Proto Labs, Inc. Announces First Quarter 2025 Financial Results
Proto Labs, a global leader in digital manufacturing services, has reported its financial results for the first quarter of 2025, marking a strong start to the year. The Company’s performance highlights continued growth, despite facing various market challenges. This report outlines key financial figures, strategic insights, and expectations for the second quarter of 2025, reinforcing Protolabs’ position as a leading player in the rapidly evolving manufacturing sector.
First Quarter 2025 Financial Performance
For the first quarter of 2025, Protolabs recorded a revenue of $126.2 million, which reflects a 1.3% decrease compared to $127.9 million reported in the same quarter of 2024. Although revenue experienced a slight dip, it remains within a narrow margin of the prior year, highlighting the company’s stability in the face of market pressures. A more detailed look at the performance reveals significant positive shifts in some key areas.
Revenue fulfilled through the Protolabs Network, which refers to the distribution and manufacturing channels utilized by the company, saw a 10.0% year-over-year increase, reaching $26.3 million. This growth indicates that Protolabs’ network fulfillment model is gaining traction and providing an increasingly vital revenue stream.
Net income for the quarter stood at $3.6 million, or $0.15 per diluted share, compared to $5.3 million, or $0.20 per diluted share, in the first quarter of 2024. This represents a decline in profitability, largely due to increased operational investments and strategic initiatives aimed at long-term growth. However, when adjusted for non-GAAP measures, Protolabs’ net income reached $8.1 million, or $0.33 per diluted share, showing a decrease from $10.4 million, or $0.40 per diluted share, during the same period in the previous year.
Despite these declines, Protolabs’ first-quarter results remain largely positive when analyzed in the context of the company’s evolving market strategy. Rob Bodor, the President and CEO of Protolabs, provided insight into the Company’s performance, stating, “Protolabs started the year strong, with revenue and earnings per share near the top of our guidance range, and increases in both the number of customers utilizing our combined factory and network offer and spend per customer.”
Bodor emphasized that the company’s shift from a prototyping business to a full-scale production service is yielding results, positioning Protolabs as a more efficient and valuable player across the entire product lifecycle. This transition is expected to provide substantial growth potential throughout 2025, especially as the demand for on-demand manufacturing and custom production increases.
Growth in Customer Engagement and Revenue Per Contact
Protolabs served 21,627 customer contacts during the quarter, demonstrating a strong demand for its digital manufacturing services. This customer engagement resulted in a 2.5% year-over-year increase in revenue per customer contact, which grew to $5,836 compared to the same quarter last year. This increase in revenue per customer suggests that Protolabs is not only expanding its customer base but is also successfully driving higher value from existing clients.
EBITDA Performance
Protolabs’ EBITDA for the first quarter was $13.6 million, which reflects strong operational performance despite lower top-line growth. Adjusted EBITDA, which excludes non-recurring items and certain non-cash charges, totaled $17.4 million, or 13.8% of revenue. This was a decrease from $20.2 million, or 15.8% of revenue, in the first quarter of 2024, primarily due to increased investments and expenses tied to operational restructuring.
The company’s focus on improving its gross and operating margins continues to drive profitability, even amidst slight fluctuations in revenue. The fact that Protolabs achieved this level of EBITDA performance while navigating industry-wide uncertainties speaks to the resilience and flexibility of its business model.
Cash Flow and Capital Return to Shareholders
Protolabs maintains a strong cash and investments balance of $116.3 million as of March 31, 2025, which provides the company with substantial financial flexibility to continue investing in growth initiatives. This healthy cash position is further bolstered by the company’s industry-leading profitability and zero debt on its balance sheet, which positions it well to navigate potential market downturns or periods of uncertainty.
During the first quarter, Protolabs returned $20.9 million in capital to shareholders through stock repurchases. This move reflects the company’s commitment to enhancing shareholder value while continuing to execute on its long-term growth strategy. The decision to repurchase shares is also a testament to the management’s confidence in the company’s future prospects.
Second Quarter 2025 Outlook
Looking ahead to the second quarter of 2025, Protolabs expects revenue to fall within the range of $124.0 million to $132.0 million, indicating a stable outlook for the near future. The company’s projected diluted net income per share for the second quarter is expected to be between $0.11 and $0.19, with non-GAAP diluted net income per share estimated to range from $0.30 to $0.38.
These estimates reflect Protolabs’ confidence in maintaining a steady revenue stream and operational performance despite the challenging market environment. The company’s continued emphasis on enhancing production capabilities and expanding its service offerings positions it well for future growth, particularly in the production of higher-value products.
Strategic Focus on Adaptability and Supply Chain Resilience
Protolabs’ strategic focus on adapting quickly to supply chain disruptions is one of the key factors that set it apart from competitors in the digital manufacturing space. As Bodor noted, “Protolabs has a proven track record of adapting faster than anyone to support our customers in times of supply chain disruption.” The company’s diverse fulfillment model, which integrates geographically varied factories and networks, provides flexibility and resilience that is crucial for navigating the current and future challenges of global supply chains.
The company’s ability to swiftly pivot and align with customer needs in a rapidly evolving landscape allows Protolabs to take advantage of emerging opportunities. As geopolitical tensions and tariff regulations continue to evolve, Protolabs is well-positioned to serve customers across various regions, thanks to its strategically located facilities and robust network of global partners.
Non-GAAP Financial Measures and Transparency
Protolabs has provided detailed reconciliations of its GAAP and non-GAAP financial measures to offer investors a clearer understanding of the company’s operational performance. Non-GAAP measures, including Adjusted EBITDA, non-GAAP net income, and non-GAAP gross margin, are important tools that the company uses to evaluate the true profitability and financial health of its business. These measures exclude certain non-recurring or non-cash items and are instrumental in providing a more accurate picture of the company’s ongoing operations.
For instance, non-GAAP net income excludes stock-based compensation expenses, amortization expenses, unrealized foreign currency gains or losses, and other non-cash items, helping to offer a clearer view of Protolabs’ core operating results. These adjustments allow investors and analysts to focus on the factors that drive the company’s performance on a recurring basis.
Protolabs’ commitment to transparency and providing investors with actionable financial data further strengthens its position in the marketplace, and the inclusion of these non-GAAP measures allows stakeholders to better assess the company’s future growth potential.
Conclusion and Long-Term Growth Potential
Overall, Protolabs’ first-quarter performance in 2025 underscores its ability to navigate a challenging global landscape while maintaining steady growth and profitability. The company’s revenue and earnings remain within range, with growth in key areas such as customer contacts, revenue per customer, and fulfillment through the Protolabs Network. With a strong cash balance, zero debt, and a solid outlook for the second quarter, Protolabs is well-positioned to continue executing its long-term strategy.
Protolabs’ focus on expanding beyond prototyping and into full-scale production, coupled with its continued investment in technological innovation and operational efficiency, lays the foundation for sustained success throughout 2025 and beyond. With strategic investments in its global infrastructure and a commitment to adapting to emerging supply chain challenges, Protolabs is poised to capture new opportunities in a rapidly evolving manufacturing market.
