First Quarter 2024 Financial Results Compared To First Quarter 2023
- Revenue was
$20.5 million compared to$24.1 million . - Gross margin was 49.3% compared to 48.1%.
- Non-GAAP gross margin was 51.3% compared to 49.3%.
- Operating expenses were
$47.2 million , inclusive of a$17.3 million accrual related to the Continuous Composite judgment, compared to$33.1 million . - Non-GAAP operating expenses were
$24.1 million compared to$26.7 million . - Net loss was
$35.9 million compared to net loss of$19.0 million . - Non-GAAP net loss was
$12.2 million compared to a loss of$13.3 million . - Cash and cash equivalents were
$107.9 million as ofMarch 31, 2024 compared to$116.9 million as ofDecember 31, 2023 .
Reconciliations of the non-GAAP financial measures provided in this press release to their most directly comparable GAAP financial measures are provided in the financial tables included at the end of this press release. An explanation of these measures and how they are calculated is also included below under the heading “Non-GAAP Financial Measures.”
“We started 2024 with strong execution, setting a solid foundation for the year ahead,” said
Business Updates
- Shipping FX10:
Markforged reached a pivotal milestone in Q1 by shipping the FX10, Markforged’s next-generation 3D printer for the factory floor. The FX10 delivers high print quality at print speeds that are nearly twice as fast and a print volume that is up to twice as large as its predecessor the X7. The initial market feedback has been encouraging as customers are already printing mission critical parts for the factory floor. Markforged’s pipeline for FX10s continues to grow, and the Company remains on plan to accelerate deliveries in the coming quarters. - Improving Operational Efficiencies:
Markforged continues to build operational efficiencies and adhere to strong cost controls. The Company was specifically encouraged by strong Q1 non-GAAP gross margin performance, which exceeded 51%, despite lower revenues. Furthermore, driven by improving operational and working capital efficiencies, net cash used in operating activities was$7.4 million , an improvement of approximately 52% from the first quarter of 2023. - Exploring All Options Regarding Patent Verdict: In
April 2024 , a jury found thatMarkforged had infringed on one of the two patent claims ofContinuous Composites Inc. and awarded monetary damages in the amount of$17.3 million .Markforged strongly disagrees with this verdict and intends to seek to overturn the verdict in post-trial motions with the District Court.Markforged is exploring all available options, including seeking to overturn the resulting judgment through the appeals process.
Markforged Announces New Director
“We are thrilled to welcome George to our Board of Directors,” said
2024 Financial Outlook
This guidance does not reflect any potential additional action Continuous Composites may take, which may include seeking additional relief through post-trial motions for royalty payments on future revenue, as described in the Company’s press release dated
Conference Call and Webcast Information
The Company will host a webcast and conference call at
Participants may access the earnings press release, related materials and the audio webcast by visiting the investors section of the Company's website at https://investors.markforged.com/
To participate in the call, please dial 1-877-407-9039 or 1-201-689-8470 ten minutes before the scheduled start.
For those unable to listen to the live conference call, a replay will be available on the Company's website and telephonically until
About
Non-GAAP Financial Measures
In addition to our financial results determined in accordance with
These non-GAAP measures have limitations as an analytical tool. We do not, nor do we suggest that investors should, consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors should also note that the non-GAAP financial measures we use may not be the same non-GAAP financial measures, and may not be calculated in the same manner, as that of other companies, including other companies in our industry.
We recommend that you review the reconciliation of these non-GAAP measures to the most directly comparable GAAP financial measures provided in the financial statement tables included below in this press release, and that you not rely on any single financial measure to evaluate our business. Additionally, to the extent that forward-looking non-GAAP financial measures are provided, they are presented on a non-GAAP basis without reconciliations of such forward-looking non-GAAP measures due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliations.
The following are the non-GAAP financial measures referenced in this press release and presented in the tables below:
- Non-GAAP gross margin is defined as GAAP gross profit (loss), less stock-based compensation expense, amortization, and certain non-recurring costs, divided by revenue.
- Non-GAAP operating profit (loss) is defined as GAAP operating profit (loss) less stock-based compensation expense, amortization, and certain non-recurring costs.
- Non-GAAP net profit (loss) is defined as GAAP net profit (loss) less stock-based compensation expense, net change in fair value of warrant liabilities and contingent earnout liabilities, amortization, and certain non-recurring costs.
- Non-GAAP earnings per share is defined as GAAP net profit (loss) less stock-based compensation expense, net change in fair value of warrant liabilities and contingent earnout liabilities, amortization, and certain non-recurring costs, divided by diluted weighted average shares outstanding for the period.
Special Note Regarding Forward-Looking Statements
This press release contains forward-looking statements that are based on beliefs and assumptions and on information currently available. In some cases, you can identify forward-looking statements by the following words: “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “strategy,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing,” “opportunity” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. These statements involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements. Although
MediaSam Manning, Public Relations Manager
sam.manning@markforged.com
Investors
investors@markforged.com
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
As of | ||||||||
(In thousands, except share data and par value amounts) (Unaudited) | ||||||||
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 107,924 | $ | 116,854 | ||||
Accounts receivable, net of allowance for expected credit losses ( | 21,493 | 24,059 | ||||||
Inventory | 23,792 | 26,773 | ||||||
Prepaid expenses | 3,328 | 2,756 | ||||||
Other current assets | 1,733 | 2,022 | ||||||
Total current assets | 158,270 | 172,464 | ||||||
Property and equipment, net | 17,893 | 17,713 | ||||||
Intangible assets, net | 15,924 | 17,128 | ||||||
Right-of-use assets | 35,809 | 36,884 | ||||||
Other assets | 3,734 | 3,763 | ||||||
Total assets | $ | 231,630 | $ | 247,952 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 11,877 | $ | 13,235 | ||||
Accrued expenses | 12,451 | 9,840 | ||||||
Litigation judgment payable | 17,300 | — | ||||||
Deferred revenue | 9,609 | 8,779 | ||||||
Lease liabilities | 7,316 | 7,368 | ||||||
Other current liabilities | 1,500 | 1,526 | ||||||
Total current liabilities | 60,053 | 40,748 | ||||||
Long-term deferred revenue | 5,457 | 6,083 | ||||||
Contingent earnout liability | 1,540 | 1,379 | ||||||
Long-term lease liabilities | 34,647 | 35,771 | ||||||
Other liabilities | 2,030 | 2,361 | ||||||
Total liabilities | 103,727 | 86,342 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity | ||||||||
Common stock, | 19 | 19 | ||||||
Additional paid-in capital | 369,561 | 366,281 | ||||||
Accumulated deficit | (240,610 | ) | (204,664 | ) | ||||
Accumulated other comprehensive income | (1,067 | ) | (26 | ) | ||||
Total stockholders’ equity | 127,903 | 161,610 | ||||||
Total liabilities and stockholders’ equity | $ | 231,630 | $ | 247,952 | ||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
For the Three Months Ended | |||||||
(In thousands, except share data and per share data) (Unaudited) | |||||||
Three Months Ended | |||||||
2024 | 2023 | ||||||
Revenue | 20,547 | 24,090 | |||||
Cost of revenue | 10,414 | 12,508 | |||||
Gross profit | 10,133 | 11,582 | |||||
Operating expenses | |||||||
Sales and marketing | 7,844 | 10,576 | |||||
Research and development | 9,935 | 10,380 | |||||
General and administrative | 12,165 | 12,128 | |||||
Litigation judgment | 17,300 | — | |||||
Total operating expenses | 47,244 | 33,084 | |||||
Loss from operations | (37,111 | ) | (21,502 | ) | |||
Change in fair value of derivative liabilities | 31 | 189 | |||||
Change in fair value of contingent earnout liability | (161 | ) | 808 | ||||
Other expense, net | (135 | ) | (204 | ) | |||
Interest expense | (154 | ) | — | ||||
Interest income | 1,400 | 1,691 | |||||
Loss before income taxes | (36,130 | ) | (19,018 | ) | |||
Income tax (benefit) expense | (184 | ) | 1 | ||||
Net loss | $ | (35,946 | ) | $ | (19,019 | ) | |
Weighted average shares outstanding - basic and diluted | 199,290,500 | 195,369,245 | |||||
Net loss per share - basic and diluted | $ | (0.18 | ) | $ | (0.10 | ) | |
CONDENSED CONSOLIDATED STATEMENTS OF | |||||||
COMPREHENSIVE INCOME (LOSS) | |||||||
For the Three Months Ended | |||||||
(In thousands) | |||||||
Three Months Ended | |||||||
2024 | 2023 | ||||||
Net loss | $ | (35,946 | ) | $ | (19,019 | ) | |
Other comprehensive loss, net of taxes: | |||||||
Unrealized loss on available-for-sale marketable securities, net | — | (50 | ) | ||||
Foreign currency translation adjustment | (1,041 | ) | 158 | ||||
Total comprehensive loss | $ | (36,987 | ) | $ | (18,911 | ) | |
DISAGGREGATED REVENUE BY NATURE OF PRODUCTS AND SERVICES | ||||||
(In thousands) (Unaudited) | ||||||
Three Months Ended | ||||||
(in thousands) | 2024 | 2023 | ||||
Hardware | $ | 11,274 | $ | 15,195 | ||
Consumables | 6,404 | 6,455 | ||||
Services | 2,869 | 2,440 | ||||
Total Revenue | $ | 20,547 | $ | 24,090 | ||
DISAGGREGATED REVENUE BY GEOGRAPHIC LOCATION | ||||||
(In thousands) (Unaudited) | ||||||
Three Months Ended | ||||||
(in thousands) | 2024 | 2023 | ||||
$ | 10,095 | $ | 10,458 | |||
EMEA | 6,335 | 8,492 | ||||
APAC | 4,117 | 5,140 | ||||
Total Revenue | $ | 20,547 | $ | 24,090 | ||
RECONCILIATION OF GAAP TO NON-GAAP MEASURES | ||||||||
(In thousands) (Unaudited) | ||||||||
| Three Months Ended | |||||||
| 2024 | 2023 | ||||||
Net loss | | $ | (35,946 | ) | $ | (19,019 | ) | |
Stock compensation expense | | 3,461 | 4,356 | |||||
Change in fair value of derivative liabilities | (31 | ) | (189 | ) | ||||
Change in fair value of contingent earnout liability | 161 | (808 | ) | |||||
Amortization | 378 | 277 | ||||||
Litigation judgment | 17,300 | — | ||||||
Non-recurring costs1 | 2,446 | 2,081 | ||||||
Non-GAAP net loss | | $ | (12,231 | ) | $ | (13,302 | ) | |
1Non-recurring costs incurred during the three months ended | ||||||||
| Three Months Ended | |||||||
Non-GAAP Cost of Revenue | | 2024 | 2023 | |||||
Cost of revenue | | $ | 10,414 | $ | 12,508 | |||
Stock compensation expense | | 49 | 73 | |||||
Amortization | 357 | 228 | ||||||
Non-GAAP Cost of Revenue | 10,008 | 12,207 | ||||||
| Three Months Ended | |||||||
Non-GAAP Gross Profit | | 2024 | 2023 | |||||
Gross profit | | $ | 10,133 | $ | 11,582 | |||
Stock compensation expense | | 49 | 73 | |||||
Amortization | 357 | 228 | ||||||
Non-GAAP gross profit | 10,539 | 11,883 | ||||||
| Three Months Ended | |||||||
Non-GAAP Sales and Marketing Expenses | | 2024 | 2023 | |||||
Sales and marketing expenses | | $ | 7,844 | $ | 10,576 | |||
Stock compensation expense | | 405 | 475 | |||||
Amortization | 21 | 49 | ||||||
Non-GAAP sales and marketing expenses | 7,418 | 10,052 | ||||||
| Three Months Ended | |||||||
| 2024 | 2023 | ||||||
Research and development expenses | | $ | 9,935 | $ | 10,380 | |||
Stock compensation expense | | 1,100 | 1,147 | |||||
Non-GAAP research and development expenses | 8,835 | 9,233 | ||||||
| Three Months Ended | |||||||
Non-GAAP General and Administrative Expenses | | 2024 | 2023 | |||||
General and administrative expenses | | $ | 12,165 | $ | 12,128 | |||
Stock compensation expense | | 1,907 | 2,661 | |||||
Non-recurring costs1 | 2,446 | 2,081 | ||||||
Non-GAAP general and administrative expenses | 7,812 | 7,386 | ||||||
| Three Months Ended | |||||||
Non-GAAP Operating Loss | | 2024 | 2023 | |||||
Operating loss | | $ | (37,111 | ) | $ | (21,502 | ) | |
Stock compensation expense | | 3,461 | 4,356 | |||||
Amortization | 378 | 277 | ||||||
Litigation judgment | 17,300 | — | ||||||
Non-recurring costs1 | 2,446 | 2,081 | ||||||
Non-GAAP operating loss | (13,526 | ) | (14,788 | ) | ||||
1Non-recurring costs incurred during the three months ended | ||||||||
Source:
2024 GlobeNewswire, Inc., source