Sigma Labs, the Santa Fe-based quality assurance software developer for additive manufacturing, has announced its financial results for the first quarter ended March 31, 2020. The company’s revenue for Q1 2020 experienced over 200 percent in growth compared to Q1 2019.
In a supporting statement, newly appointed CEO Mark K. Ruport explains that, amid the ongoing COVID-19 pandemic, Sigma Labs is optimistic about the position of its business as the company continues its route towards commercialization.
“The first quarter of 2020, even amongst the various COVID-19 related headwinds, positioned us for an exciting year in the commercialization of PrintRite3D,” explains Ruport. “Although we had some short-term impact on our business in March, we are cautiously optimistic that the momentum in the market and the increased demand for more agility in manufacturing supply chains will accelerate the growth of 3D metal printing and open up an even larger opportunity and demand for our technology.”
“We have a well-refined product, ready for use in immediate production and validated by tier-1 partners globally.”
Sigma Labs activity in Q1 2020
Sigma Labs’ flagship product is PrintRite3D, an in-process quality assurance (IPQA) software package for metal additive manufacturing. It is composed of hardware and multi-sensor modules and various software modules for additive manufacturing quality assurance and in-process monitoring. Together, the modules collect and process the data of a 3D printer, allowing users to analyse and inspect in real-time, and implement corrections if necessary.
The company experienced a number of key developments throughout Q1 2020. To help further validate its technology, Sigma Labs signed a contract to implement its quality assurance software for metal additive manufacturing at Northwestern University.
Sigma Labs entered into an additional contract with the Mississippi State University Center for Advanced Vehicular Systems (CAVS) to install, test and demonstrate the PrintRite3D software on Renishaw’s AM400 3D printer.
Furthermore, the company signed a joint sales agreement with Belgium headquartered Materialise, advancing an earlier MoU to develop an integrated in-situ quality assurance system for metal 3D printing. The new agreement focuses on commercializing the newly integrated PrintRite3D quality assurance technology with the Materialise control platform.
Sigma Labs also launched an updated product known as the Printrite3D Production Series, which introduces a ‘Production Dashboard’ to provide production managers with critical metrics, insight and actionable information during the production process. Finally, the company was awarded with two U.S. Patents for its PrinRite3D product.
Sigma Labs Summary of Condensed Balance Sheets
In its Q1 2020 financial report, Sigma posted a total revenue of $221,730, compared to $64,450 for the first quarter of 2019. This growth represents an increase of 244 percent.
The cost of revenue in Q1 2020 was reported at $244,703, whereas for Q1 2019 this figure was $96,555.
Gross profit for Q1 2020 was -$22,973, and net loss for the same period was reported at -$1,583,585. For comparison, in Q1 2019, gross profit was reported at -$32,105, with a net loss of -$1,484,112.
|$||Q1 2020||Q1 2019||Variance $||%|
|Cost of Revenue||244,703||96,555||148,148||153.43%|
The growth in revenue in Q1 2020 was attributed by Sigma Labs to the sales of two PrintRite3D units to Northwestern University and CAVS respectively. The company also generated revenue from its legacy Rapid Test and Evaluation (“RTE”) program during the quarter.
During the earnings call with analysts and investors, Ruport explained that throughout most of Q1 2020, Sigma Labs was working towards a forecast of over $400,000, even with the COVID-19 pandemic gaining momentum in late February and early March. The order, comprising two machines at $200,000, was placed by a a supplier to the aerospace industry. With the impact of the pandemic, the customer had to puil the order as its capital expenditures had been frozen.
“We would have hit the 400,000 in Q1 if it wasn’t for the last minute issues that were encountered by our customer. And you can imagine if you’re a main supplier to aerospace and what’s happened to that industry, how reluctant you are to spend your capital right now,” explains Ruport.
Moving forward, despite the impact of the current health crisis, Ruport believes Sigma Labs’ Q2 revenue will increase by 50 percent to 100 percent over Q1 2020. However, due to the uncertainties caused by the pandemic, he also remains cautious about the optimistic prediction: “Of course I have some caveats around that regarding what might happen, that we’re not sure if regarding COVID and also when it comes to shipping and recognizing is different than sometimes booking the revenue because of the lead time. But I feel very confident that we have enough opportunities for foreseeable growth quarter-over-quarter of 50 percent to 100 percent.”
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Featured image via Sigma Labs.