Revenue of $52.3 million, down from $60.6 million in the same quarter a year ago, and up 22% sequentially over the prior quarter
Year-over-year improvements to net loss, adjusted EBITDA, gross margins, non-GAAP gross margins, operating expenses, and operating cash flow following more than $150 million in cost reduction efforts announced since June 2022
Net loss of $(323.4) million in 2023 compared to net loss of $(740.3) million in 2022
Adjusted EBITDA of $(9.2 million), a year-over-year improvement of 56% – and the company’s strongest quarterly performance to date
GAAP gross margin of (32)%; GAAP gross margin was negatively impacted by one-time non-cash restructuring activities in the quarter. Non-GAAP gross margin of 34%, a year-over-year improvement of 39.9%.
Quarterly GAAP operating expenses declined 58% year over year, both periods were impacted by goodwill impairment. Quarterly non-GAAP operating expenses declined for seven consecutive quarters to $31.6 million, down 39% from the start of DM’s cost reduction initiative
Cash, cash equivalents, and short-term investments closed fourth quarter 2023 at $84.5 million, as rate of cash consumption declined 25% compared to the same year-ago quarter
Initiated a review of strategic alternatives for industrial photopolymer business in effort to further strengthen position in our core healthcare photopolymers and production binder jetting for metal, sand and ceramic parts
Full year 2024 revenue guidance of between $175 and $215 million, and adjusted EBITDA between $(30) and $(10) million, with expectation to achieve adjusted EBITDA breakeven in the second half of 2024

BOSTON–(BUSINESS WIRE)–Desktop Metal, Inc. (NYSE: DM), a global leader in Additive Manufacturing 2.0 technologies for mass production, today announced its financial results for the fourth quarter and full year ended December 31, 2023.

“Despite a challenging capital investment environment led by elevated interest rates and slower sales cycles, I’m proud that Team DM buckled down and delivered a much improved operating performance including reduced not loss and a record adjusted EBITDA performance,” said Ric Fulop, Founder and CEO of Desktop Metal.

“While we didn’t make our internal target of A-EBITDA positive by the end of the year, as some customer projects rolled into 2024, we are now very, very close to that goal,” Fulop continued. “We now enter the year with a lower cost structure that makes us resilient for the long term. The hard work will continue as we drive toward profitability, a goal that is clearly within sight despite the tough market conditions.”

Fulop noted that DM continues to see strong demand for production binder jet systems that produce metal, sand and ceramic parts, as well as increasing evidence of the value of Additive Manufacturing 2.0 systems. For the full year, DM reported record recurring revenue of $65 million, a 29% increase over the prior year that now represents 34% of revenue, up from 24% from 2022.

“Our all-time high recurring revenue levels prove that customers who have adopted our technology are using it successfully and getting great value from our technologies,” Fulop said.

Fourth Quarter 2023 and Recent Business Highlights:

Corporate

Continued execution of cost reduction plans with expectation of positive adjusted EBITDA in the second half of 2024

Product Performance

Desktop Metal and Evonik expand partnership, announce qualification of INFINAM® ST 6100 L on large format Additive Manufacturing 2.0 systems for high-performance, high-temperature products
Desktop Health™ announces Flexcera™ Base Ultra+ dental resin for stronger, more comfortable 3D Printed dentures
Desktop Metal now shipping the Figur G15 – a Digital Sheet Metal Forming machine that eliminates the need for custom tooling
Desktop Health announces first patients treated with FDA-Cleared CMFlex™ – and off-the-shelf 3D printed synthetic bone graft product pioneered by Dimension Inx on the 3D-Bioplotter®
Desktop Metal launches Live Monitor™ for users of Additive Manufacturing 2.0 production technology
DM now has metal and ceramic parts in production in multiple high value programs in defense and aerospace with parts in several jet engine families, major platforms like F35 and in several space vehicles
Growing business in Gigacasting with several global automakers

Fourth Quarter 2023 Financial Highlights

Revenue of $52.3 million, down from $60.6 million in the same quarter a year ago, and up 22% sequentially over the prior quarter
GAAP gross margin of (32)%; GAAP gross margin was negatively impacted by restructuring activities in the quarter. Non-GAAP gross margin of 34%, a year-over-year increase of 39.9%.
GAAP net loss of $(174.5) million, including $110.5 million of goodwill impairment; non-GAAP net loss of $(10.9) million
Adjusted EBITDA of $(9.2) million, a year-over-year improvement of 56% – and the company’s strongest quarterly performance to date
Cash, cash equivalents, and short-term investments closed fourth quarter 2023 at $84.5 million, as rate of cash consumption declined 25% compared to the same year-ago quarter

Financial Outlook

Revenue expectation of between $175 million to $215 million for 2024
Adjusted EBITDA of between $(30) million to $(10) million for full-year 2024

Desktop Metal has not provided a reconciliation of its Adjusted EBITDA outlook to net income because estimates of all of the reconciling items cannot be provided without unreasonable efforts. See “Non-GAAP Financial Information.”

Conference Call Information:

Desktop Metal will host a conference call on Friday, March 15, 2024 to discuss fourth quarter 2023 results. Participants may access the call at 1-877-407-4018, international callers may use 1-201-689-8471, and request to join the Desktop Metal financial results conference call. A simultaneous webcast of the conference call and the accompanying summary presentation may be accessed online at the Events & Presentations section of ir.desktopmetal.com. A replay will be available shortly after the conclusion of the conference call at the same website.

About Desktop Metal:

Desktop Metal (NYSE:DM) is driving Additive Manufacturing 2.0, a new era of on-demand, digital mass production of industrial, medical, and consumer products. Our innovative 3D printers, materials, and software deliver the speed, cost, and part quality required for this transformation. We’re the original inventors and world leaders of the 3D printing methods we believe will empower this shift, binder jetting and digital light processing. Today, our systems print metal, polymer, sand and other ceramics, as well as foam and recycled wood. Manufacturers use our technology worldwide to save time and money, reduce waste, increase flexibility, and produce designs that solve the world’s toughest problems and enable once-impossible innovations. Learn more about Desktop Metal and our #TeamDM brands at www.desktopmetal.com.

Forward-looking Statements:

This press release contains forward-looking statements within the meaning of the federal securities laws. All statements other than statements of historical facts contained in these communications, including statements regarding Desktop Metal’s future results of operations and financial position, financial targets, business strategy, and plans and objectives for future operations, are forward-looking statements. Forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this document, including but not limited to: demand for Desktop Metal’s products and services; the global macro-economic environment; impacts of rapid technological change in the additive manufacturing industry; Desktop Metals’ ability to realize the benefits from cost saving measures; and supply and logistics disruptions, including shortages and delays. For more information about risks and uncertainties that may impact Desktop Metal’s business, financial condition, results of operations and prospects generally, please refer to Desktop Metal’s reports filed with the SEC, including without limitation the “Risk Factors” and/or other information included in the Form 10-Q filed with the SEC on November 9, 2023, and such other reports as Desktop Metal has filed or may file with the SEC from time to time. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Desktop Metal, Inc. assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.

DESKTOP METAL, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)

	December 31,
	2023		2022
Assets
Current assets:
Cash and cash equivalents	$	83,845	$	76,291
Current portion of restricted cash		233		4,510
Short‑term investments		625		108,243
Accounts receivable		37,690		38,481
Inventory		82,639		91,736
Prepaid expenses and other current assets		11,105		17,155
Total current assets		216,137		336,416
Restricted cash, net of current portion		612		1,112
Property and equipment, net		35,840		56,271
Goodwill		—		112,955
Intangible assets, net		168,259		219,830
Other noncurrent assets		37,153		27,763
Total Assets	$	458,001	$	754,347
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	18,190	$	25,105
Customer deposits		5,356		11,526
Current portion of lease liability		7,404		5,730
Accrued expenses and other current liabilities		27,085		26,723
Current portion of deferred revenue		11,739		13,719
Current portion of long‑term debt, net of deferred financing costs		330		584
Total current liabilities		70,104		83,387
Long-term debt, net of current portion		89		311
Convertible notes		112,565		111,834
Lease liability, net of current portion		23,566		17,860
Deferred revenue, net of current portion		3,696		3,664
Deferred tax liability		3,523		8,430
Other noncurrent liabilities		2,806		1,359
Total liabilities		216,349		226,845
Commitments and Contingencies (Note 17)
Stockholders’ Equity
Preferred Stock, $0.0001 par value—authorized, 50,000,000 shares; no shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively		—		—
Common Stock, $0.0001 par value—500,000,000 shares authorized; 325,277,419 and 318,235,106 shares issued as of December 31, 2023 and December 31, 2022, respectively, 325,271,670 and 318,133,434 shares outstanding as of December 31, 2023 and December 31, 2022, respectively		33		32
Additional paid‑in capital		1,908,504		1,874,792
Accumulated deficit		(1,632,225)		(1,308,954)
Accumulated other comprehensive loss		(34,660)		(38,368)
Total Stockholders’ Equity		241,652		527,502
Total Liabilities and Stockholders’ Equity	$	458,001	$	754,347

See notes to consolidated financial statements.

DESKTOP METAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)


	Years Ended December 31,
	2023		2022		2021
Revenues
Products	$	168,091	$	190,248	$	105,994
Services		21,607		18,775		6,414
Total revenues		189,698		209,023		112,408
Cost of sales
Products		184,614		178,952		87,450
Services		15,174		15,000		6,665
Total cost of sales		199,788		193,952		94,115
Gross profit (loss)		(10,090)		15,071		18,293
Operating expenses
Research and development		85,096		96,878		68,131
Sales and marketing		40,334		68,091		47,995
General and administrative		66,272		83,065		78,041
In-process research and development assets acquired		—		—		25,581
Impairment charges		8,518		—		—
Goodwill impairment		112,911		498,800		—
Total operating expenses		313,131		746,834		219,748
Loss from operations		(323,221)		(731,763)		(201,455)
Change in fair value of warrant liability		—		—		(56,576)
Interest expense		(4,099)		(1,743)		(149)
Interest and other (expense) income, net		944		(8,335)		(11,822)
Loss before income taxes		(326,376)		(741,841)		(270,002)
Income tax benefit		3,105		1,498		29,668
Net loss	$	(323,271)	$	(740,343)	$	(240,334)
Net loss per share—basic and diluted	$	(1.00)	$	(2.35)	$	(0.92)
Weighted average shares outstanding, basic and diluted		322,196		314,817		260,770

See notes to consolidated financial statements.

DESKTOP METAL, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(in thousands)

	Years Ended December 31,
	2023		2022		2021
Net loss	$	(323,271)	$	(740,343)	$	(240,334)
Other comprehensive (loss) income, net of taxes:
Unrealized loss		(203)		(290)		(40)
Foreign currency translation adjustment		3,911		(31,664)		(6,365)
Total comprehensive (loss) income, net of taxes of $0	$	(319,563)	$	(772,297)	$	(246,739)

See notes to consolidated financial statements.

DESKTOP METAL, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(in thousands, except share amounts)

								Accumulated
				Additional				Other		Total
	Common Stock			Paid‑in		Accumulated		Comprehensive		Stockholders’
	Shares	Amount		Capital		Deficit		(Loss)		Equity

BALANCE—January 1, 2021	224,626,597	$	23	$	844,188	$	(328,277)	$	(9)	$	515,925
Exercise of Common Stock options	5,732,247		1		6,425		—		—		6,426
Vesting of restricted Common Stock	491,293		—		—		—		—		—
Repurchase of shares for employee tax withholdings – RSA	(109,150)		—		(958)		—		—		(958)
Vesting of restricted share units	650,777		—		—		—		—		—
Repurchase of shares for employee tax withholdings – RSU	(61,498)		—		(541)		—		—		(541)
Issuance of Common Stock in connection with acquisitions	57,267,401		5		620,585		—		—		620,590
Issuance of Common Stock in connection with acquired in-process research and development	334,370		—		4,300		—		—		4,300
Stock‑based compensation expense	—		—		28,778		—		—		28,778
Vesting of Trine Founder Shares	1,850,938		—		—		—		—		—
Common Stock issued in connection with warrants exercised	20,690,975		2		320,567		—		—		320,569
Net loss	—		—		—		(240,334)		—		(240,334)
Other comprehensive loss	—		—		—		—		(6,405)		(6,405)
BALANCE—December 31, 2021	311,473,950	$	31	$	1,823,344	$	(568,611)	$	(6,414)	$	1,248,350
Exercise of Common Stock options	2,310,931		—		3,190		—		—		3,190
Vesting of restricted Common Stock	157,131		—		—		—		—		—
Vesting of restricted share units	4,153,939		1		—		—		—		1
Repurchase of shares for employee tax withholdings – RSU	(74,719)		—		(243)		—		—		(243)
Issuance of common stock related to settlement of contingent consideration	112,202		—		500		—		—		500
Stock‑based compensation expense	—		—		48,001		—		—		48,001
Net loss	—		—		—		(740,343)		—		(740,343)
Other comprehensive loss	—		—		—		—		(31,954)		(31,954)
BALANCE—December 31, 2022	318,133,434	$	32	$	1,874,792	$	(1,308,954)	$	(38,368)	$	527,502
Exercise of Common Stock options	1,006,046		—		1,203		—		—		1,203
Vesting of restricted Common Stock	95,859		—		—		—		—		—
Vesting of restricted share units	5,802,852		1		(1)		—		—		—
Repurchase of shares for employee tax withholdings – RSU	(211,314)		—		(250)		—		—		(250)
Issuance of common stock related to settlement of contingent consideration	444,793		—		797		—		—		797
Stock‑based compensation expense	—		—		31,963		—		—		31,963
Net loss	—		—		—		(323,271)		—		(323,271)
Other comprehensive income	—		—		—		—		3,708		3,708
BALANCE—December 31, 2023	325,271,670	$	33	$	1,908,504	$	(1,632,225)	$	(34,660)	$	241,652

See notes to consolidated financial statements.

DESKTOP METAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

	Years Ended December 31,
	2023		2022		2021
Cash flows from operating activities:
Net loss	$	(323,271)	$	(740,343)	$	(240,334)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		53,632		50,767		24,854
Stock‑based compensation		33,177		48,001		28,778
Impairment charges		8,518		—		—
Goodwill impairment		112,911		498,800		—
Inventory write-off		28,966		—		—
Change in fair value of warrant liability		—		—		56,576
Change in fair value of subscription agreement		—		—		2,920
Amortization of capitalized commissions		318		—		—
Amortization (accretion) of discount on investments		(490)		(888)		3,021
Amortization of debt financing cost		—		—		9
Amortization of deferred costs on convertible notes		731		453		—
Provision for bad debt		2,215		975		447
Provision for slow-moving, obsolete, and lower of cost or net realizable value inventories, net		17		(45)		—
Acquired in-process research and development		—		—		25,581
Loss on disposal of property and equipment		209		224		74
Net increase (decrease) in accrued interest related to marketable securities		238		847		(819)
Net unrealized (gain) loss on equity investment		464		6,332		9,660
Net unrealized (gain) loss on other investments		–		1,595		(130)
Deferred tax benefit		(3,105)		(1,498)		(29,668)
Change in fair value of contingent consideration		—		(1,567)		(429)
Foreign currency transaction (gain) loss		(613)		303		189
Changes in operating assets and liabilities:		—
Accounts receivable		(1,297)		6,737		(18,299)
Inventory		(19,079)		(28,183)		(16,962)
Prepaid expenses and other current assets		5,205		1,787		(8,937)
Other assets		4,265		2,505		(3)
Accounts payable		(6,894)		(6,595)		12,797
Accrued expenses and other current liabilities		1,966		(10,613)		(8,761)
Customer deposits		(6,169)		(2,037)		(2,569)
Current portion of deferred revenue		(1,962)		(4,749)		5,989
Change in right of use assets and lease liabilities, net		(6,626)		(4,298)		(641)
Other liabilities		1,679		(41)		1,609
Net cash used in operating activities		(114,995)		(181,531)		(155,048)
Cash flows from investing activities:
Purchases of property and equipment		(2,762)		(11,517)		(7,683)
Purchase of other investments		—		—		(3,620)
Proceeds from other investments		4,089		3,155		—
Purchase of equity investment		—		—		(20,000)
Proceeds from sale of property and equipment		9,942		6		44
Proceeds from policy buyout		—		—		333
Purchase of marketable securities		(4,973)		(158,404)		(330,873)
Proceeds from sales and maturities of marketable securities		112,719		248,150		243,349
Proceeds from capital grant		—		200		—
Cash paid to acquire in-process research and development		—		—		(21,220)
Cash paid for acquisitions, net of cash acquired		(1,750)		(23)		(287,624)
Net cash provided by (used in) investing activities		117,265		81,567		(427,294)
Cash flows from financing activities:
Proceeds from reverse recapitalization, net of issuance costs		—		—		—
Proceeds from the exercise of stock options		1,203		3,190		6,426
Proceeds from the exercise of stock warrants		—		—		170,665
Payment of taxes related to net share settlement upon vesting of restricted stock units		(250)		(243)		(541)
Repayment of loans		(419)		(542)		—
Proceeds from issuance of convertible notes		—		115,000		—
Costs incurred in connection with the issuance of convertible notes		—		(3,619)		—
Repayment of term loan		—		—		(10,000)
Net cash provided by financing activities		534		113,786		166,550
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(27)		(167)		(87)
Net increase (decrease) in cash, cash equivalents, and restricted cash		2,777		13,655		(415,879)
Cash, cash equivalents, and restricted cash at beginning of period		81,913		68,258		484,137
Cash, cash equivalents, and restricted cash at end of period	$	84,690	$	81,913	$	68,258

Supplemental disclosures of cash flow information
Reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total shown in the consolidated statements of cash flows:
Cash and cash equivalents	$	83,845	$	76,291	$	65,017
Restricted cash included in other current assets		233		4,510		2,129
Restricted cash included in other noncurrent assets		612		1,112		1,112
Total cash, cash equivalents and restricted cash shown in the consolidated statements of cash flows	$	84,690	$	81,913	$	68,258

Supplemental cash flow information:
Interest paid	$	6,900	$	3,488	$	148
Taxes paid	$	—	$	—	$	150

Non‑cash investing and financing activities:
Net unrealized (gain) loss on investments	$	(339)	$	290	$	40
Exercise of private placement warrants	$	—	$	—	$	149,904
Common Stock issued for acquisitions	$	—	$	—	$	620,590
Common Stock issued for acquisition of in-process research and development	$	—	$	—	$	4,300
Common Stock issued for settlement of contingent consideration	$	797	$	500	$	—
Accrued purchase price related to acquisitions	$	—	$	—	$	1,800
Additions to right of use assets and lease liabilities	$	13,926	$	10,812	$	5,582
Purchase of property and equipment included in accounts payable	$	239	$	516	$	90
Purchase of property and equipment included in accrued expense	$	31	$	—	$	38
Transfers from property and equipment to inventory	$	2,214	$	4,993	$	1,068
Transfers from inventory to property and equipment	$	1,566	$	4,513	$	1,435
Accrued contingent consideration in connection with acquisitions	$	—	$	—	$	6,083
Taxes related to net share settlement upon vesting of restricted stock awards in accrued expense	$	—	$	—	$	958
Deferred contract costs	$	—	$	1,341	$	—
Equipment financing	$	—	$	175	$	—

See notes to consolidated financial statements.

Non-GAAP Financial Information

This press release contains non-GAAP financial measures, including non-GAAP gross margin, non-GAAP operating loss, non-GAAP net loss, non-GAAP operating expense, EBITDA and Adjusted EBITDA.

We define non-GAAP gross margin as GAAP gross margin excluding the effect of stock-based compensation, amortization of acquired intangible assets, restructuring, acquisition-related and integration costs, and inventory step-up adjustments
We define non-GAAP operating loss as GAAP operating loss excluding the effect of stock-based compensation, amortization of acquired intangible assets, restructuring, inventory step-up adjustments, and acquisition-related and integration costs
We define non-GAAP net loss as GAAP net loss excluding the effect of stock-based compensation

Contacts

Investor Relations:
(857) 504-1084

[email protected]

Media Relations:
Sarah Webster

(313) 715-6988

[email protected]

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