Xometry 4Q24 Earnings Preview: Strong U.S. Demand Should Offset Weak International Trends; But 2025 Estimates Look Aggressive

View all Xometry reports. and link to our research disclaimer.

Xometry XMTR 0.00%↑ is slated to report 4Q24 results before markets open on Tuesday, February 25th. While there are positive trends that should support strong 4Q24 performance, including robust U.S. pricing, very strong Networking growth at Protolabs, and an improving broader manufacturing environment, our 4Q24 Pricing Analysis showed international pricing weakness may act as a headwind. However, despite this challenge, we believe Xometry will likely come in within its original guidance range given ~83% of sales are derived in the U.S. Encouragingly, our 4Q24 Pricing Analysis highlighted sustained strength in U.S. pricing trends, which have extended into 1Q25. Additionally, international pricing is beginning to see signs of stabilization and potential recovery in early 2025. That said, while we expect the company to guide to robust double-digit Y/Y growth in 1Q25, we do believe consensus estimates are likely aggressive, with expectations for Y/Y revenue growth to accelerate to ~23% from mid-teens in 4Q24. However, despite these positive top-line trends, our primary concern remains Xometry’s ability to translate growth into profitability, as we believe 2025 profitability expectations may still be elevated. We believe lack of revenue per unique buyer growth will continue to force the company to accelerate marketing spend to drive growth. Rising marketing expenses, in line with trends seen at Protolabs PRLB 0.00%↑, could weigh on margins, leading to potential downward revisions in 2025 adjusted EBITDA expectations. With Xometry trading at ~160x EV/EBITDA based on 2025 estimates, any downward estimate revisions will likely put significant downside risks on shares.

Below we dive deeper into 4Q24 / 1Q25 pricing trends and our bearish view on Xometry heading into 4Q24 earnings.