Xometry, Inc. Q3 FY2025 earnings call

• Q3 demonstrated the success of Xometry's marketplace model with 28% year-over-year revenue growth. Marketplace gross margin increased 210 basis points year-over-year to 35.7%, driving 40% growth in marketplace gross profit. • Launched auto-quote for injection molding services in the US and Europe, advanced AI-powered design for manufacturing capabilities, and expanded the global supplier network to over 4,500 active suppliers. • Enterprise sales efforts are paying off with growth in accounts having last 12-month spend of at least $50,000 and $500,000. • Launched the Workcenter mobile app to enhance supplier engagement, enabling them to manage job offers, production workflows, and cash flow more efficiently. • Continued investments in technology initiatives like Teamspace and ERP integrations to become more embedded in customer workflows.

Q3 revenue was $181 million. Marketplace revenue was $167 million, representing a 31% year-over-year growth. Supplier services revenue was $14.1 million, which declined approximately 1% quarter-over-quarter. Marketplace revenue contributed significantly, driven by the expansion of buyer and supplier networks, growth with larger accounts, and strong execution across various verticals such as semiconductors, energy, aerospace, defense, and automotive.

• Q4 revenue is expected to be in the range of $182 million to $184 million, representing 23%-24% year-over-year growth. • Q4 marketplace growth is expected to be approximately 25%-27% year-over-year. • Full-year 2025 marketplace growth outlook is raised to 27%-28% from the previous 23%-24%. • Full-year 2025 revenue outlook is raised to $676 million to $678 million. • Q4 adjusted EBITDA is expected to be between $6 million and $7 million. • Full-year 2025 adjusted EBITDA guidance is raised to $16 million to $17 million. • Expect at least 20% total revenue growth in 2026, driven by large market opportunity, wallet share expansion with strategic accounts, and international expansion.

• Uncertain macro environment which could impact business performance. • Risks associated with forward-looking statements, as they may differ materially from actual results due to various uncertainties.

Q: Can you unpack the 20% growth for 2026?

A: Driven by strong active buyer growth, revenue per buyer growth, and continued execution of growth initiatives across enterprise, supplier networks, and platform technology enhancements.

Q: Talk about the impact of the Workcenter mobile app?

A: The Workcenter mobile app helps drive customer and supplier experience by enabling deeper engagement with partners, allowing better management of orders, quality control, and dispatch, and is part of AI-enabled tools to improve speed and selection.

Q: Discuss team changes and talent additions?

A: Xometry is attracting top talent from leading tech companies to drive product outcomes, with a focus on AI efforts in price, selection, and speed across various products like injection molding auto-quoting and Thomasnet ad serving.

Q: How has visibility changed and what led to revenue outperformance?

A: Increased customer adoption of technology tools like Teamspace, Workcenter, and punchout integrations, along with accelerating product road map releases, have contributed to revenue outperformance.

Q: Thoughts on Q4 guidance and incremental margins?

A: Q4 is off to a strong start with continued momentum, and the company is balancing growth and profitability, expecting at least 20% incremental adjusted EBITDA leverage annually as it scales towards $1 billion revenue.