Company: VLDXW
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001641172-25-022448
Chunk: 60

Company: Velo3D, Inc.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 1
Chunk 60
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 result in lower emissions; increased demand for generation and transmission of energy from alternative
energy sources; and any anticipated reputational risks resulting from operations or products that produce material greenhouse gas emissions
and (3) material increased compliance costs related to climate change. In addition, extreme weather and other natural disasters may become
more intense or more frequent, which may disrupt our operations or the operations of our suppliers and customers.

Components
of Results of Operations

Revenue

Our
revenue is primarily derived from our AM fully integrated hardware and software solution based on our proprietary L-PBF technology. Our
products include Sapphire, Sapphire 1MZ, Sapphire XC and Sapphire XC 1MZ metal AM printer using our L-PBF technology and Assure quality
validation software (collectively referred to as the “3D Printer”). Contracts for 3D Printers also include post-sale customer
support services (“Support Services”), except for our distributor partners, which are qualified to perform support services.

31

We
sell our fully integrated hardware and software AM solutions through two types of transaction models: a 3D Printer sale transaction and
a recurring payment transaction (“Recurring Payment”). Support services are included with a 3D Printer sale transaction and
a Recurring Payment transaction. For 3D Printer sale transactions where the support service period has expired, customers may purchase
extended support service contracts.

3D
Printer sale transactions - fixed purchase price model. The timeframe from order to completion of the site acceptance test usually
occurs over three to nine months. As we scale our production, we expect to reduce this timeframe. Contract consideration allocated to
the 3D Printer is recognized at a point in time, which occurs upon transfer of control to the customer at shipment.

The
initial sales of 3D Printers and Support Services are included in one contract and are invoiced together. Contract consideration is allocated
between the two performance obligations based on relative fair value. This allocation involves judgment and is periodically updated as
new relevant information becomes available.

Other
revenue included under 3D Printer sales includes parts and consumables, such as filters, powder or build plates, that are sold to customers
and recognized upon transfer of control to the customer at shipment.

Recurring
Payment transactions - are our leased 3D Printer transactions. We define our Recurring Payment transactions as operating leases.
Under the leased 3D Printer transaction, the customer typically pays an amount for a lease which entitles the customer to a base number
of hours of usage