• Revenue: $15 million, best third quarter ever, 22% increase over last year's same period.
• Gross Margin: 48%, up from 44%; adjusted gross margin at 51%, up from 48%.
• Net Cash Burn: Reduced to $3 million, down from $16 million per quarter last year.
• Organic Growth: 29% growth from 2022 to 2023, excluding acquisitions.
• Pro Forma Revenue: $340 million based on 2023 numbers, including acquisitions of Desktop Metal and Markforged.
• Cash on Balance Sheet: $470 million.

• Warning! GuruFocus has detected 1 Warning Sign with NNDM.

Release Date: November 20, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Nano Dimension Ltd (NASDAQ:NNDM) reported $15 million in revenue for Q3 2024, marking the best third quarter ever and a 22% increase over the same period last year.
• The company achieved a gross margin of 48%, up from 44% in the previous year, with an adjusted gross margin of 51%.
• Net cash burn was significantly reduced from $16 million per quarter last year to $3 million, indicating progress towards breakeven.
• Nano Dimension Ltd (NASDAQ:NNDM) successfully closed acquisitions of Desktop Metal and Markforged, expanding its product line and customer base.
• The company has a strong cash position with $470 million on the balance sheet, providing resources for future growth and profitability initiatives.

Negative Points

• There is ongoing conflict with activist shareholders, particularly Murchinson, who are attempting to influence company decisions and potentially dismantle the company.
• Concerns were raised about the integration and performance of past acquisitions, with some stakeholders questioning the synergies and revenue growth achieved.
• The company is facing regulatory hurdles with the CFIUS process for its acquisitions, which could delay completion.
• Despite the positive financial metrics, the stock continues to trade below cash value, indicating market skepticism about the company's strategy.
• There is uncertainty regarding the impact of potential new board members proposed by activist shareholders, which could affect strategic decisions.

Q & A Highlights

Q: Could you provide details on customer reactions to your proposed acquisitions and an update on the regulatory status? Also, do you expect to reach breakeven EBITDA through cost synergies rather than revenue synergies? A: Customer reactions have been extremely positive, especially at the Formnext show in Frankfurt. Regulatory processes are nearly complete for Desktop Metal, with expectations to close by year-end, and Markforged is anticipated to close in Q1 2025. We aim to achieve breakeven EBITDA by focusing on cost synergies, with profitability expected by early 2026. - Yoav Stern, CEO

Q: With the AGM approaching, is there concern that activist shareholders could derail the acquisitions if they succeed in installing new directors? A: The activists aim to install two directors, but they would remain a minority on the board, unable to derail the acquisitions. The deals are legally committed, and any attempt to interfere would be against contractual obligations. - Yoav Stern, CEO

Q: Can you explain the rationale behind the recent acquisitions, given past acquisitions' performance and the current financial state of Markforged and Desktop Metal? A: Previous acquisitions have shown organic growth, and the new acquisitions bring valuable technologies and customer bases. We plan to improve their performance through synergies and management changes, focusing on profitability. - Yoav Stern, CEO

Q: What is the status of the CFIUS process for the acquisitions, and how might it impact shareholders? A: The CFIUS process for Desktop Metal is nearly complete, with no outstanding issues. The process for Markforged is expected to be shorter, as checks on Nano Dimension are already done. This regulatory step is typical for foreign companies and should not negatively impact shareholders. - Yoav Stern, CEO

Q: How do you address concerns about the company's strategy and its impact on shareholder value, given the stock's current performance? A: The strategy focuses on creating value through strategic acquisitions and improving operational efficiency. Despite current stock performance, the goal is to enhance shareholder value by building a profitable and growing business. - Yoav Stern, CEO

For the complete transcript of the earnings call, please refer to the full earnings call transcript.