0001193125-26-134997
SEC filingRevenue grew 12.1% to $46.0M driven by 3D printer sales, but gross margin worsened to -16.1% and going concern persists.
Velo3D is a production-focused metal additive manufacturing technology company that develops and manufactures advanced metal additive manufacturing systems and provides production and engineering services. The company serves a range of end markets including defense, aerospace, energy, and other industrial sectors. Its business combines two complementary operating models: equipment sales (primarily the Sapphire family of metal AM systems and associated software) and production/engineering services delivered through Rapid Production Solutions (RPS) and Expert Services.
Velo3D operates in a single reporting segment. Revenue is primarily derived from the sale of 3D printers, with production services growing. For the year ended December 31, 2025, approximately 56% of revenue came from defense-related programs, 24% from aerospace and aviation, and 20% from energy, semiconductor, and other industrial applications. Management is monitoring the RPS business for potential expanded segment reporting in 2026.
The core product line is the Sapphire family of metal additive manufacturing systems, including the original Sapphire, Sapphire XC (extra capacity), and the 1MZ variants with a one-meter-tall build module. These systems are supported by Flow print preparation software, Assure quality assurance software, and the Intelligent Fusion manufacturing process that manages information flow and sensor data. The company also offers Flow Developer for advanced parameter customization and the RPS service for production on a fleet of Sapphire XC printers.
Velo3D sells directly and through distribution partners, such as Taiyo Nippon Sanso in Japan and SBO in Austria. Customers include original equipment manufacturers (OEMs) and contract manufacturers (CMs) in defense, aerospace, space, semiconductor, energy, and industrial markets. Notable customers include RTX Corporation, Honeywell, Lockheed Martin, Ursa Major, Vast Space, Avio, and Lam Research. The company's systems support programs for the U.S. Navy, Army, and Air Force.
The company competes with other suppliers of 3D printers, parts, materials, and software, as well as traditional metal manufacturing methods. Competitors are described as well-established with greater financial resources and well-recognized brands. Principal competitive factors include technology capabilities, materials, process know-how, total cost of operation, product reliability, and the ability to provide a full range of solutions.
Velo3D's strategy centers on a 'land-and-expand' approach, focusing on uncontested segments where customers require complex geometries and production scalability. Key pillars include: focusing on high-performance applications not well-served by conventional AM; ensuring customer success by validating technology then integrating it into customer processes; accelerating global customer acquisition through organic growth and distribution partners; and extending competitive advantage through quality improvements and new products.
As of December 31, 2025, Velo3D had 134 full-time employees, the majority based at its headquarters and manufacturing facility in Fremont, California. The sales and customer service team consists of 28 employees. The company also relies on consultants and outside contractors. None of the employees are subject to collective bargaining agreements.
For the year ended December 31, 2025, Velo3D reported total revenue of $46.0 million, up 12.1% from $41.0 million in 2024. The growth was driven primarily by 3D Printer and parts sales, which surged 54.5% to $39.2 million, reflecting higher average selling prices and increased system sales. Excluding the $5.0 million licensing agreement with SpaceX recorded in 2024 (classified as Other revenue), core revenue grew 26.1%.
Gross loss widened to $7.4 million from $2.1 million, resulting in a negative gross margin of -16.1% versus -5.1% in the prior year. The deterioration was attributed to factory overhead costs to scale RPS operations, production engineering costs, expedited shipping, and a $7.0 million inventory adjustment for excess and obsolete inventory. Operating expenses decreased 38.1% to $47.5 million, driven by reductions in R&D, selling & marketing, and G&A due to cost-cutting measures and lower bad debt expense. Still, the operating loss improved to $54.9 million from $78.8 million.
Net loss remained relatively flat at $71.4 million compared to $69.7 million, impacted by large non-cash items: a $11.4 million loss on warrant cancellation and a $1.1 million loss on fair value of warrants, partially offset by a $11.6 million decrease in interest expense following the December 2024 debt-for-equity exchange.
Customer concentration remained high but improved: top 3 customers represented 33.2% of revenue in 2025 versus 47.0% in 2024, with all three top customers different from the prior year.
Management expressed substantial doubt about the company's ability to continue as a going concern for at least 12 months from the filing date. Despite raising over $70 million in 2025 through equity offerings (August 2025 offering netting $17.8M, December 2025 PIPE netting ~$28M), equipment loan ($10M), and convertible notes, liquidity remains insufficient. On March 4, 2026, the January and February Notes were fully converted into equity, and on March 18, 2026, the Secured Notes were repaid in full. However, the company expects to need additional financings to fund operations.
Operationally, management expects R&D spending to increase in 2026 to support a refreshed technology roadmap and RPS scaling. Selling and marketing will also rise as the company re-engages defense and aerospace markets. Gross margins are expected to improve in the second half of 2026 through production cycle time reductions and cost optimization, but component cost pressures from tariffs and lack of supplier credit will persist until financial condition improves. The company's backlog stood at $31 million as of December 31, 2025, providing some visibility, but cash burn remains a critical risk.
As of December 31, 2025, Velo3D held $39.0M in cash and equivalents, a significant increase from $1.2M in 2024, driven by $67.8M in financing proceeds. Total assets were $105.3M, down from $89.2M in 2024 primarily due to a $22.9M reduction in inventory (net of reserves). The company continues to operate with a substantial accumulated deficit of $498.1M and reported a net loss of $71.4M for 2025. Current assets of $80.1M exceed current liabilities of $33.8M, but management has expressed substantial doubt about the company's ability to continue as a going concern for at least 12 months from the issuance date.
The notes do not disclose separate purchase commitments; however, operating lease liabilities total $16.5M in undiscounted payments, with $2.7M due in 2026. Financing lease liabilities are immaterial ($0.3M). Contract liabilities (deferred revenue) were $9.3M as of year-end.
Velo3D's capital allocation was driven by debt and equity raises. In 2025, the company issued $15M in secured convertible notes and a $10M equipment loan (sale-leaseback financing). It also raised $50.1M in equity offerings (August and December 2025). Debt repayments totaled $2.9M. Capital expenditures were $2.7M (5.9% of revenue). No stock buybacks or dividends were declared.
The company operates as a single reportable segment. The chief operating decision maker uses consolidated net income to evaluate performance. No segment-level or geographic revenue breakdown is provided in the notes.
Velo3D's primary risk is substantial doubt about its ability to continue as a going concern. The company reported operating losses of $54.9 million in 2025 and $78.8 million in 2024, with expectations of continued losses and negative cash flow. This has led customers to delay orders, suppliers to demand prepayment, and the company to consider cost-cutting measures including further layoffs. The need for additional capital is critical, but the going concern status may deter investors. Additionally, the company entered a $10 million sale-leaseback transaction in December 2025, increasing fixed obligations and repo
Customer concentration remains high: the top three customers accounted for 33.2% of revenue in 2025, down from 47% in 2024, but still significant. The company's reliance on a limited number of defense and aerospace customers introduces program and contract risks. Moreover, certain components are sourced from limited suppliers, and the company's inability to secure credit terms due to financial strain forces premium payments. Export controls on additive manufacturing, designated as an emerging technology by the BIS, impose licensing requirements that could delay international sales and increase compliance costs.
Seven material weaknesses in internal control over financial reporting were identified, including deficiencies in inventory accounting, contract assets, stock-based compensation, and IT general controls. These weaknesses have led to prior period adjustments and could result in future misstatements. Remediation efforts are ongoing but uncertain.
The additive manufacturing market is highly competitive and rapidly evolving. Velo3D must continuously innovate to keep pace; failure to do so could render products obsolete. The company also faces risks from open-source software use in its Flow platform and potential intellectual property disputes.
CEO Arun Jeldi beneficially owns approximately 48.6% of common stock, giving him significant control. This concentration may deter potential acquirers and affect stock liquidity. The company's public warrants are classified as liabilities, causing non-cash earnings volatility.
The provided document excerpt does not contain the actual cash flow statement. The index indicates the statement is on page 88, but the text only includes the audit report and critical audit matters. Therefore, no cash flow data (CFO, investing, financing, capex, FCF, etc.) can be extracted. The analysis cannot be performed without the numerical data.