Velo3D Posts 48% Revenue Growth as Gross Margins Turn Positive, Debt Falls 70%
Positive Gross Margin Signals Operational Turning Point
Velo3D’s first quarter 2026 results stand out for a clear reason: a 48% year-over-year revenue increase to $13.8 million and a return to positive gross margins at 17.2%, up from just 7.5% a year ago. This improvement marks a key milestone in the company’s efforts to scale production and drive cost efficiency as demand surges in its core markets of defense and aerospace. CEO Arun Jeldi pointed to disciplined execution and a robust opportunity pipeline as the driving forces behind this growth, reinforced by the company's ability to command higher average selling prices for its Sapphire XC systems and expanding RPS parts production revenues.
Debt Reduced by 70% Following Strategic Capital Moves
Velo3D made major strides in strengthening its balance sheet this quarter. Through debt-to-equity conversions and repaying secured notes, outstanding debt was slashed by approximately 70% to $9 million. In April, Velo3D raised an additional $50 million through an equity offering, boosting liquidity for future expansion. These financial maneuvers provide the momentum needed to invest in talent, R&D, and operational infrastructure while supporting its expansion in defense supply chains through contracts like the $9.8 million DLA JAMA award.
Losses Narrow Sharply While Cash Position Remains Stable
While still operating at a loss, Velo3D shrank its GAAP net loss to $7.0 million from $25.0 million in the same period last year, and its non-GAAP net loss to $5.1 million from $9.0 million. Adjusted EBITDA improved to ($3.59) million, reflecting better operating leverage. At quarter-end, cash and equivalents stood at $16.56 million, with $12 million in new bookings and a $30 million backlog—demonstrating ongoing customer demand and cash management discipline.
Key Financial Metrics Show Improving Trends
| Metric | Q1 2026 | Q1 2025 |
|---|---|---|
| Revenue ($M) | 13.8 | 9.3 |
| Gross Margin (%) | 17.2% | 7.5% |
| GAAP Net Loss ($M) | (7.0) | (25.0) |
| Non-GAAP Net Loss ($M) | (5.1) | (9.0) |
| Adjusted EBITDA ($M) | (3.59) | (6.94) |
| Operating Expenses ($M) | 9.33 | 12.22 |
| Non-GAAP Adj. OpEx ($M) | 8.08 | 8.83 |
| Cash & Equivalents ($M) | 16.56 | 3.87 |
| Total Backlog ($M) | 30.0 | - |
| Shares Outstanding (Millions) | 26.2 | 13.4 |
Guidance Reiterated: Focus on Margin Expansion and Profitability
Management reaffirmed its outlook for 2026, targeting revenue between $60 million and $70 million, with gross margins expected to exceed 30% in the second half of the year and a goal of turning EBITDA positive by late 2026. The company expects non-GAAP adjusted operating expenses in the range of $45–$55 million and plans significant capital investments, particularly in its RPS production expansion.
Strong Demand in Aerospace and Defense Fuels Optimism
Customer demand remains especially robust in the defense and aerospace segments, where the need for reliable, scalable additive manufacturing continues to grow. The $9.8 million Defense Logistics Agency contract reflects deepening relationships with government clients and positions Velo3D for further expansion.
Takeaway: Execution and Market Focus Drive Business Momentum
Velo3D’s Q1 2026 performance underscores its path to operational efficiency and long-term growth. With positive gross margins, disciplined spending, and strengthened financial footing—alongside a healthy pipeline of government contracts and sector demand—the company appears well-positioned for further margin gains and potential profitability by year-end. Investors and industry watchers may want to track margin trends and backlog growth as key signals of ongoing progress.
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