Xometry's Q1 2025 Results: A Turning Point in the On-Demand Manufacturing Era?

Xometry, Inc. (NASDAQ: XOM), a leader in on-demand manufacturing, is poised to deliver its Q1 2025 financial results on May 6, 2025, underpinned by a year of transformative progress. The company’s Q4 2024 earnings, which marked its first positive Adjusted EBITDA and record revenue, set a high bar for continued execution in 2025. As investors await the latest update, the question remains: Can xometry sustain its momentum in a challenging macroeconomic environment, or will headwinds like foreign exchange pressures and supplier services contraction test its resilience?

The Momentum of Marketplace Dominance

Xometry’s success hinges on its AI-driven marketplace, which now connects 68,267 active buyers with 4,375 certified suppliers. In Q4 2024, marketplace revenue surged 20% YoY to $135 million, driven by global expansion and advanced features like Teamspace collaboration tools and real-time quoting. The platform’s gross margin expanded to 34.5%, a 320-basis-point improvement, reflecting operational efficiencies and supplier network optimization.

The company’s focus on high-margin enterprise buyers is paying off. The number of accounts spending at least $50,000 annually grew 12% to 1,495, underscoring sticky demand from industrial and aerospace clients. This segment’s scalability is critical, as it commands premium pricing and long-term contracts.

The Path to Profitability—and the Hurdles Ahead

Xometry’s Q4 milestone—$1.0 million in Adjusted EBITDA—was a watershed, but the road to sustained profitability remains uneven. The company projects Q1 2025 Adjusted EBITDA to dip into a ~$1.5 million loss due to foreign exchange headwinds, which could cost up to $1 million in revenue. Meanwhile, supplier services revenue continues to shrink, down 13% YoY in Q4, as Xometry exits non-core offerings.

The balance sheet, however, remains robust. Cash reserves stood at $240 million as of December 2024, providing a cushion against macro risks. The stock-based compensation and amortization reductions also highlight a shift toward leaner operations.

Global Ambitions and AI Innovation

Xometry’s expansion into Turkey, India, and Europe—where it now supports 18 languages—reflects its vision of becoming a truly global platform. In China, its WeChat mini-app enhancements are tapping into a market critical for high-volume manufacturing. Additionally, its AI advancements, including a new patent for the Xometry Instant Quoting Engine, position it to dominate the $1 trillion on-demand manufacturing sector.

Partnerships like the Google Cloud collaboration signal deeper integration of AI into core processes. The Vertex AI-powered auto-quoting system, for instance, reduces lead times for custom parts, a key advantage in industries like automotive and aerospace.

Risks on the Horizon

Despite the positives, risks loom large. The supplier services segment’s decline—expected to drop another 5–10% in 2025—could strain near-term cash flows. Foreign exchange pressures, particularly in emerging markets, may persist if the U.S. dollar strengthens further. Moreover, macroeconomic uncertainty in sectors like semiconductors and consumer electronics could dampen demand for custom parts.

The Outlook: A Year of Proof Points

Xometry’s 2025 guidance is ambitious: it aims for full-year Adjusted EBITDA positivity and revenue growth exceeding 2024’s 23% rate. Q1’s revenue of $147–$149 million (up 20–21% YoY) will be the first test. If met, it could validate the company’s pivot toward enterprise clients and AI-driven efficiency.

Conclusion: A Buy or Hold for the Long Game?

Xometry’s Q4 results and strategic moves suggest it’s on track to become a dominant player in the on-demand manufacturing space. Its AI-powered marketplace, robust cash reserves, and enterprise buyer growth provide a solid foundation. However, the Q1 results will need to demonstrate resilience against forex and supplier services headwinds.

Investors should note that XOMETRY’s 2024 Adjusted EBITDA improved by $17.8 million year-over-year, and its non-GAAP net income turned positive in Q4. If Q1’s EBITDA loss narrows further, it could signal a path to sustained profitability by year-end. With a 16% YoY revenue growth in Q4 and a global footprint now spanning 18 languages, Xometry is building a moat against competitors.

The risks are real, but for patient investors, XOMETRY’s potential to capture a growing share of the $1 trillion manufacturing market—and its AI-driven differentiation—makes it a compelling long-term bet. The May 6 results will be the first chapter in this story’s next act.