Xometry (XMTR) Q1 2026 earnings review
Marketplace Flywheel Accelerates as Siemens Deal Validates AI Model
Xometry delivered a blowout quarter, accelerating total revenue growth to 36% YoY ($205.1 million). The core growth engine—the AI-native Marketplace—surged 40% YoY, pulling the rest of the business upward and expanding Adjusted EBITDA to a record $10.5 million. The most significant development is a new strategic partnership with Siemens, which includes a $50 million equity investment and embeds Xometry's pricing and sourcing intelligence directly into Siemens Xcelerator. This validates the company's technology moat and opens a massive new enterprise funnel. While the legacy Services segment continues to shrink, the operating leverage from the Marketplace segment prompted management to aggressively raise full-year guidance.
🐂 Bull Case
Marketplace revenue growth has accelerated for four consecutive quarters (26% to 40%). Adjusted EBITDA exploded from $0.1M a year ago to $10.5M, proving the asset-light model scales highly profitably once network density is achieved.
Siemens' $50M investment and integration into Siemens Xcelerator places Xometry's Instant Quoting Engine directly onto the desktops of countless industrial engineers, structurally lowering customer acquisition costs.
🐻 Bear Case
The Thomasnet-driven Services segment continues to contract, falling 5% YoY to $13.8M. It is now a persistent drag on total company top-line growth.
While international revenue grew 42%, the segment still posted an Adjusted EBITDA loss of $2.8M. Scaling global operations continues to consume cash generated by the highly profitable US market.
⚖️ Verdict: 🟢🟢
Strongly Bullish. An acceleration in top-line growth paired with a massive 13,342% YoY increase in Adjusted EBITDA proves the business model is working. The Siemens partnership acts as a powerful catalyst for future enterprise adoption.
Key Themes
Siemens Xcelerator Integration
The strategic partnership with Siemens is a structural breakthrough. By embedding proprietary manufacturability, pricing, and sourcing intelligence directly into Siemens Xcelerator, Xometry inserts itself at the very beginning of the design phase. The accompanying $50 million Class A common stock purchase is a strong corporate endorsement that AI-powered intelligence is becoming essential infrastructure for industrial software.
Deep Learning Upgrades to Instant Quoting Engine
Xometry rolled out a new enterprise machining lead time model trained on a dataset 4x larger than previous iterations. This AI enhancement directly impacts conversion by improving prediction accuracy, expanding 1-day lead time capabilities, and analyzing unique geometric features to generate tailored price-response functions for every quote.
Enterprise Land-and-Expand Strategy Working
Accounts with last twelve-months spend of at least $50,000 grew 21% YoY to 1,864. High-value enterprise customers are actively adopting supply chain solutions like the new 'name your part' reordering feature, which harmonizes Xometry's parts library with internal customer ERP/SKU systems.
Services Segment Drags Total Growth
Decelerating. The Services segment (primarily Thomasnet) remains the weakest link. Revenue declined 5% YoY to $13.8M, continuing a multi-quarter trend of stagnation or contraction. Additionally, Services gross margin compressed 200 basis points YoY to 87.1%. Management's failure to return this segment to growth limits the company's ultimate top-line trajectory.
International Segment Profitability Drag
Stable but negative. International revenue surged 42% YoY to $32.9M, but it continues to operate at a loss. International Adjusted EBITDA was -$2.8M, virtually unchanged from a year ago (-$2.9M). Xometry relies entirely on its U.S. operations ($13.3M Adj. EBITDA) to subsidize its global expansion efforts.
GAAP Profitability Remains Elusive Due to SBC
Despite stellar Adjusted EBITDA growth, Xometry still reported a GAAP Net Loss of $5.3M. A primary culprit is Stock-Based Compensation (SBC), which totaled $8.3M for the quarter (up 13% YoY). While the business generates positive operating cash flow ($14.6M), shareholders are bearing the cost of heavy equity dilution to retain engineering talent.
Other KPIs
Accelerating. Up 290 basis points from 31.8% a year ago. This reflects the increasing sophistication of the AI pricing algorithm and better volume leverage across the supplier network, offsetting the slight sequential dip from late 2025.
Reversing. A massive swing from -$3.7M in Q1 2025. This was driven by higher profitability and a $17.6M favorable change in Accounts Payable and Accrued Cost of Revenue, signaling excellent working capital management as the platform scales.
Stable. Up 20% YoY, matching the historical pace of buyer acquisition. Even more impressively, 98% of total revenue came from existing accounts, highlighting extreme customer stickiness and a highly successful land-and-expand motion.
Guidance
Stable at high growth rates. Represents 32-33% YoY growth. This implies a strong sequential jump and confirms that the momentum seen in Q1 is carrying firmly into the second quarter.
Accelerating. Management raised the full-year outlook significantly from the prior guidance of 'at least 21%'. This upgrade is driven by an expectation of approximately 30% Marketplace growth, suggesting confidence that macroeconomic headwinds are not impacting their enterprise adoption.
Accelerating. The midpoint of $11.5M represents continued sequential margin expansion and is vastly improved from the $3.9M generated in Q2 2025. Management reaffirmed their commitment to delivering 20% annual incremental Adjusted EBITDA margins.
Key Questions
Siemens Partnership Financial Impact
The integration with Siemens Xcelerator is a major strategic win. Over what timeline do you expect this embedded placement to begin materially impacting active buyer acquisition and marketplace revenue?
Path to International Profitability
International revenue is growing 42% YoY but Adjusted EBITDA losses remain static at roughly $2.8M. At what revenue run-rate do you expect the International segment to reach Adjusted EBITDA breakeven?
Services Segment Turnaround
The Services segment has continued to post negative YoY growth despite past platform updates to Thomasnet. Is there a structural issue with the advertising model in the current macro environment, or are there further product interventions planned to return this to growth?