I wonder if Nano Dimension realizes what it has bought...?
The Atomic Layers: S4E13 (00099)
Atomic Layer of the Day:
Desktop Metal and Markforged, two recent acquisitions by Nano Dimension, have published what may be some of their last individual quarterly results. And they are not good. In the case of Desktop Metal, they are really poor.
Each company reported significant losses, although they are taking steps to optimize costs and increase operational efficiency. However, they’ve been doing so for over a year (if not two).
Markforged reported a slight increase in revenue to $20.5 million, just a +2% rise year-over-year. Simultaneously, the company improved its gross margin from 45.7% to 49%. Notably, it undertook a deep operational restructuring, reducing operating expenses from $59.6 million to $27.6 million year-over-year.
This reduction had a significant impact on decreasing net losses, which stood at -$23.4 million in Q3, a notable improvement compared to the -$51.4 million net loss in the same period last year. Nevertheless, Markforged continues to face liquidity challenges—its cash position at the end of September 2024 was $79.5 million, a decrease from the previous quarter, largely due to the high costs of a patent settlement.
On the other hand, Desktop Metal faces even more severe challenges. The company's revenue dropped to $36.4 million from $42.8 million a year earlier, and net losses for the third quarter reached -$35.4 million. Total net losses for 2024 have already reached -$191 million, indicating persistent financial difficulties that have not been alleviated despite restructuring and the sale of select assets, such as the subsidiary Aerosint and one of its Ohio facilities.
To cut costs, Desktop Metal also plans a partial exit from the photopolymers market, which resulted in an accounting write-down of $80.3 million on assets related to this technology. At the end of the third quarter, the company had only $30 million in cash, a decrease of $15.4 million from the previous quarter, and its assets shrank from $458 million at the start of the year to $273 million by the end of September. Additionally, the company is burdened with $113 million in debt in the form of convertible bonds.
For Nano Dimension, the acquisition of two such unprofitable companies poses a significant strategic challenge. While Yoav Stern plans to combine the resources and expertise of both companies to create a more operationally efficient entity, the success of this strategy will depend on further cost reductions as well as increases in revenue and operational efficiency.
In the short term, Nano Dimension has sufficient financial resources—a total cash position of around $475 million—which should allow it to fund operations and implement further changes. However, if Nano Dimension cannot quickly stabilize and achieve profitability with these two companies, it may face its own difficult situation, where continued cash burn threatens the long-term liquidity of the entire organization.
Atomic Layer from the Past:
11-13-2018: Shining 3D introduced the EinScan Pro 2X and EinScan Pro 2X Plus.
Atomic News & Gossips:
Nikon SLM Solutions sold its 1000th system, an NXG XII 600, to Bosch for use in powertrain, hydrogen, and electric drive applications at Bosch’s 3D Printing Center in Nuremberg. That's a milestone!
EOS has introduced two new metal additive manufacturing materials, EOS NickelAlloy IN738 and K500, both offering high strength and temperature resistance for challenging applications.
Supernova - company created by BCN3D, introduced its Viscogels photopolymer materials and Pulse Production Platform, powered by Viscous Lithography Manufacturing (VLM) technology. Viscogels feature high-performance properties, matching molded plastic standards, and the Pulse system supports efficient production with dual-material capabilities, automated quality control, and advanced post-processing. This closed system ensures high-quality outcomes, with full launch planned for autumn 2025.