Markforged Q2 revenue growth 19% as 3D printing “at point of need” gathers momentum

3D printer manufacturer Markforged (MKFG) has published Q2 2022 financial statements showing a revenue increase of 18.6%. 

Over the quarter, Markforged earned $24.2 million in revenue, $3.8 million more than it reported in Q2 2021, and a rise of $2.3 million quarter-on-quarter. During the firm’s Q2 2022 earnings call, its CEO Shai Terem explained how this growth was driven by “strong demand” for the Markforged FX20 3D printer, especially among those trying to combat supply issues by creating “industrial-strength parts at point of need.”

“Demand for The Digital Forge continues to grow,” said Terem. “Our customers realize the value of our additive solutions as they solve for a growing number of applications with high-quality parts. We continue to make great strides in executing on our strategy thanks to great efforts from our talented team, and feel very confident in our long-term opportunity.”

Traders looking up at a Markforged sign outside the NYSE.
Traders looking up at a Markforged sign outside the NYSE. Photo via Markforged.

Markforged’s Q2 2022 financials 

Since Markforged went public on the NYSE in July 2021, it has demonstrated fairly consistent growth. However, given that Markforged’s revenue rose 9.0% in Q2 2021, its Q2 2022 results represent a significant step up in the pace of its expansion. According to Terem, this acceleration has been possible thanks to the “pipeline of opportunities” provided by its still-growing Digital Forge offering. 

In particular, Terem noted on the firm’s earnings call how the FX20’s size, speed, and ability to print temperature-resistant parts led demand to “exceed expectations.” While the CEO said interest in the machine is “really solid” and “not weak anywhere,” he added that it’s proving especially popular in aerospace and machine shop applications, where users are replacing “real mission-critical metal parts.”

On the consumables front, Markforged’s CFO Mark Schwartz also revealed that Onyx was its highest-selling material during Q2 2022, although it saw “very healthy usage across the board.” Last quarter, for instance, Markforged launched its Precise PLA filaments, a range designed to cater to low-cost prototyping applications that Schwartz said is “ramping nicely” and bringing in new revenue to the company. 

However, while Markforged continues to see strong client demand, Terem admitted that the volatility of the global economy is having a short-term impact on its pipeline conversion. This, Terem said, has led the firm to “scrutinize its internal cost controls,” but he added that it doesn’t intend to cut back on innovation spending, with R&D costs up 62.5% in Q2 to $10.4 million, and further growth here to come.

Financials ($) Q2 2021Q2 2022Variance ($) Variance (%) Q1 2022 Q2 2022Variance ($) Variance (%) 
Revenue 20.4m24.2m+3.8m+18.621.9m24.2m+2.3m+10.5
Cost of Revenue 8.5m11.3m+2.8m+32.910.3m11.3m+1.0m+9.7
Gross Profit 11.9m12.9m+1.0m+8.411.6m12.9m+1.3m+11.2
Operating Expenses 22.7m36.7m+14m+61.732.8m36.7m+3.9m+11.9
Operating Loss10.7m23.8m+13.1m+122.421.2m23.8m+2.6m+12.3

Markforged’s Q2 3D printing activities 

One area that Markforged’s portfolio proved particularly popular in during Q2 was the defense industry. The company recently published a case study that detailed how the US Air Force is using an X7 3D printer to build devices in training environments designed to match real combat zones at the Cannon Air Force Base

By using the machine to 3D print night vision goggle mounts for airmen’s tactical helmets, the Air Force was reportedly able to improve their stamina and agility while reducing the part’s cost from hundreds of dollars down to just $5. 

In Halifax, North Carolina, meanwhile, the Phillips Corporation adopted the FX20 3D printer, a machine with large-format additive manufacturing capabilities. At the time, Terem said the system would allow adopters to enter new “high-value mission-critical applications,” especially those catering to the aerospace, defense, and automotive industries.

Markforged has also continued to expand its portfolio via acquisitions. Over the course of Q2 2022, Markforged acquired Teton Simulation in a move that’ll see SmartSlice software integrated into its Eiger platform. On top of this, Markforged has since bought Digital Metal, a binder jet 3D printer manufacturer, via a deal that’s expected to allow its Digital Forge to address a wider set of customer needs. 

“Digital Metal’s technology complements our existing Metal X solution while also expanding our addressable market within manufacturing industries that includes automotive, medical and luxury goods,” added Terem on the call. “We believe this strategic acquisition advances our long-term vision of distributed manufacturing.”

A row of Markforged X7 3D printers. Photo via Markforged.

As Markforged moves into Q3 2022, it has revised its FY guidance down to $110.0 million to $115.0 million, from its prior forecast of $114.0 million to $123.0 million. Described by Terem as a “prudent” move that takes economic conditions into account, the revision still leaves the firm projecting growth of 20.6% to 26.1%, and it finished the Q2 with $243.2 million in cash, positioning it well for the months ahead. 

“I believe in a future where supply chains are resilient and sustainable and I think the best way to realize this future is by pushing digital manufacturing capability directly to the point of need,” concluded Terem. “Changing the order manufacturing won’t happen overnight. It is a long-term mission. That is why even during this period of macroeconomic uncertainty, we’re investing in our product portfolio.” 

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Featured image shows traders looking up at a Markforged sign outside the NYSE. Photo via Markforged.