Xometry reported record results for its fiscal Q2, as more large manufacturers turned to their artificial intelligence (AI)-powered marketplace to streamline custom parts sourcing and improve supply chain resilience.

Xometry revenue rose 23% to $163 million in its Q2, which ended June 30. Meanwhile, gross merchandise volume (GMV), the total value of transactions on its platform, increased 21% to $171 million. Year-to-date, GMV reached $327 million, up 22% from last year.

The company’s core marketplace business connects engineers and manufacturers to a network of over 4,000 suppliers. It grew 26% year over year. Xometry is increasingly winning business from larger enterprises, including a new deal to become a preferred supplier for a major European aerospace company.

CEO Randy Altschuler said the company’s platform is gaining traction as manufacturers seek faster, more flexible alternatives to traditional sourcing.

“We’re helping customers diversify their supplier base, speed up production, and adapt to global supply chain disruptions,” he said.

How AI boosted Xometry revenue in Q2

Xometry’s platform uses AI to match custom part orders with available suppliers, automatically quote prices, and suggest materials or turnaround options. New features it launched in Q2 include AI tools that read technical drawings for faster quoting and mobile tools for suppliers to track jobs and upload work in progress.

The company’s international business grew 31%, boosted by the expansion of its Teamspace collaboration software in Europe, the U.K., and Turkey. Meanwhile, Xometry U.S. revenue grew 25% in Q2.

Xometry is also embedding its tools deeper into customer operations. A growing number of enterprise buyers now connect the marketplace directly to their procurement systems. The number of customers spending at least $50,000 annually rose 15% to more than 1,650.

The company’s profit margin improved across the board, with overall gross margin reaching 40.1%. That’s its highest ever. It was helped by better pricing, more efficient order matching, and increasing scale on the platform.

Xometry continues to invest in its technology, rolling out upgrades to both its buyer and supplier experiences. It also recently began testing new search tools on Thomasnet, its industrial sourcing site, using natural language processing to better understand buyer intent.

The only soft spot was in Xometry’s supplier advertising business, which declined slightly compared to the previous quarter. The company said it’s preparing to launch an updated version of its ad platform later this year to boost engagement.

Xometry Q3 outlook

Xometry ended the quarter with $226 million in cash. In June, it refinanced $250 million in debt to extend maturity and lower interest costs.

Looking ahead, the company raised its full-year revenue forecast. It now expects to grow at least 20% in 2025, up from 18% last year. Xometry also expects stronger results in Q3, projecting revenue between $167 million and $169 million.

“As we scale toward $1 billion in revenue, we’re showing that our model not only works — it improves as we grow,” said chief financial officer James Miln. “We’re becoming the digital infrastructure for custom manufacturing.”

Check back for more earnings reports. Here’s last quarter’s update on Xometry sales and revenue.