Desktop Metal achieves record sales in the second quarter of 2022

Desktop Metal, Inc. (NYSE: DM) announced its financial results for the second quarter ended June 30, 2022.

• Record revenue of $57.7 million, up 204% from second quarter 2021, and an increase of 32% sequentially from first quarter 2022
• GAAP gross margin of 14.6%; non-GAAP gross margin of 26.7%, increasing over 170 basis points from second quarter 2021
• Announced Strategic Integration and Cost Optimization Initiative to accelerate AM 2.0 growth, support path to profitability, and drive value to shareholders
• Unveiled FreeFoam, a revolutionary, expandable 3D printable resin designed for volume production of foam parts
• Reaffirming full year 2022 guidance of approximately $260 million for revenue, representing 131% growth from 2021, and approximately $(90) million for adjusted EBITDA

“Desktop Metal continued to build on its momentum in the second quarter, delivering record revenue of $57.7 million and expanding non-GAAP gross margins to 26.7%,” said Ric Fulop, Founder and CEO of Desktop Metal. “Our strong financial results represent the strength and breadth of our unmatched AM 2.0 portfolio as our team continues to execute at a high level in a dynamic macro environment.”

Fulop continued, “We enter the second half of the year with a more streamlined and efficient operating model, combining continued revenue growth at scale with a disciplined strategy to optimize our expense structure, in order to achieve our financial commitments and support our path to profitability.”

Second Quarter 2022 and Recent Business Highlights:

• Announced Strategic Integration and Cost Optimization Initiative to accelerate AM 2.0 growth, support path to profitability, and drive value to shareholders including expectation of approximately $40 million of annualized run rate non-GAAP cost savings, $20 million of which is expected to take place in the second half of 2022, and at least $100 million of aggregate cost savings over the next 24 months
• Unveiled FreeFoam, a revolutionary, expandable 3D printable resin designed for volume production of foam parts
• Awarded a sub-contract under the Defense Logistics Agency (DLA) of the Department of Defense prime contract worth a potential $15 million
• Began effort to monetize dominant IP portfolio of over 650 patents and pending applications

Second Quarter 2022 Financial Highlights:

• Revenue of $57.7 million, up 203.9% from second quarter 2021 revenue of $19.0 million, and an increase of 32.0% sequentially from first quarter 2022
• Revenue growth driven by strength from metals platform and contributions from acquisitions
• GAAP gross margin of 14.6%; non-GAAP gross margin of 26.7%, increasing over 170 basis points from second quarter 2021
• Net loss of $297.3 million, primarily due to a non-cash goodwill impairment charge of $229.5 million as a result of the Company’s and comparable companies’ stock price declines and including $2.4 million of restructuring charges in connection with the Strategic Integration and Cost Optimization Initiative
• Adjusted EBITDA of $(27.5) million
• Cash, cash equivalents, and short-term investments of $255.7 million as of June 30, 2022
• Successfully completed $115 million convertible notes offering in May 2022, bolstering liquidity in an uncertain macro environment and providing sufficient runway to reach cash flow breakeven

Outlook for Full Year 2022:

• Reaffirming revenue expectation of approximately $260 million for 2022, representing 131% growth from 2021
• Reaffirming adjusted EBITDA expectation of approximately $(90) million for 2022

Conference Call Information:

Desktop Metal hosted a conference call on Monday, August 8, 2022, to discuss second quarter 2022 results. A replay is available at ir.desktopmetal.com.

For more information, please visit www.desktopmetal.com.