Are we good? We're live here? Okay. Thanks everybody for being here. I'm Nick Jones, Internet Analyst here at Citizens. Excited to have Xometry here today. We have CEO Randy Altschuler and the new CFO, James Miln. Thanks for being here, guys. Really interesting story. I think just to kick it off, you know, Xometry's been around for a little bit, but I don't know that everyone in the room maybe knows the story or maybe they're hearing the company for the first time. Can you kinda just give a brief introduction to the business? What are the end markets you serve? You know, what is Xometry's core service? Sure. So Xometry is the leading marketplace for custom manufacturing. And the TAM is almost or over $2 trillion. So when you think about manufacturing, you can kinda divide it into two buckets. One would be contract manufacturing, where you're making millions and millions of units. And then the other segment would be where you're making smaller quantities, which could be tens of thousands or hundreds of thousands. And it's a very fragmented industry with hundreds of thousands of small manufacturers spread out across the world and with millions of buyers. And historically, the procurement of those manufacturing services has been very inefficient, has been analog. And so we bring technology. We're using artificial intelligence to create automated pricing and to match buyers, and suppliers in our online marketplace. Maybe just to get a little, you know, finer point on it, what do you see as kinda the key pain points Xometry is solving for suppliers and the buyers? Yeah. So for buyers, the key pain points are first, getting quickly the right price. Since this is custom manufacturing, it's not. You're not buying SKUs. There isn't a market price for a customer's particular product. So if you're an electric car maker, you're making something specifically for your car, you're an aerospace company making something for your rocket, or you're a medical device company making something for your medical device, there isn't a custom standard price. So historically, you've taken days or sometimes weeks to get a price, and you're haggling, and it's going back and forth. Our ability to provide you an instant price with our AI is tremendous. And then the second thing is giving you access to effectively unlimited capacity and all sorts of capabilities. Think about it as a supply chain out of the box. That's also very powerful for customers, customers ranging from some of the largest companies in the world to, to startups. Then for the suppliers, these are these hundreds of thousands of small manufacturers. Prior to Xometry, there really wasn't a place online for them to fill their capacity. So that long tail of the Internet really hadn't touched them yet. So their ability to join Xometry, join our ecosystem, and to get work from customers all around the country and all around the world is, is, is a huge boost to them. So think about it. If you're a if you're a manufacturer in Houston, Texas, you probably have historically lived and died with the oil and gas industry. And, and you've got great capabilities, but when the oil and gas industry isn't doing well, you got no customers. Now with Xometry, that aerospace company in Southern California can access your capabilities. That's a great explanation. You know, you spoke to a $2 trillion total addressable market. Can you maybe whittle that down? And what's, like, serviceable? What's really on demand? You know, how much of that is accessible to Xometry today? Well, the amazing thing is that that really is our accessible market. And, you know, it's broken up into smaller, different verticals in terms of manufacturing, but it also applies to lots of verticals in terms of customers. So one of the nice things about Xometry and we had, at the end of last year, I think, over 55,000 active buyers, we're very diversified. So we're not long any one particular industry, and we're in lots of different verticals. So the extensibility of our platform is very powerful. And that's, you know, one of the advantages of being a tech company, at our core. And because we are a tech company and we're using artificial intelligence to do our pricing and to do our matching, we can easily add new manufacturing capabilities. So throughout the years since we've been around and I'm the co-founder of the company, and we started in 2013, we've been adding different capabilities, manufacturing capabilities. We've also been adding geography. So we've taken that core technology that we've built here in the United States, and we've utilized that in Europe. And we've utilized that now in Asia, in China. We're now in 14 different languages. I think we accept six different currencies. And last year, our international growth was, I think, over 80%. So very strong and, again, using that technology that we've built. And maybe before taking a step back and thinking about macro and industry trends, you know, you spoke to adding new processes. I think some folks maybe think when they think on-demand manufacturing, they kind of right they go immediately to prototyping and 3D Printing. You know, do you do 3D Printing? And, you know, how should investors really associate the business and kind of what the core processes are? Yeah. So I, I think this we don't explicitly state how we break out our different manufacturing technologies, what percentage of our business, but it largely, you know, in large part reflects what is the overall market. So 3D printing is interesting. It's fascinating. But it is largely prototyping, so it's not the majority of what we do. The majority of what we do is gonna be more in production capabilities, things like machining, sheet metal, molding, casting. And so when you think about our market, it's not just prototyping. It's production. But it's not production that's so big that's 10 figures that would go to a large contract manufacturer. So, when you think about industries like aerospace and even medical devices, etc., people are often making thousands of them or tens of thousands. They're not making millions. And so that's really the differentiating point. If somebody's gonna make millions of something, our marketplace doesn't make sense. There's a very efficient way for them to procure that. But anything sort of below that where they're historically going to small manufacturers, Xometry's a great way to access that, those capabilities and that market of small manufacturers. You mentioned aerospace. Has anything, kind of purchased through Xometry ended up in space or on airplanes? Or what's the most interesting place that products ended up? We've been everywhere. We've been in space. You go in the airport, you see the CLEAR machines. You know, I'm sure lots of people here have CLEAR memberships. We're there. During COVID, the vaccine from Moderna, thank you. Moderna, the vaccine mixers for the vaccine, those parts are being made by the Xometry marketplace. So, when you think about all the amazing things that are happening now, you know, a bunch of them are emanating from Xometry. And at this point, we're working with, you know, most of the Fortune 1,000 that has some sort of manufacturing need are a customer of Xometry or one way or the other. Taking a step back, you know, there's kind of mixed signals in the macro environment in terms of how manufacturing's trending. How do these indicators impact Xometry? Or, you know, can you kinda grow through it? Can you speak to kinda just how the broader macro and industry trends are impacting the business today? Sure. So just, you know, last year, we grew top-line 22.5%. And we actually, you know, had healthy growth in our gross profit. Our gross profit margins in our core business marketplace have been growing nicely as well. In fact, they've been growing faster than our revenue has been growing, and, and the marketplace side of things. We've also been adding lots of new customers to Xometry. One of the KPIs we report out are active buyers. And that grew year-over-year, I think, about 36%. So strong numbers. So we're gaining market share. There's, again, millions of potential buyers out there. We're up to over 55,000, but that grew over 36% last year. So there's certainly reported, you know, sort of softness in, in and some contraction in manufacturing. It's such a large industry that through our gaining of that market share, we're still growing at a nice pace. So maybe drilling down to how, you know, buyer behavior, are you seeing any changes in behavior in terms of purchase frequency, lead times, volumes? Is it elongating? Are people deferring to kind of outsourcing versus buying in the U.S.? Yeah. So, you know, a couple different questions there. So and we're global. So as we have networks throughout the United States. We have networks throughout Europe. The E.U. in particular. We're not outside the E.U. and the U.K. We have networks in China and Mexico and in Turkey. So there is some reshoring trend that we're seeing where U.S. customers in particular are pulling back a little bit from Asia, particularly in China, geopolitical concerns, also concerns about the resilience of their supply chain. So some of that is happening. And that's one of the reasons why it's important for Xometry to be global and for us to have marketplaces to meet our customers wherever they might be. So. Great. So let's switch more kinda to the business, the growth initiatives, kinda what's exciting for Xometry from here. At a high level, can you describe kinda the key inputs to revenue for Xometry? You know, there's active buyers. There's suppliers. You know, how does Xometry inject itself in there, make money, and what are kinda the growth inputs? Sure. Absolutely. So continuing to add active buyers, new customers to our marketplace is very important. So, that's been growing nicely. And some of the ways that we attract new buyers is we're constantly investing in our product, in our technology. So we're investing to make it easier for customers to come and purchase from us. We launched something called Teamspace, which enables customers who are working together on larger products to collaborate in Xometry. So historically, Xometry has been more one buyer to one buyer. In this case with Teamspace, we got teams of buyers working together. We rolled that out in the fourth quarter, and we have over 1,500 teams that are now active. So that product's been very powerful. And we're continuing also to invest in our AI. So we announced in the third quarter a partnership with Google Vertex AI. So we're leveraging Google's Vertex AI's capabilities in AI to enable us to release even quicker our AI models and expand so part of our strategy is also expanding what we can offer our customers to be more of their one-stop shop. So the more that we can auto-quote, the more that we can be that one-stop shop for their manufacturing needs. So that's another critical item. Maybe you could speak a little bit more to the, the algorithm and, and the kinda the pricing model. You know, you give a price. You have to pay somebody. That manifests in gross profit margin. Sure. How should folks think about that over time? Can it expand? Do you take it down and get more volume? Just. Sure. So, we're kind of, people think, almost like a market maker because there is no set price for something. It's not like going to a grocery store where you know how much a quart of milk's gonna cost. And you go to two grocery stores, and maybe it's 5% off or whatever. And in our instance, there isn't a set price. So we're setting the price. And so we use this AI. We use a technique called machine learning to come up with a price for somebody's custom parts right away. So they upload their parts online. They answer a bunch of questions, and boom, they get a price, which is, again, somewhat miraculous in our industry. And then when the customer buys, we use those algorithms, our algorithms, to figure out which suppliers are ideally suited to make those parts. And then we offer them a price to make those parts. So Xometry's profit margin, gross profit margin, is really the spread between what we sell it to the customer and what we buy it from the manufacturer. And as we get more and more data going to your question about gross margins, our gross margins have grown really nicely over the years, because as we get more and more data and as we grow the size of our supplier network, we're able to get better, and better margins. We're more accurate with our pricing, and we're able to get a better deal from our suppliers. That's also creating a network effect of better and better deals for our customers. So this is a very unique instance where everybody is better off. The customer's better off because they're, as we expand our network, getting better and better deals, and they're able to find it faster. Our suppliers are able to find work that fits their needs. So our algorithms are in part giving suppliers what they're really good at. So if you're a supplier and you have two different jobs, one job can give you a 5% margin. One might be a 50% margin. Historically, that supplier didn't have much choice. They were dependent on their local customers. But now with Xometry, they can cherry-pick and get the best job. So you've got this great instance where customer's better off, the supplier's better off, and we're able to grow our margins because we're creating more value for both sides. So as that value increases, we're able to accrete more value to Xometry. So for the folks using the pricing engine, you have a kind of a land and expand strategy that's been successful for the business. So when you talk to one of these Fortune 1,000 companies, they have a lot of different teams. So can you kind of elaborate? Do you, you know, how do buyers get on the platform? Do you kinda land a, an account within an organization? And TeamSpace kinda helps drive collaboration. Are there teams that don't even talk to each other that still. Sure. I guess just kinda elaborate on the land and expand strategy and how. Yeah. You kinda onboard buyers within these accounts. Yeah. So, you know, one of the key things to grow in these enterprise companies and just to put this in perspective, some of our customers are spending $1 billion a year plus on manufacturing. And when you think about how much of that is relevant to us, that's a huge number. It's, you know, $10s of millions, $100s of millions. So, like, there's lots of spend there. But these are large companies, as you said. So for to be able to scale, you need, first of all, great technology. So rolling out tools that enable us to scale. So we talked about TeamSpace that enables groups. So if you think about a company that's got a product, there's probably multiple mechanical engineers. There are multiple procurement people involved with that. They all wanna know what's going on. They want the visibility on the supply chain. TeamSpace enables them to have that. The customer also wants less friction when they're buying. Like, they wanna make it easy buying. So being able to integrate directly into the ERP systems, we have that capability. We call it Punchout. So instead of the old-fashioned way that they had to buy from their suppliers, which is faxing them something or emailing them or whatever, putting it in the mail, now they can just point to point, push us a purchase order right from their system into our system. And then also for all these large companies often have hundreds of engineers being able to integrate within their CAD software. So if you're an engineer and you're designing parts using Autodesk's products or PTC's or Dassault Systèmes products, we actually Xometry integrates or has an add-on with those popular CAD softwares so they can actually access our pricing and our technology without even coming to our website. So all these different things that we're doing to make it easier, and reduce friction are very powerful. And then there's also sales motion. So we've been investing in an enterprise sales team, you know, who can go in and meet with the leaders of procurement, leaders of supply chain, leaders of operations, and help, you know, execute deals that were enterprise-wide. I wanna talk a little bit about Thomas. You acquired this business. It's kind of a legacy kinda internet media business. Can you talk about what opportunities you see there, and how does that kind of augment, you know, Xometry's core business? Sure. So Thomas had a storied history, a company over 100 years old, literally over 100 years old, and, effectively an online directory. It had used to be a paper directory. So it used to have a giant paper directory. And then they brought it all online. You know, again, a great family tradition. We purchased that business at the end of 2021. So we've had about two years with it. And so that's an opportunity for manufacturers to be found directly by customers. And Thomas is actually. It's still in the same realm as we are, sort of industrial, and manufacturing, but it's broader than Xometry. So going back to your question before about, one of our growth initiatives is adding more capabilities that we can instantly quote customers. Thomas has all those suppliers listed there. They've got over 500,000 North American suppliers listed. So we're investing in the technology to make the search better for customers. When they're coming to search on Thomasnet.com, is it easier to find what they're looking for? And we're also investing in the ad tech and technology. So it's easier for suppliers to get ads, you know, buy keywords and to buy advertising. That had historically been very manual, and required intervention by salespeople. That was expensive, and it was clumsy. And it also limited the number of customers that could buy that advertising. We've been investing since last year, and we're continuing to invest this year to upgrade all that technology to widen the aperture of customers that could buy advertising on Thomas and then, again, make it better search results for the seekers too. So let's talk a little bit more about active buyers. That's a key, key input to growth. Yes. Thomas had really robust active buyer growth. 95% of the revenue comes from existing accounts. Can you talk to what drives that kinda stickiness? Yeah. And you know, if you wanna learn more, we also included in our investor deck—we've updated this now for a couple years—a slide with our cohort data. So when you think about, you know, where we're seeing the company, you know, really healthy underlying metrics are cohorts. Our cohorts have not only been getting larger every year. Every new cohort we're adding is actually year one larger and larger. But also you can see nicely the trajectory of the existing cohorts year over year. So, I'm trying to remember now what your question was, Nick. just for the stickiness. Oh, active buyers. Yeah. Yeah. The stickiness. So, you know, we've seen really nice once we get within those companies and we get within those buyers, as we've been over time adding more and more capabilities, making it easier and easier for them to use our system and for them to access our system. And as we've got more efficient and better with our pricing, we've seen really nice, organic growth within that customer base. And so that's, that's been very successful for us. Kind of in the more recent quarter, there's been some changes in revenue per active buyer. Sure. There's been some volatility. So can you maybe just speak to the predictability? You know, you spoke to the cohort curves. But kinda quarter- to- quarter, you know, how predictable and volatile can revenue per active buyer be? Sure. So just to, you know, so in the fourth quarter, which results we just released last week, you know, we had overall revenue growth of over 30% in the marketplace segment. The non-Thomas segment was over 40%. So really healthy growth. We also saw our gross margins grow sequentially from the prior quarter. And we also saw, you know, we're marching to profitability, and we saw, you know, great progress there as we got down to our smallest adjusted EBITDA loss since we've been a public company. So that's all good. As we stepped into Q1, we did see some weakness in January, where some of our larger customers with larger orders were holding back on purchasing that. So when we did our guidance in February when we announced our earnings, we took that January and sort of used that as our as to help fashion our guidance for the quarter and for the year to kinda sort of anchor ourselves, because we didn't wanna get ahead of ourselves, and we wanna be prudent in that. So, that does imply a step back in revenue per active buyer. But again, when you look at the underlying metrics in our marketplace in terms of adding additional buyers, when you see the behavior, the actual reported behavior of our cohorts in that analysis, everything is healthy. But again, we just had to reflect a tough January, and we just wanted to be prudent with our guidance for the year. So. Yeah. Makes sense. Let's talk a little bit about profitability. You know, you're steadily marching towards EBITDA profitability. You know, can you kinda speak to the inputs to get there? Is that just more volume? You know, maybe even speak a little bit to the fixed versus variable cost structure in the business so investors can kind of understand the trajectory as you continue to grow? Yeah. Great, great question. So what you saw last year from Q1 to Q4, we were steadily or from Q4 to Q1, you know, over the last five quarters, you saw our profitability increase sequentially quarter over quarter. And we've gotten leverage in a few different areas. One is in sales and marketing or marketing in particular. Marketing as a, our advertising spend. I'm sorry. Our advertising spend as a percentage of revenue has been decreasing. So we're getting more and more efficient with that advertising spend. And I think sales and marketing in general as a percentage of our revenue has also been dropping, sequentially. So we're continuing to get leverage there, more organic growth. Things like our SEO is kicking in. People are finding us more on their own without us paying for paid search. All that's been a good trend. We've been seeing a lot of, you know, continued leverage on our G&A spend, and sort of our other expense categories including our product development costs, and our operations and support costs. So you've seen that. You know, the variable spend in our business is mostly on that advertising side. That's our sort of our primary variable spend there. And then, of course, commissions flex some of our sales stuff flex ups and downs with our sales growth too. Great. And so we have a few minutes left. I do wanna see if anyone has questions before we continue on. We did announce we had a new CFO join us. Yeah. Who's sitting right next to here, James Miln, who joined us from Yelp. So, James is day three here. Oh. Yeah. You go. Thank you. Thank you for coming. My question is, where, where do you see the company going in the year 2030 or, like, the direction to 2030? Just ballpark. Like, what's the vision like? What's it look like? Yeah. So a couple things. We're in a huge industry, and I'm very proud of the growth that we've had, but I'm very optimistic that we can continue to be a rapidly growing company for a long time. You know, there's no shortage. Again, there's millions of potential customers, huge spend out there. So if we can execute, we can continue to grow at a rapid pace. Profitability is important. So making sure that we're getting leverage on those, you know, there are different OpEx categories. As we invest in our technology, as we make things more efficient, we're gonna be achieving that. So we also wanna be a nicely profitable company as well. And then just, this is the thing that gets all of our employees excited, etc. We're also in a really exciting industry. Like, we are truly, we're enabling amazing things to happen. You know, you mentioned this before. Like, when there are launches in space, there's a good chance that some Xometry parts are in that. Or when you think about new medical devices or, or, or whatever, all these steps in the future or even it more legacy industries, we're playing a bigger and bigger role. So I think Xometry not only, you know, should be a very valuable company, and a big company, but I think we can be an important company. And, and that's, that's important to me. It's important to our employees. It's, it's what gets them excited. You know, we have a lot of software engineers, as you can imagine, as a tech company. And our, our engineers, our software engineers love the fact that something tangible comes out of our marketplace. Like, you feel very proud about that. If I can add, I mean, I think what Randy expressed there is the core of what attracted me to this amazing opportunity and to be able to partner with Randy and the team on this journey. You know, I've done my own due diligence and obviously deciding to, you know, take this role and be on that journey to 2030 and beyond and the opportunity that's there. I think there's a few areas where maybe I can be helpful for my background with the assets that we've got and the opportunity ahead. You know, it's a marketplace business. And with Thomas, we have a search and advertising business. My experience is deep in marketplaces, search, and advertising. So I think strategically with Randy, like, being able to, like, lay out the milestones that can help us capture that opportunity. I'm really excited to work with Randy and the team to put in place, you know, they've made so much progress to date. And to get to that opportunity ahead, you know, we need to scale the business, have really robust operating plans, really make smart decisions around our investments to get on this, improving both revenue and profitability path. And again, I think I've got a lot of experience operating with a lot of global businesses, tech internet businesses that I think can be valuable. And the last thing I'll say is I have a, you know, deep experience in investor relations over the last decade at a number of large and well-known companies. And so, I'm looking forward to working with Shawn and working with Randy and, you know, yourself, Nick, and others and being out there and being available and helping, you know, articulate the story and help, you know, drive consistent execution of the business as we move towards these long-term goals. That's great. And I think, you know, we're up on time. But the last question I'd like to ask is, you know, what do you think the biggest misconception is with Xometry today? And what do you want everyone to walk away with from this conversation? I don't know. Is that too loaded? It's a look. You know, the underlying obviously, you know, people got when we came in and we expressed that there was some weakness in January, and that's why we were more temperate or more, you know, prudent is the word we've been using with our guide. I think that concern spooked some investors like, "Hey, is the underlying marketplace healthy?" The answer is absolutely. You know, we've guided to an increase in number of active buyers in Q1 versus Q4. And so this is a huge industry. We're the leader, and we expect to continue to have robust growth. And we've been again, we've becoming more and more profitable. We've been growing our gross profit, getting leverage in the OpEx. So I think the future is bright. Great. Randy, James, thank you both for being here. Thank you.