Proto Labs Q2 2025 presentation: Revenue jumps 6.5% YoY, shares surge in premarket

Proto Labs Inc (NASDAQ:NYSE:PRLB) reported strong second-quarter results on July 31, 2025, with revenue increasing 6.5% year-over-year in constant currencies to $135.1 million. The digital manufacturing company’s shares jumped 10.88% in premarket trading to $43.50, reflecting investor enthusiasm for the results that showed both sequential and year-over-year growth.

Quarterly Performance Highlights

Proto Labs delivered solid financial performance in Q2 2025, with revenue reaching $135.1 million, up 6.5% year-over-year in constant currencies and 7% sequentially from Q1 2025. Non-GAAP earnings per share came in at $0.41, an increase of $0.03 from the year-ago quarter.

"We continued our momentum from Q1, with strong performance across most service lines and particularly in our network fulfillment business," the company noted in its presentation.

The company highlighted that customer contacts using their combined manufacturing offer increased nearly 45% year-over-year, while revenue per customer contact in Q2 2025 grew 11% compared to the same period last year, demonstrating success in the company’s strategic priorities.

As shown in the following financial summary chart:

Detailed Financial Analysis

Proto Labs’ service mix showed significant variation in performance, with CNC Machining leading growth at 20% year-over-year to $61.9 million. Sheet Metal revenue increased 9% to $4.3 million, while Injection Molding declined 4% to $47.4 million and 3D Printing decreased slightly by 1% to $21.2 million.

The revenue breakdown by service line illustrates these trends:

The company maintained a Non-GAAP gross margin of 44.8% in Q2 2025, unchanged from the previous quarter but down 90 basis points year-over-year. Non-GAAP operating margin improved sequentially by 120 basis points to 8.6%, though it was down 30 basis points compared to Q2 2024.

Proto Labs’ comprehensive financial results table provides a clear picture of the company’s performance metrics:

The company’s balance sheet remains exceptionally strong with zero debt and $123.2 million in cash and investments, up from $116.3 million in the previous quarter. Operating cash flow was $10.6 million in Q2, while capital expenditures remained modest at $1.5 million. The company continued its share repurchase program, buying back $3.1 million in stock during the quarter, though at a significantly reduced pace compared to the $20.9 million repurchased in Q1 2025.

The following cash flow and balance sheet summary highlights the company’s financial position:

Strategic Initiatives

Proto Labs has made significant inroads in the aerospace and defense sector, highlighting in its presentation that it serves 100% of Fortune 500 companies in this industry. The company’s focus on this high-value sector appears to be paying dividends as it works with major clients including Boeing (NYSE:BA), Northrop Grumman (NYSE:NOC), Airbus, and space companies like Relativity.

The company’s aerospace and defense strategy is illustrated in this slide:

Proto Labs also received recognition for its manufacturing excellence, winning the National Association of Manufacturers (NAM) Future of Manufacturing Award. Additionally, the company obtained ISO 13485 Certification for its Metal 3D Printing technology, expanding its capabilities in medical device manufacturing.

Forward-Looking Statements

Looking ahead to Q3 2025, Proto Labs provided revenue guidance of $130 million to $138 million and projected Non-GAAP earnings per share between $0.35 and $0.43. The company noted that foreign currency is expected to have an approximately $0.4 million favorable impact on Q3 revenue.

The Q3 2025 outlook is detailed in the following guidance slide:

This guidance suggests the company expects to maintain its growth trajectory, though the midpoint of the EPS range ($0.39) would represent a slight sequential decline from Q2’s $0.41.

The strong Q2 results mark a significant improvement from Q1 2025, when the company reported revenue of $126.2 million and Non-GAAP EPS of $0.33. The sequential growth in both revenue and earnings demonstrates the company’s ability to execute on its strategic priorities despite ongoing challenges in the manufacturing sector.

With its debt-free balance sheet, focus on high-value aerospace and defense customers, and improving operational metrics, Proto Labs appears well-positioned to continue its growth trajectory through the remainder of 2025.

Full presentation:

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