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Freemelt Holding AB reported its Q2 2025 earnings, showcasing record sales that matched its full-year 2024 figures. The company’s stock surged 11.38% following the announcement, reflecting investor optimism. Freemelt’s quarterly sales reached SEK 19 million, with a significant order intake of SEK 20 million. According to InvestingPro data, the company maintains impressive gross profit margins of 87.23% and analysts anticipate strong sales growth for the current year. The company’s strategic moves, including a manufacturing transition and new market entry, position it for future growth.
Key Takeaways
- Record quarterly sales of SEK 19 million, equivalent to full-year 2024 sales.
- Stock price increased by 11.38%, reflecting positive investor sentiment.
- Strategic partnership for market entry in China, Taiwan, and Hong Kong.
- Order intake of SEK 20 million, with a 47% year-on-year increase in the order book.
Company Performance
Freemelt’s performance in Q2 2025 demonstrated impressive growth, with sales reaching SEK 19 million, a significant milestone that matches its entire sales for 2024. The company’s order intake stood at SEK 20 million, indicating robust demand for its products. The order book saw a 47% year-on-year increase, underscoring strong market traction. Freemelt’s focus on modular printer design and targeting sectors like defense and medical technology has bolstered its competitive position.
Financial Highlights
- Revenue: SEK 19 million, matching full-year 2024 sales.
- Order intake: SEK 20 million, driven by six new machines and two customer projects.
- Order book: SEK 14 million, a 47% increase year-on-year.
- Operating cash flow: -SEK 14 million, impacted by inventory and receivables growth.
Market Reaction
Freemelt’s stock price surged by 11.38% in response to the earnings announcement, closing at 3.23 SEK. This increase reflects investor confidence in the company’s strategic initiatives and market positioning. InvestingPro analysis indicates the stock is currently trading above its Fair Value, with a remarkable YTD return of 241.18%. The stock’s performance is notable given its 52-week range, with the current price moving closer to its high of 5.8 SEK. InvestingPro subscribers have access to 12 additional key insights about Freemelt’s valuation and growth prospects.
Outlook & Guidance
Freemelt aims to become a global leader in electron beam part bed fusion solutions. The company anticipates growth in industrial machine sales and customer projects, with increased adoption of additive manufacturing in serial production. The strategic partnership with GUD for market entry in China, Taiwan, and Hong Kong is expected to drive future growth.
Executive Commentary
"We are well positioned, and we continue now to turn our technology edge into commercial growth," said Daniel Yidlund, CEO. This statement highlights the company’s focus on leveraging its technological advancements for market expansion. Yidlund also noted, "China is becoming one of the most advanced manufacturing countries globally," emphasizing the importance of the company’s strategic partnership for market entry in Asia.
Risks and Challenges
- Supply chain issues: Potential disruptions could impact production and delivery timelines.
- Market saturation: Increased competition in the additive manufacturing sector may pressure margins.
- Macroeconomic pressures: Economic downturns could affect customer purchasing behavior and project funding.
- Cash flow management: Negative cash flow due to inventory and receivables growth requires careful management.
Q&A
During the earnings call, analysts inquired about Freemelt’s market traction and strategic partnerships. The company confirmed its breakthrough in market traction, with strategic partnerships playing a crucial role in its growth strategy. Analysts also questioned the potential for higher revenue per machine as the business scales, to which Freemelt responded by emphasizing its focus on increasing productivity and targeting high-performance material components.
Full transcript - Freemelt Holding AB (FREEM) Q2 2025:
Moderator: Welcome to Fremelt’s Q2 presentation 2025. With us to present, we have CEO, Daniel Yidlund and CFO, Martin Grond Lund. If you have any questions for the company, you can send them in the form to the right. And with that said, I give the word to you, Daniel.
Daniel Yidlund, CEO, Freemelt: Thank you, and welcome everyone to our Q2 forecast. So as we have received many new shareholders since the start of 2025 and continue to do so, we will just make a brief introduction about the first. So Fremont, we were founded in 2017 by engineers coming from another successful Swedish three d printing company called Arcam. So what what we do, we develop and we sell advanced three d printers for metal applications. And our ambition is is to become a leading supplier in additive manufacturing.
Our focus is where additive manufacturing, of course, can add value. And for our technology, and you can actually see on the screen as well, the green dots is what we call electron beam part of bed fusion, an extremely fast melting process. So here, this is not a lot of lasers. It’s an electron beam moving four kilometers per second or melting more than 3,000 dots per per second. So this technology typically is used where you need complex and high performance materials and also components, which is typically needed and demanded by the defense industry, energy, like in in nuclear or fission and also fusion energy, and also in med tech application.
Our technology is not limited to any kind of material, but our focus for for the past couple of years has been in tungsten, titanium, and then copper. If we look into Fremont from a design perspective of our printers, we are unique. And why we are unique is that we have a modular printer. And the reason for this, and I think this is also where three d printing for for many years has has struggled a bit, is really to increase the productivity and and really get short cycle times, which means that you get higher availability for producing, which means you get up your productivity and then get the cost down per print printed part. Our customers so far has been a lot into research, so typically universities, research institutes.
But since we we launched our industrial machine mid of last year, we have also now been exposed to industrial clients more and more. The three focus areas and business verticals that we are having is all under substantial growth. If you look into the defense side, and I think the numbers actually is outdated now. I mean, now NATO has increased their budget. The European Union is also rapidly increasing their defense budgets as well.
And here you can see a couple of examples of organizations, companies, and so forth that that we have disclosed. So far, we still have a few undisclosed that we we can’t mention as well. But just to mention one, Saab is is one of the the Swedish clients that that we have worked with since last year. If we then zoom in on energy, this is mainly a fusion energy where we have a a really strong position. This is also an energy, source that is is rapidly increasing its substantial investments happening here, as well globally, and we have a very strong position here.
And then last, but not least, med tech. So med tech, and in this context, it’s mainly referring to orthopedic implants, which actually is the industry which has the highest adoption rate, of serial production, through additive manufacturing. And here we have also two global OEMs that that we have as clients. So let’s zoom in then on q two, which has been a record quarter regarding sales. So sales for this single quarter is actually in par with the full year 2024.
Our ambition is to be a leader in electron beam part of air fusion solutions global, as I mentioned, and China is the the fastest growing additive manufacturing market globally. Why it it, of course, was a breakthrough in the quarter when we also signed up a partnership with GUD to represent Fremont in China, Taiwan, and then Hong Kong. And then lastly, lastly, the the strategic agreement with Scanfilm to manufacture our machines moving forward has also enhanced our supply chain scalability while we, you know, continue to to grow our business globally. So, of course, I’m I’m very happy with the the sales numbers for q two. This is a result of four machines that were delivered during the quarter and installed at customer sites.
We also had great order intake in q two. So we had 20,000,000 SEK in order intake, which represents six new machines and also two paid customer projects. And and one of them was a real precision order from fusion for energy, so within the energy sector. Additive manufacturing is is a technology that is being more adopted now for serial production. And the industry that already started this transformation, as I mentioned, as previously is med tech, so orthopedic implants.
So here, volumes of implants are already being produced through additive manufacturing. And therefore, it’s a critical milestone also during the quarter when we had a delivery of our industrial machine email to one of the global implanter ends. So if we look at our total installed base, I must say that, I mean, we have an impressing number of 39 machines now, which means that we are definitely taking clear steps towards our ambition to being a leader in an EPVF solutions globally. I think many people have a maybe a perception about China as a labor intensive, low cost production country. But when it comes to manufacturing, China actually today is becoming one of the most advanced manufacturing countries globally, which means that they can produce, you know, really advanced and high quality product in a very efficient way.
China is also the the fastest growing additive manufacturing market globally, and it’s also a country which rapidly adopt additive manufacturing for zero production. So this is why China is a key market for Fremont to enter into as well. China is has also a rapidly increasing demand of orthopedic implants, while the medical business is growing fast. And then China has also stated that it want to become a leader in renewable energy, such as fusion energy as well. So all these focus areas and and and positive areas are actually also key focus areas for Fremont, why it’s it’s a great fit for us as well.
And, Yuli, they are not a typical sales agent with several additive brands in their portfolio. They are an international industrial player with an extensive business success in areas such as energy. So for me, this is one of the most important strategic milestones for Fremant since its start, actually. Another major milestone for Freemelt, which also happened during this quarter, is our strategic agreement with Scunfield, and this is to outsource the manufacturing of our machines. This will substantially improve our production scalability.
It will optimize our networking capital, and it will also free up resources to focus more on r and d, aftermarket development and customer support. So this is also a critical step in our industrialization journey. And the transition of the manufacturing is progressing according to the plan, and it shall be transferred prior to September. So with that said, I hand over to our CFO, Martin.
Martin Grond Lund, CFO, Freemelt: Thank you, Daniel. If we first zoom in on the order intake order book and the receivables of the company. So in the second quarter, as mentioned, the order intake was EUR 20,000,000 and in the first half of this year, 42,000,000. This is a number we started tracking this year and will continue to track going forward. And the order intake is, of course, the orders received in the period.
We also track the order book. The order book is what the orders received, which have not yet been invoiced. So they haven’t entered the financial books in any way. The order book total at quarter end was SEK 14,000,000, which is 47% up year on year, slightly down since the first quarter, but that’s an effect of those orders turning into receivables, prepaid income and eventually sales as the deliveries are being finalized. So looking at the sales number for the second quarter, we only book revenues to the sales where we have completed deliveries.
So uncompleted deliveries are still in the order book, in the account receivables or as prepaid income. So to summarize, we have a very strong order intake. We have a healthy order book. We have receivables growing very quickly, up to SEK 20,000,000, and we have record quarterly sales, as we see on the next slide. 19,000,000 is a record.
We’ve never seen anywhere close to these sales numbers in a previous quarter. It contains four machine deliveries, and that’s, of course, the majority of the net sales recorded, 86%. We have an aftermarket, which is 13%. But in actual terms, as you can see on the bottom graph, the green line, it ticks up quite a lot. We shouldn’t expect this exponential growth going forward, although the aftermarket business will continue to grow as an effect of the installed base increasing.
On the gray line on the bottom, we see customer projects and other. It’s 1% of net sales. It’s a very low number for the quarter, but I don’t think it’s in any way significant going forward as we should see these project orders continue to come in and to see an uptick in customer projects going forward as well. Then if we finally look at the operating cash flow. So Fremant has a positive net working capital, which is good in the way that we can cover our short term debts, but we also tie up cash as we grow.
One of the things we’ve done to limit this effect is to outsource our assembly and manufacturing to a third party. This will limit the effect, but it will not completely remove the effect of more capital being tied up as we grow. So in the quarter, we had operating cash flow of minus SEK 14,000,000. The main contributors are an increase in inventory and an increase in receivables. And all those are, of course, going to be cash in for the company in the future.
So these are cash generating assets but for the future. What we’ve done in the graph is to plot the operating cash flow versus the receivables just to give everyone an idea of the sort of inverse relationship that we see, which is reflective of the growth stage that the company is in. So the negative cash flow is has an inverse relationship with the increasing receivables that we see, which will be generating cash in the future. Thank you.
Daniel Yidlund, CEO, Freemelt: Thank you, Martin. So let’s wrap up. So once again, I mean, Q2 was a record quarter regarding sales of of 19,000,000. Once again, it it just to give some sort of comparison, it’s on par with the full year 2024, and we had a very strong quarter regarding order intake. Just to highlight a few orders as well, Germany has been an important market for us on the academia side.
Germany is a big industrial market as well, so that that’s why it was pleasing to to get our first industrial machine order from Germany. As well, we had a couple of new businesses both within energy and and and also in defense sector and including the prestige order, as I mentioned before as well, from Fusion for Energy, which is the European part of the the largest R and D fusion product globally, Ether. We also achieved two major strategic milestones. So again, we established a presence in China, which is a very important market as it’s it’s adopting quickly to to additive manufacturing. And the fact that we also signed a strategic agreement with Scamfield to outsource our machine manufacturing as well.
So lastly, I would say that it’s really fun at the moment to be the CEO at Fremont. We are well positioned, and we continue now to to turn our technology edge into commercial growth. And also the fact that external factors now as well is really accelerating the adoption for additive manufacturing. So with that said, thanks for listening. And now we open up for some questions.
Moderator: Thank you so much for that presentation. Now we’ll move over to the Q and A. First question here is, you write in your CEO statement that you have made a breakthrough in the second quarter. What do you mean by that?
Daniel Yidlund, CEO, Freemelt: Sure. So, I mean, we are experiencing constant increased traction now in the market, which also is reflected, I would say, in the increasing order intake. We have record sales number and also the number of successful projects. So I think this combined with us having entered into now strategic partnerships with international players like ULE and also Scunfield, I think this is a clear confirmation that we have reached a new level and and and also a new establishment in the market.
Moderator: Thanks. How do you view the industry industrialization of AM given that you mostly sell Freemelt one?
Daniel Yidlund, CEO, Freemelt: Good question. I mean, we see that the willingness now to invest in AM is increasing as companies and and and actually also governments are now increasingly reviewing their supply chains and also how to increase productivity in in different kind of ways, not least in defense and energy. And FEMA one actually plays a major role in the development of additive manufacturing. And therefore, see it as a strength that we can deliver this type of development machine like Fremont one as as as part of large and important industrial products. So so this will actually validate our technology and and also then lay a good foundation for sale of future industrial machines.
Moderator: Thanks. Next question here. Can you comment on the prospects for China and what we can expect from the collaboration with Julie?
Daniel Yidlund, CEO, Freemelt: Yes. Absolutely. I mean, China, as I said before, I mean, it’s the the fastest growing additive manufacturing market. China is is leading also investments now in in fusion energy in particular. And this is an area where Fremont I mean, we have a very strong position.
We work with United Kingdom, atomic energy authorities for for many years. Now we have fusion for energy. So that that’s an important area. ULE is also an established player, and I must say I’m I’m really impressed about their structured and proactive way of working, which, I mean, really increased the potential of a successful establishment in China as well. So we definitely have high hopes and expectations for for the cooperation with Duly and also the the upcoming business opportunities in in China.
Moderator: Thanks. What is the difference in the capability between Freemelt one, ID and I’m So
Daniel Yidlund, CEO, Freemelt: I would say there there are three different kind of stages. Have Fremont one is when you start to do the material development to to really develop the the material that’s gonna be used for the specific application. So so Fremont one is an open source machine, really open architecture, and where you can add a lot of tools for for more research purpose. It’s a small, let’s say, smaller build chamber, so you can work with a bit smaller kind of products, but really efficient research. The email ID is the next step.
When you develop the material and you’re gonna develop the application, then email ID is the the perfect fit. So you can still transfer your work from from Fremont one, but then focus more on the the application development, maybe also start more from a a low scale kind of production. And then EMILT I m is when you’re stepping up to serial production. So this is designed really to, as I mentioned initially, to to have short cycle times and turnaround times to to really increase your availability for production.
Moderator: Thanks. Now we move on to the last question here. Can we expect higher revenue per machine sold as you scale up the business, and what is driving that development?
Daniel Yidlund, CEO, Freemelt: Maybe you can answer that, Martin.
Martin Grond Lund, CFO, Freemelt: Yes, good question. So the focus right now is to expand the installed base and get as many machines as possible out there to build a foundation for the scale up. When it comes to products, so the Freemelt one is a bit more mature. The eMelt is a new product. We always see better margins for mature products than for new products.
So I think this will improve over time, but we also see potential for Freemelt One to have somewhat better profitability in the future. What’s also relevant here is the partnership that we have with Scanfel, which we’re entering into. I think this will also support us in our strive to improve profitability for the machines sold in the longer term. They will be a good partner to improve this going forward.
Moderator: Thanks. That was the end of the presentation. We got one last question here. Do you see an effect that customer buy machine directly instead of starting a pre study?
Daniel Yidlund, CEO, Freemelt: I think that’s also a bit depending on the, let’s say, the majority, so the majority of the the customer. So if if you if you go to orthopedic implants again, they have worked, for a longer period of time with additive manufacturing. They have also worked with their, you know, materials that have been developed over many years as well. So in in these cases, then it’s a shorter step for, they don’t need to go into a feasibility study in most of the cases. So then most probably they can purchase a machine shorter.
If you go to new materials like tungsten, for instance, or if you talk about copper or or some other materials, then and a customer that has never manufactured with additive manufacturing before, then the typical step is that you start with a feasibility study, and then develop from there into application development. So so it it’s difficult to say. So it’s really dependent on the maturity of the customer for when it comes additive manufacturing and the the type of application, I I would say. I I hope that answered your question.
Moderator: Thanks. And once again, thanks for the presentation. Now I’ll give the word to you, Daniel.
Daniel Yidlund, CEO, Freemelt: Okay. Yeah. No. Thanks to to everyone that invested your time and interest with Fremont today. So with that said, we wish you all a great day, and bye for now.
Thank you.
Martin Grond Lund, CFO, Freemelt: Thank you very much. Bye bye.
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