Velo3D, Inc.
For the period ended Jun 30, 2026. Filed Aug 11, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 11, 2026
VELO$5.58+15.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-14.
0001193125-26-223945
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-11.
0001193125-26-344560
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 177 previous paragraphs and 211 current paragraphs.
112 unchanged; 38 reworded; 38 added; 24 removed; 3 previous and 23 current paragraphs rearranged.
Tables are not compared: 5 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (38)
Current report
At the Market Offering
Current report
On May 15, 2026, the Company entered into a sales agreement (the“Sales Agreement”) with Needham & Company, LLC ("Needham"), Cantor Fitzgerald & Co. ("Cantor") and Craig-Hallum Capital Group, LLC ("Craig-Hallum") (each, a “Sales Agent,” and collectively, the “Sales Agents”), acting as sales agents and/or principals. Pursuant to the terms of the Sales Agreement, the Company may sell from time to time to or through any Sales Agent shares of the Company’s common stock, par value $0.00001 per share (the“Shares”), having an aggregate offering price of up to $100,000,000 (the “Offering”). Sales of Shares, if any, under the Sales Agreement may be made in any transactions permitted by law that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act. See Note 16, At-the-Market Offering for further information.
Current report
Notwithstanding the recent debt and equity transactions, as described under “—Liquidity and Capital Resources” and in Note 1 Description of Business and Basis of Presentation—Going Concern, Financial Condition and Liquidity and Capital Resources in the notes to these unaudited condensed consolidated interim financial statements, management concluded that substantial doubt continues to exist about the Company's ability to continue as a going concern. Although the Company significantly improved its liquidity position during the six months ended June 30, 2026 through equity financings, debt conversions and debt repayments, management expects that additional financing will be required to fund operations and satisfy obligations during the assessment period due to continued operating losses, negative operating cash flows and ongoing working capital requirements. There can be no assurance that additional financing will be available on acceptable terms, or at all. If the Company is unable to obtain additional financing or otherwise improve its liquidity, it may be required to significantly reduce or discontinue operations, sell assets, pursue strategic alternatives, restructure its obligations or seek protection under applicable bankruptcy laws.
Current report
NM = Not Meaningful
Current report
Total revenue for the three months ended June 30, 2026 and 2025 was $20.7 million and $13.6 million, respectively, an increase of $7.1 million, or 52.3%.
Current report
Other revenue was $0.2 million and less than $0.1 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $0.1 million.
Current report
Total cost of revenue for the three months ended June 30, 2026 and 2025 was $16.2 million and $15.2 million, respectively, an increase of $1.1 million, or 7.0%. While overall cost of revenue increased consistently with the increase in sales, during the second quarter of 2026, the cost of revenue also reflected the impact of a prospective refinement in the allocation of certain labor and overhead costs between cost of revenue and operating expenses to align with current operational activities, which offset this increase from sales.
Current report
Cost of revenue as a percentage of revenue was 78.5% and 111.7% for the three months ended June 30, 2026 and 2025, respectively. The decrease was primarily attributable to a more favorable product mix and the impact of a prospective refinement in the allocation of certain labor and overhead costs between cost of revenue and operating expenses to align with current operational activities.
Current report
Total gross profit (loss) was $4.4 million and ($1.6) million for the three months ended June 30, 2026 and 2025, respectively. As a percentage of revenue, the gross margin was 21.5% and (11.7)% for the three months ended June 30, 2026 and 2025, respectively. The improvement primarily reflected the impact of a prospective refinement in the allocation of certain labor and overhead costs between cost of revenue and operating expenses to align with current operational activities, as well as higher average selling prices, a more favorable product mix, increased RPS revenue, and manufacturing efficiencies.
Current report
General and administrative expenses were $8.3 million and $6.0 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $2.4 million. The increase was attributable to an increase of $1.2 million in legal and professional services, an increase of $1.0 million in facility and overhead costs and a $0.3 million increase in stock-based compensation, offset by a decrease of $0.1 million in headcount, salaries and employee-related expenses.
Current report
Other Expense, Net
Current report
Other expense, net was $0.2 million and less than $0.1 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $0.2 million. The increase was primarily driven by a non-recurring other business expense, slightly offset by higher interest income for the second quarter of 2026.
Current report
Results of Operations
Current report
Comparison of the Six Months Ended June 30, 2026 and 2025:
Current report
NM = Not Meaningful
Current report
Revenue
Current report
Total revenue for the six months ended June 30, 2026 and 2025 was $34.5 million and $22.9 million, respectively, an increase of $11.6 million, or 50.6%.
Current report
Other revenue was $0.7 million and less than $0.1 million for the six months ended June 30, 2026 and 2025, respectively, an increase of $0.7 million.The increase was primarily attributable to higher software revenue during the six months ended June 30, 2026.
Current report
Total cost of revenue for the six months ended June 30, 2026 and 2025 was $27.7 million and $23.8 million, respectively, an increase of $3.9 million, or 16.3%. While overall cost of revenue increased consistently with the increase in sales, during the second quarter of 2026, the cost of revenue also reflected the impact of a prospective refinement in the allocation of certain labor and overhead costs between cost of revenue and operating expenses to align with current operational activities, which offset this increase from sales.
Current report
Cost of 3D Printer and parts was $26.0 million and $21.5 million for the six months ended June 30, 2026 and 2025, respectively. The increase of $4.4 million primarily reflected differences in product mix and higher RPS volume during the current period. We expect manufacturing costs to improve as a percentage of revenue as a result of overhead and fixed cost reduction initiatives implemented in late 2025 and increased production volumes leading to economies of scale.
Current report
Cost of Support Services was $1.7 million and $2.2 million for the six months ended June 30, 2026 and 2025, respectively. Cost of Support Services decreased by $0.6 million, primarily due to lower direct customer support costs and changes in employee responsibilities supporting existing customers.
Current report
Cost of revenue as a percentage of revenue was 80.2% and 103.9% for the six months ended June 30, 2026 and 2025, respectively. The decrease was primarily attributable to a more favorable product mix and the impact of a prospective refinement in the allocation of certain labor and overhead costs between cost of revenue and operating expenses to align with current operational activities.
Current report
Gross Profit (Loss) and Gross Margin
Current report
Total gross profit (loss) was $6.8 million and ($0.9) million for the six months ended June 30, 2026 and 2025, respectively. As a percentage of revenue, the gross margin was 19.8% and (3.9)% for the six months ended June 30, 2026 and 2025, respectively. The improvement primarily reflected the impact of a prospective refinement in the allocation of certain labor and overhead costs between cost of revenue and operating expenses to align with current operational activities, as well as higher average selling prices, a more favorable product mix, increased RPS revenue, and manufacturing efficiencies.
Current report
System reliability performance; and
Current report
We expect to accelerate production cycle times and further improve efficiencies on the production floor, which we expect will continue to improve gross profit and gross margin during the second half of 2026. Ongoing trends in component costs, tariffs and supplier pricing may continue to negatively impact gross profit and gross margin until our financial condition improves.
Current report
We expect research and development expenses to increase during the remainder of 2026 and beyond as we execute our refreshed technology roadmap, expand our RPS capabilities, improve system utilization efficiency and continue to enhance our portfolio of additive manufacturing solutions.
Current report
Selling and marketing expenses were $4.6 million and $2.6 million for the six months ended June 30, 2026 and 2025, respectively, an increase of $2.0 million. The increase was attributable to an increase of $0.8 million in headcount, salaries and employee-related expenses, a $0.5 million increase in stock-based compensation, an increase of $0.4 million in facility and overhead costs, and a $0.3 million increase in marketing initiatives and trade show spending.
Current report
We expect selling and marketing expenses to increase during the remainder of 2026 and beyond as we expand our commercial activities, including increased participation in the defense and aerospace markets, and continue investing in trade shows, marketing initiatives and brand awareness.
Current report
We expect general and administrative expenses to increase as we support the continued growth of the business, including projects related to the expansion of our RPS manufacturing operations. At the same time, we remain focused on managing operating costs through reduced reliance on outside consultants, ongoing facility cost management and vendor negotiations designed to improve enterprise-wide efficiencies.
Current report
The loss on fair value of warrants was less than $0.1 million and $1.0 million for the six months ended June 30, 2026 and 2025, respectively. The change was related to the non-cash fair value change of the warrant liabilities driven by the relative change in our stock price.
Current report
Our purchase commitments with suppliers are generally cancellable prior to shipment. As of June 30, 2026, we had approximately $31.5 of non-cancellable purchase commitments for components and assemblies, which are expected to be delivered primarily during the remainder of 2026. These purchase commitments support anticipated production requirements and are expected to be funded through operating cash flows and available liquidity. See Note 8, Leases, in the unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report for additional information regarding our lease commitments.
Current report
During the six months ended June 30, 2026, we strengthened our liquidity position through the completion of a firm commitment underwritten registered direct offering, sales under our At-the-Market ("ATM") equity program, the conversion of our previously outstanding secured convertible notes into equity by the holders thereof and the repayment of certain debt obligations. Despite these improvements, we continue to incur operating losses and negative operating cash flows, and our business requires significant ongoing working capital to support manufacturing operations and customer deliveries.
Current report
Management evaluated the Company's liquidity in accordance with ASC 205-40 and considered current cash balances, historical and projected operating cash flows, recurring working capital requirements, scheduled debt obligations and available financing alternatives. Although our liquidity position improved significantly during the six months ended June 30, 2026, management concluded that substantial doubt continues to exist about our ability to continue as a going concern because we expect to require additional financing to fund operations during the twelve-month period following the issuance of the financial statements included in this Quarterly Report. See Note 1, Description of Business and Basis of Presentation—Going Concern, Financial Condition and Liquidity and Capital Resources, in the unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report for additional information.
Current report
We intend to continue pursuing additional sources of capital, including equity and debt financings and other strategic financing alternatives. There can be no assurance that additional financing will be available on acceptable terms, or at all. If we are unable to obtain additional financing or otherwise improve our liquidity, we may be required to significantly reduce operating expenditures, delay strategic initiatives, sell assets, restructure obligations or pursue other strategic alternatives.
Current report
On May 15, 2026, Velo3D, Inc. (the“Company”) entered into a sales agreement (the“Sales Agreement”) with Needham & Company, LLC ("Needham"), Cantor Fitzgerald & Co. ("Cantor") and Craig-Hallum Capital Group, LLC ("Craig-Hallum") (each, a “Sales Agent,” and collectively, the “Sales Agents”), acting as sales agents and/or principals. Pursuant to the terms of the Sales Agreement, the Company may sell from time to time to or through any Sales Agent shares of the Company’s common stock, par value $0.00001 per share (the“Shares”), having an aggregate offering price of up to $100,000,000 (the“Offering”). Sales of Shares, if any, under the Sales Agreement may be made in any transactions permitted by law that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act. See Note 16, At-the-Market Offering for further information.
Current report
Our ability to satisfy future liquidity requirements will depend on a number of factors, including our ability to increase revenue, improve gross margins, manage working capital efficiently, control operating expenses, execute our strategic initiatives and access additional sources of capital. Actual results may differ from our current expectations due to market conditions, customer demand, macroeconomic conditions and other factors beyond our control.
Current report
As of June 30, 2026, our outstanding debt consisted solely of the 2025 Equipment Loan, with an aggregate principal of approximately $8.2 million.
Removed paragraphs (24)
Previous report
Notwithstanding the recent debt and equity transactions, as described in “—Liquidity and Capital Resources” and in Note 1 Description of Business and Basis of Presentation—Going Concern, Financial Condition and Liquidity and Capital Resources in the notes to the unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report, management believes that substantial doubt exists about the Company's ability to continue as a going concern. We do not have sufficient liquidity to meet our operating needs and satisfy our debt obligations for at least the next 12 months. The Company will need to engage in additional financings to fund our operations, continue to fund payroll for employees, and satisfy our obligations in the near term. Without such additional funding, we will not be able to continue operations and may be required to sell assets, liquidate and/or file for bankruptcy.
Previous report
Cost of Revenue
Previous report
Research and Development Expenses
Previous report
Selling and Marketing Expenses
Previous report
General and Administrative Expenses
Previous report
Interest Expense
Previous report
Income Taxes
Previous report
Total revenue for the three months ended March 31, 2026 and 2025 was $13.8 million and $9.3 million, respectively, an increase of $4.5 million, or 48.2%.
Previous report
Cost of Revenue
Previous report
Total cost of revenue for the three months ended March 31, 2026 and 2025 was $11.4 million and $8.6 million, respectively, an increase of $2.8 million, or 32.6%.
Previous report
Cost of Support Services was $1.2 million and $1.1 million for the three months ended March 31, 2026 and 2025, respectively. Cost of Support Services increased by $0.1 million, due to higher labor costs to scale the field service engineering support teams.
Previous report
Cost of revenue as a percentage of revenue was 82.8% and 92.5% for the three months ended March 31, 2026 and 2025, respectively. The decrease in the cost of revenue as a percentage of revenue was primarily driven by an increase in the number of system sold, offset by efficiency improvements in costs for overhead and labor for the three months ended March 31, 2026, compared to the three months ended March 31, 2025.
Previous report
Total gross profit was $2.4 million and $0.7 million for the three months ended March 31, 2026 and 2025, respectively. As a percentage of revenue, the gross margin was 17.2% and 7.5% for the three months ended March 31, 2026 and 2025, respectively. The increase in gross profit for the three months ended March 31, 2026 was primarily attributable to the an increase in the average selling price, an increase in the number of systems sold, and an increase in RPS revenue as well as efficiencies in improving our overhead and labor costs during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025.
Previous report
Research and Development Expenses
Previous report
Selling and Marketing Expenses
Previous report
General and Administrative Expenses
Previous report
Interest Expense
Previous report
Income Taxes
Previous report
During the three months ended March 31, 2026, we experienced revenue growth over the prior quarter as expected due to our focus on improving the reliability of systems and working on restoring market confidence with our high-value customers with the new executive leadership team. As of March 31, 2026, we do not have sufficient working capital to meet our financial needs for the twelve-month period following the filing date of this Quarterly Report. As such, we believe that there is substantial doubt about our ability to continue as a going concern for the twelve-month period following the issuance of these unaudited condensed consolidated interim financial statements. See Note 1, Description of Business and Basis of Presentation—Going Concern, Financial Condition and Liquidity and Capital Resources, in the unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report.
Previous report
We will need to engage in additional financings to fund our operations and satisfy our debt obligations in the near-term as well as to respond to business challenges and opportunities, including the need to repay the Secured Notes, provide working capital, continue to fund payroll for employees, improve our operating infrastructure, and continue to sustain operations. Accordingly, subject to our compliance with the covenants in the Secured Notes, to fund our operations, we will need to engage in equity or debt financings to secure additional funds, including seeking additional capital from public or private offerings of our equity or debt securities, electing to repay, restructure or refinance our existing indebtedness, or electing to borrow additional amounts under new credit lines or from other sources. We may also seek to raise additional capital, including from offerings of our equity or debt securities, on an opportunistic basis when we believe there are suitable opportunities for doing so.
Previous report
Additionally, our recent and projected financial results, and the related conditions that raise substantial doubt about our ability to continue as a going concern, and general concerns among potential investors and creditors about our financial well-being, may make cost cutting activities and securing additional financing on commercially reasonable terms (if at all) or in an amount sufficient to fund our operations for at least 12 months especially difficult.
Previous report
More generally, our ability to meet our cash requirements depends on, among other things, our operating performance, competitive and industry developments, and financial market conditions, all of which are significantly affected by business, financial, economic, political, and other factors, many of which we may not be able to control or influence. To the extent that our actual operating results or other developments differ from our expectations, our liquidity will continue to be adversely affected.
Previous report
As of March 31, 2026, our debt arrangements comprised the 2025 Equipment Loan, of which we had approximately $9.2 million aggregate principal amount outstanding as of March 31, 2026.
Previous report
There was no cash provided by investing activities during the three months ended March 31, 2025.
Reworded paragraphs (38)
Previous wording
The following discussion and analysis provides information which our management believes is relevant to an assessment and understanding of our results of operations and financial condition. This discussion should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 and our unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report. This discussion contains forward-looking statements based upon our current expectations, estimates and projections, and involves numerous risks and uncertainties. Actual results may differ materially from those contained in any forward-looking statements due to, among other considerations, the matters discussed in the sections titled “Risk Factors” and “Cautionary Note Regarding Forward-looking Statements” herein. During the fiscal year ended December 31, 2025, we identified immaterial errors in our previously issued financial statements. We have corrected the amounts as presented in this Item 2 accordingly. Refer to Note 2, Summary of Significant Accounting Policies to the unaudited condensed consolidated interim financial statements included in Part I of this Quarterly Report for additional information.
Current wording
The following discussion and analysis provides information which our management believes is relevant to an assessment and understanding of our results of operations and financial condition. This discussion should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 and our unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report. This discussion contains forward-looking statements based upon our current expectations, estimates and projections, and involves numerous risks and uncertainties. Actual results may differ materially from those contained in any forward-looking statements due to, among other considerations, the matters discussed in the sections titled “Risk Factors” and “Cautionary Note Regarding Forward-looking Statements” herein. During the fiscal year ended December 31, 2025, we identified immaterial errors in our previously issued financial statements. We have corrected the amounts as presented in this Item 2 accordingly. Refer to Note 2, Summary of Significant Accounting Policies to the unaudited condensed consolidated interim financial statements included in Part I of this Quarterly Report for additional information regarding the prior-period corrections.
Previous wording
On February 10, 2025, the Company issued a Senior Secured Convertible Promissory Note in the principal amount of $10,000,000 (the "February Note") to Thieneman Construction, Inc. an Indiana corporation, to be funded in two tranches of $5,000,000. The February Note bears interest at a rate of 30.0% per annum, is payable in full on the date that is six months from the date such tranche was funded, (the first tranche and second tranche were received by the Company on February 10, 2025 and March 20, 2025, respectively), in the amount of $5,750,000 and given it was not paid on or prior to such date, will continue to accrue interest at the same rate until paid. The outstanding principal amount of the February Note is convertible into shares of the Company's common stock upon the occurrence of the Company’s successful listing of shares of its common stock on a national securities exchange or the occurrence and during the continuation of an event of default, into common stock at a fixed conversion price of $15.00 per share.
Current wording
On February 10, 2025, the Company issued a Senior Secured Convertible Promissory Note in the principal amount of $10,000,000 (the"February Note") to Thieneman Construction, Inc., an Indiana corporation, to be funded in two tranches of $5,000,000. The February Note bore interest at a rate of 30.0% per annum, was payable in full on the date that is six months from the date such tranche was funded (the first tranche and second tranche were received by the Company on February 10, 2025 and March 20, 2025, respectively), in the amount of $5,750,000 and given it was not paid on or prior to such date, would continue to accrue interest at the same rate until paid. The outstanding principal amount of the February Note was convertible into shares of the Company's common stock upon the occurrence of the Company’s successful listing of shares of its common stock on a national securities exchange or the occurrence and during the continuation of an event of default, into common stock at a fixed conversion price of $15.00 per share.
Previous wording
On February 24, 2025, the Company entered into February Warrant Exchange Agreements with each of: (i) Highbridge Tactical Credit Master Fund, L.P. (“HM”); (ii) Highbridge Tactical Credit Institutional Fund, Ltd. (collectively with HM, the “Highbridge Holders”); (iii) Anson Investments Master Fund LP (“AMF”); (iv) Anson East Master Fund LP (collectively with AMF, the “Anson Holders”); (v) High Trail Investments ON LLC (“HTI”), and (vi) HB SPV I Master LLC (together with HTI, the “High Trail Holders”), pursuant to which: (a) the Highbridge Holders and the Anson Holders agreed to exchange an aggregate of 60,150 registered warrants issued in April 2024 and an aggregate of 99,048 registered warrants issued in August 2024, and (b) the High Trail Holders agreed to exchange an aggregate of 151,808 unregistered warrants issued in April 2024 and July 2024, and an aggregate of 19,048 registered warrants issued in December 2023, for an aggregate of 990,159 shares (the “Acquired Shares”) of Company’s common stock, respectively, equating in each case to an exchange ratio of three Acquired Shares for each warrant.
Current wording
On February 24, 2025, the Company entered into February Warrant Exchange Agreements with each of: (i) Highbridge Tactical Credit Master Fund, L.P. (“HM”); (ii) Highbridge Tactical Credit Institutional Fund, Ltd. (collectively with HM, the “Highbridge Holders”); (iii) Anson Investments Master Fund LP (“AMF”); (iv) Anson East Master Fund LP (collectively with AMF, the “Anson Holders”); (v) High Trail Investments ON LLC (“HTI”), and (vi) HB SPV I Master LLC (together with HTI, the “High Trail Holders”), pursuant to which: (a) the Highbridge Holders and the Anson Holders agreed to exchange an aggregate of 60,150 registered warrants issued in April 2024 and an aggregate of 99,048 registered warrants issued in August 2024, and (b) the High Trail Holders agreed to exchange an aggregate of 151,808 unregistered warrants issued in April 2024 and July 2024, and an aggregate of 19,048 registered warrants issued in December 2023, for an aggregate of 990,159 shares (the“Acquired Shares”) of the Company’s common stock, respectively, equating in each case to an exchange ratio of three Acquired Shares for each warrant.
Previous wording
On August 14, 2025, the Company amended the January Note (the "January Note Amendment"), which amended certain provisions of the January Note, including: an extension of the maturity date under the January Note to February 14, 2027; a reductions of the interest rate under the January Note to 12%; and an adjustment of the fixed conversion price to 16.38 per share. On August 14, 2025, the Company also amended the February Note (the “February Note Amendment”) which, amended certain provisions of the February Note, including: an extension of the maturity dates for each tranche under the February Note to February 14, 2027; a reduction of the interest rate under the February Note to 12%; and an adjustment of the fixed conversion price to 10.50 per share. The Company has evaluated that the note amendments are both treated as a debt modification under ASC Topic 470, Debt.
Current wording
On August 14, 2025, the Company amended the January Note (the"January Note Amendment"), which amended certain provisions of the January Note, including: an extension of the maturity date under the January Note to February 14, 2027; a reduction of the interest rate under the January Note to 12%; and an adjustment of the fixed conversion price to $16.38 per share. On August 14, 2025, the Company also amended the February Note (the“February Note Amendment”) which, amended certain provisions of the February Note, including: an extension of the maturity dates for each tranche under the February Note to February 14, 2027; a reduction of the interest rate under the February Note to 12%; and an adjustment of the fixed conversion price to $10.50 per share. The Company has evaluated that the note amendments are both treated as a debt modification under ASC Topic 470, Debt.
Previous wording
On April 27, 2026, the Company entered into an Offering of 3,571,428 shares of the Company’s common stock, par value $0.00001 per share. The Shares were sold at a public offering price per share of $14.00. The gross proceeds from the Offering were approximately $50 million, before deducting underwriting discounts and commissions and other offering expenses of $3 million.
Current wording
On April 27, 2026, the Company entered into an underwriting agreement (the“Underwriting Agreement”) with Cantor Fitzgerald & Co., as underwriter (the“Underwriter”), relating to the offer and sale in a firm commitment underwritten registered direct offering (the“Offering”) of 3,571,428 shares (the“Shares”) of the Company’s common stock, par value $0.00001 per share. The Shares were sold at a public offering price per share of $14.00. The gross proceeds from the Offering were approximately $50 million, before deducting underwriting discounts and commissions and other offering expenses of $3.4 million. The Company currently intends to use the net proceeds of the Offering for working capital and general corporate purposes.
Previous wording
Our operating results for the foreseeable future will continue to depend on sales to a small group of customers. For the three months ended March 31, 2026 and 2025, sales to the top three customers accounted for 60.9% and 70.7%, respectively, of our revenue. Of the top three customers for the three months ended March 31, 2026, all three customers were different from the top three customers for the comparable period in 2025.
Current wording
Our operating results for the foreseeable future will continue to depend on sales to a small group of customers. For the three months ended June 30, 2026 and 2025, sales to the top three customers accounted for 45.9% and 65.2%, respectively, of our revenue. Of the top three customers for the three months ended June 30, 2026, all three customers were different from the top three customers for the comparable period in 2025. For the six months ended June 30, 2026 and 2025, sales of the top three customers accounted for 33.9% and 54.6%, respectively, of our revenue. Of the top three customers for the six months ended June 30, 2026, all three customers were different from the top three customers for the comparable period in 2025.
Previous wording
While our objective is to diversify our customer base, we continue to be susceptible to risks associated with customer concentration.
Current wording
While our objective is to diversify our customer base, we continue to be susceptible to risks associated with customer concentration. See “Risk Factors—Risks Related to Our Financial Position and Need for Additional Capital—We expect to rely on a limited number of customers for a significant portion of our near-term revenue” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. Also see Note 5, Revenue—Customer Concentration, in the notes to the unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report.
Previous wording
General economic and political conditions such as recessions, interest rates, fuel prices, inflation, foreign currency fluctuations, international tariffs, social, political and economic risks and acts of war or terrorism (including, for example, the ongoing military conflicts in Israel and in Ukraine and the economic sanctions related thereto), have added uncertainty in timing of customer orders and supply chain constraints. In 2025, we implemented a number of supply chain and manufacturing improvements in response and intend to continue to focus on driving further operational improvements during 2026 to reduce operating costs.
Current wording
General economic and political conditions such as recessions, interest rates, fuel prices, inflation, foreign currency fluctuations, international tariffs, social, political and economic risks and acts of war or terrorism (including, for example, the ongoing military conflicts in the Middle East, including Israel and in Ukraine and the economic sanctions related thereto), have added uncertainty in timing of customer orders and supply chain constraints. In 2025, we implemented a number of supply chain and manufacturing improvements in response and intend to continue to focus on driving further operational improvements during 2026 to reduce operating costs.
Previous wording
No provision for federal and state income taxes was recorded for any periods presented due to projected losses, and we maintained a full valuation allowance on the deferred tax assets as of March 31, 2026 and 2025.
Current wording
There was minimal federal and state income tax expense (benefit) recorded during the periods presented due to projected losses, and we maintained a full valuation allowance on the deferred tax assets as of June 30, 2026 and 2025.
Previous wording
3D Printer and parts sales were $12.0 million and $7.5 million for the three months ended March 31, 2026 and 2025, respectively, an increase of $4.5 million. The increase in revenue was primarily attributed to an increase in the average selling price, an increase in the number of systems sold, and an increase in RPS revenues related to an increase in production volume for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. The 3D Printer and parts sales also included printed parts and consumables revenue.
Current wording
3D Printer and parts sales were $19.0 million and $12.1 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $6.9 million. The increase in revenue was primarily attributed to an increase in the average selling price, product mix, and an increase in RPS revenues related to an increase in production volume for the three months ended June 30, 2026, compared to the three months ended June 30, 2025.
Previous wording
Recurring Payment revenue, structured as an operating lease, was $0.0 million for the three months ended March 31, 2026 and $0.0 million for the three months ended March 31, 2025.
Current wording
Recurring Payment revenue, structured as an operating lease, was $0.0 million for the three months ended June 30, 2026 and less than $0.1 million for the three months ended June 30, 2025.
Previous wording
As part of our Strategic Realignment started in 2025, we have implemented new go-to-market and service strategies to rebuild our bookings and backlog pipeline. As we rebuild our bookings and backlog, we expect the demand for the Sapphire, Sapphire 1MZ, Sapphire XC and Sapphire XC 1MZ to increase our revenue in the future. We expect Recurring Payment revenue to decrease as we continue to shift our focus to 3D Printer system sales and RPS for printed parts. We expect our Support Service revenue to increase as the number of systems we have in the field increases. As of March 31, 2026 our backlog for firm orders was $30 million for 3D Printer and printed parts. Our focus for revenue has shifted to ensuring customer success, improving system reliability to strengthen our existing customer network, developing new customer networks to increase demand and expanding our RPS for printed parts.
Current wording
As part of our Strategic Realignment started in 2025, we have implemented new go-to-market and service strategies to rebuild our bookings and backlog pipeline. As we rebuild our bookings and backlog, we expect the demand for the Sapphire, Sapphire 1MZ, Sapphire XC and Sapphire XC 1MZ to increase our revenue in the future. We expect Recurring Payment revenue to decrease as we continue to shift our focus to 3D Printer system sales and RPS for printed parts. We expect our Support Service revenue to increase as the number of systems we have in the field increases. As of June 30, 2026 our backlog for firm orders was $31 million for 3D Printer and printed parts. Our focus for revenue has shifted to ensuring customer success, improving system reliability to strengthen our existing customer network, developing new customer networks to increase demand and expanding our RPS for printed parts.
Previous wording
Cost of 3D Printer and parts was $10.2 million and $7.5 million for the three months ended March 31, 2026 and 2025, respectively. The increase of $2.7 million was due to an increase in the number of system sold, offset by efficiency improvements in costs for overhead and labor for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. We expect the cost to manufacture new systems and to operate the RPS programs in 2026 to improve as a percentage of revenue as a result of overhead and fixed cost reduction efforts implement in late 2025 and increases in production volume leading to economies of scale cost efficiencies.
Current wording
Cost of 3D Printer and parts was $15.8 million and $14.0 million for the three months ended June 30, 2026 and 2025, respectively. The increase of $1.8 million primarily reflected differences in product mix and an increase in RPS volume for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. We expect manufacturing costs to improve as a percentage of revenue as a result of overhead and fixed cost reduction initiatives implemented in late 2025 and increased production volumes leading to economies of scale.
Previous wording
Other revenue was $0.5 million and less than $0.1 million for the three months ended March 31, 2026 and 2025, respectively, an increase of $0.5 million.
Current wording
Cost of Support Services was $0.5 million and $1.2 million for the three months ended June 30, 2026 and 2025, respectively. Cost of Support Services decreased by $0.7 million, primarily reflected lower direct customer support costs and changes in employee responsibilities supporting existing customers.
Previous wording
We expect to accelerate production cycle times and further improving efficiencies on the production floor to lower our cost of revenue, which we expect will improve our gross profit and gross margins in the second half of 2026. Due to the aforementioned trends in component costs, our gross profit and gross margin may continue to be negatively impacted until our financial condition improves.
Current wording
We expect to accelerate production cycle times and further improve efficiencies on the production floor, which we expect will continue to improve gross profit and gross margin during the second half of 2026. Ongoing trends in component costs, tariffs and supplier pricing may continue to negatively impact gross profit until our financial condition improves.
Previous wording
Research and development expenses were $2.7 million and $2.1 million for the three months ended March 31, 2026 and 2025, respectively, an increase of $0.6 million. The increase in research and development expenses was driven by a $0.8 million increase in headcount, salaries and employee-related expenses, an increase of $0.1 million in stock-based compensation, offset by a decrease of $0.3 million in other costs, primarily driven by a decrease in software costs. Research and development projects in 2026 are focused primarily on projects aligned with increasing the reliability experience for customers.
Current wording
Research and development expenses were $4.3 million and $2.6 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $1.7 million. The increase in research and development expenses was driven by a $0.6 million increase in headcount, salaries and employee-related expenses, an increase of $0.6 million in stock-based compensation, and an increase of $0.5 million in other costs, primarily reflecting higher facility-related costs and overhead allocations. Research and development projects in 2026 are focused primarily on projects aligned with increasing the reliability experience for customers.
Previous wording
Selling and marketing expenses were $1.7 million and $1.1 million for the three months ended March 31, 2026 and 2025, respectively, an increase of $0.6 million. The increase was attributable to an increase of $0.5 million in headcount, salaries and employee-related expenses, a $0.2 million increase in stock-based compensation. and a $0.2 million increase in marketing costs and initiatives spending, offset by $0.3 million in other costs.
Current wording
Selling and marketing expenses were $2.9 million and $1.5 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $1.4 million. The increase was attributable to $0.7 million increase in facility and overhead costs, an increase of $0.3 million in headcount, salaries and employee-related expenses, a $0.3 million increase in stock-based compensation, and a $0.1 million increase in marketing costs and initiatives spending.
Previous wording
Interest expense was $0.7 million and $1.1 million for the three months ended March 31, 2026 and 2025, respectively. The decrease was due to the reduction of the outstanding balances in the Senior Secured Notes and Convertible Secured Notes.
Current wording
Interest expense was $0.2 million and $1.6 million for the three months ended June 30, 2026 and 2025, respectively. The decrease was due to the reduction of the outstanding balances in the Senior Secured Notes and Convertible Secured Notes.
Previous wording
The gain (loss) on fair value of warrants was $0.0 million and ($1.0) million for the three months ended March 31, 2026 and 2025, respectively. The change was related to the absence of warrant cancelations or revaluations in the first quarter of 2026.
Current wording
The loss on fair value of warrants was less than $0.1 million and $0.0 million for the three months ended June 30, 2026 and 2025, respectively. The change was related to the non-cash fair value change of the warrant liabilities driven by the relative change in our stock price.
Previous wording
Less than $0.1 million of a provision for federal and state income taxes was recorded for both the three months ended March 31, 2026 and 2025 due to projected losses, and we maintained a full valuation allowance on the deferred tax assets as of March 31, 2026 and December 31, 2025.
Current wording
Less than $0.1 million of a provision for (benefit from) federal and state income taxes was recorded for both the three months ended June 30, 2026 and 2025 due to projected losses, and we maintained a full valuation allowance on the deferred tax assets as of June 30, 2026 and December 31, 2025.
Previous wording
Our Support Services revenue was $1.3 million and $1.8 million for the three months ended March 31, 2026 and 2025, respectively, a decrease of $0.5 million. Support Services revenue is primarily due to services provided to customers based on the installed base requiring preventive maintenance and other support services.
Current wording
Our Support Services revenue was $2.8 million and $3.1 million for the six months ended June 30, 2026 and 2025, respectively, a decrease of $0.4 million. Support Services revenue is primarily due to services provided to customers based on the installed base requiring preventive maintenance and other support services.
Previous wording
Cost of Recurring Payment was $0.0 million and less than $0.1 million for the three months ended March 31, 2026 and 2025, respectively.
Current wording
Cost of Recurring Payment was $0.0 million and less than $0.1 million for the six months ended June 30, 2026 and 2025, respectively.
Previous wording
We continue to focus on reducing our material costs through improved purchasing and inventory planning, accelerating production cycle times and improving efficiencies on the production floor to lower our cost of revenue.
Current wording
We continue to focus on reducing material costs through improved purchasing and inventory planning, accelerating production cycle times and improving production efficiencies to lower cost of revenue. These operational initiatives are expected to continue improving manufacturing efficiency and gross margins over time.
Previous wording
General and administrative expenses were $4.9 million and $9.1 million for the three months ended March 31, 2026 and 2025, respectively, a decrease of $4.2 million. The decrease was attributable to a $2.5 million decrease in stock-based compensation, a decrease of $0.8 million in legal, professional fees and general and administrative expenses, decrease of $0.6 million in facilities and other general and administrative expenses, and decrease of $0.3 million in headcount, salaries and employee-related expenses.
Current wording
General and administrative expenses were $13.2 million and $15.0 million for the six months ended June 30, 2026 and 2025, respectively, a decrease of $1.8 million. The decrease was attributable to a $2.2 million decrease in stock-based compensation, and a decrease of $0.4 million in headcount, salaries and employee-related expenses; offset by an increase of $0.6 million in legal and professional services and $0.2 million in facilities and overhead costs.
Previous wording
Loss on warrant cancellation was $11.4 million for the three months ended March 31, 2025 and related to the loss recognized in conjunction with the February 2025 Warrant Exchange transaction.
Current wording
Loss on warrant cancellation was $11.4 million for the six months ended June 30, 2025 and related to the loss recognized in conjunction with the February 2025 Warrant Exchange transaction.
Previous wording
Other income (expense), net was income of $0.7 million and expense of less than $0.1 million for the three months ended March 31, 2026 and 2025, respectively, an increase of $.7 million. The increase was primarily driven by non-routine income and higher interest income for the first quarter of 2026.
Current wording
Other income (expense), net was income of $0.5 million and expense of less than $0.1 million for the six months ended June 30, 2026 and 2025, respectively, an increase of $0.5 million. The increase was primarily driven by higher interest income for the first half of 2026.
Previous wording
As of March 31, 2026, we had approximately $16.6 million in cash and cash equivalents on hand and $6.7 million in accounts receivable. Our business requires substantial amounts of cash for operating activities, including salaries and wages paid to our employees, component and sub-assembly purchases, general and administrative expenses, and others.
Current wording
As of June 30, 2026, we had approximately $91.1 million in cash and cash equivalents on hand and $8.4 million in accounts receivable, net. Our business requires significant cash to fund operating activities, including employee compensation, purchases of components and subassemblies, manufacturing operations, working capital requirements and general corporate expenses.
Previous wording
On April 27, 2026, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Cantor Fitzgerald & Co., as underwriter (the “Underwriter”), relating to the offer and sale in a firm commitment underwritten registered direct offering (the “April 2026 Offering”) of 3,571,428 shares (the “Shares”) of the Company’s common stock, par value $0.00001 per share. The Shares were sold at a public offering price per share of $14.00. The gross proceeds from the Offering were approximately $50 million, before deducting underwriting discounts and commissions and other offering expenses.
Current wording
On April 27, 2026, the Company entered into an underwriting agreement (the“Underwriting Agreement”) with Cantor Fitzgerald & Co., as underwriter (the“Underwriter”), relating to the offer and sale in a firm commitment underwritten registered direct offering (the“Offering”) of 3,571,428 shares (the“Shares”) of the Company’s common stock, par value $0.00001 per share. The Shares were sold at a public offering price per share of $14.00. The gross proceeds from the Offering were approximately $50 million, before deducting underwriting discounts and commissions and other offering expenses of $3.4 million.
Previous wording
The following table summarizes our cash flows for the three months ended March 31, 2026 and 2025:
Current wording
The following table summarizes our cash flows for the six months ended June 30, 2026 and 2025:
Previous wording
Net cash used in operating activities for the three months ended March 31, 2026 was $18.0 million, consisting primarily of a net loss of $7.0 million, non-cash loss of $2.7 million described below, and a decrease in net operating assets of $13.7 million.The cash used from net operating assets was comprised of a decrease from contract assets of $2.1 million, a decrease from prepaid expenses and other current assets of $3.9 million, a decrease from accounts payable of $5.5 million, a decrease from accrued expenses and other current liabilities of $1.0 million, a decrease from contract liabilities of $1.5 million, and a decrease from other net operating assets of $1.0 million, offset by an increase from inventories of $0.7 million, and an increase from other assets of $0.6 million. The non-cash loss of $2.7 million primarily consisted of stock-based compensation expense of $1.9 million, and depreciation and amortization of $0.8 million.
Current wording
Net cash used in operating activities for the six months ended June 30, 2026 was $39.5 million, consisting primarily of a net loss of $18.5 million, non-cash loss of $6.0 million described below, and a decrease in net operating assets of $27.0 million. The cash used from net operating assets was comprised of a decrease from prepaid expenses and other current assets of $11.2 million, a decrease from contract assets of $10.1 million, a decrease from accounts payable of $8.2 million, a decrease from accrued expenses and other current liabilities of $4.3 million, a decrease from account receivable of $2.1 million, and a decrease from other assets of $0.1 million, offset by an increase from inventories of $4.4 million, and increase from other noncurrent liabilities of $2.6 million, and an increase from contract liabilities of $2.0 million. The non-cash loss of $6.0 million primarily consisted of stock-based compensation expense of $4.3 million, and depreciation and amortization of $1.5 million.
Previous wording
Net cash used in operating activities for the three months ended March 31, 2025 was $12.3 million, consisting primarily of a net loss of $25.0 million, non-cash loss of $17.1 million described below, and a decrease in net operating assets of $4.4 million. The cash used from net operating assets was comprised of a decrease from accounts payable of $0.9 million, a decrease from contract liabilities of $2.7 million, a decrease from prepaid expenses of $3.4 million related to insurance and vendor prepayments, a decrease of $0.8 million from accounts receivables and a decrease of $1.0 million related to other net operating assets, offset by an increase inventories of $2.0 million for Sapphire XC, Sapphire 1MZ and Sapphire XC 1MZ system production, an increase from other assets of $1.2 million and an $1.2 million increase from accrued expenses. The noncash loss of $17.1 million primarily consisted of the loss on cancelation of warrants of $11.4 million, stock-based compensation expense of $3.6 million, depreciation and amortization of $1.1 million, and the loss on fair value of warrants of $1.0 million.
Current wording
Net cash used in operating activities for the six months ended June 30, 2025 was $13.6 million, consisting primarily of a net loss of $38.3 million, non-cash loss of $22.6 million described below, and an increase in net operating assets of less than $2.1 million. The cash used from net operating assets was comprised of a decrease from accounts receivable of $1.7 million, a decrease from contract liabilities of $3.6 million, a decrease from accounts payable of $0.9 million, a decrease from contract assets of $0.9 million, a decrease from other noncurrent liabilities of $0.6 million, and a decrease from prepaid expense and other noncurrent assets of $0.3 million, and offset by an increase from inventories of $5.7 million, an increase from other assets of $2.0 million, and an increase from accrued expenses and other liabilities of $2.5 million. The non-cash loss of $22.6 million primarily consisted of the loss on cancellation of warrants of $11.4 million, stock-based compensation expense of $5.4 million, the loss on the disposal of fixed assets of $2.8 million, depreciation and amortization of $1.8 million, and the loss on fair value of warrants of $1.0 million.
Previous wording
Net cash used by investing activities during the three months ended March 31, 2026 was $0.9 million, consisting of purchases of property and equipment.
Current wording
Net cash used by investing activities during the six months ended June 30, 2026 was $4.5 million, consisting of purchases of property and equipment.
Previous wording
We expect our capital expenditures to increase in 2026 compared to 2025 as we invest in printer capacity and related facilities for the RPS expansion project. Management's expectations for capital expenditures is in the range of $40 million to $50 million.
Current wording
We expect our capital expenditures to increase in 2026 compared to 2025 as we invest in printer capacity and related facilities for the RPS expansion project. Management's expectations for capital expenditures is in the range of $40 million to $50 million. This capital expenditure plan is subject to obtaining sufficient additional financing and may be adjusted based on our liquidity position and market conditions.
Previous wording
Net cash used by financing activities during the three months ended March 31, 2026 was $3.5 million, consisting of $3.0 million principal repayment of the secured notes, and $0.5 million principal repayment of the equipment loans.
Current wording
Net cash used by financing activities during the six months ended June 30, 2026 was $99.5 million, consisting of $57.4 million net proceeds from the ATM Offering, $46.6 million net proceeds from the April 2026 Offering, $3.0 million principal repayment of the Secured Notes, and $1.5 million principal repayment of the equipment loans.
Previous wording
Net cash provided by financing activities during the three months ended March 31, 2025 was $15.0 million, consisting of proceeds of $15.0 million from the issuance of the January Note and the February Note.
Current wording
Net cash provided by financing activities during the six months ended June 30, 2025 was $15.0 million, consisting of proceeds of $15.0 million from the issuance of the January Note and the February Note.
Previous wording
Our purchase commitments per our terms and conditions with our suppliers and vendors are cancellable in whole or in part prior to shipment. Non-cancellable purchase commitments (purchase orders) of $24.4 million for parts and assemblies are due upon receipt and will primarily be delivered in 2026. If inventory is shipped, we will accrue a liability under accrued expenses. See Note 13, Commitments and Contingencies, in the notes to the unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report for further discussion. We have no other commitment and contingencies, except for the operating leases, which represent total undiscounted future minimum lease payments of $15.9 million as of March 31, 2026. See Note 8, Leases, in the notes to the unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report for further discussion.
Current wording
Our purchase commitments per our terms and conditions with our suppliers and vendors are cancellable in whole or in part prior to shipment. Non-cancellable purchase commitments (purchase orders) of $31.5 million for parts and assemblies are due upon receipt and will primarily be delivered in 2026. If inventory is shipped, we will accrue a liability under accrued expenses. See Note 13, Commitments and Contingencies, in the notes to the unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report for further discussion. We have no other commitment and contingencies, except for the operating leases, which represent total undiscounted future minimum lease payments of $45.0 million as of June 30, 2026. See Note 8, Leases, in the notes to the unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report for further discussion.
Previous wording
We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We will remain a smaller reporting company and may take advantage of certain scaled disclosures available to smaller reporting companies until the last day of the fiscal year in which (a) the market value of our voting and nonvoting common stock held by non-affiliates equals or exceeds $250 million measured on the last business day of that year’s second fiscal quarter and (b) our annual revenue equals or exceeds $100 million during the most recently completed fiscal year or our voting and nonvoting common stock held by non-affiliates equals or exceeds $700 million measured on the last business day of that year’s second fiscal quarter.
Current wording
We will remain a smaller reporting company and may take advantage of certain scaled disclosures available to smaller reporting companies until the last day of the fiscal year in which (a) the market value of our voting and nonvoting common stock held by non-affiliates equals or exceeds $250 million measured on the last business day of that year’s second fiscal quarter and (b) our annual revenue equals or exceeds $100 million during the most recently completed fiscal year and the market value of our voting and nonvoting common stock held by non-affiliates equals or exceeds $700 million measured on the last business day of that year’s second fiscal quarter.
Previous wording
Our discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated interim financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). We evaluated the development and selection of our critical accounting policies and estimates and believe that the following involve a higher degree of judgment or complexity and are most significant to reporting our results of operations and financial position and are therefore discussed as critical. The following critical accounting policies reflect the significant estimates and judgments used in the preparation of our unaudited condensed consolidated interim financial statements. Actual results could differ materially from those estimates and assumptions, and those differences could be material to our unaudited condensed consolidated interim financial statements. We re-evaluate our estimates on an ongoing basis. For more information, see Note 2, Summary of Significant Accounting Policies, included in the notes to the unaudited condensed consolidated interim financial statements in this Quarterly Report, and Critical Accounting Policies and Significant Estimates in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.
Current wording
Our discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated interim financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). We evaluated the development and selection of our critical accounting policies and estimates and believe that the following involve a higher degree of judgment or complexity and are most significant to reporting our results of operations and financial position and are therefore discussed as critical. The following critical accounting policies reflect the significant estimates and judgments used in the preparation of our unaudited condensed consolidated interim financial statements. Actual results could differ materially from those estimates and assumptions, and those differences could be material to our unaudited condensed consolidated interim financial statements. We re-evaluate our estimates on an ongoing basis. For more information, see Note 2, Summary of Significant Accounting Policies, included in the notes to the unaudited condensed consolidated interim financial statements in this Quarterly Report, and Critical Accounting Policies and Significant Estimates in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. During the six months ended June 30, 2026 there were no significant updates to the Company’s critical accounting policies and estimates, except as described in Note 2, Summary of Significant Accounting Policies, included in the notes to the unaudited condensed consolidated interim financial statements in this Quarterly Report.
Rearranged current paragraphs (23)
Current report — wording carried from elsewhere
Our Support Services revenue was $1.5 million and $1.4 million for the three months ended June 30, 2026 and 2025, respectively, an increase of less than $0.1 million. Support Services revenue is primarily due to services provided to customers based on the installed base requiring preventive maintenance and other support services.
Current report — wording carried from elsewhere
We continue to focus on reducing material costs through improved purchasing and inventory planning, accelerating production cycle times and improving efficiencies on the production floor. These operational initiatives are expected to continue reducing manufacturing costs and improve gross margins over time.
Current report — wording carried from elsewhere
Loss on Fair Value of Warrants
Current report — wording carried from elsewhere
The following table summarizes our historical results of operations for the periods presented:
Current report — wording carried from elsewhere
The following table presents the revenue disaggregated by products and service type, as well as the percentage of total revenue.
Current report — wording carried from elsewhere
3D Printer and parts sales were $31.0 million and $19.6 million for the six months ended June 30, 2026 and 2025, respectively, an increase of $11.4 million. The increase in revenue was primarily attributed to an increase in the average selling price, product mix, and an increase in RPS revenues related to an increase in production volume for the six months ended June 30, 2026, compared to the six months ended June 30, 2025.
Current report — wording carried from elsewhere
Recurring Payment revenue, structured as an operating lease, was $0.0 million for the six months ended June 30, 2026 and less than $0.1 million for the six months ended June 30, 2025.
Current report — wording carried from elsewhere
As part of our Strategic Realignment started in 2025, we have implemented new go-to-market and service strategies to rebuild our bookings and backlog pipeline. As we rebuild our bookings and backlog, we expect the demand for the Sapphire, Sapphire 1MZ, Sapphire XC and Sapphire XC 1MZ to increase our revenue in the future. We expect Recurring Payment revenue to decrease as we continue to shift our focus to 3D Printer system sales and RPS for printed parts. We expect our Support Service revenue to increase as the number of systems we have in the field increases. As of June 30, 2026, our backlog for firm orders was $31 million for 3D Printer and printed parts. Our focus for revenue has shifted to ensuring customer success, improving system reliability to strengthen our existing customer network, developing new customer networks to increase demand and expanding our RPS for printed parts.
Current report — wording carried from elsewhere
The following table presents the Cost of Revenue disaggregated by product and service type, as well as the percentage of total cost of revenue.
Current report — wording carried from elsewhere
We may experience increasing component costs from our suppliers due to international tariffs and our current financial situation. We are currently unable to secure credit terms and volume discounts with our suppliers, causing us to pay a premium, in advance, or source from alternate suppliers at unfavorable terms for our products. This has negatively impacted our cost of revenue and will continue to negatively impact our cost of revenue until our financial condition improves and costs associated with tariffs ease.
Current report — wording carried from elsewhere
Our gross profit and gross margin are influenced by a number of factors, including:
Current report — wording carried from elsewhere
Product mix of Sapphire, and Sapphire XC systems;
Current report — wording carried from elsewhere
Average selling prices for our systems;
Current report — wording carried from elsewhere
Trends in materials and shipping costs;
Current report — wording carried from elsewhere
Production volumes that may impact factory overhead absorption;
Current report — wording carried from elsewhere
Impact of product mix changes, including new product introductions, and other factors, on our Cost of Support Services.
Current report — wording carried from elsewhere
Research and development expenses were $7.0 million and $4.6 million for the six months ended June 30, 2026 and 2025, respectively, an increase of $2.4 million. The increase in research and development expenses was driven by a $1.4 million increase in headcount, salaries and employee-related expenses, an increase of $0.7 million in stock-based compensation, and an increase of $0.3 million in facility and overhead costs. Research and development projects in 2026 are focused primarily on projects aligned with increasing the reliability experience for customers.
Current report — wording carried from elsewhere
Interest expense was $0.9 million and $2.6 million for the six months ended June 30, 2026 and 2025, respectively. The decrease was due to the reduction of the outstanding balances in the Senior Secured Notes and Convertible Secured Notes.
Current report — wording carried from elsewhere
We expect our interest expense will continue to decrease as a result of our lower outstanding debt balances.
Current report — wording carried from elsewhere
Loss on Fair Value of Warrants
Current report — wording carried from elsewhere
Less than $0.1 million of a provision for federal and state income taxes was recorded for both the six months ended June 30, 2026 and 2025 due to projected losses, and we maintained a full valuation allowance on the deferred tax assets as of June 30, 2026 and December 31, 2025.
Current report — wording carried from elsewhere
We will continue to review our conclusions about the appropriate amount of the valuation allowance on a quarterly basis. If we were to generate profits in the remainder of 2026 and beyond, the U.S. valuation allowance position could be reversed in the foreseeable future. We expect a benefit to be recorded in the period the valuation allowance reversal is recorded and a higher effective tax rate in periods following the valuation allowance reversal.
Current report — wording carried from elsewhere
Net cash used by investing activities during the six months ended June 30, 2025 was $1.8 million, consisting of purchases of property and equipment.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Other revenue included under 3D Printer sales includes parts and consumables, such as filters, powder or build plates, that are sold to customers and recognized upon transfer of control to the customer at shipment.
Previous report — wording carried elsewhere
Gain (loss) on Fair Value of Warrants
Previous report — wording carried elsewhere
Our purchase commitments per terms and conditions with suppliers and vendors are cancellable in whole or in part prior to shipment. Non-cancellable purchase commitments (purchase orders) of $24.4 million for parts and assemblies are due upon receipt and will primarily be delivered throughout the remainder of 2026. If inventory is shipped, we will accrue a liability under accrued expenses. We have no other commitments and contingencies, except for the operating leases and the Secured Notes, the January Note, and the February Note. See Note 8, Leases, in the unaudited condensed consolidated interim financial statements included elsewhere in this Quarterly Report for further discussion.