0001443669FALSE00014436692024-08-022024-08-02

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 2, 2024
Proto Labs, Inc.
(Exact name of registrant as specified in its charter)
Minnesota001-3543541-1939628
(State or other jurisdiction
of incorporation)
(Commission File Number)(IRS Employer
Identification Number)
5540 Pioneer Creek Drive
Maple Plain, Minnesota
55359
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code:
(763) 479-3680
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, Par Value $0.001 Per SharePRLBNew York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.



Item 2.02.Results of Operations and Financial Condition.
On August 2, 2024, Proto Labs, Inc. issued a press release announcing its second quarter 2024 financial results. A copy of the press release is furnished as Exhibit 99.1 to this report and incorporated herein by reference.
Item 9.01.Financial Statements and Exhibits.
(d)Exhibits
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document)



SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Proto Labs, Inc.
Date:
August 2, 2024
By:/s/ Daniel Schumacher
Daniel Schumacher
Chief Financial Officer


Exhibit 99.1
logo.jpg
logo1.jpg
Protolabs Reports Financial Results for the Second Quarter of 2024
Total Revenue of $126 Million
GAAP Earnings Per Share of $0.18, Non-GAAP Earnings Per Share of $0.38
MINNEAPOLIS August 2, 2024 – Proto Labs, Inc. ("Protolabs" or the "Company") (NYSE: PRLB), the world’s leading provider of digital manufacturing services, today announced financial results for the second quarter ended June 30, 2024.
Second Quarter 2024 Financial Highlights:
Revenue was $125.6 million, a 2.8% increase compared to the second quarter of 2023.
Revenue generated from Protolabs Network was $24.7 million, a 22.0% increase compared to the second quarter of 2023.
Net income was $4.5 million, or $0.18 per diluted share, compared to net loss of $0.4 million, or $0.01 per diluted share, in the second quarter of 2023.
Non-GAAP net income was $9.5 million, or $0.38 per diluted share, compared to $8.7 million, or $0.33 per diluted share, in the second quarter of 2023. See “Non-GAAP Financial Measures” below.
EBITDA was $15.2 million, or 12.1% of revenue. See “Non-GAAP Financial Measures” below.
Adjusted EBITDA was $19.3 million, or 15.4% of revenue, compared to $19.2 million, or 15.7% of revenue, in the second quarter of 2023. See “Non-GAAP Financial Measures” below.

"We executed well through the first half of 2024 despite operating in a challenging macroeconomic environment,” said Rob Bodor, President and Chief Executive Officer. "We continue to make progress on driving customer adoption of our combined offer fulfilled through both Factory and Network, while also increasing our revenue per customer. We have aligned our organization to support our initiatives, accelerate our next phase of growth, and improve our efficiency."

Dan Schumacher, Chief Financial Officer, commented, "Our results were driven by strong performance in our Network business and gross margin improvement across both Factory and Network. We remain committed to returning capital to shareholders as we repurchased $10.9 million of common stock in the quarter."

Additional Second Quarter 2024 Highlights:
Customer contact information
Protolabs served 22,456 customer contacts during the quarter.
Revenue per customer contact increased 7.0% year-over-year to $5,595.
Gross margin was 45.0% of revenue, compared to 43.4% of revenue in the second quarter of 2023.
Non-GAAP gross margin was 45.7% of revenue, compared to 44.1% of revenue in the second quarter of 2023. See "Non-GAAP Financial Measures" below.
Cash flow from operations was $14.4 million in the second quarter of 2024.
Cash and investments balance was $112.9 million as of June 30, 2024.

Third Quarter 2024 Outlook

For the third quarter of 2024, the Company expects to generate revenue between $117 million and $125 million.

The Company expects third quarter 2024 diluted net income per share between $0.10 and $0.18, and non-GAAP diluted net income per share between $0.29 and $0.37. See "Non-GAAP Financial Measures" below.



Non-GAAP Financial Measures
The Company has included non-GAAP revenue growth by region and by service line that excludes the impact of changes in foreign currency exchange rates (collectively, “non-GAAP revenue growth”). Management believes these metrics, when viewed in conjunction with the comparable GAAP metrics, are useful in evaluating the underlying business trends and ongoing operating performance of the Company.
The Company has included earnings before interest, taxes, depreciation and amortization (“EBITDA”) and EBITDA, adjusted for stock-based compensation expense, unrealized (gain) loss on foreign currency and costs related to the Japan closure activities (collectively, “Adjusted EBITDA”), in this press release to provide investors with additional information regarding the Company’s financial results. The Company has also included earnings before interest, taxes, depreciation and amortization margin (“EBITDA margin”) and EBITDA margin, adjusted for stock-based compensation expense, unrealized (gain) loss on foreign currency and costs related to the Japan closure activities (collectively, “Adjusted EBITDA margin”), in this press release to provide investors with additional information regarding the Company’s financial results.
The Company has included non-GAAP gross margin, adjusted for stock-based compensation expense and amortization expense in this press release to provide investors with additional information regarding the Company’s financial results.
The Company has included non-GAAP operating margin, adjusted for stock-based compensation expense, amortization expense and costs related to the closure of Japan (collectively, “non-GAAP operating margin”), in this press release to provide investors with additional information regarding the Company’s financial results.
The Company has included non-GAAP net income, adjusted for stock-based compensation expense, amortization expense, unrealized (gain) loss on foreign currency and costs related to the closure of Japan (collectively, “non-GAAP net income”), in this press release to provide investors with additional information regarding the Company’s financial results.
The Company has provided below reconciliations of GAAP to non-GAAP net income, non-GAAP gross margin, non-GAAP operating margin, non-GAAP revenue growth by region and by service, and Adjusted EBITDA and Adjusted EBITDA margin, the most directly comparable measures calculated and presented in accordance with GAAP. These non-GAAP measures are used by the Company’s management and board of directors to understand and evaluate operating performance and trends and provide useful measures for period-to-period comparisons of the Company’s business. Accordingly, the Company believes that these non-GAAP measures provide useful information to investors and others in understanding and evaluating operating results in the same manner as our management and board of directors.
Conference Call
The Company has scheduled a conference call to discuss its second quarter 2024 financial results and third quarter 2024 outlook today, August 2, 2024 at 8:30 a.m. EDT. To access the call in the U.S. please dial 877-709-8150 or outside the U.S. dial 201-689-8354 at least five minutes prior to the 8:30 a.m. EDT start time. No participant code is required. A simultaneous webcast of the call and accompanying presentation will be available via the investor relations section of the Protolabs website and the following link: https://edge.media-server.com/mmc/p/b94yu8yp/. A replay will be available for 14 days following the call on the investor relations section of the Protolabs website.
About Protolabs
Protolabs is the fastest and most comprehensive digital manufacturing service in the world. Our digital factories produce low-volume parts in days while Protolabs Network unlocks advanced capabilities and volume pricing through its highly vetted manufacturing partners. The result? One manufacturing source—from prototyping to production—for product developers, engineers, and supply chain teams across the globe. See what's next at protolabs.com.
Forward-Looking Statements
Statements contained in this press release regarding matters that are not historical or current facts are “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors which may cause the results of Protolabs to be materially different than those expressed or implied in such statements. Certain of these risk factors and others are described in the “Risk Factors” section within reports filed with the SEC. Other unknown or unpredictable factors also could have material adverse effects on Protolabs’ future results. The forward-looking statements included in this press release are made only as of the date



hereof. Protolabs cannot guarantee future results, levels of activity, performance or achievements. Accordingly, you should not place undue reliance on these forward-looking statements. Finally, Protolabs expressly disclaims any intent or obligation to update any forward-looking statements to reflect subsequent events or circumstances.
Source: Proto Labs, Inc.
Investor Relations Contacts:
Protolabs
Ryan Johnsrud, 612-225-4873
Manager – Investor Relations and FP&A
ryan.johnsrud@protolabs.com

Gateway Group, Inc.
949-574-3860
PRLB@gateway-grp.com
Media Contact:
Protolabs
Brent Renneke, 763-479-7704
Marketing Communications Manager
brent.renneke@protolabs.com



Proto Labs, Inc.
Condensed Consolidated Balance Sheets
(In thousands)
June 30,
2024
December 31,
2023
(Unaudited)
Assets
Current assets
Cash and cash equivalents$96,149 $83,790 
Short-term marketable securities16,792 19,013 
Accounts receivable, net70,891 72,848 
Inventory12,357 13,657 
Income taxes receivable1,400 2,228 
Prepaid expenses and other current assets10,034 9,124 
Total current assets207,623 200,660 
Property and equipment, net243,710 253,655 
Goodwill273,991 273,991 
Other intangible assets, net23,427 25,584 
Long-term marketable securities— 8,019 
Operating lease assets3,790 4,628 
Finance lease assets826 960 
Other long-term assets4,839 4,856 
Total assets$758,206 $772,353 
Liabilities and shareholders' equity  
Current liabilities  
Accounts payable$15,910 $15,636 
Accrued compensation15,544 15,292 
Accrued liabilities and other17,656 16,872 
Current operating lease liabilities1,534 1,585 
Current finance lease liabilities302 296 
Total current liabilities50,946 49,681 
Long-term operating lease liabilities2,203 3,008 
Long-term finance lease liabilities443 595 
Long-term deferred tax liabilities14,588 18,742 
Other long-term liabilities4,790 5,032 
Shareholders' equity685,236 695,295 
Total liabilities and shareholders' equity$758,206 $772,353 



Proto Labs, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except share and per share amounts)
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
2024202320242023
Revenue
Injection Molding$49,080 $48,819 $101,743 $100,767 
CNC Machining51,239 48,297 101,171 96,401 
3D Printing21,281 21,005 42,863 42,330 
Sheet Metal3,922 3,939 7,475 8,187 
Other Revenue109 205 269 439 
Total Revenue125,631 122,265 253,521 248,124 
Cost of revenue69,085 69,142 139,508 141,225 
Gross profit56,546 53,123 114,013 106,899 
Operating expenses
Marketing and sales23,291 21,730 46,451 44,181 
Research and development10,661 9,865 21,828 20,542 
General and administrative16,595 15,822 32,908 32,655 
Closure of Japan business— 98 — 164 
Total operating expenses50,547 47,515 101,187 97,542 
Income from operations5,999 5,608 12,826 9,357 
Other income (loss), net1,361 (3,368)2,260 (2,078)
Income before income taxes7,360 2,240 15,086 7,279 
Provision for income taxes2,820 2,623 5,278 5,003 
Net income (loss)$4,540 $(383)$9,808 $2,276 
Net income (loss) per share:
Basic$0.18 $(0.01)$0.39 $0.09 
Diluted$0.18 $(0.01)$0.38 $0.09 
Shares used to compute net income (loss) per share:
Basic25,313,03626,210,47825,473,93726,414,467
Diluted25,372,97226,210,47825,573,34426,445,427



Proto Labs, Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended
June 30,
20242023
Operating activities
Net income$9,808 $2,276 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization18,075 18,883 
Stock-based compensation expense8,520 7,370 
Deferred taxes(4,144)(5,605)
Interest on finance lease obligations18 568 
Loss on foreign currency translation— 3,906 
Gain on disposal of property and equipment(20)(428)
Other64 215 
Changes in operating assets and liabilities3,460 4,682 
Net cash provided by operating activities35,781 31,867 
Investing activities
Purchases of property, equipment and other capital assets(6,784)(6,829)
Proceeds from sales of property, equipment and other capital assets30 623 
Proceeds from call redemptions and maturities of marketable securities10,419 14,020 
Net cash provided by investing activities3,665 7,814 
Financing activities
Proceeds from exercises of stock options2,094 1,986 
Purchases of shares withheld for tax obligations(1,920)(1,425)
Repurchases of common stock(26,940)(30,064)
Principal repayments of finance lease obligations(146)(163)
Net cash used in financing activities(26,912)(29,666)
Effect of exchange rate changes on cash and cash equivalents(175)(80)
Net increase in cash and cash equivalents12,359 9,935 
Cash and cash equivalents, beginning of period83,790 56,558 
Cash and cash equivalents, end of period$96,149 $66,493 



Proto Labs, Inc.
Reconciliation of GAAP to Non-GAAP Net Income (Loss) per Share
(In thousands, except share and per share amounts)
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
2024202320242023
Non-GAAP net income, adjusted for stock-based compensation expense, amortization expense, unrealized (gain) loss on foreign currency and costs related to Japan closure activities
GAAP net income (loss)$4,540 $(383)$9,808 $2,276 
Add back:
Stock-based compensation expense4,244 3,675 8,520 7,370 
Amortization expense921 1,484 1,908 3,010 
Unrealized (gain) loss on foreign currency(88)187 149 115 
Costs related to Japan closure activities— 4,004 — 4,070 
Total adjustments 1
5,077 9,350 10,577 14,565 
Income tax benefits on adjustments 2
(85)(296)(439)(298)
Non-GAAP net income$9,532 $8,671 $19,946 $16,543 
Non-GAAP net income per share:
Basic$0.38 $0.33 $0.78 $0.63 
Diluted$0.38 $0.33 $0.78 $0.63 
Shares used to compute non-GAAP net income per share:
Basic25,313,03626,210,47825,473,93726,414,467
Diluted25,372,97226,224,56225,573,34426,445,427
1Stock-based compensation expense, amortization expense, unrealized (gain) loss on foreign currency and costs related to Japan closure activities were included in the following GAAP consolidated statement of operations categories:
Three Months Ended
June 30,
Six Months Ended
June 30,
2024202320242023
Cost of revenue$810 $803 $1,611 $1,611 
Marketing and sales819 855 1,652 1,547 
Research and development667 641 1,359 1,212 
General and administrative2,869 2,861 5,806 6,010 
Closure of Japan business— 98 — 164 
Total operating expenses4,355 4,455 8,817 8,933 
Other income (loss), net(88)4,092 149 4,021 
Total adjustments$5,077 $9,350 $10,577 $14,565 
2For the three and six months ended June 30, 2024 and 2023, income tax effects were calculated using the effective tax rate for the relevant jurisdictions. The Company's non-GAAP tax rates differ from its GAAP tax rates due primarily to the mix of activity incurred in domestic and foreign tax jurisdictions and removing effective tax rate benefits from stock-based compensation activity in the quarter.



Proto Labs, Inc.
Reconciliation of GAAP to Non-GAAP Gross Margin
(In thousands)
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
2024202320242023
Revenue$125,631 $122,265 $253,521 $248,124 
Gross profit56,546 53,123 114,013 106,899 
GAAP gross margin45.0 %43.4 %45.0 %43.1 %
Add back:  
Stock-based compensation expense468 461 927 927 
Amortization expense342 342 684 684 
Total adjustments810 803 1,611 1,611 
Non-GAAP gross profit$57,356 $53,926 $115,624 $108,510 
Non-GAAP gross margin45.7 %44.1 %45.6 %43.7 %



Proto Labs, Inc.
Reconciliation of GAAP to Non-GAAP Operating Margin
(In thousands)
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
2024202320242023
Revenue$125,631 $122,265 $253,521 $248,124 
Income from operations5,999 5,608 12,826 9,357 
GAAP operating margin4.8 %4.6 %5.1 %3.8 %
Add back:
Stock-based compensation expense4,244 3,675 8,520 7,370 
Amortization expense921 1,484 1,908 3,010 
Costs related to Japan closure activities— 98 — 164 
Total adjustments5,165 5,257 10,428 10,544 
Non-GAAP income from operations$11,164 $10,865 $23,254 $19,901 
Non-GAAP operating margin8.9 %8.9 %9.2 %8.0 %



Proto Labs, Inc.
Reconciliation of GAAP Net Income (Loss) to EBITDA and Adjusted EBITDA
(In thousands)
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
2024202320242023
Revenue$125,631 $122,265 $253,521 $248,124 
GAAP net income (loss)4,540 (383)9,808 2,276 
GAAP net income (loss) margin3.6 %(0.3 %)3.9 %0.9 %
Add back:
Amortization expense$921 $1,484 $1,908 $3,010 
Depreciation expense8,051 8,011 16,167 15,873 
Interest income, net(1,149)(372)(2,261)(722)
Provision for income taxes2,820 2,623 5,278 5,003 
EBITDA15,183 11,363 30,900 25,440 
EBITDA Margin12.1 %9.3 %12.2 %10.3 %
Add back:
Stock-based compensation expense4,244 3,675 8,520 7,370 
Unrealized (gain) loss on foreign currency(88)187 149 115 
Costs related to Japan closure activities— 4,004 — 4,070 
Total adjustments4,156 7,866 8,669 11,555 
Adjusted EBITDA$19,339 $19,229 $39,569 $36,995 
Adjusted EBITDA Margin15.4 %15.7 %15.6 %14.9 %



Proto Labs, Inc.
Comparison of GAAP to Non-GAAP Revenue Growth by Region
(In thousands)
(Unaudited)
Three Months Ended
June 30, 2024
Three Months Ended
June 30, 2023
%
Change2
% Change
Organic3
GAAP
Foreign
Currency1
Non-GAAPGAAP
Revenues
United States$98,541 $— $98,541 $96,321 2.3 %2.3 %
Europe27,090 24 27,114 25,944 4.4 %4.5 %
Total revenue$125,631 $24 $125,655 $122,265 2.8 %2.8 %
Six Months Ended
June 30, 2024
Six Months Ended
June 30, 2023
%
Change2
% Change
Organic3
GAAPForeign
Currency1
Non-GAAPGAAP
Revenues
United States$200,022 $— $200,022 $194,067 3.1 %3.1 %
Europe53,499 (883)52,616 54,057 (1.0 %)(2.7 %)
Total revenue$253,521 $(883)$252,638 $248,124 2.2 %1.8 %

1Revenue for the three and six months ended June 30, 2024 has been recalculated using 2023 foreign currency exchange rates in effect during comparable periods to provide information useful in evaluating the underlying business trends excluding the impact of changes in foreign currency exchange rates.
2This column presents the percentage change from GAAP revenue for the three and six months ended June 30, 2023 to GAAP revenue for the three and six months ended June 30, 2024.
3This column presents the percentage change from GAAP revenue for the three and six months ended June 30, 2023 to non-GAAP revenue for the three and six months ended June 30, 2024 (as recalculated using the foreign currency exchange rates in effect during the three and six months ended June 30, 2023) in order to provide a constant-currency comparison.



Proto Labs, Inc.
Comparison of GAAP to Non-GAAP Revenue Growth by Service Line
(In thousands)
(Unaudited)
Three Months Ended
June 30, 2024
Three Months Ended
June 30, 2023
%
Change2
% Change
Organic3
GAAP
Foreign
Currency1
Non-GAAPGAAP
Revenues
Injection Molding$49,080 $(60)$49,020 $48,819 0.5 %0.4 %
CNC Machining51,239 90 51,329 48,297 6.1 6.3 
3D Printing21,281 (20)21,261 21,005 1.3 1.2 
Sheet Metal3,922 17 3,939 3,939 (0.4)— 
Other Revenue109 (3)106 205 (46.8)(48.3)
Total Revenue$125,631 $24 $125,655 $122,265 2.8 %2.8 %
Six Months Ended
June 30, 2024
Six Months Ended
June 30, 2023
%
Change2
% Change
Organic3
GAAP
Foreign
Currency1
Non-GAAPGAAP
Revenues
Injection Molding$101,743 $(468)$101,275 $100,767 1.0 %0.5 %
CNC Machining101,171 (218)100,953 96,401 4.9 4.7 
3D Printing42,863 (207)42,656 42,330 1.3 0.8 
Sheet Metal7,475 13 7,488 8,187 (8.7)(8.5)
Other Revenue269 (3)266 439 (38.7)(39.4)
Total Revenue$253,521 $(883)$252,638 $248,124 2.2 %1.8 %

1Revenue for the three and six months ended June 30, 2024 has been recalculated using 2023 foreign currency exchange rates in effect during comparable periods to provide information useful in evaluating the underlying business trends excluding the impact of changes in foreign currency exchange rates.
2This column presents the percentage change from GAAP revenue for the three and six months ended June 30, 2023 to GAAP revenue for the three and six months ended June 30, 2024.
3This column presents the percentage change from GAAP revenue for the three and six months ended June 30, 2023 to non-GAAP revenue for the three and six months ended June 30, 2024 (as recalculated using the foreign currency exchange rates in effect during the three and six months ended June 30, 2023) in order to provide a constant-currency comparison.



Proto Labs, Inc.
Customer Contact Information
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
2024202320242023
Customer contacts22,45623,37734,33835,743
Revenue per customer contact$5,595 $5,230 $7,383 $6,942 
Proto Labs, Inc.
Reconciliation of GAAP to Non-GAAP Guidance
(In thousands, except per share and per share amounts)
(Unaudited)

Q3 2024 Outlook
LowHigh
GAAP diluted net income per share$0.10 $0.18 
Add back:
Stock-based compensation expense0.16 0.16 
Amortization expense0.03 0.03 
Unrealized (gain) loss on foreign currency0.00 0.00 
Total adjustments0.19 0.19 
Non-GAAP diluted net income per share$0.29 $0.37 

v3.24.2.u1
Cover
Aug. 02, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Aug. 02, 2024
Entity Registrant Name Proto Labs, Inc.
Entity Incorporation, State or Country Code MN
Entity File Number 001-35435
Entity Tax Identification Number 41-1939628
Entity Address, Address Line One 5540 Pioneer Creek Drive
Entity Address, City or Town Maple Plain
Entity Address, State or Province MN
Entity Address, Postal Zip Code 55359
City Area Code (763)
Local Phone Number 479-3680
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, Par Value $0.001 Per Share
Trading Symbol PRLB
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0001443669
Amendment Flag false

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