Q1 2025 Nano Dimension Ltd Earnings Call
Operator: Good day, ladies and gentlemen.
Good day, ladies and gentlemen, welcome to nano dimension first quarter 2025 financial results Conference call. My name is Pasha and I'm your operator for today's call.
Operator: Welcome to Nano Dimension's first quarter 2025 Financial Results Conference Call. My name is Asya, and I'm your operator for today's call. On the call with us today are Ofir Baharav, Chief Executive Officer, Assaf Zipori, Chief Financial Officer, and Julien Lederman, Chief Business Officer.
On the call with us today.
Mary: Mary <unk>, Chief Executive Officer of South Dakota, Chief Financial Officer, and Julie Julian, Let a man Chief business Officer.
Operator: Before we begin, may I remind our listeners that certain information provided on this call may contain forward-looking statements, and the safe harbor statement outlined in today's earnings press release also pertains to statements made on this call. If you have not received a copy of the press release, please view it in the investor relations section of the company's website. A replay of today's call will also be available on the investor relations section. of the company's website.
Before we begin may I remind our listeners that certain information provided on this call may contain forward looking statements and the safe Harbor statement outlined in today's earnings press release also pertains to statements made on this call.
Mary: If you have not received a copy of the press release. Please view it in the Investor Relations section of the company's website.
Today's call will also be available on the Investor Relations section.
Mary: The company's website.
Operator: Ofir will begin the call with the business update followed by a question and answer session. At which time, the management team will answer questions.
We'll begin the call with the business update followed by a question and answer session.
Speaker Change: At which time the management team to answer your question I would now like to turn the conference over to none of that mentioned <unk> CEO of their behavior well Sir. Please go ahead.
Ofir Baharav: I would now like to turn the conference over to Nano Dimension CEO, Ofir Baharav. Ofir, please go ahead. Good afternoon, everyone, and thank you for joining Nano Dimension's first quarter 2025 financial results. Joining me today are Assaf Zipori, our Chief Financial Officer, and Julien Lederman, our Chief Business Officer.
Good afternoon, everyone and thank you for joining now that I mentioned was first quarter of 2025 financial results.
Speaker Change: Joining me today are a soft safari, our chief financial Officer, and Julian let him our chief business Officer.
Ofir Baharav: Let's look at who we are. We are a digital manufacturing leader. We are changing the way the world designs and manufactures high-performance, high-value parts. We innovate and deliver the industrial manufacturing solutions that are at the pinnacle of multidisciplinary technology, combining hardware, software, and materials science.
Speaker Change: Let's look at who we are.
Speaker Change: We are a digital manufacturing leader.
Speaker Change: We are changing the way the world designs and manufactures high performance high value parts.
Speaker Change: Yeah.
Speaker Change: We innovate and deliver the industrial manufacturing solution.
Speaker Change: The pinnacle.
Speaker Change: Multidisciplinary technology.
Speaker Change: Combining hardware.
Speaker Change: Software.
Speaker Change: And materials science.
Ofir Baharav: Let's see your assistant. What you'll see here says so much about us. By combining software, machine learning, materials science, and hardware, we partner with industrial innovators to deliver high-performance, high-value solutions.
Speaker Change: Let's see our system.
Speaker Change: What you'll see here says so much about us.
Speaker Change: By combining software.
Speaker Change: She learning.
Speaker Change: Cereals science and hardware, we partner with industrial innovators to deliver high performance high value solution.
Ofir Baharav: Let's dive into headline results. Importantly, I want to reiterate that these results are for the first quarter 2025, ending March 31st, and thus only reflect Nano Dimension's business. Let's call this our core business. which does not include the acquisitions of Mark Forge and Desktop Metal as they both occurred in April after the quarter closed.
Speaker Change: Let's dive into headline results.
Speaker Change: Importantly.
Speaker Change: I want to reiterate that these results are for the first quarter 2025, ending March 31, and thus only reflect novel dimensions business, let's call. This our core business.
Speaker Change: Which does not include the acquisitions of Mark forwards and desktop metal as they.
Speaker Change: Both occurred in April after the quarter closed.
Assaf Zipori: I'll ask Assaf to cover some of the other figures. Thanks, Ofir.
Speaker Change: Alaska Saab to cover some of the other figure.
Speaker Change: Thanks, all for you.
Assaf Zipori: I will walk you through our financial results for Q1 2025. Just a quick note, my comments today are based on our non-IFRS results. You can find the full IFRS to non-IFRS reconciliations in our earnings release, which was issued earlier today and posted on our investor relations website. Total revenue for the period was $14.4 million representing an 8% growth from Q1 2024 despite macroeconomic headwinds. Our adjusted gross margin for the quarter was 43.8% compared to 49.8% in Q1 2024. Our gross margin in Q1 was impacted by the discontinuation of non-strategic assets. OPEX net of one-time expenses declined to $14 million in Q1 compared to $25.3 million in Q1 of last year.
Speaker Change: I will walk you through our financial results for Q1 2025.
Speaker Change: Just a quick note my comments today are based on our non <unk> results.
Speaker Change: You can find the full ifr ias to non <unk> reconciliations in our earnings release, which was issued earlier today and posted on our Investor Relations website.
Speaker Change: Total revenue for the period was $14 4 million, representing an 8% growth from Q1 2024, despite macroeconomic headwinds.
Speaker Change: Our adjusted gross margin for the quarter was 43, 8%.
Speaker Change: Compared to 49, 8% in Q1 2024.
Speaker Change: Our gross margin in Q1 was impacted by the discontinuation of non strategic asset.
Speaker Change: Opex net of one time expenses.
Speaker Change: Declined to $14 million in Q1 compared to $25 3 million in Q1 of last year.
Assaf Zipori: This improvement reflects our focus on cost controls and operational efficiencies. This focused execution is also reflected in our adjusted EBITDA loss of $9 million in Q1. That is compared to a loss of $13.6 million in Q1 2024.
Speaker Change: This improvement reflects our focus on cost controls and operational efficiencies.
Speaker Change: This focused execution is also reflected in our adjusted EBITDA loss of 9 million in Q1.
Assaf Zipori: That is compared to a loss of $13 6 million in Q1 2024.
Assaf Zipori: Finally, as of March 31st, our cash, cash equivalents, and investable securities was $840 million. Our cash balance includes our investment in strategies. Additionally, it excludes our two most recent acquisitions with a combined purchase price of $294.5 million.
Assaf Zipori: Finally as of March 31, our cash cash equivalents and investable securities was $840 million.
Assaf Zipori: Our cash balance includes our investment in strategy.
Assaf Zipori: Additionally, it excludes our two most recent acquisitions, where the combined purchase price of $294.5 million.
Julien Lederman: Now Julien, I will hand it over to you. Good afternoon, everyone. This is a review of some key strategic decisions we have made, which you may recognize from previous communication. This was all part of our program to assess. then transform. then invest, and finally grow.
Now Julien I will hand, it over to you.
Julien Lederman: Good afternoon, everyone. This is a review of some key strategic decisions. We have made which you may recognize from previous communications.
Speaker Change: This was all part of our program to assess then transform.
Speaker Change: Then invest and finally grow.
Julien Lederman: The first key actions in this program were the discontinuation of several products, including Admatech, DeepTube, Fabrica, and Formatech. Simply put, these products were not found to deliver sufficient ROI for continued support from shareholders' capital. These decisions were forecast to save around $20 million on annual operating expenses. We believe these results demonstrate our ability to act quickly. on decisions that have impact.
Speaker Change: The first key actions and this program, where the discontinuation of several products, including Avnet checks deep cube fabric Informa Tech.
Speaker Change: Simply put these products were not bound to deliver sufficient ROI for continued support from shareholders capital.
Speaker Change: These decisions.
Speaker Change: We're forecasting to save around $20 million on annual operating expenses.
Speaker Change: We believe these results demonstrate our ability to act quickly.
Speaker Change: Decisions that have impact.
Julien Lederman: Thank you, Julien.
Julien: Thank you Julien.
Ofir Baharav: Let's shift to strategic integration program. We did this through product rationalization and operating model optimization. for our products. We ensure we have a competitive advantage that can command a high margin, while making sure our solutions can work towards manufacturing high value, high performance parts, manufacturing at scale, rather than the fabrication of experimental designs and concepts. and ultimately deliver a clear ROI for our customers.
Speaker Change: Shift to strategic integration programs.
Speaker Change: We did this through product rationalization and operating model optimization.
Ofir Baharav: For our products, we ensure we have a competitive advantage that can command a high margin, while making sure our solutions can work towards manufacturing high value high performance parts.
Speaker Change: Manufacturing at scale, rather than the fabrication of experimental designs and concepts.
Ofir Baharav: And ultimately deliver a clear ROI for our customers.
Ofir Baharav: For our operations, we have further reduced expenses, pursuing world-class financial ratios. broken down organizational silos and move towards a team with more doers. fewer managers for a flatter organization, better equipped to innovate and deliver value at speed.
Ofir Baharav: For our operations, we have further reduced expenses pursuing world class financial ratios.
Broken down organizational silos and move towards a team with more doors.
Speaker Change: Fewer managers for a flatter organization better equipped to innovate and deliver value at speed.
Ofir Baharav: Let us start looking at Nano Dimension's core business with Mark Forge.
Speaker Change: Let us start looking at none that I mentioned core business with marque fortune.
Ofir Baharav: Firstly, desktop metal is not included here due to its ongoing independent strategic assessment. I encourage those who are new to this topic to review our previous communications on this subject in April and in May. Back to the slide. You'll see here that Nano Dimension core business, which is the company as it was prior to the acquisition, was just under $15 million in revenue in the first quarter, 2025. while Mark Forge was just under 17 million. In looking at adjusted EBITDA across the two organizations, you can see notable improvement due to our prudent management. and Cost Reduction.
Ofir Baharav: Firstly.
Ofir Baharav: Desktop metal is not included here due to its ongoing independent strategic assessment.
Ofir Baharav: I encourage those who are new to this topic to review our previous communications on the subject in April and in May.
Ofir Baharav: Back to this slide.
Ofir Baharav: You'll see here, but now that I mentioned core business, which is the company as it was prior to the acquisition.
Ofir Baharav: It was just under $15 million in revenue in the first quarter 2025.
Speaker Change: Well Mark Forge was just under 17 million.
Speaker Change: And looking at adjusted EBITDA across the two organizations you can see notable improvement due to our prudent management.
Speaker Change: And cost reduction.
Ofir Baharav: Let's shift to post-merger integration, or PMI. We appreciate that many of our shareholders have interest in our thinking about the acquisition. We are focused on growing our business, but doing so in a responsible way.
Speaker Change: Let's shift to post merger integration or PMI.
Speaker Change: We appreciate that many of our shareholders and interest in our thinking about the acquisitions.
Speaker Change: We are focused on growing our business.
Speaker Change: But doing so in a responsible way.
Ofir Baharav: We are running Product Rationalization and Operating Model Optimization Processing. For product rationalization, we are ensuring our solutions have a competitive advantage that can demand a high margin and enable high value, high performance parts manufacturing at scale. If we do this, we can deliver a ROI for shareholders. For Operating Model Optimization, we are reducing expenses to normal ratios, breaking down organizational silos, and shaping the team around more doers, less managers, for a flatter organization, better equipped to innovate and deliver value.
Speaker Change: We are running product rationalization.
Speaker Change: And operating model optimization processes.
Speaker Change: For product rationalization, we are ensuring our solutions have a competitive advantage that can demand a high margin and enable high value high performance parts manufacturing at scale.
Speaker Change: If we do this we can deliver a ROI for shareholders.
Speaker Change: For operating model optimization, we are reducing expenses to normal ratios.
Speaker Change: Breaking down organizational silos and.
Speaker Change: In shaping the team around four doors.
Speaker Change: Less managers for a flatter organization better equipped to innovate and deliver value.
Ofir Baharav: A key point. While we did all of this in the core business, this is exactly how we are approaching post-acquisition integration of Markforged.
Speaker Change: A key point.
Mark Schwartz: While we did all of this in the core business. This is exactly how we are approaching post acquisition integration of Mark Schwartz.
Ofir Baharav: Moving on. I would normally say more about desktop metal at this point. But again, they're going through an independent strategic assistance.
Speaker Change: Moving on.
Speaker Change: I would normally say more about desktop metal at this point.
Speaker Change: But again.
Speaker Change: They are going through an independent strategic assessment.
Ofir Baharav: Mark Forge We are very excited about post-merger integration development. We are building on three strong foundations Mark Forge has developed through its years of operations. First, A leading software platform positioned to be a leading multiproduct suite serving the digital manufacturing industry. Montforge FFF technology that is already adopted on factory floors and used for end parts. Their metal binder jetting solution, which can manufacture exceptional, high performance, high value metal parts at scale.
Mark Schwartz: Well Mark forged.
Mark Schwartz: We are very excited about the post merger integration development.
Mark Schwartz: We are building on three strong foundation, Mark Forge has developed three tiers of operations.
Mark Schwartz: First.
Mark Schwartz: A leading software platform.
Mark Schwartz: <unk> to be a leading multi product suite, serving the digital manufacturing industry.
Mark Schwartz: Second.
Mark Schwartz: Mark towards if if it's technology that is already adopted on factory floors and used for imports.
Ofir Baharav: Third.
Mark Schwartz: There may tell binder, jetting solution, which can manufacturer exceptional high performance high value metal parts at scale.
Ofir Baharav: We must also look at things requiring some change. We're shifting to more strategic sales to deliver more solutions to the leading industrial manufacturing company. We are reducing operating expenses like we did in the core business.
Mark Schwartz: We must also look at things requiring some change.
Mark Schwartz: We're shifting to more strategic sales to deliver more solutions to the leading industrial manufacturing companies.
Ofir Baharav: We are reducing operating expenses.
Mark Schwartz: Like we did in the core business.
Ofir Baharav: before going to Q&A. I want to conclude with the following. We are confident we are doing the right things to create shareholders value. We did the right things to address the Nano Dimension business challenge. And we are doing the same with Mark Forge. And while we cannot say what will happen with Desktop Metal's independent strategic assessment, I am confident our board and management team are focused on creating shareholder value by being a digital manufacturing leader through pioneering technology and also a P&L and balance that will be formidable and signal our long-term strength and leadership.
Mark Schwartz: Before going to Q&A.
Mark Schwartz: I want to conclude with the following.
Mark Schwartz: We are confident we're doing the right things to create shareholders value.
Mark Schwartz: We did the right things to address the nano dimension business challenges.
And we are doing the same with Mark Schwartz.
Mark Schwartz: And while we cannot say what will happen with desktop metals independent strategic assistance I am confident our board and management team are focused on creating shareholder value by being a digital manufacturing leader through pioneering technology and also.
Mark Schwartz: A P&L and balance sheet that will be formidable and signal our long term strength and leadership.
Ofir Baharav: Thank you.
Mark Schwartz: Thank you.
Operator: I will now open it for questions. Thank you. To ask a question, you may press star, then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the key. To withdraw your question, please press star, then two.
Mark Schwartz: I will now open it for questions.
Mark Schwartz: Thank you.
Speaker Change: I ask a question you May press Star then one on your telephone keypad, if youre using a speakerphone. Please pick up your handset before pressing the king.
Mark Schwartz: The mentality that question.
Mark Schwartz: Thank you.
Troy Jensen: At this time, we'll pause momentarily to assemble a rough The first question comes from Troy Jensen with Cantor Fitzgerald. Please go ahead. Hey gentlemen, thanks for taking my question.
At this time, well pause momentarily to assemble our roster.
Mark Schwartz: Okay.
Speaker Change: Our first question comes from Troy Jensen with Cantor Fitzgerald. Please go ahead.
Troy Jensen: Hey, gentlemen, thanks for taking my question.
Ofir Baharav: I guess I want to ask a little bit on the desktop metal, you know, I guess it's a strategic view and you can't say much, but I guess my curiosity is on their convertible and whether or not that stays with desktop or is Nano responsible for it now that you guys acquired I believe we've elaborated on desktop and on the convertible in previous communications. We have met and we're meeting our obligations. to Gestalt Metal. And this submittal right now is managed by an independent management. Independent Financial Advisors and Independent Boards. And they will make the decisions that are best for this document.
Speaker Change: Okay, I guess I wanted to ask a little bit on the desktop metal.
Mark Schwartz: I guess this is strategic.
Mark Schwartz: Not to say much about.
Mark Schwartz: I guess my curiosity is on their convertible and whether or not that there is risks.
Mark Schwartz: Desktop.
Mark Schwartz: He is now responsible for it but you guys.
Mark Schwartz: So quiet.
Mark Schwartz: I believe we've elaborated on desktop.
Mark Schwartz: And the convert and on the convertible in previous communications.
Mark Schwartz: We have a mix and we're meeting our obligations.
Mark Schwartz: To stop medal.
Mark Schwartz: And then stop metal right now is managed by an independent management.
Mark Schwartz: Dependent.
Mark Schwartz: National Advisors, and an independent boards.
Mark Schwartz: And they will make the decisions that are best for their stocking at all.
Mark Schwartz: Okay.
Unknown Attendee: Alright, I understand you can't see a lot.
Mark Schwartz: Alright I understand.
Mark Schwartz: Alright.
Unknown Attendee: Assaf Zipori, Shai Terem, Ofir Baharav, Nano Dimension, Shai Terem, Ofir Baharav, Nano Out, what does, you know, the cost structure that, you know, the cash burn rate.
Mark Schwartz: How about a softer year could you help us out maybe six to 12 months.
Alex: Alex what does the cost structure that the cash burn rates.
Unknown Attendee: you know, any insight on what a combined business model looks like for Nano. Yeah, I try.
Alex: Any insight on what the combined business model looks like for nano.
Speaker Change: Yeah, Hi, Troy.
Assaf Zipori: Definitely, at this point, we've decided to not provide guidance as we evaluate the strategic alternatives of DM. And we are working through the integration process of Markforged and Nano together. I can say that we are very disciplined in our approach towards expenses. We are very mindful of our cash burn. That's what we'll continue to do.
Unknown Attendee: Currently at this point, we have decided to not to provide guidance as we strategically.
Mark Schwartz: Strategic alternatives.
Mark Schwartz: Yeah.
Mark Schwartz: And we are working through the integration process.
Assaf Zipori: Mark forged and N O together I can say that we are very disciplined in our approach towards expenses, we are very mindful of.
Mark Schwartz: And entrepreneur.
Assaf Zipori: And we will continue and reduce operational expenses and controlling our costs.
Mark Schwartz: As we've been doing and if you take a look at our Q1 numbers for nano understand alone basis, you can see that opex improved significantly from the previous quarter.
Assaf Zipori: And.
Mark Schwartz: That's what we'll continue to do so.
Assaf Zipori: So, unfortunately, I cannot give you any specific details at this point.
Assaf Zipori: Unfortunately, I cannot give you any specific details at this point.
Unknown Attendee: Alright, understood guys, good luck.
Alright understood guys are they looking for.
Unknown Attendee: Okay.
Operator: Once again, if you have a question, please press star then 1.
Mark Schwartz: Once again, if you have a question. Please press Star then one.
Operator: Since there are no more questions, this concludes the question and answer session.
Operator: Since there are no more questions. This can.
Speaker Change: The question and answer session I would like to turn the conference back over to the company for any closing remarks. Please go ahead.
Operator: I would like to turn the conference back over to the company for any closing remarks. Please go ahead. Thank you for your participation, everyone, and we look forward to meeting with you for one-on-one calls as soon as time permits.
Operator: Thank you for your participation everyone and we look forward to meeting with you for one on one calls.
Mark Schwartz: So as time permits.
Operator: Thank you for today's call.
Mark Schwartz: Thank you for today's call.
Operator: The conference is now concluded.
Speaker Change: The conference has now concluded. Thank you for attending that Andi mentioned quarterly earning conference call you may now disconnect.
Operator: Thank you for attending Nano Dimension's Quarterly Earnings Conference Call. © BF-WATCH TV 2021
Operator: Okay.
Mark Schwartz: Yes.
Operator: Okay.
Mark Schwartz: Yeah.
Mark Schwartz: [music].