With record quarterly revenue from its AI-powered digital manufacturing services marketplace, Xometry Inc. say it is on track to reap more benefits from machine learning technology designed to connect buyers with suppliers that meet their specific manufacturing needs.

Randy Altschuler, CEO, Xometry Inc.

“Q3 2024 represented another record-setting quarter for our company,” says CEO Randy Altschuler. “Powered by our AI-driven marketplace, we achieved record revenues, record gross profit and record marketplace gross margin while capturing additional market share globally.”

Xometry marketplace revenue rose faster than expected

Marketplace revenue grew better than expected, increasing 24% year over year to $127 million as total revenue grew 19% to $142 million.

“We saw strength across many end markets including engineering, aerospace consumer and robotics,” Altschuler said on the company’s Q3 earnings call.

The digital manufacturing services provider uses AI machine learning in the Xometry Instant Quoting Engine, which the company says has issued “over 8 million job offers to our manufacturing network.”

Xometry hosts through its Xometry.com marketplace over 64,000 registered buyers and a network of about 7,000 manufacturers providing such manufacturing services as 3D printing, injection molding, die casting and computer numerical code (CNC) manufacturing.

The quoting engine’s AI capability enables it to analyze computer files of product designs uploaded by marketplace buyers to match them with the skills of available manufacturers. Xometry says the quoting engine “gets smarter over time, which translates to better lead times and prices for our customers and growing business for our manufacturing suppliers.”

Xometry’s AI model “fuels gross profit”

“As we scale our data, our machine learning AI model gets better at pricing and matching, which in turn fuels gross profit dollar growth,” Altschuler said, adding, “Q3 marketplace gross margin expanded 250 basis points year over year to a record 33.6%.” Q3 marketplace gross profit increased 34% to $42.62 million.

Xometry said it is working a partnership with Google Cloud to use Vertex AI, a managed machine learning platform, to “accelerate the deployment of new auto-quote methods and models on our marketplace.”

“In this very inefficient, opaque market, we have the ability with our AI to find the best supplier both from a delivery and a quality perspective, but also the one that has the optimal cost structure for a particular order from a customer,” Altschuler said. “So, as we get to know those suppliers better, as we gain more and more data, as we enhance those matching algorithms, that gives the opportunity to make our suppliers happy but also for that to be a more profitable transaction for Xometry.”

Xometry launches European marketplace tools

Other developments Xometry kicked off in Q3 include:

⦁ A suite of tools on Xometry’s European marketplace designed to make it easier for enterprise customers to order parts for their high-volume manufacturing projects. “The tools give engineers, designers, procurement professionals and project managers everything they need to coordinate, collaborate and manage complex orders,” Xometry says.

In addition, Xometry Europe added the Hungarian (Magyar) language to its marketplace. Worldwide, the Xometry marketplace is available in 16 languages.

⦁ Xometry EU expanded its marketplace with a suite of collaboration tools designed to enable engineers, procurement professionals and project managers to collaborate and manage high-volume complex orders.

⦁ A French design and manufacturing company specializing in unmanned vehicles and robotics used Xometry’s manufacturing solutions to strengthen their supply chain and reduce operating costs by streamlining procurement.

⦁ Xometry Asia launched an English-language site in APAC. “This is already bearing fruit with a small consumer product company in Australia choosing Xometry’s marketplace to move from prototype to production for an entire assembly including CNC and 3D processes. This production order is our first seven-figure order in APAC,” Xometry says.

For the third quarter ended Sept. 30, Xometry reported:
⦁ Revenue rose 19% year over year to $141.698 million.
⦁ Gross profit increased 21% to $55.825 million.
⦁ Net loss attributable to common stockholders narrowed 15% to $10.199 million.
⦁ Adjusted Ebitda improved 85% to a loss of $632,000.

For the nine months ended Sept. 30, Xometry reported:
⦁ Revenue increased 18% to $396.98 million.
⦁ Net loss attributable to common stockholders narrowed 29% to $40.51 million.
⦁ Marketplace revenue increased 24% to $351.44 million.
⦁ Marketplace gross profit rose 34% to $116.16 million.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. [email protected].

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