Company: VLDXW
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0000950170-25-047760
Chunk: 196

Company: Velo3D, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1B
Chunk 196
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 more Sapphire XC, and Sapphire XC 1MZ systems compared to Sapphire systems. Additionally, the decrease was also driven by changes in our business strategy due to our Strategic Realignment to improve efficiency and reduce overhead.

We continue to focus on reducing our material costs through improved purchasing and inventory planning, accelerating production cycle times and improving efficiencies on the production floor to lower our cost of revenue.

We expect our cost of revenue to improve as we address the challenges that impact our production.

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Gross (Loss) and Gross Margin

Total gross loss was $(2.1) million and $(26.3) million for the years ended December 31, 2024 and 2023, respectively. As a percentage of revenue, the gross margin was (5.1)% and (33.9)% for the years ended December 31, 2024 and 2023, respectively. The higher gross loss for the year ended December 31, 2024 was primarily attributable to the change in the mix of Sapphire and Sapphire XC system sales, the operational and overhead improvement as a result of the Strategic Realignment offset by a decreased number of systems sold in 2024, as compared to 2023.

Our gross profit and gross margin are influenced by a number of factors, including: 

•Product mix of Sapphire, Sapphire XC, Sapphire 1MZ and Sapphire XC 1MZ systems;

•Average selling prices for our systems;

•Trends in materials and shipping costs;

•Production volumes that may impact factory overhead absorption;

•System reliability performance; and

•Impact of product mix changes, including new product introductions, and other factors on our Cost of Support Services 

We expect to accelerate production cycle times and further improving efficiencies on the production floor to lower our cost of revenue, which we expect will improve our gross profit and gross margins in the second half of 2025.

Research and Development Expenses 

Research and development expenses were $17.1 million and $42.0 million for the years ended December 31, 2024 and 2023, respectively. In the year ended December 31, 2024, there was a decrease of $24.9 million in research and development expenses primarily due to the completion of the development of the Sapphire 1MZ, Sapphire XC, and Sapphire XC 1MZ systems in 2023 and reduction of new research and development projects in 2024 due to our Strategic Realignment.

The decrease in research and development expenses in 2024 were related to a $