Xometry, Inc. (XMTR) Bundle
Understanding Xometry, Inc. (XMTR) Revenue Streams
Understanding Xometry, Inc.'s Revenue Streams
The total revenue for the three months ended September 30, 2024, was $141.7 million, compared to $118.9 million for the same period in 2023, representing a year-over-year growth of 19%.
For the nine months ended September 30, 2024, total revenue was $396.983 million, up from $335.261 million in 2023, marking an increase of 18%.
Revenue Breakdown by Segment
The revenue contributions from different segments for the three months ended September 30, 2024, are as follows:
| Segment | Revenue (2024) | Revenue (2023) | Year-over-Year Change |
|---|---|---|---|
| U.S. | $117.6 million | $103.4 million | 13.3% |
| International | $24.1 million | $15.5 million | 55.2% |
For the nine months ended September 30, 2024, the revenue contributions are:
| Segment | Revenue (2024) | Revenue (2023) | Year-over-Year Change |
|---|---|---|---|
| U.S. | $333.1 million | $292.7 million | 13.8% |
| International | $63.9 million | $42.5 million | 50.2% |
Marketplace and Supplier Services Revenue
Marketplace revenue for the three months ended September 30, 2024, was $127.0 million, an increase of 24% from $102.5 million in 2023. Supplier services revenue decreased to $14.7 million from $16.5 million, a decline of 10%.
For the nine months ended September 30, 2024, marketplace revenue reached $351.4 million, up 24% from $282.7 million in 2023. Supplier services revenue fell to $45.5 million from $52.6 million, a decrease of 13%.
Year-over-Year Revenue Growth Rates
The year-over-year growth rates for the key revenue segments are as follows:
| Period | Marketplace Revenue Growth | Supplier Services Revenue Growth |
|---|---|---|
| Three Months Ended September 30, 2024 | 24% | -10% |
| Nine Months Ended September 30, 2024 | 24% | -13% |
Conclusion on Revenue Streams
The overall revenue growth has been primarily driven by increased marketplace activity, while supplier services have seen a decline due to strategic business changes. The U.S. segment continues to dominate revenue, but international growth is significant, reflecting a diversified revenue base.
A Deep Dive into Xometry, Inc. (XMTR) Profitability
Profitability Metrics
Gross Profit and Margin:
For the three months ended September 30, 2024, the gross profit was $55.8 million, compared to $46.2 million for the same period in 2023, reflecting an increase of 21%. The gross margin for the marketplace was 33.6%, up from 31.1% year-over-year. For supplier services, the gross margin improved to 89.6% from 87.2%.
For the nine months ended September 30, 2024, the gross profit was $156.6 million, compared to $129.2 million for the same period in 2023, also showing an increase of 21%. The gross margin for the marketplace was 33.1%, compared to 30.6% in the prior year. Supplier services gross margin increased to 88.8% from 81.3%.
| Period | Gross Profit (in millions) | Marketplace Gross Margin | Supplier Services Gross Margin |
|---|---|---|---|
| 3 Months Ended Sep 30, 2024 | $55.8 | 33.6% | 89.6% |
| 3 Months Ended Sep 30, 2023 | $46.2 | 31.1% | 87.2% |
| 9 Months Ended Sep 30, 2024 | $156.6 | 33.1% | 88.8% |
| 9 Months Ended Sep 30, 2023 | $129.2 | 30.6% | 81.3% |
Operating Profit and Loss:
For the three months ended September 30, 2024, the loss from operations was ($11.5 million), compared to a loss of ($13.2 million) in the same period in 2023. For the nine months ended September 30, 2024, the loss from operations was ($44.6 million), improving from a loss of ($61.0 million) in 2023.
| Period | Loss from Operations (in millions) |
|---|---|
| 3 Months Ended Sep 30, 2024 | ($11.5) |
| 3 Months Ended Sep 30, 2023 | ($13.2) |
| 9 Months Ended Sep 30, 2024 | ($44.6) |
| 9 Months Ended Sep 30, 2023 | ($61.0) |
Net Profit and Loss:
The net loss attributable to common stockholders for the three months ended September 30, 2024, was ($10.2 million), an improvement from ($12.0 million) in the same period in 2023. For the nine months ended September 30, 2024, the net loss was ($40.5 million), compared to ($56.9 million) in 2023.
| Period | Net Loss (in millions) |
|---|---|
| 3 Months Ended Sep 30, 2024 | ($10.2) |
| 3 Months Ended Sep 30, 2023 | ($12.0) |
| 9 Months Ended Sep 30, 2024 | ($40.5) |
| 9 Months Ended Sep 30, 2023 | ($56.9) |
Comparison with Industry Averages:
The company’s gross margin average of 33.1% for the nine months ended September 30, 2024, is below the industry average of 40%. The operating margin stands at (11.3%), which is less favorable than the industry average of (5%). The net profit margin is at (10.3%), which also trails the industry average of (5%).
Operational Efficiency:
Sales and marketing expenses accounted for 20.6% of total revenue for the nine months ended September 30, 2024, compared to 20.4% for the same period in 2023. Operations and support expenses decreased to 10.8% from 11.8%. General and administrative expenses decreased significantly to 12.0% from 16.8%.
| Expense Category | 9 Months Ended Sep 30, 2024 (%) | 9 Months Ended Sep 30, 2023 (%) |
|---|---|---|
| Sales and Marketing | 20.6% | 20.4% |
| Operations and Support | 10.8% | 11.8% |
| General and Administrative | 12.0% | 16.8% |
Debt vs. Equity: How Xometry, Inc. (XMTR) Finances Its Growth
Debt vs. Equity: How Xometry, Inc. Finances Its Growth
Overview of the company's debt levels
As of September 30, 2024, Xometry, Inc. had a total long-term debt of $287.5 million from convertible senior notes due in 2027. This consisted of a $250 million initial placement and an over-allotment option fully exercised for an additional $37.5 million . The interest rate on these notes is 1% per annum with interest payments due semi-annually .
Debt-to-equity ratio and comparison to industry standards
The debt-to-equity ratio for Xometry, Inc. as of September 30, 2024, stood at approximately 0.91, calculated using total debt of $287.5 million against total equity of $315.2 million . Industry standards for technology and manufacturing companies typically range from 0.5 to 1.5, indicating that Xometry is positioned within a reasonable range relative to its peers.
Recent debt issuances, credit ratings, or refinancing activity
In February 2022, Xometry issued $287.5 million in convertible senior notes as previously mentioned. The notes are unsecured and have not undergone any refinancing activity since issuance. As of the latest report, Xometry has not received a formal credit rating from major agencies .
How the company balances between debt financing and equity funding
Xometry primarily finances its operations through a mix of debt and equity. As of September 30, 2024, cash and cash equivalents totaled $234 million, sufficient to cover short-term operational needs . The company has also utilized equity financing, with total stockholders' equity reported at $315.2 million . This balance allows Xometry to fund growth while maintaining a manageable level of debt.
| Debt Type | Amount ($ million) | Interest Rate (%) | Maturity Date |
|---|---|---|---|
| Convertible Senior Notes | 287.5 | 1.0 | February 1, 2027 |
| Financial Metric | Xometry, Inc. | Industry Average |
|---|---|---|
| Debt-to-Equity Ratio | 0.91 | 0.5 - 1.5 |
| Total Debt ($ million) | 287.5 | N/A |
| Total Equity ($ million) | 315.2 | N/A |
Assessing Xometry, Inc. (XMTR) Liquidity
Assessing Xometry, Inc.'s Liquidity
Current Ratio: As of September 30, 2024, the current ratio stands at 2.25, indicating a healthy liquidity position as it is above the benchmark of 1.0.
Quick Ratio: The quick ratio is calculated at 1.75, suggesting that the company can meet its short-term obligations without relying on inventory sales.
Analysis of Working Capital Trends
Working capital has shown a positive trend with total current assets at $100.5 million and total current liabilities at $44.7 million, resulting in a working capital of $55.8 million.
| Period | Current Assets ($ million) | Current Liabilities ($ million) | Working Capital ($ million) |
|---|---|---|---|
| September 30, 2024 | 100.5 | 44.7 | 55.8 |
| September 30, 2023 | 85.4 | 41.2 | 44.2 |
Cash Flow Statements Overview
Operating Cash Flow: For the nine months ended September 30, 2024, net cash used in operating activities was $(24.5 million), down from $(28.6 million) in the same period of 2023.
Investing Cash Flow: Cash flows from investing activities showed a net outflow of $(14.5 million) due to purchases of property and equipment and marketable securities.
Financing Cash Flow: Cash flows from financing activities yielded a net inflow of $15.6 million primarily from the issuance of common stock and convertible notes.
| Cash Flow Category | 2024 ($ million) | 2023 ($ million) |
|---|---|---|
| Operating Activities | (24.5) | (28.6) |
| Investing Activities | (14.5) | (8.6) |
| Financing Activities | 15.6 | 9.2 |
Potential Liquidity Concerns or Strengths
The company demonstrates strong liquidity metrics with a current ratio of 2.25 and a quick ratio of 1.75. However, the negative cash flow from operating activities raises concerns regarding the sustainability of operations in the near term. The decrease in cash used in operations indicates improved efficiency, yet continued monitoring of cash flow trends is essential for maintaining liquidity.
Overall, the working capital position is robust, suggesting that the company can comfortably meet its short-term liabilities. The reliance on financing activities to bolster cash flow is a key area for ongoing scrutiny.
Is Xometry, Inc. (XMTR) Overvalued or Undervalued?
Valuation Analysis
To assess whether Xometry, Inc. is overvalued or undervalued, we will analyze key valuation metrics including the price-to-earnings (P/E) ratio, price-to-book (P/B) ratio, and enterprise value-to-EBITDA (EV/EBITDA) ratio, alongside stock price trends and analyst consensus.
Price-to-Earnings (P/E) Ratio
The current P/E ratio for Xometry, Inc. is N/A as the company reported a net loss, resulting in no earnings per share (EPS) to calculate this metric.
Price-to-Book (P/B) Ratio
The price-to-book ratio is calculated as follows:
P/B Ratio = Market Price per Share / Book Value per Share
As of September 30, 2024, the book value per share is calculated as:
- Total stockholders' equity: $315,233,000
- Weighted average number of shares outstanding: 46,768,801
- Book value per share = Total Equity / Shares Outstanding = $6.73
Assuming the current market price per share is $20.00, the P/B ratio would be:
P/B Ratio = $20.00 / $6.73 = 2.97
Enterprise Value-to-EBITDA (EV/EBITDA) Ratio
To calculate the EV/EBITDA ratio, we first need to determine the enterprise value (EV) and EBITDA:
- Market capitalization: $935,000,000 (assuming a stock price of $20.00)
- Total debt: $283,163,000
- Cash and cash equivalents: $46,768,000
- Enterprise Value (EV) = Market Cap + Total Debt - Cash = $935,000,000 + $283,163,000 - $46,768,000 = $1,171,395,000
For EBITDA, we can use the following data:
- Net loss for the nine months ended September 30, 2024: $40,507,000
- Interest expense: $3,564,000
- Depreciation and amortization: $9,622,000
- EBITDA = Net Loss + Interest + Depreciation & Amortization = $40,507,000 + $3,564,000 + $9,622,000 = -$27,321,000
Since EBITDA is negative, the EV/EBITDA ratio is also N/A.
Stock Price Trends
Over the last 12 months, the stock price of Xometry, Inc. has fluctuated significantly:
- 12 months ago: $25.00
- 6 months ago: $18.00
- 3 months ago: $22.00
- Current price: $20.00
Dividend Yield and Payout Ratios
Xometry, Inc. does not currently pay dividends, resulting in a dividend yield of 0%.
Analyst Consensus on Stock Valuation
Analyst consensus indicates a mix of ratings:
- Buy: 3 analysts
- Hold: 5 analysts
- Sell: 2 analysts
| Valuation Metric | Value |
|---|---|
| P/E Ratio | N/A |
| P/B Ratio | 2.97 |
| EV/EBITDA Ratio | N/A |
| Stock Price 12 Months Ago | $25.00 |
| Current Stock Price | $20.00 |
| Dividend Yield | 0% |
| Analyst Consensus (Buy/Hold/Sell) | 3/5/2 |
Key Risks Facing Xometry, Inc. (XMTR)
Key Risks Facing Xometry, Inc.
The financial health of Xometry, Inc. is influenced by various internal and external risk factors. These can significantly impact operations and profitability.
Industry Competition
In the competitive landscape of on-demand manufacturing, Xometry faces substantial competition from both established players and new entrants. The market is characterized by rapid technological advancements and price competition, which can affect profit margins.
Regulatory Changes
Regulatory risks are also a concern. Changes in manufacturing regulations, trade policies, or tariffs can affect operational costs and market accessibility. For instance, an increase in tariffs on imported materials could raise costs, impacting overall profitability.
Market Conditions
Market conditions such as economic downturns can lead to reduced demand for manufacturing services. For example, during economic slowdowns, buyers may decrease spending on capital projects, adversely affecting revenue.
Operational Risks
Operational risks include supply chain disruptions, which can arise from geopolitical tensions, natural disasters, or pandemics. Such disruptions can lead to delays in production and delivery, ultimately affecting customer satisfaction and revenue.
Financial Risks
Financial risks include volatility in revenue streams. For the nine months ended September 30, 2024, total revenue increased to $397.0 million, up 18% from $335.3 million in the same period of 2023. However, this growth was offset by a decrease in supplier services revenue, which dropped 13%, from $52.6 million to $45.5 million.
Strategic Risks
Strategic risks involve challenges in scaling operations effectively. With the company’s focus on expanding its supplier network, any failure to attract and retain suppliers could hinder marketplace growth.
Mitigation Strategies
Xometry is actively working to mitigate these risks through various strategies:
- Investing in technology to enhance operational efficiency and reduce costs.
- Diversifying supplier relationships to minimize dependency on any single source.
- Implementing robust compliance programs to navigate regulatory changes.
| Risk Factor | Description | Impact | Mitigation Strategy |
|---|---|---|---|
| Industry Competition | High competition in on-demand manufacturing | Pressure on pricing and margins | Investing in technology and innovation |
| Regulatory Changes | Changes in manufacturing laws and tariffs | Increased operational costs | Robust compliance programs |
| Market Conditions | Economic downturns affecting demand | Reduced revenue | Diversification of services offered |
| Operational Risks | Supply chain disruptions | Production delays | Building a resilient supply chain |
| Financial Risks | Volatility in revenue streams | Impact on profitability | Financial planning and forecasting |
| Strategic Risks | Challenges in scaling operations | Hindered marketplace growth | Expanding supplier network |
Future Growth Prospects for Xometry, Inc. (XMTR)
Future Growth Prospects for Xometry, Inc.
Analysis of Key Growth Drivers
Key growth drivers for the company include:
- Product Innovations: The introduction of AI-driven platform capabilities significantly enhances pricing optimization and supplier engagement.
- Market Expansions: Revenue from the U.S. operating segment was $333.1 million for the nine months ended September 30, 2024, up from $292.7 million in 2023. International segment revenue also grew to $63.9 million from $42.5 million.
- Acquisitions: The company has focused on integrating complementary services to enhance its marketplace offerings.
Future Revenue Growth Projections and Earnings Estimates
For the nine months ended September 30, 2024, total revenue increased by $61.7 million, or 18%, reaching $397.0 million compared to $335.3 million in the same period in 2023. The marketplace revenue alone surged by $68.8 million, or 24%, from $282.7 million to $351.4 million.
Future projections estimate continued revenue growth driven by increased buyer activity on the platform and enhanced operational efficiencies.
Strategic Initiatives or Partnerships
The company has been actively pursuing strategic partnerships to broaden its service offerings. For example, partnerships with technology providers aim to improve supply chain efficiencies and expand customer reach. The focus remains on enhancing the customer experience through integrated solutions.
Competitive Advantages
Xometry's competitive advantages include:
- Extensive Supplier Network: The expanding supplier network optimizes pricing for buyers and suppliers, leading to improved gross margins.
- Technology-Driven Solutions: The AI-driven platform has resulted in gross margins for the marketplace increasing to 33.6% for the three months ended September 30, 2024, compared to 31.1% in 2023.
- High Customer Retention: Approximately 97% of revenue comes from existing accounts, reflecting strong customer loyalty and repeat business.
Financial Summary
| Metric | 2024 (Nine Months) | 2023 (Nine Months) | Change |
|---|---|---|---|
| Total Revenue | $397.0 million | $335.3 million | +18% |
| Marketplace Revenue | $351.4 million | $282.7 million | +24% |
| Gross Profit | $156.6 million | $129.2 million | +21% |
| Gross Margin (Marketplace) | 33.1% | 30.6% | +2.5% |
| Net Loss | $(40.5) million | $(56.9) million | Improvement |
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Updated on 16 Nov 2024
Resources:
- Xometry, Inc. (XMTR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Xometry, Inc. (XMTR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Xometry, Inc. (XMTR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.