are as follows (in millions, except share and per share amounts):
|
|
Number of |
|
|
Weighted |
|
|
Average |
|
|
Aggregate |
|
||||
Exercisable at December 31, 2025 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Balance at December 31, 2025 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Exercised |
|
|
( |
) |
|
$ |
|
|
|
— |
|
|
$ |
|
||
Forfeited |
|
|
( |
) |
|
$ |
|
|
|
— |
|
|
|
— |
|
|
Balance at March 31, 2026 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Exercisable at March 31, 2026 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
At March 31, 2026, there was approximately $
The Company currently uses authorized and unissued shares to satisfy share award exercises.
14
Table of Contents
RSUs
A summary of the status of the Company’s RSU activity and the changes during the three months ended March 31, 2026 are as follows (in millions, except share and per share amounts):
|
|
Number of |
|
|
Weighted |
|
|
Aggregate |
|
|||
Unvested RSUs as of December 31, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|||
Granted |
|
|
|
|
$ |
|
|
|
— |
|
||
Vested |
|
|
( |
) |
|
$ |
|
|
|
— |
|
|
Forfeited and cancelled |
|
|
( |
) |
|
$ |
|
|
|
— |
|
|
Unvested RSUs as of March 31, 2026 |
|
|
|
|
$ |
|
|
$ |
|
|||
At March 31, 2026, there was approximately $
PRSUs
A summary of the status of the Company’s PRSU activity and the changes during the three months ended March 31, 2026 are as follows (in millions, except share and per share amounts):
|
|
Number of |
|
|
Weighted |
|
|
Aggregate |
|
|||
Unvested PRSUs as of December 31, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|||
Granted |
|
|
|
|
$ |
|
|
|
— |
|
||
Vested |
|
|
( |
) |
|
$ |
|
|
|
— |
|
|
Unvested PRSUs as of March 31, 2026 |
|
|
|
|
$ |
|
|
$ |
|
|||
At March 31, 2026, there was approximately $
Total stock-based compensation cost for the three months ended March 31, 2026 and 2025 were as follows (in thousands):
|
|
Three Months Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Sales and marketing |
|
$ |
|
|
$ |
|
||
Operations and support |
|
|
|
|
|
|
||
Product development |
|
|
|
|
|
|
||
General and administrative |
|
|
|
|
|
|
||
Total stock compensation expense |
|
$ |
|
|
$ |
|
||
(7) Income Taxes
A full valuation allowance has been established against our net U.S. federal and state deferred tax assets and foreign deferred tax assets, including net operating loss carryforwards.
The Company had $
15
Table of Contents
(8) Net Loss Per Share Attributable to Common Stockholders
The Company computes net loss per share of Class A common stock, Class B common stock and participating securities using the two-class method. Basic and diluted net loss per share are the same for each class of common stock and participating securities because they are entitled to the same liquidation and dividend rights.
|
|
Three Months Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
|
|
|
|
|
|
|
||
Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
Net income attributable to noncontrolling interest |
|
|
|
|
|
|
||
Net loss attributable to common stockholders |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
||
Weighted-average number of shares outstanding used to compute net loss per share, basic and diluted |
|
|
|
|
|
|
||
Net loss per share, basic and diluted |
|
$ |
( |
) |
|
$ |
( |
) |
The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net loss per share because including them would have had an anti-dilutive effect, or issuance of such shares is contingent upon the occurrence of an event:
|
|
March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Stock options outstanding |
|
|
|
|
|
|
||
Unvested RSUs |
|
|
|
|
|
|
||
Unvested PRSUs |
|
|
|
|
|
|
||
Shares reserved for charitable contribution |
|
|
|
|
|
|
||
2027 Notes |
|
|
|
|
|
|
||
2030 Notes |
|
|
|
|
|
|
||
Total shares |
|
|
|
|
|
|
||
(9) Commitments and Contingencies
2030 Convertible Notes
In June 2025, we issued $
The 2030 Notes are general unsecured obligations and bear regular interest at
The 2030 Notes are convertible into cash, shares of our Class A common stock, or a combination of cash and shares of our Class A common stock, at our election, at an initial conversion rate of
We may redeem for cash all or any portion of the 2030 Notes, at our option, on or after June 20, 2028 if the last reported sale price of our Class A common stock has been at least
16
Table of Contents
Holders of the 2030 Notes may convert all or a portion of their 2030 Notes at their option prior to the close of business on the business day immediately preceding March 15, 2030, in multiples of $
On or after March 15, 2030, the 2030 Notes are convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date.
In the event of a fundamental change (as defined in the indenture governing the 2030 Notes), subject to certain conditions and limited exceptions, holders of the 2030 Notes may require us to repurchase for cash all or a portion of the 2030 Notes at a price equal to
We accounted for the issuance of the 2030 Notes as a single liability measured at its amortized cost, as no embedded features require bifurcation and recognition as derivatives.
2027 Convertible Notes
In February 2022, we issued $
The 2027 Notes are unsecured obligations and bear regular interest at
The 2027 Notes are convertible into cash, shares of our Class A common stock, or a combination of cash and shares of our Class A common stock, at our election, at an initial conversion rate of
We may redeem for cash all or any portion of the 2027 Notes, at our option, if the last reported sale price of our Class A common stock has been at least
17
Table of Contents
Holders of the 2027 Notes may convert all or a portion of their 2027 Notes at their option prior to November 1, 2026, in multiples of $
On or after November 1, 2026, the 2027 Notes are convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date.
In the event of a fundamental change (as defined in the indenture governing the 2027 Notes), subject to certain conditions and limited exceptions, holders of the 2027 Notes may require us to repurchase all or a portion of the 2027 Notes at a price equal to
We accounted for the issuance of the 2027 Notes as a single liability measured at its amortized cost, as no embedded features require bifurcation and recognition as derivatives.
Partial Repurchase of 2027 Notes
We used a portion of the net proceeds from the issuance of the 2030 Notes to repurchase approximately $
Following this partial repurchase, approximately $
The following table presents the outstanding principal amount and carrying value of the Convertible Notes as of the dates indicated (in thousands):
|
|
March 31, 2026 |
|
|||||||||||||
|
|
Principal |
|
|
Unamortized Debt Discount |
|
|
Unamortized Debt Issuance Costs |
|
|
Carrying Value |
|
||||
2027 Notes |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
||
2030 Notes |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
|
||
Total |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
December 31, 2025 |
|
|||||||||||||
|
|
Principal |
|
|
Unamortized Debt Discount |
|
|
Unamortized Debt Issuance Costs |
|
|
Carrying Value |
|
||||
2027 Notes |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
||
2030 Notes |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
|
||
Total |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
||
18
Table of Contents
The annual effective interest rate for the 2027 Notes and the 2030 Notes were approximately
|
|
Three Months Ended |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Coupon interest |
|
$ |
|
|
$ |
|
||
Amortization of debt discount |
|
|
|
|
|
|
||
Amortization of transaction costs |
|
|
|
|
|
|
||
Total interest expense |
|
$ |
|
|
$ |
|
||
The Company estimates the fair value of the Convertible Notes based on quoted market prices in less active markets and is classified as Level 2 in the fair value hierarchy.
|
|
March 31, 2026 |
|
|
December 31, 2025 |
|
||||||||||
|
|
Carrying Value |
|
|
Fair Value |
|
|
Carrying Value |
|
|
Fair Value |
|
||||
2027 Notes(1) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
2030 Notes(1) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total Convertible Notes |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Capped Call Transactions
In connection with the issuance of the 2030 Notes, we entered into capped call transactions (the “Capped Calls”) with respect to its Class A common shares with certain financial institutions. The Capped Calls are expected to reduce the potential dilution to our Class A common stock upon any conversion of the 2030 Notes and/or offset any cash payments we are required to make in excess of the principal amount of the converted 2030 Notes, as the case may be, with such reduction and/or offset subject to a cap based on a cap price initially equal to $
We used approximately $
Purchase of Treasury Stock
In conjunction with the 2030 Notes issuance, we purchased
Contingencies
The Company from time to time may be subject to various claims and legal proceedings covering a range of matters that arise in the ordinary course of its business activities. In the opinion of the Company, although the outcome of any legal proceedings cannot be predicted with certainty, the ultimate liability of the Company in connection with its legal proceedings is not expected to have a material adverse effect on the Company’s financial position or operations.
Restructuring
In the first quarter of 2025, the Company initiated a restructuring action to help manage its operating expenses, improve its efficiency and align resources by reducing its workforce. During the three months ended March 31, 2025, the Company incurred approximately $
19
Table of Contents
The following table shows the total restructuring costs incurred during the three months ended March 31, 2026 and 2025 (in thousands):
|
|
Three Months Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Sales and marketing |
|
$ |
|
|
$ |
|
||
Operations and support |
|
|
|
|
|
|
||
Product development |
|
|
|
|
|
|
||
General and administrative |
|
|
|
|
|
|
||
|
$ |
|
|
$ |
|
|||
Defined Contribution Plans
The Company sponsors a defined contribution plan for qualifying employees, including a 401(k) Plan in the United States to which it makes matching contributions of
(10) Goodwill and Intangible Assets
The following tables summarize the Company’s intangible assets (dollars in thousands):
|
|
March 31, 2026 |
|
|||||||||||||
|
|
Weighted |
|
|
Gross |
|
|
Accumulated |
|
|
Net |
|
||||
Customer Relationships |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Trade Names |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Developed Technology |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Vendor Relationships |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Database |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Patents |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total intangible assets |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
December 31, 2025 |
|
|||||||||||||
|
|
Weighted |
|
|
Gross |
|
|
Accumulated |
|
|
Net |
|
||||
Customer Relationships |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Trade Names |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Developed Technology |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Vendor Relationships |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Database |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Patents |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Subtotal intangible assets |
|
|
|
|
|
|
|
|
|
|
|
|
||||
In-place Lease Intangible Asset |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Above Market Lease Intangible Asset |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total intangible assets |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
20
Table of Contents
Amortization expense for the three months ended March 31, 2026 and 2025 was as follows (in thousands):
|
|
Three Months Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Sales and marketing |
|
$ |
|
|
$ |
|
||
Product development |
|
|
|
|
|
|
||
General and administrative (1) |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
(1) Amortization of the lease-related intangible assets is recorded as operating lease expense in general and administrative.
As of March 31, 2026, estimated amortization expense for intangible assets for the remainder of 2026 and the next five years is: $
The following table provides a roll forward of the carrying amount of goodwill (in thousands):
|
|
2026 |
|
|
2025 |
|
||
Balance as of January 1: |
|
|
|
|
|
|
||
Gross goodwill |
|
$ |
|
|
$ |
|
||
Accumulated impairments |
|
|
( |
) |
|
|
( |
) |
Net goodwill as of January 1 |
|
|
|
|
|
|
||
Impact of foreign exchange |
|
|
( |
) |
|
|
|
|
Net goodwill as of March 31, 2026 and December 31, 2025: |
|
$ |
|
|
$ |
|
||
As of March 31, 2026 and December 31, 2025, Xometry had $
(11) Subsequent Events
On May 6, 2026, in connection with its entry into a Collaboration Agreement, the Company entered into a stock purchase agreement (the “Purchase Agreement”) with Siemens Beteiligungen Inland GmbH (“Siemens GmbH”), an affiliate of Siemens Industry Software Inc. (“Siemens”), pursuant to which the Company agreed to issue and sell
21
Table of Contents
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q. The discussion contains forward-looking statements that are based on the beliefs of management, as well as assumptions made by, and information currently available to, our management. Actual results could differ materially from those discussed in or implied by forward-looking statements as a result of various factors, including those discussed in Part II, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025. Our historical results are not necessarily indicative of the results that may be expected in the future and our current quarterly results are not necessarily indicative of the results expected for the full year or any other period.
Overview
Xometry, Inc. (“Xometry”, the “Company”, “our”, or “we”) is an AI-native global online manufacturing marketplace with a suite of services that are rapidly digitizing the custom manufacturing industry. Xometry’s marketplace enables the design-to-production workflow by providing the AI-driven execution layer that translates design intent into intelligent sourcing decisions and production outcomes at scale. The marketplace offers transparency and traceability from the first quote to final delivery. We provide services that power the broader manufacturing lifecycle. These services include advertising and marketing services through our Thomasnet industrial sourcing platform, financial services and Workcenter, our cloud-based manufacturing execution system. These services deepen our relationships with suppliers. Together, our marketplace and services platforms provide manufacturers the critical resources they need to grow their business and make it easy for buyers to create locally resilient supply chains.
Xometry operates an AI-native online marketplace that connects buyers with suppliers of manufacturing services, driving the digital transformation of one of the largest industries in the world. The platform is designed to digitize and modernize the sourcing, pricing, and execution of manufacturing work across a broad range of processes, materials and industries, enabling more efficient matching of manufacturing demand with available production capacity. We facilitate innovation by providing real-time access to global manufacturing demand and capacity. We believe these capabilities position Xometry as a preferred digital collaboration, sourcing and transaction platform for custom manufacturing, and lead to Xometry becoming an integral part of our buyer’s supply chains.
We use proprietary technology to enable product designers, engineers, buyers, and supply chain professionals to instantly access the capacity of a global network of manufacturing facilities. The Company’s marketplace makes it possible for buyers to quickly receive pricing, expected lead times, and manufacturability feedback and place orders on the marketplace. The network allows us to provide high volumes of unique parts, including custom components and assemblies for our buyers, as well as larger production orders of single parts. Teamspace is a cloud-based solution within the Xometry platform that enables customers to collaborate with other users on projects and custom part orders. Workcenter, our partner operating system, gives suppliers a one-stop view into all of their Xometry and non-Xometry work. A cloud-based manufacturing execution system, Workcenter brings the job board and financial services into one, easy-to-use platform which helps our suppliers digitize their operations so they can work smarter and faster. With Workcenter, shop owners can build and manage workflows for all their projects, including those from non-Xometry customers. These technology solutions help drive our land and expand efforts by embedding Xometry further into enterprise workflows.
Our business benefits from a network effect, because adding buyers to our platform generates greater demand on our marketplace which in turn attracts more suppliers to the platform, allowing us to rapidly scale and increase the number of manufacturing processes offered on our platform. In order to continue to meet the needs of buyers and remain highly competitive, we expect to continue to add suppliers to our platform that have new and innovative manufacturing processes. Thus, our platform is unbounded by the in-house manufacturing capacity and processes of our current suppliers.
We define “buyers” as individuals who have placed an order to purchase custom-manufactured, on-demand parts or assemblies on our marketplace. Our buyers include engineers, product designers, procurement and supply chain personnel, entrepreneurs, technicians and business owners from small businesses to Fortune 500 companies. We define “accounts” as an individual entity, such as a sole proprietor with a single buyer or corporate entities with multiple buyers, having purchased at least one part on our marketplace. We define “suppliers” as individuals or businesses who have been approved by us to either manufacture a product on our marketplace for a buyer or have utilized our services, including our financial services or the purchase of tools and materials.
The majority of our revenue is derived from the sale of part(s) and assemblies to our customers on our marketplace, which we refer to as marketplace revenue. The suppliers on our platform offer a diversified and expanding mix of manufacturing processes. These manufacturing processes include computer numerical control (“CNC”) manufacturing, sheet metal forming, sheet cutting, 3D printing (including fused deposition modeling, direct metal laser sintering, PolyJet, stereolithography, selective laser sintering, binder jetting, carbon digital light synthesis, multi jet fusion and lubricant sublayer photo-curing), die casting, stamping, injection molding, urethane casting, tube cutting, tube bending, as well as finishing services, rapid prototyping and high-volume production. Xometry’s extensible technology platform allows the Company to add new technologies and processes to gain more wallet share with our buyers. We enable buyers to source these processes to meet complex and specific design and order needs across several industries, including Aerospace, Industrial, Medical Devices, Automotive, Consumer Goods, Defense, Government, Energy, Education and Robotics.
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We empower suppliers to grow their manufacturing businesses and improve machine utilization by providing access to an extensive, diverse base of buyers. We also offer suppliers supporting services to meet their unique needs. The Thomasnet digital platform connects industrial buyers with over 500,000 North American suppliers. Operating at the intersection of digital marketing, industrial sourcing, and supply chain management, Thomasnet supports manufacturers, distributors, and service providers with tools and resources to enhance visibility, drive qualified leads, and streamline procurement processes. Thomasnet offers a suite of digital marketing services including SEO, content creation, data-driven advertising, analytics and insights. These solutions help industrial companies increase online visibility and drive business growth. In addition, our services include financial service products to facilitate faster payments.
Macroeconomic Conditions
Unfavorable conditions in the economy both in the United States and abroad may negatively affect the growth of our business and our results of operations. For example, macroeconomic events, fluctuations in inflation and interest rates, volatile market conditions, impacts from tariffs, the Russia-Ukraine war, conflict in the Middle East and other geopolitical tensions, have led to economic uncertainty globally. Historically, during periods of economic uncertainty and downturns, businesses may slow spending on information technology and manufacturing, which may impact our business and our customers’ businesses.
The effect of macroeconomic conditions may not be fully reflected in our results of operations until future periods. If, however, economic uncertainty increases or the global economy worsens, our business, financial condition and results of operations may be harmed. For further discussion of the potential impacts of macroeconomic events on our business, financial condition, and operating results, see the section titled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025.
Restructuring
During 2025, we initiated restructuring actions to help improve efficiency and align resources by reducing our workforce by approximately 5%. The workforce reduction focused on realigning our staffing levels to help us meet the current and future objectives of our business. For the three months ended March 31, 2025, we incurred $1.5 million for employee termination costs related to our restructuring. Refer to Note 9, Commitments and Contingencies—Restructuring for our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.
Recent Developments
On May 6, 2026, in connection with its entry into a Collaboration Agreement, the Company entered into a stock purchase agreement (the “Purchase Agreement”) with Siemens Beteiligungen Inland GmbH (“Siemens GmbH”), an affiliate of Siemens Industry Software Inc. (“Siemens”), pursuant to which the Company agreed to issue and sell 1,049,759 shares (the “Shares”) of the Company’s Class A common stock, par value $0.000001 per share, to Siemens GmbH for an aggregate purchase price of approximately $50,000,000 in a private placement. The number of Shares of Class A common stock to be issued and sold to Siemens GmbH pursuant to the Purchase Agreement was based on the 20-day volume-weighted average price of the Common Stock for the period ending May 5, 2026. The issuance of the Shares is expected to occur on or about May 8, 2026, subject to customary closing conditions.
Key Marketplace Operational and Business Metrics
In addition to the measures presented in our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q, we use the following key operational and business metrics to help us evaluate our marketplace business, measure our performance, identify trends affecting our business, formulate business plans and develop forecasts, and make strategic decisions:
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Table of Contents
Active Buyers
We define Active Buyers as the number of buyers who have made at least one purchase on our marketplace during the last twelve months. An increase or decrease in the number of Active Buyers is a key indicator of our ability to attract, retain and engage buyers on our platform.
Active Buyers has consistently grown over time. The number of Active Buyers on our platform reached 85,581 as of March 31, 2026, up 20% from 71,454 as of March 31, 2025. The key drivers of Active Buyer growth are continued account and buyer engagement and the success of our strategy to attract new buyers.
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Table of Contents
Percentage of Revenue from Existing Accounts
We define an existing account as an account where at least one buyer has made a purchase on our marketplace. We believe the efficiency and transparency of our business model leads to increasing account stickiness and spend over time. Buyers can utilize our marketplace for both one-off and recurring manufacturing opportunities. For example, a buyer may choose to utilize our marketplace’s CNC manufacturing processes to manufacture a discrete component for a prototype, and then may choose to later use our marketplace to mass produce that same component. A buyer may also recommend our marketplace to other engineers within their organizations who are designing other products and who may use an entirely different set of manufacturing processes, deepening our reach and stickiness with an account.
For the quarter ended March 31, 2026, 98% of our revenue was generated from existing accounts. We believe the repeat purchase activity from existing accounts reflects the underlying strength of our business and provides us with substantial revenue visibility and predictability.
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Table of Contents
Accounts with Last Twelve-Month Spend of at Least $50,000
Accounts with Last Twelve-Month, or LTM, Spend of at Least $50,000 means an account that has spent at least $50,000 on our marketplace in the most recent twelve-month period. We view the acquisition of an account as a foundation for the addition of long-term buyers to our marketplace. Once an account joins our platform, we aim to expand the relationship and increase engagement and spending activities from that account over time. The number of accounts with LTM Spend of at Least $50,000 on our platform reached 1,864 as of March 31, 2026, up 21% from 1,545 as of March 31, 2025.
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Table of Contents
Non-GAAP Financial Measures
Adjusted EBITDA and Non-GAAP Net Income (Loss) are non-GAAP financial measures that we use, in addition to our GAAP financial measures, to evaluate our business. We have included Adjusted EBITDA and Non-GAAP Net Income (Loss) in this filing because they are key measures used by our management to evaluate our operating performance. Accordingly, we believe that Adjusted EBITDA and Non-GAAP Net Income (Loss) provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management team and board of directors. Our calculation of Adjusted EBITDA and Non-GAAP Net Income (Loss) may differ from similarly titled non-GAAP measures, if any, reported by our peer companies and therefore may not serve as an accurate basis of comparison among companies. Adjusted EBITDA and Non-GAAP Net Income (Loss) should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.
Adjusted EBITDA
We define Adjusted EBITDA as net loss, adjusted for interest expense, interest and dividend income, other expenses, and certain other non-cash or non-recurring items impacting net loss from time to time, principally comprised of depreciation and amortization, amortization of lease intangible, provision for income taxes, stock-based compensation, payroll tax expense related to stock-based compensation, charitable contributions of common stock, income from unconsolidated joint venture, restructuring charges, and acquisition and other adjustments not reflective of our ongoing business, such as adjustments related to purchase accounting, the revaluation of contingent consideration, transaction costs and executive severance. Adjusted EBITDA is a performance measure that we use to assess our operating performance and the operating leverage in our business. Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA for a period by revenue for the same period.
|
|
For the Three Months |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Net Loss |
|
$ |
(5,259 |
) |
|
$ |
(15,076 |
) |
Add (deduct): |
|
|
|
|
|
|
||
Interest expense, interest and dividend income and other expenses |
|
|
(63 |
) |
|
|
(209 |
) |
Depreciation and amortization |
|
|
4,931 |
|
|
|
4,246 |
|
Amortization of lease intangible |
|
|
— |
|
|
|
180 |
|
Provision from income taxes |
|
|
248 |
|
|
|
— |
|
Stock-based compensation |
|
|
8,327 |
|
|
|
7,342 |
|
Payroll tax expense related to stock-based compensation |
|
|
1,605 |
|
|
|
1,473 |
|
Acquisition and other |
|
|
— |
|
|
|
251 |
|
Charitable contribution of common stock |
|
|
826 |
|
|
|
516 |
|
Income from unconsolidated joint venture |
|
|
(146 |
) |
|
|
(106 |
) |
Restructuring charges |
|
|
16 |
|
|
|
1,461 |
|
Adjusted EBITDA |
|
$ |
10,485 |
|
|
$ |
78 |
|
For the three months ended March 31, 2026, Adjusted EBITDA was $10.5 million, as compared to Adjusted EBITDA of $0.1 million for the same quarter in 2025. For the three months ended March 31, 2026, Adjusted EBITDA Margin was 5.1% of revenue, as compared to 0.1% of revenue for the same quarter in 2025.
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Table of Contents
Non-GAAP Net Income (Loss)
We define Non-GAAP Net Income (Loss), as net loss adjusted for stock-based compensation, payroll tax expense related to stock-based compensation, amortization of lease intangible, amortization of deferred costs on convertible notes, charitable contributions of common stock, lease termination, restructuring charges, amortization of acquired intangible assets & patents, other amortization and acquisition and other adjustments not reflective of our ongoing business, such as adjustments related to purchase accounting, the revaluation of contingent consideration, transaction costs and executive severance.
Effective January 1, 2026, we revised our definition of Non-GAAP Net Income (Loss) to exclude depreciation expense which had previously been included as an adjustment. Management believes this revised definition provides a more representative view of our core operating performance. All prior-period amounts have been recast to conform to this new definition.
|
|
For the Three Months |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Non-GAAP Net Income (Loss): |
|
|
|
|
|
|
||
Net loss |
|
$ |
(5,259 |
) |
|
$ |
(15,076 |
) |
Add (deduct): |
|
|
|
|
|
|
||
Stock-based compensation |
|
|
8,327 |
|
|
|
7,342 |
|
Payroll tax expense related to stock-based compensation |
|
|
1,605 |
|
|
|
1,473 |
|
Amortization of lease intangible |
|
|
— |
|
|
|
180 |
|
Amortization of deferred costs on convertible notes |
|
|
571 |
|
|
|
465 |
|
Acquisition and other |
|
|
— |
|
|
|
251 |
|
Charitable contribution of common stock |
|
|
826 |
|
|
|
516 |
|
Lease termination |
|
|
— |
|
|
|
(30 |
) |
Restructuring charges |
|
|
16 |
|
|
|
1,461 |
|
Amortization of acquired intangible assets & patents |
|
|
803 |
|
|
|
804 |
|
Other amortization |
|
|
— |
|
|
|
92 |
|
Non-GAAP Net Income (Loss) |
|
$ |
6,889 |
|
|
$ |
(2,522 |
) |
For the three months ended March 31, 2026, Non-GAAP net income was $6.9 million, as compared to Non-GAAP net loss of $(2.5) million for the same quarter in 2025. For the quarter ended March 31, 2026, Non-GAAP net income was 3.4% of revenue, as compared to Non-GAAP net loss was (1.7)% of revenue for the same quarter in 2025.
Components of Results of Operations
Revenue
Our marketplace revenue is primarily comprised of sales of parts and assemblies to customers through our platform. Buyers purchase specialized CNC manufacturing, sheet metal manufacturing, 3D printing, injection molding, urethane casting, stamping, extrusions, tube cutting, tube bending and finishing services. Customer purchases range from rapid prototyping of single parts to high-volume production on our marketplace. These products are primarily manufactured by our network of suppliers.
Services revenue includes the sale of marketing and advertising services and financial service products.
Cost of Revenue
Marketplace cost of revenue primarily consists of the cost to us of the products that are manufactured or produced by us or our suppliers for delivery to buyers on our platform, internal and external production costs, shipping costs and certain internal depreciation. We expect the cost of revenue to increase in absolute dollars to the extent our revenue increases and transaction volume increases. As we grow and add suppliers to our platform, we are able to improve our pricing efficiency and we expect cost of revenue to decline as a percentage of revenue over time.
Services cost of revenue primarily consists of internal and external production costs and website hosting.
Gross Profit
Gross profit, or revenue less cost of revenue, is primarily affected by the growth of our revenue and the mix of our business between marketplace and services. Marketplace gross margin is our economic value driven by the spread between the price to the buyer and the cost to the supplier. The price to the buyer is primarily driven by AI through our instant quoting engine which utilizes machine learning
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Table of Contents
and our proprietary data to make price predictions. The cost to the supplier is driven by an AI powered matching algorithm which finds the optimal supplier match in our network.
Operating Expenses
Our operating expenses consist of sales and marketing, operations and support, product development, general and administrative functions and impairment of assets.
Sales and Marketing
Sales and marketing expenses are expensed as incurred and include the costs of our digital marketing strategies, branding costs and other advertising costs, restructuring charges, certain depreciation and amortization expense, contract acquisition costs and compensation expenses, including stock-based compensation for our sales and marketing employees. We intend to continue to invest in our sales and marketing capabilities in the future to continue to increase our brand awareness, add new accounts and further penetrate existing accounts. We expect sales and marketing expense to increase in absolute dollars in the future as we grow our business but decrease over time as a percentage of revenue. Sales and marketing expenses may fluctuate from period to period based on the timing of our investments, which may vary in scope and scale over future periods.
Operations and Support
Operations and support expenses are the costs we incur in support of the buyers and suppliers on our platform which are provided by phone, email and chat for purposes of resolving buyer and suppliers related matters. These costs primarily consist of compensation expenses of the support staff, including stock-based compensation, restructuring charges, certain depreciation and amortization expense and software costs used in delivering buyer and suppliers services. We expect operations and support expenses to increase in absolute dollars in the future as we grow our business but decrease over time as a percentage of revenue. Operations and support expenses may fluctuate from period to period based on the timing of our investments, which may vary in scope and scale over future periods.
Product Development
Product development costs that are not eligible for capitalization are expensed as incurred. These costs primarily consist of compensation expenses, including stock-based compensation expenses to our employees performing these functions, restructuring charges and certain depreciation and amortization expense. We expect product development expense to increase in absolute dollars in the future as we grow our business but decrease as a percentage of revenue. Product development expenses may fluctuate from period to period based on the timing of our investments, which may vary in scope and scale over future periods.
General and Administrative
General and administrative expenses primarily consist of compensation expenses, including stock-based compensation expenses, for executive, finance, legal and other administrative personnel, provision for bad debt, professional service fees, facilities cost, restructuring charges and certain depreciation and amortization expense. We expect general and administrative expenses to increase in absolute dollars in the future as we grow our business but decrease as a percentage of revenue. General and administrative expenses may fluctuate from period to period due to the timing of our investments, which may vary in scope and scale over future periods.
Other (Expenses) Income
Interest Expense
Interest expense consists of interest incurred on our outstanding borrowings under our outstanding convertible notes or other borrowings.
Interest and Dividend Income
Interest and dividend income consists of interest and dividends on our cash, cash equivalents and marketable securities.
Other Expenses
Other expenses consist primarily of realized foreign exchange gains and/or losses, non-income based taxes and other expenses.
Income from Unconsolidated Joint Venture
Income from unconsolidated joint venture consists of our share of the joint venture’s income.
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Table of Contents
Provision for Income Taxes
Provision for income taxes primarily consists of income based taxes primarily from international operations.
Results of Operations
Comparison of the Three Months Ended March 31, 2026 and 2025
The following table sets forth our unaudited statements of operations data for the periods indicated:
|
|
For the Three Months |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Revenue |
|
$ |
205,138 |
|
|
$ |
150,971 |
|
Cost of revenue |
|
|
126,650 |
|
|
|
94,640 |
|
Gross profit |
|
|
78,488 |
|
|
|
56,331 |
|
Operating expenses: |
|
|
|
|
|
|
||
Sales and marketing |
|
|
31,967 |
|
|
|
26,435 |
|
Operations and support |
|
|
19,659 |
|
|
|
17,090 |
|
Product development |
|
|
11,428 |
|
|
|
11,171 |
|
General and administrative |
|
|
20,654 |
|
|
|
17,026 |
|
Total operating expenses |
|
|
83,708 |
|
|
|
71,722 |
|
Loss from operations |
|
|
(5,220 |
) |
|
|
(15,391 |
) |
Other (expenses) income: |
|
|
|
|
|
|
||
Interest expense |
|
|
(1,258 |
) |
|
|
(1,188 |
) |
Interest and dividend income |
|
|
1,785 |
|
|
|
2,277 |
|
Other expenses |
|
|
(464 |
) |
|
|
(880 |
) |
Income from unconsolidated joint venture |
|
|
146 |
|
|
|
106 |
|
Total other income |
|
|
209 |
|
|
|
315 |
|
Loss before income taxes |
|
|
(5,011 |
) |
|
|
(15,076 |
) |
Provision for income taxes |
|
|
(248 |
) |
|
|
— |
|
Net loss |
|
|
(5,259 |
) |
|
|
(15,076 |
) |
Net income attributable to noncontrolling interest |
|
|
8 |
|
|
|
2 |
|
Net loss attributable to common stockholders |
|
$ |
(5,267 |
) |
|
$ |
(15,078 |
) |
30
Table of Contents
The following table sets forth our unaudited statements of operations data expressed as a percentage of total revenue for the periods indicated:
|
|
For the Three Months |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Revenue |
|
|
100.0 |
% |
|
|
100.0 |
% |
Cost of revenue |
|
|
61.7 |
% |
|
|
62.7 |
% |
Gross profit |
|
|
38.3 |
% |
|
|
37.3 |
% |
Operating expenses: |
|
|
|
|
|
|
||
Sales and marketing |
|
|
15.6 |
% |
|
|
17.5 |
% |
Operations and support |
|
|
9.6 |
% |
|
|
11.3 |
% |
Product development |
|
|
5.6 |
% |
|
|
7.4 |
% |
General and administrative |
|
|
10.1 |
% |
|
|
11.3 |
% |
Total operating expenses |
|
|
40.9 |
% |
|
|
47.5 |
% |
Loss from operations |
|
|
(2.6 |
)% |
|
|
(10.2 |
)% |
Other (expenses) income: |
|
|
|
|
|
|
||
Interest expense |
|
|
(0.6 |
)% |
|
|
(0.8 |
)% |
Interest and dividend income |
|
|
0.9 |
% |
|
|
1.5 |
% |
Other expenses |
|
|
(0.2 |
)% |
|
|
(0.6 |
)% |
Income from unconsolidated joint venture |
|
|
0.1 |
% |
|
|
0.1 |
% |
Total other income |
|
|
0.2 |
% |
|
|
0.2 |
% |
Loss before income taxes |
|
|
(2.4 |
)% |
|
|
(10.0 |
)% |
Provision for income taxes |
|
|
(0.1 |
)% |
|
|
— |
% |
Net loss |
|
|
(2.5 |
)% |
|
|
(10.0 |
)% |
Net income attributable to noncontrolling interest |
|
|
— |
% |
|
|
— |
% |
Net loss attributable to common stockholders |
|
|
(2.5 |
)% |
|
|
(10.0 |
)% |
The following tables present our disaggregated revenue and cost of revenue. Revenue from our marketplace primarily reflects the sales of parts and assemblies on our platform. Revenue from services includes the sale of advertising and financial service products.
Revenue and cost of revenue is presented in the following tables for the three months ended March 31, 2026 and 2025 (in thousands):
|
|
For the Three Months |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Marketplace |
|
|
|
|
|
|
||
Revenue |
|
$ |
191,318 |
|
|
$ |
136,353 |
|
Cost of revenue |
|
|
124,873 |
|
|
|
93,046 |
|
Gross Profit |
|
$ |
66,445 |
|
|
$ |
43,307 |
|
Gross Margin |
|
|
34.7 |
% |
|
|
31.8 |
% |
|
|
|
|
|
|
|
||
Services |
|
|
|
|
|
|
||
Revenue |
|
$ |
13,820 |
|
|
$ |
14,618 |
|
Cost of revenue |
|
|
1,777 |
|
|
|
1,594 |
|
Gross Profit |
|
$ |
12,043 |
|
|
$ |
13,024 |
|
Gross Margin |
|
|
87.1 |
% |
|
|
89.1 |
% |
Revenue
Total revenue increased $54.2 million, or 36%, from $151.0 million for the three months ended March 31, 2025 to $205.1 million for the three months ended March 31, 2026. This growth was a result of an increase in marketplace revenue, partially offset by a decrease in services revenue. Marketplace revenue increased $55.0 million, or 40%, from $136.4 million for the three months ended March 31, 2025 to $191.3 million for the three months ended March 31, 2026. The increase in marketplace revenue was primarily due to increased buyer activity on the platform, particularly with respect to enterprise customers, for the three months ended March 31, 2026 as compared to the prior year period.
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Table of Contents
Services revenue decreased $0.8 million, or 5% from $14.6 million for the three months ended March 31, 2025 to $13.8 million for the three months ended March 31, 2026. The decrease in revenue was due to reductions in Thomas advertising and marketing services, partly offset by growth in financial services.
Total revenue for the three months ended March 31, 2026 and 2025 was $172.2 million and $127.8 million, respectively, for the U.S. reportable segment and $32.9 million and $23.2 million, respectively, for the International reportable segment.
Cost of Revenue
Total cost of revenue increased $32.0 million, or 34%, from $94.6 million for the three months ended March 31, 2025 to $126.7 million for the three months ended March 31, 2026. This increase was primarily the result of an increase in marketplace cost of revenue. Total cost of revenue from marketplace and supplier services for the three months ended March 31, 2026 was $124.9 million and $1.8 million, respectively, as compared to $93.0 million and $1.6 million, respectively, for the three months ended March 31, 2025.
Marketplace cost of revenue was driven by order growth and increased activity on our marketplace.
Total cost of revenue for the three months ended March 31, 2026 and 2025 was $106.1 million and $79.9 million, respectively for the U.S. reportable segment, and $20.6 million and $14.7 million, respectively, for the International reportable segment.
Gross Profit and Margin
Gross profit increased $22.2 million, or 39%, from $56.3 million for the three months ended March 31, 2025 to $78.5 million for the three months ended March 31, 2026. The increase in gross profit was primarily due to increases in revenue from marketplace and improved marketplace gross margins as compared to the prior year period.
Total gross margin was 38.3% for the three months ended March 31, 2026 as compared to 37.3% for the three months ended March 31, 2025. The increase was primarily driven by higher marketplace gross margin as compared to the prior period.
Gross margin for marketplace was 34.7% for the three months ended March 31, 2026, as compared to 31.8% for the three months ended March 31, 2025. The improvement was due largely to our AI-driven platform and expanding network of active suppliers which optimizes pricing to buyers and suppliers.
Gross margin for our supplier services was 87.1% for the three months ended March 31, 2026, as compared to 89.1% for the three months ended March 31, 2025.
Operating Expenses
Sales and Marketing
Sales and marketing expense increased $5.5 million, or 21%, from $26.4 million for the three months ended March 31, 2025 to $32.0 million for the three months ended March 31, 2026, primarily due to increases in marketing and advertising spend, consulting expenses, commission expense and employee compensation and benefit costs due to increased headcount. As a percent of total revenue, sales and marketing expenses decreased to 15.6% for the three months ended March 31, 2026 from 17.5% for the three months ended March 31, 2025.
Advertising expense increased $2.0 million, from $6.8 million for the three months ended March 31, 2025 to $8.8 million for the three months ended March 31, 2026 primarily due to increased marketplace advertising.
Operations and Support
Operations and support expense increased $2.6 million, or 15%, from $17.1 million for the three months ended March 31, 2025 to $19.7 million for the three months ended March 31, 2026, primarily due to increases in consulting expenses and employee compensation and benefit costs due to increased headcount. These increases were offset by a reduction in restructuring costs. As a percent of total revenue, operations and support expenses decreased to 9.6% for the three months ended March 31, 2026 from 11.3% for the three months ended March 31, 2025.
Product Development
Product development expense increased $0.3 million, or 2%, from $11.2 million for the three months ended March 31, 2025 to $11.4 million for the three months ended March 31, 2026, primarily as a result of an increase in software costs, offset by increases in the amount of compensation and benefits cost and stock-based compensation capitalized to software development. As a percent of total
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revenue, product development expenses decreased to 5.6% for the three months ended March 31, 2026 as compared to 7.4% for the three months ended March 31, 2025.
General and Administrative
General and administrative expense increased $3.6 million, or 21%, from $17.0 million for the three months ended March 31, 2025 to $20.7 million for the three months ended March 31, 2026, primarily driven by increases in stock-based compensation and higher employee compensation and benefit costs due to increased headcount. As a percent of total revenue, general and administrative expenses decreased to 10.1% for the three months ended March 31, 2026 from 11.3% for the three months ended March 31, 2025.
Other (Expenses) Income
Interest Expense
Interest expense remained flat at $1.2 million for the three months ended March 31, 2026 and 2025.
Interest and Dividend Income
Interest and dividend income decreased $0.5 million, or 22%, from $2.3 million for the three months ended March 31, 2025 to $1.8 million for the three months ended March 31, 2026. The decrease was primarily due to lower investment in the money market account as the Company funds ongoing operations.
Other Expenses
Other expenses decreased by $0.4 million, from $0.9 million for the three months ended March 31, 2025 to $0.5 million for the three months ended March 31, 2026. The decrease was primarily due to decreases in foreign exchange losses.
Income from Unconsolidated Joint Venture
Income from unconsolidated joint venture remained flat at $0.1 million for the three months ended March 31, 2026 and 2025.
Additional Segment Considerations
Segment Adjusted EBITDA from our U.S. reportable segment for the three months ended March 31, 2026 and 2025 was $13.3 million and $3.0 million, respectively. Segment Adjusted EBITDA from our International reportable segment for the three months ended March 31, 2026 and 2025 was $(2.8) million and $(2.9) million, respectively.
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Liquidity and Capital Resources
General
We have financed our operations primarily through sales of our equity securities and borrowings under our convertible notes. As of March 31, 2026, our cash and cash equivalents and marketable securities totaled $224.0 million. We believe our existing cash and cash equivalents and marketable securities will be sufficient to support our working capital and capital expenditure requirements for at least the next twelve months. We believe we will meet our longer-term expected future cash requirements primarily from a combination of cash flow from operating activities and available cash and cash equivalents and marketable securities. We may also engage in equity or debt financings to secure additional funds. Our future capital requirements will depend on many factors, including our revenue growth rate, receivable and payable cycles, the timing and extent of investments in product development, sales and marketing, operations and support and general and administrative expenses.
Our capital expenditures consist primarily of internal-use software costs, manufacturing equipment, computers and peripheral equipment, furniture and fixtures and leasehold improvements and patents.
Convertible Notes due 2030
In June 2025, we issued $250.0 million aggregate principal amount of 2030 Notes pursuant to an indenture dated June 12, 2025, including the exercise in full of the initial purchasers’ option to purchase up to an additional $25.0 million principal amount of the 2030 Notes. The 2030 Notes were sold in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act. The net proceeds from the issuance of the 2030 Notes were $241.4 million, net of debt issuance costs. The debt issuance costs are amortized to interest expense using the effective interest rate method.
The 2030 Notes are general unsecured obligations and bear regular interest at 0.75% per annum, payable semiannually in arrears on June 15 and December 15 of each year, beginning on December 15, 2025. The 2030 Notes will mature on June 15, 2030 unless earlier repurchased, redeemed, or converted in accordance with their terms prior to such date.
The 2030 Notes are convertible into cash, shares of our Class A common stock, or a combination of cash and shares of our Class A common stock, at our election, at an initial conversion rate of 21.2495 shares of Class A common stock per $1,000 principal amount of 2030 Notes, which is equivalent to an initial conversion price of approximately $47.06 per share of our Class A common stock. The conversion rate is subject to customary adjustments for certain events as described in the indenture governing the 2030 Notes. In addition, following certain corporate events that occur prior to the maturity date of the 2030 Notes or if we deliver a notice of redemption in respect of the 2030 Notes, we will, under certain circumstances, increase the conversion rate of the 2030 Notes for a holder who elects to convert its 2030 Notes in connection with such a corporate event or convert its 2030 Notes called (or deemed called) for redemption in connection with such notice of redemption, as the case may be.
We may redeem for cash all or any portion of the 2030 Notes, at our option, on or after June 20, 2028 if the last reported sale price of our Class A common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption, at a redemption price equal to 100% of the principal amount of the 2030 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date.
Holders of the 2030 Notes may convert all or a portion of their 2030 Notes at their option prior to the close of business on the business day immediately preceding March 15, 2030, in multiples of $1,000 principal amounts, only under the following circumstances:
On or after March 15, 2030, the 2030 Notes are convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date.
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In the event of a fundamental change (as defined in the indenture governing the 2030 Notes), subject to certain conditions and limited exceptions, holders of the 2030 Notes may require us to repurchase for cash all or a portion of the 2030 Notes at a price equal to 100% of the principal amount of the 2030 Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date.
We accounted for the issuance of the 2030 Notes as a single liability measured at its amortized cost, as no embedded features require bifurcation and recognition as derivatives.
As of March 31, 2026, the 2030 Notes have a carrying value of approximately $242.7 million with an effective annual interest rate of 1.4%.
Convertible Notes due 2027
In February 2022, we issued $287.5 million aggregate principal amount of 2027 Notes pursuant to an indenture dated February 4, 2022. The 2027 Notes were issued in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act. The net proceeds from the issuance of the 2027 Notes were $278.2 million, net of debt issuance costs. The debt issuance costs are amortized to interest expense using the effective interest rate method.
The 2027 Notes are unsecured obligations and bear regular interest at 1% per annum, payable on February 1 and August 1 of each year. The 2027 Notes will mature on February 1, 2027 unless repurchased, redeemed, or converted in accordance with their terms prior to such date.
The 2027 Notes are convertible into cash, shares of our Class A common stock, or a combination of cash and shares of our Class A common stock, at our election, at an initial conversion rate of 17.8213 shares of Class A common stock per $1,000 principal amount of 2027 Notes, which is equivalent to an initial conversion price of approximately $56.11 per share of our Class A common stock. The conversion rate is subject to customary adjustments for certain events as described in the indenture governing the 2027 Notes. In addition, following certain corporate events that occur prior to the maturity date of the 2027 Notes or if we deliver a notice of redemption in respect of the 2027 Notes, we will, under certain circumstances, increase the conversion rate of the 2027 Notes for a holder who elects to convert its 2027 Notes in connection with such a corporate event or convert its 2027 Notes called (or deemed called) for redemption in connection with such notice of redemption, as the case may be.
We may redeem for cash all or any portion of the 2027 Notes, at our option, if the last reported sale price of our Class A common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption, at a redemption price equal to 100% of the principal amount of the 2027 Notes to be redeemed, plus accrued and unpaid interest or additional interest, if any.
Holders of the 2027 Notes may convert all or a portion of their 2027 Notes at their option prior to November 1, 2026, in multiples of $1,000 principal amounts, only under the following circumstances:
On or after November 1, 2026, the 2027 Notes are convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date.
In the event of a fundamental change (as defined in the indenture governing the 2027 Notes), subject to certain conditions and limited exceptions, holders of the 2027 Notes may require us to repurchase all or a portion of the 2027 Notes at a price equal to 100% of the principal amount of 2027 Notes, plus accrued and unpaid interest.
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We accounted for the issuance of the 2027 Notes as a single liability measured at its amortized cost, as no embedded features require bifurcation and recognition as derivatives.
As of March 31, 2026, the 2027 Notes have a carrying value of approximately $85.3 million with an effective annual interest rate of 1.6%.
We may, from time to time, repurchase our convertible senior notes using cash on hand, either on the open market or in privately negotiated transactions.
Partial Repurchase of 2027 Notes
We used a portion of the net proceeds from the issuance of the 2030 Notes to repurchase approximately $201.7 million in aggregate principal amount of outstanding 2027 Notes. The total cash paid in connection with this repurchase was approximately $216.7 million, which included approximately $0.7 million to pay the accrued interest through the settlement date and an approximate $14.3 million premium. The repurchase resulted in a $16.4 million loss on debt extinguishment, which included the write-off of $2.1 million of deferred costs related to the 2027 Notes. The loss on debt extinguishment was recorded within Other expenses in the Condensed Consolidated Statements of Operations and Comprehensive Loss.
Following this partial repurchase, approximately $85.8 million aggregate principal amount of the 2027 Notes remain outstanding on our Condensed Consolidated Balance Sheet. The original terms and conditions continue to apply to the remaining notes, and the unamortized debt discount and issuance costs related to these notes will continue to be deferred and accreted.
Capped Call Transactions
In connection with the issuance of 2030 Notes, we entered into capped call transactions (the “Capped Calls”) with respect to its Class A common shares with certain financial institutions. The Capped Calls are expected to reduce the potential dilution to our Class A common stock upon any conversion of the 2030 Notes and/or offset any cash payments we are required to make in excess of the principal amount of the converted 2030 Notes, as the case may be, with such reduction and/or offset subject to a cap based on a cap price initially equal to $63.35 per share and which is subject to certain adjustments under the terms of the Capped Calls.
We used approximately $17.5 million of the net proceeds from the 2030 Notes to pay the cost of the Capped Calls. These instruments are classified as equity and recorded as a reduction of additional paid-in capital in the Condensed Consolidated Statements of Changes in Stockholders’ Equity. The Capped Call are not accounted for as derivatives and will not be remeasured; they will remain in stockholders’ equity until expiration or settlement.
Purchase of Treasury Stock
In conjunction with the 2030 Notes issuance, we purchased 220,994 shares of our Class A common stock in privately negotiated transactions at an average price of $36.20 per share on June 9, 2025. The $8.1 million of treasury stock repurchase costs was funded using a portion of the proceeds of the 2030 Notes and was recorded as a reduction to stockholders’ equity in the Condensed Consolidated Statements of Changes in Stockholders’ Equity.
Cash Flows
The following table presents a summary of our cash flows from operating, investing, and financing activities for the three months ended March 31, 2026 and 2025.
|
|
Three Months Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
|
|
(in thousands) |
|
|||||
Net cash provided by (used in) operating activities |
|
$ |
14,623 |
|
|
$ |
(3,691 |
) |
Net cash used in investing activities |
|
$ |
(9,321 |
) |
|
$ |
(3,686 |
) |
Net cash provided by financing activities |
|
$ |
830 |
|
|
$ |
510 |
|
Operating Activities
For the three months ended March 31, 2026, net cash provided by operating activities was $14.6 million, primarily due to a net loss of $(5.3) million adjusted for non-cash charges of $15.1 million and a net $4.8 million adjustment from changes in operating assets and liabilities. The non-cash charges primarily relate to stock-based compensation of $8.3 million, and depreciation and amortization of $4.9 million. The net decrease in operating assets and liabilities is primarily driven by the changes in accounts receivable of $22.7 million due to increased sales, offset by changes in accounts payable and accrued cost of revenue of $17.7 million due to the timing of payments and sales growth, and changes in other accrued expenses of $11.0 million.
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For the three months ended March 31, 2025, net cash used in operating activities was $3.7 million, primarily due to a net loss of $(15.1) million adjusted for non-cash charges of $13.6 million and a net decrease in our operating assets and liabilities of $(2.2) million. The non-cash adjustments primarily relate to stock-based compensation of $7.3 million, depreciation and amortization of $4.2 million and a $1.1 million of reduction to our right of use lease assets. The net decrease in operating assets and liabilities is primarily driven by the changes in accounts receivable of $13.4 million due to increased sales, changes in other assets of $2.0 million, changes in lease liabilities of $1.5 million and changes in prepaid expenses of $1.5 million offset by changes in accounts payable of $15.0 million due to timing of payments and changes in contract liabilities of $1.9 million.
Investing Activities
For the three months ended March 31, 2026, net cash used in investing activities was $9.3 million, primarily due to the purchase of marketable securities of $12.3 million and capitalization of internal-use software development costs and the purchase of property and equipment of $10.6 million offset by the sale of marketable securities of $13.5 million.
For the three months ended March 31, 2025, net cash used in investing activities was $3.7 million, primarily due to capitalization of internal-use software development costs and the purchase of property and equipment of $5.5 million and the purchase of marketable securities of $2.3 million offset by the sale of marketable securities of $4.0 million.
Financing Activities
For the three months ended March 31, 2026, net cash provided by financing activities was $0.8 million, relating to proceeds from the exercise of stock options.
For the three months ended March 31, 2025, net cash provided by financing activities was $0.5 million, relating to proceeds from the exercise of stock options.
Critical Accounting Estimates
Our condensed consolidated financial statements and accompanying notes have been prepared in accordance with GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances. We evaluate our estimates and assumptions on an ongoing basis. Actual results may differ from these estimates. To the extent that there are material differences between these estimates and our actual results, our future financial statements will be affected. For additional information about our critical accounting policies and estimates, see the disclosure included in our Annual Report on Form 10-K for the year ended December 31, 2025 as well as Note 2, Basis of Presentation and Summary of Significant Accounting Policies in the notes to the condensed consolidated financial statements included in Part I, Item 1, of this Quarterly Report on Form 10-Q. There have been no material changes to our critical accounting policies and accounting estimates as compared to those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025.
Recent Accounting Pronouncements
For a description of our recently adopted accounting pronouncements and recently issued accounting standards not yet adopted, see Note 2, Basis of Presentation and Summary of Significant Accounting Policies in the notes to the condensed consolidated financial statements included in Part I, Item 1, of this Quarterly Report on Form 10-Q.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
We are exposed to market risks in the ordinary course of our business. Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily a result of exposure to potential changes in interest rates. We do not enter into investments for trading or speculative purposes and have not used any derivative financial instruments to manage our interest rate risk exposure.
Foreign Currency Exchange Risk
Our U.S. revenue and costs are principally denominated in U.S. dollars and are not subject to foreign currency exchange risk. Our International operating segment generates revenue outside of the United States that is denominated in currencies other than the U.S. dollar. Our results of operations are impacted by changes in exchange rates. Outside the U.S., our International operations generated approximately 16% of our revenues for the three months ended March 31, 2026, of which the majority was generated in Euros. If the average exchange rate of Euros changed unfavorably by 10%, our revenues for the three months ended March 31, 2026 would have decreased by 1.2%. During the three months ended March 31, 2026, our revenues were impacted as the average exchange rate
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experienced fluctuations of 11% during the three-month periods ending March 31, 2026 and March 31, 2025. This fluctuation caused a 1.2% increase in International revenue.
Inflation Risk
We do not believe that inflation has had a material effect on our business, results of operations, or financial condition. If our costs were to become subject to significant inflationary pressures such as those caused by geopolitical tensions, we may not be able to fully offset such higher costs through price increases. Our inability or failure to do so could harm our business, results of operations and financial condition.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
We maintain “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Pursuant to Rules 13a-15(e) and 15d-15(e) under the Exchange Act, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, performed an evaluation of the effectiveness of our disclosure controls and procedures as of March 31, 2026. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2026.
Changes in Internal Control over Financial Reporting
There were no changes to our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the quarter ended March 31, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Controls
Our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
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PART II—OTHER INFORMATION
Item 1. Legal Proceedings.
From time to time, we are involved in various claims and legal actions that arise in the ordinary course of business. We are not a party to any legal proceedings, that individually or in the aggregate, are reasonably expected to have a material adverse effect on our consolidated results of operations, financial condition or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more matters could have a material adverse effect on our consolidated results of operations, financial condition or cash flows.
For the period ended March 31, 2026, there were no material legal proceedings brought against us nor were there any material developments to any ongoing legal proceedings which constituted reportable events.
Item 1A. Risk Factors.
Investing in our Class A common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described in our Annual Report on Form 10‑K for the year ended December 31, 2025 under Part I, Item 1A, “Risk Factors,” together with all of the other information in this Quarterly Report on Form 10-Q, including the sections titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our condensed consolidated financial statements and related notes, before making a decision to invest in our Class A common stock. Our business, financial condition, results of operations, or prospects could also be harmed by risks and uncertainties not currently known to us or that we currently do not believe are material. If any of the risks actually occur, our business, financial condition, results of operations, and prospects could be adversely affected. In that event, the market price of our Class A common stock could decline, and you could lose part or all of your investment.
There have been no material changes to our risk factors as previously disclosed in Item 1A. contained in Part I of our Annual Report on Form 10-K for the year ended December 31, 2025.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Not applicable.
Item 3. Defaults Upon Senior Securities.
Not applicable.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
Securities Trading Plans of Directors and Executive Officers
During the three months ended March 31, 2026,
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Item 6. Exhibits.
The documents listed in the Exhibit Index of this Quarterly Report on Form 10-Q are herein incorporated by reference or are filed with this Quarterly Report on Form 10-Q, in each case as indicated therein (numbered in accordance with Item 601 of Regulation S-K).
Exhibit Number |
|
Description |
|
|
|
3.1 |
|
Amended and Restated Certificate of Incorporation of Xometry, Inc., (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 001-40546), filed with the SEC on July 2, 2021). |
3.2 |
|
Amended and Restated Bylaws of Xometry, Inc., (incorporated herein by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K (File No. 001-40546), filed with the SEC on July 2, 2021). |
31.1* |
|
Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2* |
|
Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32.1** |
|
Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
32.2** |
|
Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
101.INS |
|
Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. |
101.SCH |
|
Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents |
104 |
|
Cover Page Interactive Data File (embedded within the Inline XBRL document) |
* Filed herewith.
** These certifications are being furnished solely to accompany this quarterly report pursuant to 18 U.S.C. Section 1350, and are not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and are not to be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
|
|
XOMETRY, INC. |
|
|
|
|
|
Date: May 7, 2026 |
|
By: |
/s/ Randolph Altschuler |
|
|
|
Randolph Altschuler |
|
|
|
Chief Executive Officer and Director (Principal Executive Officer) |
|
|
|
|
Date: May 7, 2026 |
|
By: |
/s/ James Miln |
|
|
|
James Miln |
|
|
|
Chief Financial Officer (Principal Financial and Accounting Officer) |
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