Company: VLDXW
Filing Date: 2025-01-14
Form Type: 10-Q
Source: 0000950170-25-005443
Chunk: 52

Company: Velo3D, Inc.
Filing Date: 2025-01-14
Form: 10-Q
Item: Part I, Item 1
Chunk 52
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 respectively. The decrease in gross profit for the nine months ended September 30, 2024 was primarily attributable to the outsized impact of fixed costs on lower volume of 3D printer sales, the change in the mix of Sapphire and Sapphire XC system sales, the impact of launch customer pricing for Sapphire XC, higher than expected costs associated with the production of the Sapphire XC, Sapphire 1MZ and Sapphire XC 1MZ systems, and higher material, labor and overhead costs, during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023.

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

•Product mix of Sapphire, and Sapphire XC 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 

Due to the aforementioned trends in customer orders and component costs, our gross profit and gross margin have been and will continue to be negatively impacted until our financial conditions improve.

Research and Development Expenses 

Research and development expenses were $14.0 million and $32.1 million for the nine months ended September 30, 2024 and 2023, respectively, a decrease of $18.1 million. The decrease in research and development expenses in the nine months ended September 30, 2024 was driven by a $5.0 millidon decrease in purchased materials, a $7.0 million decrease in headcount, salaries and employee-related expenses, a decrease of $1.6 million in professional and miscellaneous expenses, and a decrease of $4.5 million in stock-based compensation .

We expect research and development costs to continue to decrease in the remainder of 2024 due to the maturation of our Sapphire family of systems and reduction in research and development projects due to our Strategic Realignment and to increase in the long term as we continue to invest in enhancing and advancing our portfolio of AM solutions. 

Selling and Marketing Expenses 

Selling and marketing expenses were $12.2 million and $18.1 million for the nine months ended September 30, 2024 and 2023, respectively, a decrease of $5.9 million. The decrease was attributable to a decrease of $2.2 million in stock-based compensation, a $1.0 million decrease in