Desktop Metal (DM) Q4 2022 Update

Desktop Metal (DM) Q4 2022 Update

What does Desktop Metal (DM) do?

  • Desktop Metal has two core technologies focusing on the mass production of end-use parts: binder jetting and photopolymer printing.
  • Binder jetting is a highly flexible technology that can do castings and direct-printed parts in mass production at a fraction of the cost of alternative additive solutions.
  • Photopolymer printing is a type of relief printing that uses light-sensitive polymers to create printing plates. In this process, a photosensitive material is exposed to ultraviolet light through a mask, which hardens the areas that are exposed. The unexposed areas remain soft and can be washed away, leaving behind a relief image. The resulting printing plate can then be used to transfer ink to paper, producing a printed image. This printing method is commonly used in the production of labels, packaging, and other printed materials.

Is Desktop Metal Halal?

We hold a comfortable rating for DM. See details here.

Here are the highlights from DM’s latest earnings report…

Just the Numbers

  • Desktop Metal reported Revenue of $209.02M beating estimates by $5.79M.
  • Desktop Metal reported a quarterly loss of $0.09 per share versus Consensus Estimate of a loss of $0.10.  
  • Desktop Metal’s Q4 2022 revenue was a record high of $60.6 million, with strong customer adoption from new and existing customers contributing to growth.
  • Desktop Metal’s 2022 revenue was $209 million, an 86% increase over 2021, with ongoing efforts to improve cost structure to drive gross margin expansion in 2023 and beyond.
  • Gross margins improved to 24.3% in Q4 2022.
  • Desktop Metal reduced its expense structure by completing $50 million in annualized cost savings and committing to an additional $50 million in cost reductions expected for 2023, bringing the total annualized cost savings to $100 million, and aiming to achieve adjusted EBITDA breakeven by the year-end.

Beyond the Numbers

  • Desktop Metal has a strong competitive moat in the binder jetting space, with the number one selling binder-jet products across the board and the largest installed base in the industry.
  • The photopolymer printing market has two segments: healthcare and dental and industrial photopolymers.
  • Desktop Metal is the leader in the dental space, cemented by the launch of the Einstein, a series of photopolymer printers with exceptional speeds and industry-leading accuracy.
  • Desktop Health also owns a catalog of differentiated materials that set it apart in the market, including Class 2 FDA-cleared Flexcera and SmileGuard.
  • Healthcare and dental are massive markets with over $90 billion in healthcare implants and over $30 billion of annual current spend in restorative end-use parts in the dental market.
  • The industrial polymer market is quite large at a $70 billion market opportunity, and Desktop Metal has the leading photopolymer platforms led by the Xtreme 8K.
  • Desktop Metal has unlocked three new markets that bring additive manufacturing into new applications, not traditionally accessible to legacy AM processes offered by peers: FreeFoam technology, Figur G15, and Live Parts.
  • FreeFoam technology is an expandable 3D printable foam for mass production that produces dimensionally accurate flow cell foam parts without tooling, disrupting the conventional polymer foam space.
  • Figur G15 offers a digital solution for standard sheet metal forming on demand that can disrupt the $300 billion a year sheet metal forming spend.
  • Live Parts is a generative design software that enables designers and engineers to create complex structures and optimize them for 3D printing.

Buy or Sell?

Below, you’ll find our new buy price for Desktop Metal (the price below which we would still buy the company).

And our New Sell price (the price above which we would sell our shares).

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