Velo3D Completes Strategic Review to Propel Future Growth and Success

Velo3D's Strategic Transformation: Paving the Way for Future Success

Velo3D, Inc. (OTC: VLDX), a frontrunner in scalable metal 3D printing technology designed for production manufacturing, recently announced significant progress following its comprehensive strategic review. This process, which began in December 2023, has led to the successful implementation of crucial changes that are set to position the company for sustainable growth in 2025 and beyond.

One of the major outcomes of the review was a debt-for-equity exchange that allowed Arrayed Notes Acquisition Corp., the holder, to acquire 95% of Velo3D's outstanding common shares. This strategic financial maneuver is not just about reshuffling numbers; it opens avenues for Velo3D and Arrayed Additive, the parent company, to pool resources effectively. With this partnership, the company aims to strengthen its leadership role in providing high-value additive manufacturing solutions, particularly focusing on the defense, aerospace, and space sectors.

In conjunction with the financial restructuring, Velo3D saw significant changes in its governance. Six members of its board resigned, paving the way for Arun Jeldi—previously the CEO of Arrayed Additive—to be appointed as both a board member and the new CEO of Velo3D. Jeldi, with his vast experience, is poised to steer the company in a direction that prioritizes innovative solutions and addresses market demands aggressively.

The firm has also unveiled a fresh go-to-market strategy aimed at uncovering and capitalizing on various revenue opportunities. This new roadmap emphasizes delivering a comprehensive solutions-based approach for customers, integrating system and parts sales into its offerings. Such a strategy not only mirrors industry trends but also positions Velo3D as a competitive player capable of adapting to varied client needs.

In terms of financial performance, recent results for the third fiscal quarter ending September 30, 2024, shed light on the company’s current standing. Velo3D reported revenue of $8.2 million with a gross margin of 49.4%. However, it also faced GAAP operating expenses totaling $22.8 million, which included $6.7 million attributed to bad debt expenses. Notably, the company recorded a GAAP net loss of $22.8 million, influenced by several non-cash expenses and adjustments. Despite the losses, these results set the stage for future reporting on a more stable footing, including the expected financial outlook for 2025.

In a statement, Jeldi expressed optimism regarding the restructuring. He believes that these changes mark a crucial step for Velo3D as it embarks on its growth trajectory. Jeldi noted, “Our focus remains on providing customers with our industry-leading, large-format metal 3D printing solutions…” He emphasized that the recent actions taken reflect the dedication to achieving a sustainable, long-term business model that can thrive in the competitive landscape.

The additively manufactured parts produced by Velo3D hold potential in multiple sectors, including aerospace, energy, and semiconductor industries, where high-value metal components are crucial. Velo3D’s integrated approach—including proprietary software and the Sapphire family of printers—facilitates the scalability of metal 3D printing, which is a game changer in manufacturing sectors that demand flexibility and precision.

This recent restructuring is a clear indication that Velo3D is committed to evolving its business model to respond to the changing dynamics within metal additive manufacturing. With an infusion of enthusiasm and strategic direction under Jeldi’s leadership, the company is well-positioned to harness new opportunities, sustain growth, and solidify its place at the forefront of technological innovation.

In conclusion, Velo3D’s extensive strategic review and subsequent actions suggest a proactive approach to overcoming the challenges of the industry and emerging stronger. As they look into 2025 and beyond, the future looks promising for both Velo3D and its partnerships across various high-stakes sectors.