Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | May 01, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | XOMETRY, INC. | |
Entity Central Index Key | 0001657573 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity File Number | 001-40546 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 32-0415449 | |
Entity Address, Address Line One | 6116 Executive Blvd | |
Entity Address, Address Line Two | Suite 800 | |
Entity Address, City or Town | North Bethesda | |
Entity Address, State or Province | MD | |
Entity Address, Postal Zip Code | 20852 | |
City Area Code | 240 | |
Local Phone Number | 335-7914 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 45,168,110 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Title of 12(b) Security | Class A common stock, par value $0.000001 per share | |
Trading Symbol | XMTR | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 39,705 | $ 65,662 |
Marketable securities | 256,458 | 253,770 |
Accounts receivable, less allowance for credit losses of $1.9 million and $2.0 million as of March 31, 2023 and December 31, 2022 | 52,217 | 49,188 |
Inventory | 1,444 | 1,571 |
Prepaid expenses | 7,055 | 7,591 |
Other current assets | 15,897 | 12,273 |
Total current assets | 372,776 | 390,055 |
Property and equipment, net | 21,597 | 19,079 |
Operating lease right-of-use assets | 24,303 | 25,923 |
Investment in unconsolidated joint venture | 4,134 | 4,068 |
Intangible assets, net | 39,041 | 39,351 |
Goodwill | 262,441 | 258,036 |
Other assets | 385 | 413 |
Total assets | 724,677 | 736,925 |
Current liabilities: | ||
Accounts payable | 12,320 | 12,437 |
Accrued expenses | 32,121 | 33,430 |
Contract liabilities | 9,974 | 8,509 |
Income taxes payable | 4,113 | 3,956 |
Operating lease liabilities, current portion | 6,256 | 5,471 |
Total current liabilities | 64,784 | 63,803 |
Convertible notes | 280,375 | 279,909 |
Operating lease liabilities, net of current portion | 15,500 | 16,940 |
Deferred income taxes | 406 | 429 |
Other liabilities | 1,260 | 1,011 |
Total liabilities | 362,325 | 362,092 |
Commitments and contingencies (Note 13) | ||
Stockholders' equity | ||
Preferred stock, $0.000001 par value. Authorized; 50,000,000 shares; zero shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively | ||
Additional paid-in capital | 628,808 | 623,081 |
Accumulated other comprehensive income | 159 | 28 |
Accumulated deficit | (267,710) | (249,366) |
Total stockholders' equity | 361,257 | 373,743 |
Noncontrolling interest | 1,095 | 1,090 |
Total equity | 362,352 | 374,833 |
Total liabilities and stockholders' equity | 724,677 | 736,925 |
Class A Common Stock | ||
Stockholders' equity | ||
Common stock | ||
Class B Common Stock | ||
Stockholders' equity | ||
Common stock |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Allowance for credit losses, accounts receivable current | $ 1.9 | $ 2 |
Preferred stock, par or stated value per share | $ 0.000001 | $ 0.000001 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Class A Common Stock | ||
Common stock, par or stated value per share | $ 0.000001 | $ 0.000001 |
Common stock shares authorized | 750,000,000 | 750,000,000 |
Common stock share issued | 45,098,314 | 44,822,264 |
Common stock share outstanding | 45,098,314 | 44,822,264 |
Class B Common Stock | ||
Common stock, par or stated value per share | $ 0.000001 | $ 0.000001 |
Common stock shares authorized | 5,000,000 | 5,000,000 |
Common stock share issued | 2,676,154 | 2,676,154 |
Common stock share outstanding | 2,676,154 | 2,676,154 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Revenue | $ 105,326 | $ 83,671 |
Cost of revenue | 65,957 | 50,732 |
Gross profit | 39,369 | 32,939 |
Sales and marketing | 22,439 | 19,285 |
Operations and support | 12,608 | 12,358 |
Product development | 8,125 | 7,290 |
General and administrative | 15,957 | 12,959 |
Impairment of assets | 27 | |
Total operating expenses | 59,156 | 51,892 |
Loss from operations | (19,787) | (18,953) |
Other (expenses) income | ||
Interest expense | (1,198) | (769) |
Interest and dividend income | 2,695 | 96 |
Other income (expenses) | 17 | (962) |
Income from unconsolidated joint venture | 66 | 34 |
Total other income (expenses) | 1,580 | (1,601) |
Loss before income taxes | (18,207) | (20,554) |
(Provision) benefit for income taxes | (136) | 559 |
Net loss | (18,343) | (19,995) |
Net income attributable to noncontrolling interest | 1 | 17 |
Net loss attributable to common stockholders | $ (18,344) | $ (20,012) |
Net loss per share, basic | $ (0.38) | $ (0.43) |
Net loss per share, diluted | $ (0.38) | $ (0.43) |
Weighted-average number of shares outstanding used to compute net loss per share, basic | 47,699,561 | 46,789,585 |
Weighted-average number of shares outstanding used to compute net loss per share, diluted | 47,699,561 | 46,789,585 |
Comprehensive income: | ||
Foreign currency translation | $ 135 | $ (28) |
Total other comprehensive income (loss) | 135 | (28) |
Net loss | (18,343) | (19,995) |
Comprehensive loss | (18,208) | (20,023) |
Comprehensive income attributable to noncontrolling interest | 5 | 34 |
Total comprehensive loss attributable to common stockholders | $ (18,213) | $ (20,057) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total Stockholders' Equity | Noncontrolling Interest | Class A - Common Stock | Class B - Common Stock |
Balance at Dec. 31, 2021 | $ 425,483 | $ 597,641 | $ 149 | $ (173,341) | $ 424,449 | $ 1,034 | ||
Balance, Shares at Dec. 31, 2021 | 43,998,404 | 2,676,154 | ||||||
Exercise of common stock options | 1,263 | 1,263 | 1,263 | |||||
Exercise of common stock options, Shares | 246,263 | |||||||
Stock based compensation | 3,456 | 3,456 | 3,456 | |||||
Comprehensive income: | ||||||||
Foreign currency translation | (28) | (45) | (45) | 17 | ||||
Net (loss) income | (19,995) | (20,012) | (20,012) | 17 | ||||
Comprehensive loss | (20,023) | (20,057) | 34 | |||||
Balance at Mar. 31, 2022 | 410,179 | 602,360 | 104 | (193,353) | 409,111 | 1,068 | ||
Balance, Shares at Mar. 31, 2022 | 44,244,667 | 2,676,154 | ||||||
Balance at Dec. 31, 2022 | 374,833 | 623,081 | 28 | (249,366) | 373,743 | 1,090 | ||
Balance, Shares at Dec. 31, 2022 | 44,822,264 | 2,676,154 | ||||||
Exercise of common stock options | $ 483 | 483 | 483 | |||||
Exercise of common stock options, Shares | 70,316 | 82,909 | ||||||
Vesting of restricted stock units,shares | 169,446 | |||||||
Other common stock issued, Shares | 3,562 | |||||||
Other common stock issued | $ 180 | 180 | 180 | |||||
Donated common stock | 370 | 370 | 370 | |||||
Donated common stock, Shares | 20,133 | |||||||
Stock based compensation | 4,694 | 4,694 | 4,694 | |||||
Comprehensive income: | ||||||||
Foreign currency translation | 135 | 131 | 131 | 4 | ||||
Net (loss) income | (18,343) | (18,344) | (18,344) | 1 | ||||
Comprehensive loss | (18,208) | (18,213) | 5 | |||||
Balance at Mar. 31, 2023 | $ 362,352 | $ 628,808 | $ 159 | $ (267,710) | $ 361,257 | $ 1,095 | ||
Balance, Shares at Mar. 31, 2023 | 45,098,314 | 2,676,154 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities: | ||
Net loss | $ (18,343) | $ (19,995) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 2,566 | 1,799 |
Impairment of assets | 27 | |
Reduction in carrying amount of right-of-use asset | 1,935 | 1,765 |
Stock based compensation | 4,694 | 3,456 |
Revaluation of contingent consideration | 434 | |
Income from unconsolidated joint venture | (66) | (34) |
Donation of common stock | 370 | |
Losses on marketable securities | 858 | |
Non-cash income tax benefit | (559) | |
Loss on sale of property and equipment | 91 | 71 |
Amortization of deferred costs on convertible notes | 466 | 312 |
Deferred taxes benefit | (23) | (2) |
Changes in other assets and liabilities: | ||
Accounts receivable, net | (2,804) | (6,145) |
Inventory | 133 | (180) |
Prepaid expenses | 185 | 567 |
Other assets | (3,687) | (1,787) |
Accounts payable | (503) | (2,752) |
Accrued expenses | (2,119) | (2,843) |
Contract liabilities | 1,436 | 2,145 |
Lease liabilities | (970) | (1,369) |
Income taxes payable | 157 | |
Net cash used in operating activities | (16,455) | (24,259) |
Cash flows from investing activities: | ||
Purchase of marketable securities | (2,688) | (280,091) |
Proceeds from sale of marketable securities | 4 | |
Purchases of property and equipment | (4,186) | (2,543) |
Proceeds from sale of property and equipment | 223 | 165 |
Cash paid for business combinations, net of cash acquired | (3,349) | |
Net cash used in investing activities | (10,000) | (282,465) |
Cash flows from financing activities: | ||
Proceeds from stock options exercised | 483 | 1,263 |
Proceeds from issuance of convertible notes | 287,500 | |
Costs incurred in connection with issuance of convertible notes | (9,301) | |
Payments on finance lease obligations | (2) | |
Net cash provided by financing activities | 483 | 279,460 |
Effect of foreign currency translation on cash and cash equivalents | 15 | (29) |
Net decrease in cash and cash equivalents | (25,957) | (27,293) |
Cash and cash equivalents at beginning of the year | 65,662 | 86,262 |
Cash and cash equivalents at end of the period | 39,705 | $ 58,969 |
Supplemental cash flow information: | ||
Cash paid for interest | 1,438 | |
Non-cash investing and financing activities: | ||
Non-cash purchase of property and equipment | 78 | |
Non-cash consideration in connection with business combination | $ 1,593 |
Organization and Description of
Organization and Description of Business | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | (1) Organization and Description of Business Xometry, Inc. (“Xometry”, the “Company”, “we”, or “our”) was incorporated in the State of Delaware in May 2013 . Xometry is a global online marketplace connecting buyers with suppliers of manufacturing services, transforming one of the largest industries in the world. We use our proprietary technology to create a marketplace that enables buyers to efficiently source manufactured parts and assemblies, and empower suppliers of manufacturing services to grow their businesses. Xometry's corporate headquarters is located in North Bethesda, Maryland. Our AI-enabled technology platform is powered by proprietary machine learning algorithms and a dataset, resulting in a sophisticated marketplace for manufacturing. As a result, buyers can procure the products they want on demand and suppliers can source new manufacturing opportunities that match their specific capabilities and capacity. Interactions on our platform provide rich data insights that allow us to continuously improve our AI models and create new products and services, fueling powerful network effects as we scale. We use proprietary technology to enable product designers, engineers, buyers, and supply chain professionals to instantly access the capacity of a global network of manufacturing facilities. The Company’s platform makes it possible for buyers to quickly receive pricing, expected lead times, manufacturability feedback and place orders on the Company’s platform. The network allows the Company to provide high volumes of unique parts, including custom components and aftermarket parts for its buyers. Xometry’s suppliers’ capabilities include computer numerical control manufacturing, sheet metal forming, sheet cutting, 3D printing (including fused deposition modeling, direct metal laser sintering, PolyJet, stereolithography, selective laser sintering, binder jetting, carbon digital light synthesis and multi jet fusion), die casting, stamping, injection molding, urethane casting, tube cutting, tube bending, as well as finishing services, rapid prototyping and high-volume production. We empower suppliers to grow their manufacturing businesses and improve machine uptime by providing access to an extensive, diverse base of buyers. We also offer suppliers supporting products and services to meet their unique needs. Our suite of supplier services includes a cloud-based manufacturing execution system, access to competitively priced tools, materials and supplies from leading brands and financial service products to stabilize and enhance cash flow. In addition, we offer suppliers digital marketing and data solutions and SaaS based solutions to help suppliers optimize their productivity. In 2021, we acquired Thomas Publishing Company (“Thomas”) and Fusiform, Inc. (d/b/a FactoryFour) (“FactoryFour”), expanding our basket of supplier services to include marketing and advertising services and SaaS based solutions to help suppliers optimize their productivity. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | (2) Basis of Presentation and Summary of Significant Accounting Policies (a) Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company's Annual Report on Form 10-K filed with the SEC on March 16, 2023. The condensed consolidated balance sheet as of December 31, 2022, included herein, was derived from the audited financial statements as of that date, but may not include all disclosures including certain notes required by U.S. GAAP on an annual reporting basis. In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, comprehensive loss, stockholders' equity (deficit) and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the full year 2023 or any future period. The Company has two reporting segments which are referred to as: (1) the United States (“U.S.”) and (2) International. Foreign Operations and Comprehensive Loss The U.S. dollar (“USD”) is the functional currency for Xometry’s consolidated subsidiary operating in the U.S. The primary functional currency for the Company's consolidated subsidiaries operating in Germany and to a lesser extent, United Kingdom, Turkey, China and Japan, is the Euro, British Pound Sterling, Turkish Lira, Yuan and the Yen, respectively. For the Company’s consolidated subsidiaries whose functional currencies are not the USD, the Company translates their financial statements into USD. The Company translates assets and liabilities at the exchange rate in effect as of the financial statement date. Revenue and expense accounts are translated using an average exchange rate for the period. Gains and losses resulting from translation are included in accumulated other comprehensive income (“AOCI”), as a separate component of equity. Noncontrolling Interest We have a 66.67 % ownership in Incom Co., LTD. As we have a controlling interest in Incom Co., LTD, we have consolidated Incom Co., LTD into our financial statements. The portion of equity in Incom Co., LTD not owned by the Company is accounted for as a noncontrolling interest. We present the portion of any equity that we do not own in a consolidated entity as noncontrolling interest and classify their interest as a component of total equity, separate from total stockholders’ equity on our Condensed Consolidated Balance Sheets. We include net income (loss) attributable to the noncontrolling interests in net loss in our Condensed Consolidated Statements of Operations and Comprehensive Loss. (b) Use of Estimates The preparation of the Company’s unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates. (c) Business Combinations The Company accounts for business combinations using the acquisition method of accounting, which requires, among other things, allocation of the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed at their estimated fair values on the acquisition date. The excess of the fair value of purchase consideration over the values of these identifiable assets and liabilities is recorded as goodwill. When determining the fair value of assets acquired and liabilities assumed, management makes significant estimates and assumptions, especially with respect to the valuation of intangible assets. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, not to exceed one year from the date of acquisition, the Company may record adjustments to the assets acquired and liabilities assumed, with a corresponding offset to goodwill if new information is obtained related to facts and circumstances that existed as of the acquisition date. Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are reflected in the consolidated statements of operations. Acquisition costs, such as legal and consulting fees, are expensed as incurred. (d) Fair Value Measurements and Financial Instruments The Company measures certain assets and liabilities at fair value on a recurring basis based on an expected exit price, which represents the amount that would be received on the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis, whereby inputs used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3 - Unobservable inputs reflecting the Company’s own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. The carrying amounts of certain of the Company’s financial instruments, which include cash and cash equivalents, accounts receivable, prepaid expenses and other assets, accounts payable, accrued expenses and contract liabilities approximate their fair values due to their short maturities. The Company's marketable securities are recorded at fair value. (e) Marketable Securities The Company measures its marketable securities at fair value and recognizes any changes in fair value in net loss. Our marketable securities represent our investments in a short term bond fund and/ or money market fund. We consider our marketable securities as available for use in current operations, and therefore classify these securities as current assets on the Condensed Consolidated Balance Sheets. As of March 31, 2023 and December 31, 2022, the Company's marketable securities of $ 256.5 million and $ 253.8 million respectively, were recorded at fair value, within Level 1 of the fair value hierarchy. The fair value of the Company’s Level 1 financial instruments is based on quoted prices in active markets, total fair value is the published market price per unit multiplied by the number of units held without consideration of transaction costs, discounts or blockage factors. No losses were recorded during the three months ended March 31, 2023. During the three months ended March 31, 2022, the Company recorded losses of $ 0.9 million related to these securities, which is recorded in other expenses on the Condensed Consolidated Statements of Operations and Comprehensive Loss. (f) Accounts Receivable Accounts receivable are stated at the amount the Company expects to collect from outstanding balances. Our accounts receivable do not bear interest. Amounts collected on accounts receivable are included in net cash used in operating activities in the Condensed Consolidated Statements of Cash Flows. For buyers for which Xometry provides credit, the Company performs credit inquiries, including reference checks, and queries credit ratings services and other publicly available information. Management provides for probable uncollectible amounts through a provision for bad debt expense and an adjustment to a valuation allowance based on the age of the outstanding amounts, each customer’s expected ability to pay and collection history, current market conditions, and reasonable and supportable forecasts of future economic conditions to determine whether the allowance is appropriate. The Company reviews its valuation allowance monthly. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable. Allowance For Credit Losses The allowance for credit losses related to accounts receivable and changes were as follows (in thousands): 2023 2022 Allowance for credit losses Balance at beginning of year, January 1 $ 1,988 $ 809 Charge to provision accounts 285 1,324 Recoveries or other ( 325 ) ( 145 ) Balance at period end, March 31 and December 31, respectively $ 1,948 $ 1,988 (g) Property and Equipment and Long-Lived Assets Property and equipment are stated at cost. Equipment under finance leases is stated at the present value of minimum lease payments. Depreciation is calculated on the straight-line method over the estimated useful life of the assets, which range from three to seven years, or in the case of leasehold improvements, over the shorter of the remaining lease term or the useful life of the asset. Property and equipment and intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. Property and equipment includes capitalized internal-use software development costs. Eligible internal-use software development costs are capitalized subsequent to the completion of the preliminary project stage. Such costs include internal and external direct development costs totaling $ 3.5 million for the three months ended March 31, 2023 and $ 11.5 million for the year ended December 31, 2022. After all substantial testing and deployment is completed and the software is ready for its intended use, capitalization is discontinued and the internal-use software costs are placed in service and amortized using the straight-line method over the estimated useful life of the software, generally three years. (h) Goodwill Goodwill represents the excess purchase price over the estimated fair value of net assets acquired in a business combination. As of March 31, 2023, the Company's goodwill is attributable to both the U.S. and International reporting units. As of December 31, 2022, the Company's goodwill is attributable to the U.S. reporting unit. Goodwill is not amortized. The Company tests goodwill for impairment annually in the fourth quarter, or more frequently, if events or changes in circumstances indicate that the carrying value of a reporting unit, including goodwill, might be impaired. In testing for goodwill impairment, we first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. These qualitative factors assessed may include the following: (i) significant changes in the manner of our use of the assets or the strategy of our overall business, (ii) certain restructuring initiatives, (iii) significant negative industry or economic trends and (iv) significant decline in our share price for a sustained period. If, after assessing the totality of events or circumstances, we determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then additional impairment testing is not required. However, if we conclude otherwise, we proceed to the quantitative assessment. (i) Revenue The Company derives the majority of its marketplace revenue in the U.S. and Europe from the sale of parts and assemblies fulfilled using a vast network of suppliers. The Company recognizes revenue from the sales to our customers pursuant to Financial Accounting Standard Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”). The Company determines that a contract exists between the Company and the customer when the customer accepts the quote and places the order, all of which are governed by the Company’s standard terms and conditions or other agreed terms with Xometry’s buyers. Upon completion of an order through Xometry’s platform, the Company identifies the performance obligation(s) within that order to complete the sale of the manufactured part(s) or assembly. Using Xometry’s in-house technology, the Company determines the price for the manufactured part(s) or assembly on a stand-alone basis at order initiation. The Company recognizes revenue from sales to Xometry’s customers upon shipment, at which point control over the part(s) or assembly have transferred. The Company has concluded that the Company is principal in the sale of part(s) and assemblies that use the Company’s network of third-party manufacturers because the Company controls the manufacturing by obtaining a right to direct a third-party manufacturer to fulfill the performance obligation Xometry has with the Company’s customers on Xometry’s behalf. The Company has considered the following conditions of the sale: (i) the Company has the obligation of providing the specified product to the customer, (ii) the Company has discretion with respect to establishing the price of the product and the price the Company pays the suppliers and the Company has margin risk on all of Xometry’s sales, (iii) the Company has discretion in determining how to fulfill each order, including selecting the supplier and (iv) Xometry bears certain risk for product quality to the extent the customer is not satisfied with the final product. Xometry also derives revenue from its supplier services which is a suite of services offered to our suppliers. Revenue also includes the sale of marketing services which includes advertising. This revenue is generally recognized as control is transferred to the customer, in an amount reflecting the consideration we expect to be entitled to in exchange for such product or service. From time to time, a purchase order with a customer may involve multiple performance obligations, including a combination of some or all of our products. Judgment may be required in determining whether products are considered distinct performance obligations that should be accounted for separately or as one combined performance obligation. Revenue is recognized over the period or at the point in time in which the performance obligations are satisfied. Consideration is typically determined based on a fixed unit price for the quantity of product transferred. For purchase orders involving multiple performance obligations, the transaction price is allocated to each performance obligation based on relative standalone selling price, and recognized as revenue when each individual product or service is transferred to the customer. Revenue is shown net of estimated returns, refunds, and allowances. At March 31, 2023 and December 31, 2022, the Company has a provision for estimated returns, refunds or allowances of $ 0.1 million and $ 0.3 million, respectively. Sales tax collected from customers and remitted to governmental authorities is excluded from revenue. Contract Liabilities Contract liabilities are primarily derived from payments received in advance or at the time an order is placed, for which the associated performance obligations have not been satisfied and revenue has not been recognized based on the Company’s revenue recognition criteria described above. The following table is presents contract liabilities as of December 31, 2022 and March 31, 2023 (in thousands): Rollforward of contract liabilities: Contract liabilities at December 31, 2022 $ 8,509 Revenue recognized ( 51,287 ) Payments received in advance 52,731 Acquired contract liabilities 21 Contract liabilities at March 31, 2023 $ 9,974 During the three months ended March 31, 2023, the Company recognized approximately $ 8.0 million of revenue related to its contract liabilities at December 31, 2022. During the three months ended March 31, 2022, the Company recognized approximately $ 7.2 million of revenue related to its contract liabilities at December 31, 2021. Sales Contract Acquisition Costs The Company’s incremental costs to obtain a contract may include a sales commission which is generally determined on a per order basis. For contracts in excess of one year, the Company amortizes such costs on a straight-line basis over the average customer life of two years for new customers and over the renewal period for existing customers which is generally one year . Sales commissions are included in Xometry’s sales and marketing expenses in the Condensed Consolidated Statements of Operations and Comprehensive Loss. For the periods ended March 31, 2023 and 2022, we recognized approximately $ 2.0 million and $ 2.2 million, respectively of amortization related to deferred sales commissions. As of March 31, 2023 and December 31, 2022, the Company had deferred sales contract acquisition costs of $ 4.3 million and $ 3.3 million, respectively which is classified in other current assets on the Condensed Consolidated Balance Sheets. (j) Cost of Revenue Cost of revenue for marketplace primarily consists of the cost of the products that are manufactured or produced by the Company’s suppliers for delivery to buyers on the Company's platform, internal and external production costs, shipping costs, and certain internal depreciation. Cost of revenue for supplier services primarily consists of internal and external production costs and website hosting. (k) Leases The Company determines if an arrangement contains a lease and the classification of that lease, if applicable, at its inception. Operating leases are included in operating lease right-of-use ("ROU") assets, operating lease liabilities and operating lease liabilities, net of current portion in the Condensed Consolidated Balance Sheets. The Company has finance leases as detailed in the Long-Lived Assets section above. For leases with terms of twelve months or less, the Company does not recognize ROU assets or lease liabilities on the Condensed Consolidated Balance Sheets. Additionally, the Company elected to use the practical expedient to not separate lease and non-lease components for leases of real estate, meaning that for these leases, the non-lease components are included in the associated ROU asset and lease liability balances on the Company’s Condensed Consolidated Balance Sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments under the lease. Operating lease ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The implicit rate within the Company’s operating leases is generally not determinable, as such the Company uses its incremental borrowing rate at lease commencement to determine the present value of lease payments. The operating lease ROU asset also includes any lease prepayments, offset by lease incentives. Certain of the Company’s leases include options to extend or terminate the lease. The expected lease term includes options to extend or terminate the lease when it is reasonably certain the Company will exercise such option. Lease expense is recognized on a straight-line basis over the term of the lease. (l) Sales and Marketing Sales and marketing expenses are expensed as incurred and include the costs of digital marketing strategies, branding costs and other advertising costs, certain depreciation and amortization expense, contract acquisition costs and compensation expenses, including stock-based compensation, to the Company’s sales and marketing employees. For the three months ended March 31, 2023 and 2022, the Company's advertising cost were $ 8.1 million and $ 7.1 million, respectively. (m) Operations and Support Operations and support expenses are the costs the Company incurs in support of the customers and suppliers on Xometry’s platforms which are provided by phone, email and chat for purposes of resolving customer and supplier related matters. These costs primarily consist of compensation expenses of the support staff, including stock-based compensation, certain depreciation and amortization expense and software costs used in delivering customer and supplier services. (n) Product Development Product development costs which are not eligible for capitalization are expensed as incurred. This account also includes compensation expenses, including stock-based compensation to the Company’s employees performing these functions and certain depreciation and amortization expense. (o) General and Administrative General and administrative expenses primarily consist of compensation expenses, including stock-based compensation expenses, for executive, finance, legal and other administrative personnel, professional service fees and certain depreciation and amortization expense. (p) Stock Based Compensation All stock-based compensation, including stock options and restricted stock units, are measured at the grant date fair value of the award. The Company estimates grant date fair value of stock options using the Black-Scholes option-pricing model. The fair value of stock options and restricted stock units is recognized as compensation expense on a straight-line basis over the requisite service period, which is typically four years . The fair value of the restricted stock units is determined using the fair value of the Company's Class A common stock on the date of grant. Forfeitures are recorded in the period in which they occur. The Black-Scholes model considers several variables and assumptions in estimating the fair value of stock-based awards. These variables include: • expected annual dividend yield; • expected volatility over the expected term; • expected term; • risk free interest rate; • per share value of the underlying common stock; and • exercise price. For all stock options granted, the Company calculated the expected term using the simplified method for “plain vanilla” stock option awards. The risk-free interest rate is based on the yield available on U.S. Treasury issuances similar in duration to the expected term of the stock-based award. The Company estimates its expected share price volatility based on the historical volatility of publicly traded peer companies and/or its own volatility and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded share price. The Company utilized a dividend yield of zero, as it had no history or plan of declaring dividends on its common stock. (q) Net Loss Per Share The Company computes net loss per share using the two-class method required for multiple classes of common stock and participating securities. The two-class method requires income available to common stockholders for the period to be allocated between common stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. Certain unvested share-based payment awards that contain nonforfeitable rights to dividends are treated as participating securities and therefore included in computing net income per share using the two-class method. The rights, including the liquidation and dividend rights, of the Class A common stock and Class B common stock are substantially identical, other than voting rights. Accordingly, the Class A common stock and Class B common stock shared proportionately in the Company’s net losses. (r) Reclassifications Certain line items on the Company’s condensed consolidated financial statements have been reclassified to conform to the current period presentation. These reclassifications have not changed the results of operations of prior periods. (s) Recently Issued Accounting Standards There are currently no other accounting standards that have been issued, but not yet adopted, that are expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows upon adoption. |
Credit Concentrations
Credit Concentrations | 3 Months Ended |
Mar. 31, 2023 | |
Risks and Uncertainties [Abstract] | |
Credit Concentrations | (3) Credit Concentrations Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and accounts receivable. The Company maintains its cash, which at times may exceed federally insured limits, in deposit accounts at major financial institutions. Most of the Company’s buyers are located in the United States. For the three months ended March 31, 2023 and 2022, no single buyer accounted for more than 10% of the Company's revenue. As of March 31, 2023, and December 31, 2022, no single buyer accounted for more than 10% of the Company’s accounts receivable. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Inventory | (4) Inventory Inventory consists of raw materials, work-in-process, tools inventory and finished goods. Raw materials (plastics and metals) become manufactured products in the additive and subtractive manufacturing processes. Work-in-progress represents manufacturing costs associated with customer orders that are not yet complete. The tools inventory primarily consists of small consumable machine tools, cutting devices, etc. Finished goods represents product awaiting shipment. Inventory consists of the following as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, 2023 2022 Raw materials $ 124 $ 119 Work-in-progress 388 675 Tools inventory 221 477 Finished goods 711 300 Total $ 1,444 $ 1,571 |
Property and Equipment and Long
Property and Equipment and Long-Lived Assets | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment and Long-Lived Assets | (5) Property and Equipment and Long-Lived Assets Property and equipment consist of the following as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, Useful Life 2023 2022 Technology hardware 3 years $ 3,049 $ 2,927 Manufacturing equipment 5 years 2,753 2,892 Capitalized software development 3 years 27,852 24,343 Leasehold improvements Shorter of useful 1,383 1,345 Furniture and fixtures 7 years 2,317 1,705 Total 37,354 33,212 Less accumulated depreciation ( 15,757 ) ( 14,133 ) Property and Equipment, net $ 21,597 $ 19,079 Depreciation expense for the three months ended March 31, 2023 and 2022 was as follows (in thousands): Three Months Ended March 31, 2023 2022 Cost of revenue $ 44 $ 34 Operations and support 12 11 Product development 1,269 704 General and administrative 316 185 Total depreciation expense $ 1,641 $ 934 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Leases | (6) Leases Operating lease expense for the three months ended March 31, 2023 and 2022 was as follows (in thousands): Three Months Ended March 31, 2023 2022 Cost of revenue $ 18 $ 16 General and administrative 2,214 1,833 Total operating lease expense $ 2,232 $ 1,849 During the first quarter of 2023, the Company entered into two new office leases in Lyon, France and Istanbul, Turkey. In connection with these leases, the Company recorded non-cash ROU assets and lease liabilities of $ 0.3 million. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2023 | |
Business Combinations [Abstract] | |
Acquisitions | (7) Acquisitions Tridi On January 2, 2023, the Company acquired Tridi Teknoloj A.S. (“Tridi”) located in Istanbul, Turkey pursuant to a Share Purchase Agreement. The acquisition of Tridi extends our marketplace capabilities in Europe and provides us access to the Turkish market. The Company accounted for the acquisition as a business combination. The goodwill of $ 4.3 million arising from the acquisition of Tridi related to expected synergies including access to the Turkish market and an established supplier network. The goodwill is included in our International reporting segment and is not deductible for tax purposes. The aggregate non-contingent portion of the purchase price was approximately $ 3.8 million in cash, of which approximately $ 0.4 million was withheld and will be paid in a future period. In addition, the purchase price included a contingent consideration arrangement to the former owner of Tridi up to a maximum amount of $ 1.25 million (undiscounted) in shares of the Company’s Class A common stock in two installments on the first and second anniversary of the acquisition. The contingent consideration arrangement is tied to the achievement of revenue thresholds. The initial fair value of the contingent consideration of $ 0.9 million was estimated by applying an income valuation approach. The measurement is based on inputs that are not observable in the market (Level 3 inputs). Key assumptions made include (a) discount rate and (b) probability weighted assumptions about achieving revenue thresholds. The Company has performed a preliminary valuation analysis of the fair market value of the acquired assets and liabilities of Tridi. The final purchase price allocation will be determined when the Company has completed and fully reviewed all information necessary to finalize the fair value of the acquired assets and liabilities. The final allocation could differ materially from the preliminary allocation and may include changes in allocations to current assets, current liabilities and goodwill. The following table (in thousands) summarizes the consideration paid for Tridi and the preliminary fair value of the assets acquired and liabilities assumed on the acquisition date: Consideration: Cash $ 3,824 Settlement of preexisting relationship 357 Fair value of contingent consideration 860 Fair value of consideration 5,041 Acquisition costs included in general and administrative for the period ended March 31, 2023 32 Recognized amounts of identifiable assets acquired and liabilities assumed: Current assets 460 Property and equipment 22 Intangible asset 608 Current liabilities ( 373 ) Total identifiable net assets assumed 717 Goodwill 4,324 Total $ 5,041 The estimated fair value of the intangible asset acquired was determined by the Company. The Company engaged a third‑party expert to assist with the valuation analysis. The Company used a cost method to estimate the fair value of the vendor relationship using Level 3 inputs. The useful life of the vendor relationship is 10 years. Tridi’s results of operations were included in the Company's consolidated financial statements from the date of acquisition, January 2, 2023. The acquisition of Tridi was not considered material to the Company for the periods presented, and therefore, proforma information has not been presented. |
Disaggregated Revenue and Cost
Disaggregated Revenue and Cost of Revenue Information | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregated Revenue and Cost of Revenue Information | (8) Disaggregated Revenue and Cost of Revenue Information The following table present our revenues and cost of revenue disaggregated by line of business. Revenue from our marketplace primarily reflects the sales of parts and assemblies on our platform. Revenue from supplier services primarily includes the sale of advertising and to a lesser extent supplies, financial service products and SaaS products. Revenue is presented in the following tables for the three months ended March 31, 2023 and 2022, respectively (in thousands): For the Three Months For The Three Months Marketplace 2023 2022 Revenue $ 86,680 $ 64,415 Cost of revenue 61,747 46,741 Gross Profit $ 24,933 $ 17,674 Supplier Services Revenue $ 18,646 $ 19,256 Cost of revenue 4,210 3,991 Gross Profit $ 14,436 $ 15,265 |
Investment in Unconsolidated Jo
Investment in Unconsolidated Joint Venture | 3 Months Ended |
Mar. 31, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Unconsolidated Joint Venture | (9) Investment in Unconsolidated Joint Venture The Company has a 50 % interest in Industrial Media, LLC ("IM, LLC") with the other 50 % owned by Rich Media Group, LLC. IM, LLC primarily manages content creation, advertising sales, and marketing initiatives for the Industrial Engineering News brand, certain magazines, videos, website and associated electronic media products for industrial engineers. No dividends were received during the period ended March 31, 2023 and 2022. During the three months ended March 31, 2023 and 2022, the Company did not pay material amounts to IM, LLC. |
Stock Based Compensation
Stock Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Based Compensation | (10) Stock Based Compensation In 2014, the Company adopted a stock compensation plan (the "2014 Equity Incentive Plan") pursuant to which the Company may grant stock options, stock purchase rights, restricted stock awards, or stock awards to employees, directors and consultants (including prospective employees, directors, and consultants). This plan was terminated in February 2016. No additional awards may be granted under the 2014 Equity Incentive Plan, however, outstanding awards continue in full effect in accordance with their existing terms. In 2016, the Company adopted a stock compensation plan (the “2016 Equity Incentive Plan”) pursuant to which the Company may grant stock options, stock purchase rights, restricted stock awards, or stock awards to employees, directors and consultants (including prospective employees, directors, and consultants). No additional awards may be granted under the 2016 Equity Incentive Plan, however, outstanding awards continue in full effect in accordance with their existing terms. In connection with the Company’s initial public offering on July 2, 2021, the Company's board of directors adopted the 2021 Equity Incentive Plan (the “2021 Equity Incentive Plan”). The 2021 Equity Incentive Plan provides for the grant of incentive stock options (“ISOs”), non-statutory stock options (“NSOs”), stock appreciation rights, restricted stock awards, restricted stock unit awards, performance-based awards and other awards, or collectively, awards. Awards may be granted to Xometry employees, including our officers, Xometry’s non-employee directors and consultants/contractors and the employees and consultants/contractors of Xometry affiliates. ISOs may be granted only to Xometry employees, including Xometry officers, and the employees of Xometry affiliates. As of March 31, 2023, there were 5,851,637 shares available for the Company to grant under the 2021 Equity Incentive Plan. Stock Options The weighted average assumptions for the three months ended March 31, 2023 and 2022 are provided in the following table. Three Months Ended March 31, 2023 2022 Valuation assumptions: Expected dividend yield —% —% Expected volatility 80 % 66 % Expected term (years) 6.3 6.0 Risk-free interest rate 3.8 % 1.9 % Fair value of share $ 11.37 $ 34.86 A summary of the status of the Company’s stock option activity and the changes during the three months ended March 31, 2023, are as follows (in millions, except share and per share amounts): Number of Weighted Average Aggregate Exercisable at December 31, 2022 1,391,047 6.09 7.2 $ 36.4 Balance at December 31, 2022 2,841,419 11.33 7.7 61.4 Granted 428,278 15.82 — — Exercised ( 70,316 ) 5.94 — — Forfeited ( 60,347 ) 19.86 — — Expired ( 556 ) 8.59 — — Balance at March 31, 2023 3,138,478 11.90 7.8 18.0 Exercisable at March 31, 2023 1,581,106 7.69 7.0 13.1 The weighted average grant date fair value of options granted during the three months ended March 31, 2023 and 2022, was $ 17.00 and $ 21.08 , respectively. The total intrinsic value of options exercised during the three months ended March 31, 2023 and 2022, was $ 1.3 million and $ 9.7 million, respectively. At March 31, 2023 and 2022, there was approximately $ 21.7 million and $ 25.5 million, respectively, of total unrecognized compensation cost related to unvested stock options. That cost is expected to be recognized over a weighted average period of approximately three years as of March 31, 2023 and 2022. The Company currently uses authorized and unissued shares to satisfy share award exercises. Restricted Stock Units A summary of the status of the Company’s restricted stock unit activity and the changes during the three months ended March 31, 2023 are as follows (in millions, except share and per share amounts): Number of Weighted Aggregate Unvested RSUs as of December 31, 2022 875,902 44.37 $ 28.2 Granted 1,242,169 15.59 — Vested ( 169,371 ) 41.25 — Forfeited and cancelled ( 97,629 ) 46.57 — Unvested RSUs as of March 31, 2023 1,851,071 25.23 27.7 At March 31, 2023 and 2022, there was approximately $ 43.5 million and $ 35.3 million, respectively of total unrecognized compensation cost related to unvested restricted stock units granted under the 2021 Equity Incentive Plan. That cost is expected to be recognized over a weighted average period of approximately three years and four years as of March 31, 2023 and March 31, 2022, respectively. Total stock-based compensation cost for the three months ended March 31, 2023 and 2022 were as follows (in thousands): Three Months Ended March 31, 2023 2022 Sales and marketing $ 1,052 $ 636 Operations and support 1,697 1,423 Product development 1,076 894 General and administrative 869 503 Total stock compensation expense $ 4,694 $ 3,456 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | (11) Income Taxes A full valuation allowance has been established against our net U.S. federal and state deferred tax assets and foreign deferred tax assets, including net operating loss carryforwards. During the three months ended March 31, 2023, the Company has a $ 0.1 million income tax expense in the U.S. The Company had a $ 0.6 million income tax benefit in the U.S. for the three months ended March 31, 2022. This estimated annual effective tax rate of ( 0.1 )%, differs from the U.S. federal statutory rate primarily due to the effects of certain permanent items, foreign tax rate differences, and increases in the valuation allowance against deferred tax assets. Net Operating Loss and Credit Carryforwards As of December 31, 2022, the Company has net operating loss (“NOL”) carryforwards for U.S. federal income tax purposes, and similar state amounts, of approximately $ 224.6 million available to reduce future income subject to income taxes before limitations. As of December 31, 2022, the Company had a net operating loss carryforward for tax purposes related to its foreign subsidiaries of $ 33.8 million. U.S. federal net operating carryforwards generated prior to 2018 in the approximate amount of $ 71.9 million will begin to expire, if not utilized, in 2023. Our non-U.S. net operating loss and U.S. federal net operating losses post 2017 have an indefinite life. Under the provisions of U.S. Internal Revenue Code Section 382, certain substantial changes in the Company’s ownership may result in a limitation in the amount of U.S. net operating loss carryforwards that can be utilized annually to offset future taxable income. |
Net Loss Per Share Attributable
Net Loss Per Share Attributable to Common Stockholders | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share Attributable to Common Stockholders | (12) Net Loss Per Share Attributable to Common Stockholders The Company computes net loss per share of Class A common stock, Class B common stock and participating securities using the two-class method. Basic and diluted EPS are the same for each class of common stock and participating securities because they are entitled to the same liquidation and dividend rights. The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share data): Three Months Ended March 31, 2023 2022 Net loss $ ( 18,343 ) $ ( 19,995 ) Net income attributable to noncontrolling interest 1 17 Net loss attributable to common stockholders $ ( 18,344 ) $ ( 20,012 ) Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic and diluted 47,699,561 46,789,585 Net loss per share attributable to common stockholders, basic and diluted $ ( 0.38 ) $ ( 0.43 ) The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net loss per share because including them would have had an anti-dilutive effect, or issuance of such shares is contingent upon the occurrence of an event: March 31, 2023 2022 Stock options outstanding 3,138,478 3,277,025 Unvested restricted stock units 1,851,071 815,543 Warrants outstanding 87,784 87,784 Shares reserved for charitable contribution 281,860 362,392 Convertible notes 5,123,624 5,123,624 Total shares 10,482,817 9,666,368 |
Debt Commitments and Contingenc
Debt Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt Commitments and Contingencies | (13) Debt Commitments and Contingencies 2027 Convertible Notes In February 2022, we entered into a purchase agreement with certain counterparties for the sale of an aggregate of $ 287.5 million principal amount of convertible senior notes due in 2027 (the “2027 Notes”) in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The 2027 Notes consisted of a $ 250 million initial placement and an over-allotment option that provided the initial purchasers of the 2027 Notes with the option to purchase an additional $ 37.5 million aggregate principal amount of the 2027 Notes, which was fully exercised. The 2027 Notes were issued pursuant to an indenture dated February 4, 2022 . The net proceeds from the issuance of the 2027 Notes were $ 278.2 million, net of debt issuance costs. The debt issuance costs are amortized to interest expense using the effective interest rate method. The 2027 Notes are unsecured obligations which bear regular interest at 1 % per annum and for which the principal balance will not accrete. Interest payment are due on February 1 and August 1 of each year the Notes remain outstanding. The 2027 Notes will mature on February 1, 2027 unless repurchased, redeemed, or converted in accordance with their terms prior to such date. The 2027 Notes are convertible into cash, shares of our Class A common stock, or a combination of cash and shares of our Class A common stock, at our election, at an initial conversion rate of 17.8213 shares of Class A common stock per $ 1,000 principal amount of 2027 Notes, which is equivalent to an initial conversion price of approximately $ 56.11 per share of our Class A common stock. The conversion rate is subject to customary adjustments for certain events as described in the indenture governing the 2027 Notes. We may redeem for cash all or any portion of the 2027 Notes, at our option, on or after February 5, 2025 if the last reported sale price of our Class A common stock has been at least 130 % of the conversion price then in effect for at least 20 trading days at a redemption price equal to 100 % of the principal amount of the 2027 Notes to be redeemed, plus accrued and unpaid interest or additional interest, if any. Holders of the 2027 Notes may convert all or a portion of their 2027 Notes at their option prior to November 1, 2026, in multiples of $ 1,000 principal amounts, only under the following circumstances: • if the last reported sale price of our Class A common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on the last trading day of the preceding calendar quarter is greater than or equal to 130 % of the applicable conversion price of the 2027 Notes on each such trading day; • during the five business day period after any ten consecutive trading day period in which the trading price per $ 1,000 principal amount of the 2027 Notes for each day of that ten consecutive trading day period was less than 98 % of the product of the last reported sale price of our Class A common stock and the applicable conversion rate of the 2027 Notes; • on a notice of redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date, in which case we may be required to increase the conversion rate for the 2027 Notes so surrendered for conversion in connection with such redemption notice; or • on the occurrence of specified corporate events. On or after November 1, 2026, the 2027 Notes are convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. Holders of the 2027 Notes who convert the 2027 Notes in connection with a make-whole fundamental change, as defined in the indenture governing the 2027 Notes, or in connection with a redemption are entitled to an increase in the conversion rate. Additionally, in the event of a fundamental change, holders of the 2027 Notes may require us to repurchase all or a portion of the 2027 Notes at a price equal to 100 % of the principal amount of 2027 Notes, plus any accrued and unpaid special interest, if any. We accounted for the issuance of the 2027 Notes as a single liability measured at its amortized cost, as no other embedded features require bifurcation and recognition as derivatives. The following table presents the outstanding principal amount and carrying value of the 2027 Notes as of the dates indicated (in thousands): March 31, December 31, 2023 2022 Principal $ 287,500 287,500 Unamortized debt discount ( 6,613 ) ( 7,044 ) Unamortized debt issuance costs ( 512 ) ( 547 ) Net carrying value $ 280,375 279,909 The annual effective interest rate for the 2027 Notes was approximately 1.6 %. Interest expense related to the 2027 Notes for the periods presented below was as follows (in thousands): Three Months Ended Three Months Ended 2023 2022 Coupon interest $ 719 $ 449 Amortization of debt discount 431 287 Amortization of transaction costs 35 25 Total interest expense $ 1,185 $ 761 The Company estimates the fair value of the 2027 Notes with inputs that are unobservable. The following table presents the carrying value and estimated fair value of the 2027 Notes as of the date indicated (in thousands): March 31, 2023 December 31, 2022 Carrying Value Fair Value Carrying Value Fair Value 2027 Notes (1) $ 280,375 $ 263,834 $ 279,909 $ 257,671 (1) The fair value is estimated using a discounted cash flow analysis, using interest rate that we believe are offered for similar borrowings (a Level 3 measurement). Contingencies The Company from time to time may be subject to various claims and legal proceedings covering a range of matters that arise in the ordinary course of its business activities. In the opinion of the Company, although the outcome of any legal proceedings cannot be predicted with certainty, the ultimate liability of the Company in connection with its legal proceedings is not expected to have a material adverse effect on the Company’s financial position or operations. Restructuring In December 2022, we initiated a restructuring action to help manage our operating expenses by reducing our workforce by approximately 6 %. The workforce reduction focused on realigning staffing levels to help meet the current and future objectives of the business. During the fourth quarter of 2022, we incurred $ 1.5 million for employee termination costs related to this restructuring. The following table shows the total amount incurred and the liability, which was recorded in accrued expenses in the Condensed Consolidated Balance Sheets, for restructuring-related employee termination benefits as of December 31, 2022 and March 31, 2023 (in thousands): Employee Termination Benefits Accrued restructuring costs as of December 31, 2022 $ 1,549 Restructuring costs incurred during the period ended March 31, 2023 - Amount paid during the period ended March 31, 2023 ( 1,273 ) Accrued restructuring costs as of March 31, 2023 $ 276 Defined Contribution Plans We sponsor a defined contribution plan for qualifying employees, including a 401(k) Plan in the United States to which we make matching contributions of 50 % of participating employee contributions up to 6 % of eligible income. Our total matching contribution to the 401(k) Plan was $ 0.5 million and $ 0.4 million for the three months ended March 31, 2023 and 2022, respectively. |
Segments
Segments | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Segments | (14) Segments Xometry is organized in two segments referred to as: (1) the U.S. and (2) International. Xometry’s operating segments are also the Company’s reportable segments. Xometry’s reportable segments, whose products and offerings are generally the same, are managed separately based on geography. Xometry’s two segments are defined based on the reporting and review process used by the chief operating decision maker (“CODM”), the Chief Executive Officer. The Company evaluates the performance of the operating segments primarily based on revenue and segment “profits/loss” which is largely the results of the segment before income taxes. The Company has not allocated certain general and administrative expenses to the International segment. The Company’s CODM monitors assets of the consolidated Company, but does not use assets by operating segment when assessing performance or making operating segment resource decisions. The following tables reflect certain segment information for the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended March 31, 2023 2022 Segment Revenue U.S. $ 93,903 $ 77,209 International 11,423 6,462 Total $ 105,326 $ 83,671 Three Months Ended March 31, 2023 2022 Segment Losses U.S. $ ( 12,937 ) $ ( 16,296 ) International ( 5,407 ) ( 3,716 ) Total $ ( 18,344 ) $ ( 20,012 ) |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | (15) Goodwill and Intangible Assets The following tables summarize the Company’s intangible assets (dollars in thousands): March 31, 2023 Weighted Gross Accumulated Net Intangible Assets Amortizing intangible assets: Customer Relationships 15 $ 36,652 $ 3,250 $ 33,402 Trade Names 10 841 118 723 Developed Technology 5 740 224 516 Vendor Relationships 13 1,861 337 1,524 Database 5 2,400 630 1,770 Patents 17 157 44 113 Subtotal intangible assets 42,651 4,603 38,048 In-place Lease Intangible Asset 4 568 178 390 Above Market Lease Intangible Asset 4 896 293 603 Total intangible assets $ 44,115 $ 5,074 $ 39,041 December 31, 2022 Weighted Gross Accumulated Net Intangible Assets Amortizing intangible assets: Customer Relationships 15 $ 36,652 $ 2,638 $ 34,014 Trade Names 10 841 97 744 Developed Technology 5 739 182 557 Vendor Relationships 15 1,267 299 968 Database 5 2,400 510 1,890 Patents 17 157 42 115 Subtotal intangible assets 42,056 3,768 38,288 In-place Lease Intangible Asset 4 548 143 405 Above Market Lease Intangible Asset 4 896 238 658 Total intangible assets $ 43,500 $ 4,149 $ 39,351 The following tables provides a roll forward of the carrying amount of goodwill (in thousands): 2023 2022 Balance as of January 1: Gross goodwill $ 261,110 $ 257,746 Accumulated impairments ( 3,074 ) ( 3,074 ) Net goodwill as of January 1 258,036 254,672 Goodwill adjustment during the year (1) 4,324 3,364 Impact of foreign exchange 81 — Net goodwill as of March 31, 2023, and December 31, 2022 $ 262,441 $ 258,036 (1) See Note 7 - Acquisitions. As of March 31, 2023 and December 31, 2022, Xometry had $ 262.4 million and $ 258.0 million, respectively of goodwill. As of March 31, 2023, $ 258.0 million is part of Xometry's U.S. operating segment and $ 4.4 million is part of Xometry's International operating segment. As of December 31, 2022, $ 258.0 million is part of Xometry's U.S. operating segment. As of March 31, 2023, estimated amortization expense for intangible assets for the remainder of 2023 and the next five years is: $ 2.8 million in 2023, $ 3.7 million in 2024, $ 3.6 million in 2025, $ 3.2 million in 2026, $ 2.7 million in 2027, $ 2.7 million in 2028 and $ 20.3 million thereafter. Amortization expense for the three months ended March 31, 2023 and 2022 was as follows (in thousands): Three Months Ended March 31, 2023 2022 Sales and marketing $ 791 774 Product development 42 89 General and administrative (1) 3 2 Total $ 836 $ 865 (1) Amortization of the lease related intangible assets is recorded as operating lease expense in general and administrative. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | (a) Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company's Annual Report on Form 10-K filed with the SEC on March 16, 2023. The condensed consolidated balance sheet as of December 31, 2022, included herein, was derived from the audited financial statements as of that date, but may not include all disclosures including certain notes required by U.S. GAAP on an annual reporting basis. In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, comprehensive loss, stockholders' equity (deficit) and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the full year 2023 or any future period. The Company has two reporting segments which are referred to as: (1) the United States (“U.S.”) and (2) International. Foreign Operations and Comprehensive Loss The U.S. dollar (“USD”) is the functional currency for Xometry’s consolidated subsidiary operating in the U.S. The primary functional currency for the Company's consolidated subsidiaries operating in Germany and to a lesser extent, United Kingdom, Turkey, China and Japan, is the Euro, British Pound Sterling, Turkish Lira, Yuan and the Yen, respectively. For the Company’s consolidated subsidiaries whose functional currencies are not the USD, the Company translates their financial statements into USD. The Company translates assets and liabilities at the exchange rate in effect as of the financial statement date. Revenue and expense accounts are translated using an average exchange rate for the period. Gains and losses resulting from translation are included in accumulated other comprehensive income (“AOCI”), as a separate component of equity. Noncontrolling Interest We have a 66.67 % ownership in Incom Co., LTD. As we have a controlling interest in Incom Co., LTD, we have consolidated Incom Co., LTD into our financial statements. The portion of equity in Incom Co., LTD not owned by the Company is accounted for as a noncontrolling interest. We present the portion of any equity that we do not own in a consolidated entity as noncontrolling interest and classify their interest as a component of total equity, separate from total stockholders’ equity on our Condensed Consolidated Balance Sheets. We include net income (loss) attributable to the noncontrolling interests in net loss in our Condensed Consolidated Statements of Operations and Comprehensive Loss. |
Use of Estimates | (b) Use of Estimates The preparation of the Company’s unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates. |
Business Combinations | (c) Business Combinations The Company accounts for business combinations using the acquisition method of accounting, which requires, among other things, allocation of the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed at their estimated fair values on the acquisition date. The excess of the fair value of purchase consideration over the values of these identifiable assets and liabilities is recorded as goodwill. When determining the fair value of assets acquired and liabilities assumed, management makes significant estimates and assumptions, especially with respect to the valuation of intangible assets. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, not to exceed one year from the date of acquisition, the Company may record adjustments to the assets acquired and liabilities assumed, with a corresponding offset to goodwill if new information is obtained related to facts and circumstances that existed as of the acquisition date. Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are reflected in the consolidated statements of operations. Acquisition costs, such as legal and consulting fees, are expensed as incurred. |
Fair Value Measurements and Financial Instruments | (d) Fair Value Measurements and Financial Instruments The Company measures certain assets and liabilities at fair value on a recurring basis based on an expected exit price, which represents the amount that would be received on the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis, whereby inputs used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3 - Unobservable inputs reflecting the Company’s own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. The carrying amounts of certain of the Company’s financial instruments, which include cash and cash equivalents, accounts receivable, prepaid expenses and other assets, accounts payable, accrued expenses and contract liabilities approximate their fair values due to their short maturities. The Company's marketable securities are recorded at fair value. |
Marketable Securities | (e) Marketable Securities The Company measures its marketable securities at fair value and recognizes any changes in fair value in net loss. Our marketable securities represent our investments in a short term bond fund and/ or money market fund. We consider our marketable securities as available for use in current operations, and therefore classify these securities as current assets on the Condensed Consolidated Balance Sheets. As of March 31, 2023 and December 31, 2022, the Company's marketable securities of $ 256.5 million and $ 253.8 million respectively, were recorded at fair value, within Level 1 of the fair value hierarchy. The fair value of the Company’s Level 1 financial instruments is based on quoted prices in active markets, total fair value is the published market price per unit multiplied by the number of units held without consideration of transaction costs, discounts or blockage factors. No losses were recorded during the three months ended March 31, 2023. During the three months ended March 31, 2022, the Company recorded losses of $ 0.9 million related to these securities, which is recorded in other expenses on the Condensed Consolidated Statements of Operations and Comprehensive Loss. |
Accounts Receivable | (f) Accounts Receivable Accounts receivable are stated at the amount the Company expects to collect from outstanding balances. Our accounts receivable do not bear interest. Amounts collected on accounts receivable are included in net cash used in operating activities in the Condensed Consolidated Statements of Cash Flows. For buyers for which Xometry provides credit, the Company performs credit inquiries, including reference checks, and queries credit ratings services and other publicly available information. Management provides for probable uncollectible amounts through a provision for bad debt expense and an adjustment to a valuation allowance based on the age of the outstanding amounts, each customer’s expected ability to pay and collection history, current market conditions, and reasonable and supportable forecasts of future economic conditions to determine whether the allowance is appropriate. The Company reviews its valuation allowance monthly. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable. Allowance For Credit Losses The allowance for credit losses related to accounts receivable and changes were as follows (in thousands): 2023 2022 Allowance for credit losses Balance at beginning of year, January 1 $ 1,988 $ 809 Charge to provision accounts 285 1,324 Recoveries or other ( 325 ) ( 145 ) Balance at period end, March 31 and December 31, respectively $ 1,948 $ 1,988 |
Property and Equipment and Long-Lived Assets | (g) Property and Equipment and Long-Lived Assets Property and equipment are stated at cost. Equipment under finance leases is stated at the present value of minimum lease payments. Depreciation is calculated on the straight-line method over the estimated useful life of the assets, which range from three to seven years, or in the case of leasehold improvements, over the shorter of the remaining lease term or the useful life of the asset. Property and equipment and intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. Property and equipment includes capitalized internal-use software development costs. Eligible internal-use software development costs are capitalized subsequent to the completion of the preliminary project stage. Such costs include internal and external direct development costs totaling $ 3.5 million for the three months ended March 31, 2023 and $ 11.5 million for the year ended December 31, 2022. After all substantial testing and deployment is completed and the software is ready for its intended use, capitalization is discontinued and the internal-use software costs are placed in service and amortized using the straight-line method over the estimated useful life of the software, generally three years. |
Goodwill | (h) Goodwill Goodwill represents the excess purchase price over the estimated fair value of net assets acquired in a business combination. As of March 31, 2023, the Company's goodwill is attributable to both the U.S. and International reporting units. As of December 31, 2022, the Company's goodwill is attributable to the U.S. reporting unit. Goodwill is not amortized. The Company tests goodwill for impairment annually in the fourth quarter, or more frequently, if events or changes in circumstances indicate that the carrying value of a reporting unit, including goodwill, might be impaired. In testing for goodwill impairment, we first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. These qualitative factors assessed may include the following: (i) significant changes in the manner of our use of the assets or the strategy of our overall business, (ii) certain restructuring initiatives, (iii) significant negative industry or economic trends and (iv) significant decline in our share price for a sustained period. If, after assessing the totality of events or circumstances, we determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then additional impairment testing is not required. However, if we conclude otherwise, we proceed to the quantitative assessment. |
Revenue | (i) Revenue The Company derives the majority of its marketplace revenue in the U.S. and Europe from the sale of parts and assemblies fulfilled using a vast network of suppliers. The Company recognizes revenue from the sales to our customers pursuant to Financial Accounting Standard Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”). The Company determines that a contract exists between the Company and the customer when the customer accepts the quote and places the order, all of which are governed by the Company’s standard terms and conditions or other agreed terms with Xometry’s buyers. Upon completion of an order through Xometry’s platform, the Company identifies the performance obligation(s) within that order to complete the sale of the manufactured part(s) or assembly. Using Xometry’s in-house technology, the Company determines the price for the manufactured part(s) or assembly on a stand-alone basis at order initiation. The Company recognizes revenue from sales to Xometry’s customers upon shipment, at which point control over the part(s) or assembly have transferred. The Company has concluded that the Company is principal in the sale of part(s) and assemblies that use the Company’s network of third-party manufacturers because the Company controls the manufacturing by obtaining a right to direct a third-party manufacturer to fulfill the performance obligation Xometry has with the Company’s customers on Xometry’s behalf. The Company has considered the following conditions of the sale: (i) the Company has the obligation of providing the specified product to the customer, (ii) the Company has discretion with respect to establishing the price of the product and the price the Company pays the suppliers and the Company has margin risk on all of Xometry’s sales, (iii) the Company has discretion in determining how to fulfill each order, including selecting the supplier and (iv) Xometry bears certain risk for product quality to the extent the customer is not satisfied with the final product. Xometry also derives revenue from its supplier services which is a suite of services offered to our suppliers. Revenue also includes the sale of marketing services which includes advertising. This revenue is generally recognized as control is transferred to the customer, in an amount reflecting the consideration we expect to be entitled to in exchange for such product or service. From time to time, a purchase order with a customer may involve multiple performance obligations, including a combination of some or all of our products. Judgment may be required in determining whether products are considered distinct performance obligations that should be accounted for separately or as one combined performance obligation. Revenue is recognized over the period or at the point in time in which the performance obligations are satisfied. Consideration is typically determined based on a fixed unit price for the quantity of product transferred. For purchase orders involving multiple performance obligations, the transaction price is allocated to each performance obligation based on relative standalone selling price, and recognized as revenue when each individual product or service is transferred to the customer. Revenue is shown net of estimated returns, refunds, and allowances. At March 31, 2023 and December 31, 2022, the Company has a provision for estimated returns, refunds or allowances of $ 0.1 million and $ 0.3 million, respectively. Sales tax collected from customers and remitted to governmental authorities is excluded from revenue. Contract Liabilities Contract liabilities are primarily derived from payments received in advance or at the time an order is placed, for which the associated performance obligations have not been satisfied and revenue has not been recognized based on the Company’s revenue recognition criteria described above. The following table is presents contract liabilities as of December 31, 2022 and March 31, 2023 (in thousands): Rollforward of contract liabilities: Contract liabilities at December 31, 2022 $ 8,509 Revenue recognized ( 51,287 ) Payments received in advance 52,731 Acquired contract liabilities 21 Contract liabilities at March 31, 2023 $ 9,974 During the three months ended March 31, 2023, the Company recognized approximately $ 8.0 million of revenue related to its contract liabilities at December 31, 2022. During the three months ended March 31, 2022, the Company recognized approximately $ 7.2 million of revenue related to its contract liabilities at December 31, 2021. Sales Contract Acquisition Costs The Company’s incremental costs to obtain a contract may include a sales commission which is generally determined on a per order basis. For contracts in excess of one year, the Company amortizes such costs on a straight-line basis over the average customer life of two years for new customers and over the renewal period for existing customers which is generally one year . Sales commissions are included in Xometry’s sales and marketing expenses in the Condensed Consolidated Statements of Operations and Comprehensive Loss. For the periods ended March 31, 2023 and 2022, we recognized approximately $ 2.0 million and $ 2.2 million, respectively of amortization related to deferred sales commissions. As of March 31, 2023 and December 31, 2022, the Company had deferred sales contract acquisition costs of $ 4.3 million and $ 3.3 million, respectively which is classified in other current assets on the Condensed Consolidated Balance Sheets. |
Cost of Revenue | (j) Cost of Revenue Cost of revenue for marketplace primarily consists of the cost of the products that are manufactured or produced by the Company’s suppliers for delivery to buyers on the Company's platform, internal and external production costs, shipping costs, and certain internal depreciation. Cost of revenue for supplier services primarily consists of internal and external production costs and website hosting. |
Leases | (k) Leases The Company determines if an arrangement contains a lease and the classification of that lease, if applicable, at its inception. Operating leases are included in operating lease right-of-use ("ROU") assets, operating lease liabilities and operating lease liabilities, net of current portion in the Condensed Consolidated Balance Sheets. The Company has finance leases as detailed in the Long-Lived Assets section above. For leases with terms of twelve months or less, the Company does not recognize ROU assets or lease liabilities on the Condensed Consolidated Balance Sheets. Additionally, the Company elected to use the practical expedient to not separate lease and non-lease components for leases of real estate, meaning that for these leases, the non-lease components are included in the associated ROU asset and lease liability balances on the Company’s Condensed Consolidated Balance Sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments under the lease. Operating lease ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The implicit rate within the Company’s operating leases is generally not determinable, as such the Company uses its incremental borrowing rate at lease commencement to determine the present value of lease payments. The operating lease ROU asset also includes any lease prepayments, offset by lease incentives. Certain of the Company’s leases include options to extend or terminate the lease. The expected lease term includes options to extend or terminate the lease when it is reasonably certain the Company will exercise such option. Lease expense is recognized on a straight-line basis over the term of the lease. |
Sales and Marketing | (l) Sales and Marketing Sales and marketing expenses are expensed as incurred and include the costs of digital marketing strategies, branding costs and other advertising costs, certain depreciation and amortization expense, contract acquisition costs and compensation expenses, including stock-based compensation, to the Company’s sales and marketing employees. For the three months ended March 31, 2023 and 2022, the Company's advertising cost were $ 8.1 million and $ 7.1 million, respectively. |
Operations and Support | (m) Operations and Support Operations and support expenses are the costs the Company incurs in support of the customers and suppliers on Xometry’s platforms which are provided by phone, email and chat for purposes of resolving customer and supplier related matters. These costs primarily consist of compensation expenses of the support staff, including stock-based compensation, certain depreciation and amortization expense and software costs used in delivering customer and supplier services. |
Product Development | (n) Product Development Product development costs which are not eligible for capitalization are expensed as incurred. This account also includes compensation expenses, including stock-based compensation to the Company’s employees performing these functions and certain depreciation and amortization expense. |
General and Administrative | (o) General and Administrative General and administrative expenses primarily consist of compensation expenses, including stock-based compensation expenses, for executive, finance, legal and other administrative personnel, professional service fees and certain depreciation and amortization expense. |
Stock Based Compensation | (p) Stock Based Compensation All stock-based compensation, including stock options and restricted stock units, are measured at the grant date fair value of the award. The Company estimates grant date fair value of stock options using the Black-Scholes option-pricing model. The fair value of stock options and restricted stock units is recognized as compensation expense on a straight-line basis over the requisite service period, which is typically four years . The fair value of the restricted stock units is determined using the fair value of the Company's Class A common stock on the date of grant. Forfeitures are recorded in the period in which they occur. The Black-Scholes model considers several variables and assumptions in estimating the fair value of stock-based awards. These variables include: • expected annual dividend yield; • expected volatility over the expected term; • expected term; • risk free interest rate; • per share value of the underlying common stock; and • exercise price. For all stock options granted, the Company calculated the expected term using the simplified method for “plain vanilla” stock option awards. The risk-free interest rate is based on the yield available on U.S. Treasury issuances similar in duration to the expected term of the stock-based award. The Company estimates its expected share price volatility based on the historical volatility of publicly traded peer companies and/or its own volatility and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded share price. The Company utilized a dividend yield of zero, as it had no history or plan of declaring dividends on its common stock. |
Net Loss Per Share | (q) Net Loss Per Share The Company computes net loss per share using the two-class method required for multiple classes of common stock and participating securities. The two-class method requires income available to common stockholders for the period to be allocated between common stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. Certain unvested share-based payment awards that contain nonforfeitable rights to dividends are treated as participating securities and therefore included in computing net income per share using the two-class method. The rights, including the liquidation and dividend rights, of the Class A common stock and Class B common stock are substantially identical, other than voting rights. Accordingly, the Class A common stock and Class B common stock shared proportionately in the Company’s net losses. |
Reclassifications | (r) Reclassifications Certain line items on the Company’s condensed consolidated financial statements have been reclassified to conform to the current period presentation. These reclassifications have not changed the results of operations of prior periods. |
Recently Issued Accounting Standards | (s) Recently Issued Accounting Standards There are currently no other accounting standards that have been issued, but not yet adopted, that are expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows upon adoption. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Allowance for Credit Losses Related to Accounts Receivable | The allowance for credit losses related to accounts receivable and changes were as follows (in thousands): 2023 2022 Allowance for credit losses Balance at beginning of year, January 1 $ 1,988 $ 809 Charge to provision accounts 285 1,324 Recoveries or other ( 325 ) ( 145 ) Balance at period end, March 31 and December 31, respectively $ 1,948 $ 1,988 |
Summary of Contract Liabilities | The following table is presents contract liabilities as of December 31, 2022 and March 31, 2023 (in thousands): Rollforward of contract liabilities: Contract liabilities at December 31, 2022 $ 8,509 Revenue recognized ( 51,287 ) Payments received in advance 52,731 Acquired contract liabilities 21 Contract liabilities at March 31, 2023 $ 9,974 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Components of Inventory | Inventory consists of the following as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, 2023 2022 Raw materials $ 124 $ 119 Work-in-progress 388 675 Tools inventory 221 477 Finished goods 711 300 Total $ 1,444 $ 1,571 |
Property and Equipment and Lo_2
Property and Equipment and Long-Lived Assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Summary of Components of Property and Equipment | Property and equipment consist of the following as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, Useful Life 2023 2022 Technology hardware 3 years $ 3,049 $ 2,927 Manufacturing equipment 5 years 2,753 2,892 Capitalized software development 3 years 27,852 24,343 Leasehold improvements Shorter of useful 1,383 1,345 Furniture and fixtures 7 years 2,317 1,705 Total 37,354 33,212 Less accumulated depreciation ( 15,757 ) ( 14,133 ) Property and Equipment, net $ 21,597 $ 19,079 |
Summary of Depreciation Expense | Depreciation expense for the three months ended March 31, 2023 and 2022 was as follows (in thousands): Three Months Ended March 31, 2023 2022 Cost of revenue $ 44 $ 34 Operations and support 12 11 Product development 1,269 704 General and administrative 316 185 Total depreciation expense $ 1,641 $ 934 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Schedule of Operating Lease Expense | Operating lease expense for the three months ended March 31, 2023 and 2022 was as follows (in thousands): Three Months Ended March 31, 2023 2022 Cost of revenue $ 18 $ 16 General and administrative 2,214 1,833 Total operating lease expense $ 2,232 $ 1,849 |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Tridi | |
Business Acquisition [Line Items] | |
Summary of Consideration Paid and Preliminary Fair Value of Assets Acquired and Liabilities Assumed | The following table (in thousands) summarizes the consideration paid for Tridi and the preliminary fair value of the assets acquired and liabilities assumed on the acquisition date: Consideration: Cash $ 3,824 Settlement of preexisting relationship 357 Fair value of contingent consideration 860 Fair value of consideration 5,041 Acquisition costs included in general and administrative for the period ended March 31, 2023 32 Recognized amounts of identifiable assets acquired and liabilities assumed: Current assets 460 Property and equipment 22 Intangible asset 608 Current liabilities ( 373 ) Total identifiable net assets assumed 717 Goodwill 4,324 Total $ 5,041 |
Disaggregated Revenue and Cos_2
Disaggregated Revenue and Cost of Revenue Information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregated Revenue Information | Revenue is presented in the following tables for the three months ended March 31, 2023 and 2022, respectively (in thousands): For the Three Months For The Three Months Marketplace 2023 2022 Revenue $ 86,680 $ 64,415 Cost of revenue 61,747 46,741 Gross Profit $ 24,933 $ 17,674 Supplier Services Revenue $ 18,646 $ 19,256 Cost of revenue 4,210 3,991 Gross Profit $ 14,436 $ 15,265 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Weighted Average Assumptions | The weighted average assumptions for the three months ended March 31, 2023 and 2022 are provided in the following table. Three Months Ended March 31, 2023 2022 Valuation assumptions: Expected dividend yield —% —% Expected volatility 80 % 66 % Expected term (years) 6.3 6.0 Risk-free interest rate 3.8 % 1.9 % Fair value of share $ 11.37 $ 34.86 |
Summary of Stock Option Activity | A summary of the status of the Company’s stock option activity and the changes during the three months ended March 31, 2023, are as follows (in millions, except share and per share amounts): Number of Weighted Average Aggregate Exercisable at December 31, 2022 1,391,047 6.09 7.2 $ 36.4 Balance at December 31, 2022 2,841,419 11.33 7.7 61.4 Granted 428,278 15.82 — — Exercised ( 70,316 ) 5.94 — — Forfeited ( 60,347 ) 19.86 — — Expired ( 556 ) 8.59 — — Balance at March 31, 2023 3,138,478 11.90 7.8 18.0 Exercisable at March 31, 2023 1,581,106 7.69 7.0 13.1 |
Summary of Restricted Stock Unit Activity | A summary of the status of the Company’s restricted stock unit activity and the changes during the three months ended March 31, 2023 are as follows (in millions, except share and per share amounts): Number of Weighted Aggregate Unvested RSUs as of December 31, 2022 875,902 44.37 $ 28.2 Granted 1,242,169 15.59 — Vested ( 169,371 ) 41.25 — Forfeited and cancelled ( 97,629 ) 46.57 — Unvested RSUs as of March 31, 2023 1,851,071 25.23 27.7 |
Schedule of Total Stock-based Compensation Costs | Total stock-based compensation cost for the three months ended March 31, 2023 and 2022 were as follows (in thousands): Three Months Ended March 31, 2023 2022 Sales and marketing $ 1,052 $ 636 Operations and support 1,697 1,423 Product development 1,076 894 General and administrative 869 503 Total stock compensation expense $ 4,694 $ 3,456 |
Net Loss Per Share Attributab_2
Net Loss Per Share Attributable to Common Stockholders (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders | The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share data): Three Months Ended March 31, 2023 2022 Net loss $ ( 18,343 ) $ ( 19,995 ) Net income attributable to noncontrolling interest 1 17 Net loss attributable to common stockholders $ ( 18,344 ) $ ( 20,012 ) Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic and diluted 47,699,561 46,789,585 Net loss per share attributable to common stockholders, basic and diluted $ ( 0.38 ) $ ( 0.43 ) |
Schedule of Outstanding Shares of Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss Per Share | The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net loss per share because including them would have had an anti-dilutive effect, or issuance of such shares is contingent upon the occurrence of an event: March 31, 2023 2022 Stock options outstanding 3,138,478 3,277,025 Unvested restricted stock units 1,851,071 815,543 Warrants outstanding 87,784 87,784 Shares reserved for charitable contribution 281,860 362,392 Convertible notes 5,123,624 5,123,624 Total shares 10,482,817 9,666,368 |
Debt Commitments and Continge_2
Debt Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Outstanding Principal Amount and Carrying Value of Notes | The following table presents the outstanding principal amount and carrying value of the 2027 Notes as of the dates indicated (in thousands): March 31, December 31, 2023 2022 Principal $ 287,500 287,500 Unamortized debt discount ( 6,613 ) ( 7,044 ) Unamortized debt issuance costs ( 512 ) ( 547 ) Net carrying value $ 280,375 279,909 |
Schedule of Interest Expense Related to Notes | Interest expense related to the 2027 Notes for the periods presented below was as follows (in thousands): Three Months Ended Three Months Ended 2023 2022 Coupon interest $ 719 $ 449 Amortization of debt discount 431 287 Amortization of transaction costs 35 25 Total interest expense $ 1,185 $ 761 |
Schedule of Carrying Value and Estimated Fair Value of Notes | The Company estimates the fair value of the 2027 Notes with inputs that are unobservable. The following table presents the carrying value and estimated fair value of the 2027 Notes as of the date indicated (in thousands): March 31, 2023 December 31, 2022 Carrying Value Fair Value Carrying Value Fair Value 2027 Notes (1) $ 280,375 $ 263,834 $ 279,909 $ 257,671 (1) The fair value is estimated using a discounted cash flow analysis, using interest rate that we believe are offered for similar borrowings (a Level 3 measurement). |
Schedule of Restructuring Related Employee Termination Benefits | The following table shows the total amount incurred and the liability, which was recorded in accrued expenses in the Condensed Consolidated Balance Sheets, for restructuring-related employee termination benefits as of December 31, 2022 and March 31, 2023 (in thousands): Employee Termination Benefits Accrued restructuring costs as of December 31, 2022 $ 1,549 Restructuring costs incurred during the period ended March 31, 2023 - Amount paid during the period ended March 31, 2023 ( 1,273 ) Accrued restructuring costs as of March 31, 2023 $ 276 |
Segments (Tables)
Segments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Summary of Segment Information | The following tables reflect certain segment information for the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended March 31, 2023 2022 Segment Revenue U.S. $ 93,903 $ 77,209 International 11,423 6,462 Total $ 105,326 $ 83,671 Three Months Ended March 31, 2023 2022 Segment Losses U.S. $ ( 12,937 ) $ ( 16,296 ) International ( 5,407 ) ( 3,716 ) Total $ ( 18,344 ) $ ( 20,012 ) |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | The following tables summarize the Company’s intangible assets (dollars in thousands): March 31, 2023 Weighted Gross Accumulated Net Intangible Assets Amortizing intangible assets: Customer Relationships 15 $ 36,652 $ 3,250 $ 33,402 Trade Names 10 841 118 723 Developed Technology 5 740 224 516 Vendor Relationships 13 1,861 337 1,524 Database 5 2,400 630 1,770 Patents 17 157 44 113 Subtotal intangible assets 42,651 4,603 38,048 In-place Lease Intangible Asset 4 568 178 390 Above Market Lease Intangible Asset 4 896 293 603 Total intangible assets $ 44,115 $ 5,074 $ 39,041 December 31, 2022 Weighted Gross Accumulated Net Intangible Assets Amortizing intangible assets: Customer Relationships 15 $ 36,652 $ 2,638 $ 34,014 Trade Names 10 841 97 744 Developed Technology 5 739 182 557 Vendor Relationships 15 1,267 299 968 Database 5 2,400 510 1,890 Patents 17 157 42 115 Subtotal intangible assets 42,056 3,768 38,288 In-place Lease Intangible Asset 4 548 143 405 Above Market Lease Intangible Asset 4 896 238 658 Total intangible assets $ 43,500 $ 4,149 $ 39,351 |
Schedule of Carrying Amount of Goodwill | The following tables provides a roll forward of the carrying amount of goodwill (in thousands): 2023 2022 Balance as of January 1: Gross goodwill $ 261,110 $ 257,746 Accumulated impairments ( 3,074 ) ( 3,074 ) Net goodwill as of January 1 258,036 254,672 Goodwill adjustment during the year (1) 4,324 3,364 Impact of foreign exchange 81 — Net goodwill as of March 31, 2023, and December 31, 2022 $ 262,441 $ 258,036 (1) See Note 7 - Acquisitions. |
Schedule of Amortization Expense | Amortization expense for the three months ended March 31, 2023 and 2022 was as follows (in thousands): Three Months Ended March 31, 2023 2022 Sales and marketing $ 791 774 Product development 42 89 General and administrative (1) 3 2 Total $ 836 $ 865 (1) Amortization of the lease related intangible assets is recorded as operating lease expense in general and administrative. |
Organization and Description _2
Organization and Description of Business - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Entity month and year of incorporation | 2013-05 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 USD ($) Segment | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |||
Number of reportable segments | Segment | 2 | ||
Marketable securities | $ 256,458,000 | $ 253,770,000 | |
Property and equipment includes capitalized internal-use software development costs | 3,500,000 | 11,500,000 | |
Revenue, net of estimated returns, refunds and allowances | 100,000 | 300,000 | |
Revenue recognized related to contract liabilities | 8,000,000 | $ 7,200,000 | |
Amortization of deferred sales commissions | 2,000,000 | 2,200,000 | |
Deferred sales contract acquisition costs | 4,300,000 | 3,300,000 | |
Advertising costs | $ 8,100,000 | 7,100,000 | |
Requisite service period | 4 years | ||
Sales Contract Acquisition Costs | New Customers | |||
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |||
Sales contract acquisition costs, amortization period | 2 years | ||
Sales Contract Acquisition Costs | Existing Customers | |||
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |||
Sales contract acquisition costs, amortization period over contract renewal | 1 year | ||
Other Expenses | |||
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |||
Losses related to marketable securities | $ 0 | $ 900,000 | |
Level 1 | |||
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |||
Marketable securities | $ 256,500,000 | $ 253,800,000 | |
Incom Co., LTD | |||
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |||
Ownership percentage | 66.67% |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant accounting Policies - Summary of Allowance for Credit Losses Related to Accounts Receivable (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Balance at beginning of year, January 1 | $ 1,988 | $ 809 |
Charge to provision accounts | 285 | 1,324 |
Recoveries or other | (325) | (145) |
Balance at period end, March 31 and December 31, respectively | $ 1,948 | $ 1,988 |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant accounting Policies - Summary of Contract Liabilities (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Accounting Policies [Abstract] | |
Contract Liabilities, Beginning balance | $ 8,509 |
Revenue recognized | (51,287) |
Payments received in advance | 52,731 |
Acquired contract liabilities | 21 |
Contract Liabilities, Ending balance | $ 9,974 |
Credit Concentrations - Additio
Credit Concentrations - Additional Information (Details) - Customer | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Revenue | Customer Concentration Risk | |||
Concentration Risk [Line Items] | |||
Number of customer accounted for more than 10% | 0 | 0 | |
Accounts Receivable | Credit Concentration Risk | |||
Concentration Risk [Line Items] | |||
Number of customer accounted for more than 10% | 0 | 0 |
Inventory - Schedule of Compone
Inventory - Schedule of Components of Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 124 | $ 119 |
Work-in-progress | 388 | 675 |
Tools inventory | 221 | 477 |
Finished goods | 711 | 300 |
Total | $ 1,444 | $ 1,571 |
Property and Equipment and Lo_3
Property and Equipment and Long-Lived Assets - Summary of Components of Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Property Plant And Equipment [Line Items] | ||
Total | $ 37,354 | $ 33,212 |
Less accumulated depreciation | (15,757) | (14,133) |
Property and Equipment, net | 21,597 | 19,079 |
Technology Hardware | ||
Property Plant And Equipment [Line Items] | ||
Total | $ 3,049 | 2,927 |
Property and equipment, Useful life | 3 years | |
Manufacturing Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total | $ 2,753 | 2,892 |
Property and equipment, Useful life | 5 years | |
Capitalized Software Development | ||
Property Plant And Equipment [Line Items] | ||
Total | $ 27,852 | 24,343 |
Property and equipment, Useful life | 3 years | |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Total | $ 1,383 | 1,345 |
Property and equipment, Useful Life | Shorter of usefullife or lease term | |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Total | $ 2,317 | $ 1,705 |
Property and equipment, Useful life | 7 years |
Property and Equipment and Lo_4
Property and Equipment and Long-Lived Assets - Summary of Depreciation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Property Plant And Equipment [Line Items] | ||
Depreciation expense | $ 1,641 | $ 934 |
Cost of Revenue | ||
Property Plant And Equipment [Line Items] | ||
Depreciation expense | 44 | 34 |
Operations and Support | ||
Property Plant And Equipment [Line Items] | ||
Depreciation expense | 12 | 11 |
Product Development | ||
Property Plant And Equipment [Line Items] | ||
Depreciation expense | 1,269 | 704 |
General and Administrative | ||
Property Plant And Equipment [Line Items] | ||
Depreciation expense | $ 316 | $ 185 |
Leases - Schedule of Operating
Leases - Schedule of Operating Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Lessee, Lease, Description [Line Items] | ||
Operating lease expense | $ 2,232 | $ 1,849 |
Cost of Revenue | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease expense | 18 | 16 |
General and Administrative | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease expense | $ 2,214 | $ 1,833 |
Leases - Additional Information
Leases - Additional Information (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 USD ($) Lease | Dec. 31, 2022 USD ($) | |
Lessee, Lease, Description [Line Items] | ||
Operating lease right-of-use lease assets | $ 24,303 | $ 25,923 |
Two New Office Leases in Lyon, France and Istanbul, Turkey | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease right-of-use lease assets | 300 | |
Operating lease, liability | $ 300 | |
Number of new leases | Lease | 2 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Details) - Tridi Teknoloj A S Member - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 02, 2023 | Mar. 31, 2023 | |
Business Acquisition [Line Items] | ||
Goodwill acquired during period | $ 4,300 | |
Aggregate non-contingent portion of purchase price | 3,800 | |
Aggregate non-contingent portion of purchase price withheld for future payment | 400 | |
Initial fair value of contingent consideration | 900 | |
Business combination contingent consideration liability payment description | In addition, the purchase price included a contingent consideration arrangement to the former owner of Tridi up to a maximum amount of $1.25 million (undiscounted) in shares of the Company’s Class A common stock in two installments on the first and second anniversary of the acquisition. | |
Maximum | ||
Business Acquisition [Line Items] | ||
Contingent consideration | $ 1,250 | |
Vendor Relationships | ||
Business Acquisition [Line Items] | ||
Acquired intangible assets, useful life | 10 years |
Acquisitions - Summary of Consi
Acquisitions - Summary of Consideration Paid and Preliminary Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Jan. 02, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Recognized amounts of identifiable assets acquired and liabilities assumed: | ||||
Goodwill | $ 262,441 | $ 258,036 | $ 254,672 | |
Tridi | ||||
Consideration: | ||||
Cash | $ 3,824 | |||
Settlement of preexisting relationship | 357 | |||
Business Combination, Fair Value of Contingent Consideration, Total | 860 | |||
Fair value of consideration | 5,041 | |||
Acquisition costs included in general and administrative for the period ended March 31, 2023 | 32 | |||
Recognized amounts of identifiable assets acquired and liabilities assumed: | ||||
Current assets | 460 | |||
Property and equipment | 22 | |||
Intangible assets | 608 | |||
Current liabilities | (373) | |||
Total identifiable net assets assumed | 717 | |||
Goodwill | 4,324 | |||
Total | $ 5,041 |
Disaggregated Revenue and Cos_3
Disaggregated Revenue and Cost of Revenue Information - Schedule of Disaggregated Revenue Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 105,326 | $ 83,671 |
Cost of revenue | 65,957 | 50,732 |
Gross profit | 39,369 | 32,939 |
Marketplace | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 86,680 | 64,415 |
Cost of revenue | 61,747 | 46,741 |
Gross profit | 24,933 | 17,674 |
Supplier Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 18,646 | 19,256 |
Cost of revenue | 4,210 | 3,991 |
Gross profit | $ 14,436 | $ 15,265 |
Investment in Unconsolidated _2
Investment in Unconsolidated Joint Venture - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Industrial Media, LLC | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership percentage | 50% | |
Dividends received | $ 0 | $ 0 |
Rich Media Group, LLC | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership percentage | 50% |
Stock Based Compensation - Addi
Stock Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Weighted average grant date fair value of options granted | $ 17 | $ 21.08 |
Intrinsic value of options exercised | $ 1.3 | $ 9.7 |
Stock options granted to purchase shares of common stock | 428,278 | |
2016 Equity Incentive Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unrecognized compensation cost related to unvested stock options granted | $ 21.7 | $ 25.5 |
Cost is expected to be recognized over weighted average period | 3 years | 3 years |
Stock options granted to purchase shares of common stock | 0 | |
2021 Equity Incentive Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Shares available for grant | 5,851,637 | |
2021 Equity Incentive Plan | Restricted Stock Units | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Cost is expected to be recognized over weighted average period | 3 years | 4 years |
Total unrecognized compensation cost related to unvested restricted stock units | $ 43.5 | $ 35.3 |
Stock Based Compensation - Sche
Stock Based Compensation - Schedule of Weighted Average Assumptions (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | ||
Expected volatility | 80% | 66% |
Expected term (years) | 6 years 3 months 18 days | 6 years |
Risk-free interest rate | 3.80% | 1.90% |
Fair value of share | $ 11.37 | $ 34.86 |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | ||
Number of Shares, Exercisable | 1,581,106 | 1,391,047 |
Number of Shares, Beginning Balance | 2,841,419 | |
Number of Shares, Granted | 428,278 | |
Number of Shares, Exercised | (70,316) | |
Number of Shares, Forfeited | (60,347) | |
Number of Shares, Expired | (556) | |
Number of Shares, Ending Balance | 3,138,478 | 2,841,419 |
Weighted Average Exercise Price Per Share, Exercisable | $ 7.69 | $ 6.09 |
Weighted Average Exercise Price Per Share, Beginning Balance | 11.33 | |
Weighted Average Exercise Price Per Share, Granted | 15.82 | |
Weighted Average Exercise Price Per Share, Exercised | 5.94 | |
Weighted Average Exercise Price Per Share, Forfeited | 19.86 | |
Weighted Average Exercise Price Per Share, Expired | 8.59 | |
Weighted Average Exercise Price Per Share, Ending Balance | $ 11.90 | $ 11.33 |
Average Remaining Contractual Term, Exercisable | 7 years | 7 years 2 months 12 days |
Average Remaining Contractual Term | 7 years 9 months 18 days | 7 years 8 months 12 days |
Aggregate Intrinsic Value, Exercisable | $ 13.1 | $ 36.4 |
Aggregate Intrinsic Value | $ 18 | $ 61.4 |
Stock Based Compensation - Su_2
Stock Based Compensation - Summary of Restricted Stock Unit Activity (Details) - Restricted Stock Units $ / shares in Units, $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares, Unvested RSUs as of December 31, 2022 | shares | 875,902 |
Number of Shares, Granted | shares | 1,242,169 |
Number of Shares, Vested | shares | (169,371) |
Number of Shares, Forfeited and cancelled | shares | (97,629) |
Number of Shares, Unvested RSUs as of March 31, 2023 | shares | 1,851,071 |
Weighted Average Grant Date fair value (per share), Unvested RSUs as of December 31, 2022 | $ / shares | $ 44.37 |
Weighted Average Grant Date fair value (per share), Granted | $ / shares | 15.59 |
Weighted Average Grant Date fair value (per share), Vested | $ / shares | 41.25 |
Weighted Average Grant Date fair value (per share) - Forfeited and cancelled | $ / shares | 46.57 |
Weighted Average Grant Date fair value (per share), Unvested RSUs as of March 31, 2023 | $ / shares | $ 25.23 |
Unvested RSUs as of December 31, 2022 | $ | $ 28.2 |
Unvested RSUs as of March 31, 2023 | $ | $ 27.7 |
Stock Based Compensation - Sc_2
Stock Based Compensation - Schedule of Total Stock-based Compensation Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock compensation expense | $ 4,694 | $ 3,456 |
Sales and Marketing | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock compensation expense | 1,052 | 636 |
Operations and Support | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock compensation expense | 1,697 | 1,423 |
Product Development | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock compensation expense | 1,076 | 894 |
General and Administrative | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock compensation expense | $ 869 | $ 503 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Income Taxes [Line Items] | |||
Current income tax expense (benefit) | $ 0.1 | $ (0.6) | |
Estimated annual effective tax rate | (0.10%) | (0.10%) | |
Operating loss carryforwards subject to expiration | $ 71.9 | ||
Federal | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards | 224.6 | ||
Foreign | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards | $ 33.8 |
Net Loss Per Share Attributab_3
Net Loss Per Share Attributable to Common Stockholders - Computation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Net loss | $ (18,343) | $ (19,995) |
Net income attributable to noncontrolling interest | 1 | 17 |
Net loss attributable to common stockholders | $ (18,344) | $ (20,012) |
Weighted-average number of shares outstanding used to compute net loss per share, basic | 47,699,561 | 46,789,585 |
Weighted-average number of shares outstanding used to compute net loss per share, diluted | 47,699,561 | 46,789,585 |
Net loss per share attributable to common stockholders, basic | $ (0.38) | $ (0.43) |
Net loss per share attributable to common stockholders, diluted | $ (0.38) | $ (0.43) |
Net Loss Per Share Attributab_4
Net Loss Per Share Attributable to Common Stockholders - Schedule of Outstanding Shares of Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total shares | 10,482,817 | 9,666,368 |
Stock Options Outstanding | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total shares | 3,138,478 | 3,277,025 |
Unvested Restricted Stock Units | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total shares | 1,851,071 | 815,543 |
Warrants Outstanding | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total shares | 87,784 | 87,784 |
Shares Reserved for Charitable Contribution | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total shares | 281,860 | 362,392 |
Convertible Notes | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total shares | 5,123,624 | 5,123,624 |
Debt Commitments and Continge_3
Debt Commitments and Contingencies - Additional Information (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | ||||
Feb. 04, 2022 | Dec. 31, 2022 | Feb. 28, 2022 USD ($) TradingDays BusinessDay $ / shares | Mar. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Mar. 31, 2022 USD ($) | |
Debt Instrument [Line Items] | ||||||
Net proceeds from issuance of notes, net of debt issuance costs | $ 287,500 | |||||
Percentage of positions eliminated | 6% | |||||
Percentage of employee's matching contribution | 50% | |||||
Maximum percentage of employee contributions | 6% | |||||
Total matching contribution | $ 500 | $ 400 | ||||
Employee Termination Benefits | ||||||
Debt Instrument [Line Items] | ||||||
Employee termination costs | $ 1,500 | |||||
2027 Notes | ||||||
Debt Instrument [Line Items] | ||||||
Indenture date | Feb. 04, 2022 | |||||
Net proceeds from issuance of notes, net of debt issuance costs | $ 278,200 | |||||
Debt instrument, interest rate | 1% | |||||
Debt instrument, maturity date | Feb. 01, 2027 | |||||
Debt instrument, convertible, stock price trigger | $ / shares | $ 1,000 | |||||
Debt instrument, convertible, threshold percentage of stock price trigger | 130% | |||||
Debt instrument, redemption price, percentage of principal amount redeemed | 100% | |||||
Number of trading days | TradingDays | 20 | |||||
Number of consecutive trading days | TradingDays | 30 | |||||
Debt instrument, effective interest rate | 1.60% | |||||
2027 Notes | Class A Common Stock | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument conversion rate | 17.8213 | |||||
Debt instrument, convertible, stock price trigger | $ / shares | $ 1,000 | |||||
Debt instrument conversion price | $ / shares | $ 56.11 | |||||
Number of consecutive trading days | TradingDays | 10 | |||||
Number of business day | BusinessDay | 5 | |||||
2027 Notes | Maximum | Class A Common Stock | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of sales price and applicable conversion rate | 98% | |||||
2027 Notes | Initial Public Offering | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | $ 250,000 | |||||
2027 Notes | Private Offering | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | 287,500 | |||||
2027 Notes | Over-Allotment Option | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | $ 37,500 |
Debt Commitments and Continge_4
Debt Commitments and Contingencies - Schedule of Outstanding Principal Amount and Carrying Value of Notes (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Net carrying value | $ 280,375 | $ 279,909 |
2027 Notes | ||
Debt Instrument [Line Items] | ||
Principal | 287,500 | 287,500 |
Unamortized debt discount | (6,613) | (7,044) |
Unamortized debt issuance costs | (512) | (547) |
Net carrying value | $ 280,375 | $ 279,909 |
Debt Commitments and Continge_5
Debt Commitments and Contingencies - Schedule of Interest Expense Related to Notes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Debt Instrument [Line Items] | ||
Total interest expense | $ 1,198 | $ 769 |
2027 Notes | ||
Debt Instrument [Line Items] | ||
Coupon interest | 719 | 449 |
Amortization of debt discount | 431 | 287 |
Amortization of transaction costs | 35 | 25 |
Total interest expense | $ 1,185 | $ 761 |
Debt Commitments and Continge_6
Debt Commitments and Contingencies - Schedule of Carrying Value and Estimated Fair Value of Notes (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Carrying Value | $ 280,375 | $ 279,909 |
2027 Notes | ||
Debt Instrument [Line Items] | ||
Carrying Value | 280,375 | 279,909 |
2027 Notes | Level 3 | ||
Debt Instrument [Line Items] | ||
Fair Value | $ 263,834 | $ 257,671 |
Debt Commitments and Continge_7
Debt Commitments and Contingencies - Schedule of Restructuring Related Employee Termination Benefits (Details) - Employee Termination Benefits $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Restructuring Cost and Reserve [Line Items] | |
Accrued restructuring costs as of December 31, 2022 | $ 1,549 |
Amount paid during the period ended March 31, 2023 | (1,273) |
Accrued restructuring costs as of March 31, 2023 | $ 276 |
Segments - Additional Informati
Segments - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2023 Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 2 |
Number of reportable segments | 2 |
Segments - Summary of Segment I
Segments - Summary of Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment Reporting Information [Line Items] | ||
Segment Revenue | $ 105,326 | $ 83,671 |
Segment Losses | (18,344) | (20,012) |
U.S. | ||
Segment Reporting Information [Line Items] | ||
Segment Revenue | 93,903 | 77,209 |
Segment Losses | (12,937) | (16,296) |
International | ||
Segment Reporting Information [Line Items] | ||
Segment Revenue | 11,423 | 6,462 |
Segment Losses | $ (5,407) | $ (3,716) |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Finite Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 44,115 | $ 43,500 |
Accumulated amortization | 5,074 | 4,149 |
Net carrying amount | $ 39,041 | $ 39,351 |
Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted average amortization period in years | 15 years | 15 years |
Gross carrying amount | $ 36,652 | $ 36,652 |
Accumulated amortization | 3,250 | 2,638 |
Net carrying amount | $ 33,402 | $ 34,014 |
Trade Names | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted average amortization period in years | 10 years | 10 years |
Gross carrying amount | $ 841 | $ 841 |
Accumulated amortization | 118 | 97 |
Net carrying amount | $ 723 | $ 744 |
Developed Technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted average amortization period in years | 5 years | 5 years |
Gross carrying amount | $ 740 | $ 739 |
Accumulated amortization | 224 | 182 |
Net carrying amount | $ 516 | $ 557 |
Vendor Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted average amortization period in years | 13 years | 15 years |
Gross carrying amount | $ 1,861 | $ 1,267 |
Accumulated amortization | 337 | 299 |
Net carrying amount | $ 1,524 | $ 968 |
Database | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted average amortization period in years | 5 years | 5 years |
Gross carrying amount | $ 2,400 | $ 2,400 |
Accumulated amortization | 630 | 510 |
Net carrying amount | $ 1,770 | $ 1,890 |
Patents | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted average amortization period in years | 17 years | 17 years |
Gross carrying amount | $ 157 | $ 157 |
Accumulated amortization | 44 | 42 |
Net carrying amount | 113 | 115 |
Subtotal | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 42,651 | 42,056 |
Accumulated amortization | 4,603 | 3,768 |
Net carrying amount | $ 38,048 | $ 38,288 |
In-place Lease Intangible Asset | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted average amortization period in years | 4 years | 4 years |
Gross carrying amount | $ 568 | $ 548 |
Accumulated amortization | 178 | 143 |
Net carrying amount | $ 390 | $ 405 |
Above Market Lease Intangible Asset | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted average amortization period in years | 4 years | 4 years |
Gross carrying amount | $ 896 | $ 896 |
Accumulated amortization | 293 | 238 |
Net carrying amount | $ 603 | $ 658 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Gross goodwill | $ 261,110 | $ 257,746 |
Accumulated impairments | (3,074) | (3,074) |
Goodwill, Beginning Balance | 258,036 | 254,672 |
Goodwill adjustment during the year | 4,324 | 3,364 |
Impact of foreign exchange | 81 | |
Goodwill, Ending Balance | $ 262,441 | $ 258,036 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Goodwill And Intangible Assets [Line Items] | |||
Goodwill | $ 262,441 | $ 258,036 | $ 254,672 |
Estimated amortization expense remainder of 2023 | 2,800 | ||
Estimated amortization expense 2024 | 3,700 | ||
Estimated amortization expense 2025 | 3,600 | ||
Estimated amortization expense 2026 | 3,200 | ||
Estimated amortization expense 2027 | 2,700 | ||
Estimated amortization expense 2028 | 2,700 | ||
Estimated amortization expense thereafter | 20,300 | ||
U.S. | |||
Goodwill And Intangible Assets [Line Items] | |||
Goodwill | 258,000 | $ 258,000 | |
International | |||
Goodwill And Intangible Assets [Line Items] | |||
Goodwill | $ 4,400 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Schedule of Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Finite Lived Intangible Assets [Line Items] | ||
Amortization Expense | $ 836 | $ 865 |
Sales and Marketing | ||
Finite Lived Intangible Assets [Line Items] | ||
Amortization Expense | 791 | 774 |
Product Development | ||
Finite Lived Intangible Assets [Line Items] | ||
Amortization Expense | 42 | 89 |
General and Administrative | ||
Finite Lived Intangible Assets [Line Items] | ||
Amortization Expense | $ 3 | $ 2 |