Company: IPGP
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0001111928-25-000132
Chunk: 119

Company: IPG PHOTONICS CORP
Filing Date: 2025-08-05
Form: 10-Q
Item: Part I, Item 2
Chunk 119
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 million  as compared to the six months ended June 30, 2024.

Cost of sales and gross margin. Cost of sales decreased by $20.8 million, or 6.6%, to $295.1 million for the six months ended June 30, 2025 from $315.9 million for the six months ended June 30, 2024. Our gross margin increased to 38.3% for the six months ended June 30, 2025 from 38.0% for the six months ended June 30, 2024. Gross margin increased mainly driven by a decrease of unabsorbed manufacturing costs, partially offset by higher product costs driven by mix, and import duties driven by tariffs, as a percentage of sales.

Sales and marketing expense. Sales and marketing expense increased by $4.5 million, or 9.9%, to $50.0 million for the six months ended June 30, 2025 compared with $45.5 million for the six months ended June 30, 2024. The increase is due to higher personnel and related expenses and depreciation and amortization expense, partially offset by lower premises expenses. As a percentage of sales, sales and marketing expense increased to 10.4% from 8.9% for the six months ended June 30, 2025 and 2024, respectively.

Research and development expense. Research and development expense increased by $1.4 million, or 2.5%, to $58.3 million for the six months ended June 30, 2025, compared to $56.9 million for the six months ended June 30, 2024. The increase is due to higher personnel and related expenses, partially offset by lower lease expense. As a percentage of sales, research and development expense increased to 12.2% from 11.2% for the six months ended June 30, 2025 and 2024, respectively.

General and administrative expense. General and administrative expense increased by $4.9 million, or 7.8%, to $67.7 million for the six months ended June 30, 2025 from $62.8 million for the six months ended June 30, 2024, primarily as a result of higher personnel and related expenses and contingent compensation expense, partially offset by lower premises and legal expense. As a percentage of sales, general and administrative expense increased to 14.1% from 12.