FREMONT, Calif. - Velo3D, Inc. (NYSE: VLD), a metal additive manufacturing firm, disclosed today that it has been notified by the New York Stock Exchange (NYSE) of non-compliance with certain market capitalization and stockholders' equity requirements. The notice, dated July 8, 2024, indicates that Velo3D's average total market capitalization fell below the NYSE's minimum threshold of $50 million over a recent 30-day trading period, concurrently with stockholders' equity being less than $50 million.
As of July 5, 2024, the company's market capitalization averaged approximately $36.6 million, and as of March 31, 2024, it reported a stockholders' deficit of roughly ($45.5) million. In response, Velo3D plans to submit a proposal within 45 days to the NYSE outlining steps to regain compliance with the listing standards. If the plan is accepted, Velo3D's stock will continue to trade on the NYSE during an 18-month cure period, provided the company meets other listing standards and regularly demonstrates progress on its plan.
The notice does not immediately affect Velo3D's stock listing or its reporting obligations to the U.S. Securities and Exchange Commission (SEC). Furthermore, the NYSE confirmed in a separate letter, dated June 28, 2024, that Velo3D's average stock price was above the $1 minimum requirement based on a 30-day trading average, resolving a previous concern regarding the continued listing criterion.
Velo3D specializes in 3D printing technology for the production of metal parts essential to industries such as space exploration, aviation, power generation, energy, and semiconductors. The company, known for its innovative approach to overcoming limitations of legacy metal additive manufacturing, provides a suite of solutions including Flow print preparation software, Sapphire family of printers, and Assure quality control system.
This announcement is based on a press release statement and does not reflect any endorsement of the company's claims or future prospects. Investors are advised to consider this information in light of Velo3D's recent financial challenges and the company's forthcoming plans to address NYSE compliance issues.
In other recent news, Velo3D has been making strides in its financial performance. The metal additive manufacturing firm's first-quarter revenue for 2024 met its guidance, hitting the $10 million mark, a significant increase from the previous quarter. Despite reporting a negative gross margin of 29% for the quarter, Velo3D is optimistic about achieving a turnaround in the next quarter and reaching sustainable profitability by the year's end.
The company also reported a GAAP net loss of $28.3 million and a non-GAAP net loss of $20.2 million for the quarter. However, improvements in revenue, margin, and operating expenses are anticipated throughout 2024, with Velo3D targeting over 30% sequential revenue growth in the second quarter and aiming for cash flow breakeven in the second half of the year.
In other significant news, Velo3D's board of directors has approved a 1-for-35 reverse stock split. This corporate action, which is designed to meet the New York Stock Exchange’s minimum share price requirement for continued listing, will not alter the number of authorized shares or the common stock's par value. The reverse stock split is expected to reduce the company's outstanding shares from approximately 297 million to about 8.5 million.
These recent developments indicate Velo3D's focus on improving operating efficiency, margin, and cash flow. The company projects a full-year revenue between $80 million to $95 million. Furthermore, Velo3D has seen improvements in Q1 bookings, particularly from the defense, space, and aerospace sectors, which are expected to positively influence the company's performance throughout 2024.
InvestingPro Insights
Velo3D, Inc. (NYSE: VLD) is currently navigating through turbulent financial waters, as highlighted by the recent NYSE non-compliance notification. The company's financial health is a key concern for investors, and real-time data from InvestingPro provides a more detailed picture of the situation. As of the latest data, Velo3D's market capitalization stands at a modest $26.66 million, reflecting a significant drop from the NYSE's minimum threshold. This is coupled with a negative price-to-earnings (P/E) ratio of -0.15, indicating that investors are concerned about the company's profitability prospects.
Moreover, the company's revenue has seen a sharp decrease, with a -35.02% change over the last twelve months as of Q1 2024. Such a decline in revenue growth can be alarming to potential investors, as it may signal underlying issues in the company's business model or market demand for its products. Additionally, the gross profit margin stands at a concerning -52.22%, which could imply that Velo3D is facing challenges in managing its cost of goods sold or pricing strategies effectively.
InvestingPro Tips suggest that Velo3D operates with a significant debt burden and may have trouble making interest payments on its debt, which is a critical factor for investors to consider given the company's financial challenges. Furthermore, the company's stock price has experienced high volatility, with a -29.15% price total return over the past month. Such volatility can be a double-edged sword, potentially offering higher returns but also posing greater risks.
For investors looking for a comprehensive analysis, there are additional InvestingPro Tips available that delve deeper into Velo3D's financial health and future prospects. Subscribers can access these tips by visiting InvestingPro Velo3D. To gain full insight and benefit from the expertise of InvestingPro, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription. There are a total of 19 InvestingPro Tips that can provide investors with a nuanced understanding of Velo3D's position and potential strategies for navigating its current challenges.
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