Proto Labs Reports 7.5% Revenue Growth in Q2 2025, Leadership Transition Announced

Proto Labs, Inc. reported its financial results for the second quarter of 2025, revealing a revenue increase of 7.5% to $135.1 million compared to $125.6 million in the same period last year. For the first half of 2025, revenue rose by 3.1% to $261.3 million, up from $253.5 million in the prior year. The company's net income for the second quarter was $4.4 million, a slight decrease from $4.5 million in the previous year, while net income for the first half fell to $8.0 million from $9.8 million. The diluted earnings per share remained stable at $0.18 for the second quarter, while the six-month figure was $0.33, down from $0.38.

The company experienced a notable increase in operating expenses, which rose by 8.4% to $54.8 million in the second quarter, driven primarily by higher marketing and sales costs. The gross profit for the quarter was $59.8 million, resulting in a gross margin of 44.3%, down from 45.0% in the prior year. The increase in costs was attributed to higher raw material and production costs, as well as personnel-related expenses. The company also reported a decrease in its effective tax rate to 33.7% from 38.3% in the same quarter last year, primarily due to changes in tax expenses related to stock options and restricted stock units.

In terms of operational metrics, Proto Labs served 21,775 unique customer contacts in the second quarter, a decrease of 3.0% from the previous year. However, revenue per customer contact increased by 10.9% to $6,203, indicating a strategic focus on larger orders from existing customers. The company’s revenue by product line showed a significant increase in CNC Machining, which grew by 20.9%, while Injection Molding revenue decreased by 3.4%. The company continues to expand its manufacturing capabilities, particularly in CNC Machining and Sheet Metal, which saw a 9.7% increase in revenue.

Strategically, Proto Labs is undergoing a transition in leadership, with Suresh Krishna appointed as the new President and CEO effective May 20, 2025, succeeding Robert Bodor. The company is also implementing a plan to close its prototype injection molding facility in Germany and discontinue certain 3D printing services, which is expected to be completed by the end of fiscal 2025. Despite these changes, Proto Labs aims to maintain its service offerings across Europe through its network of manufacturing partners.

Looking ahead, Proto Labs anticipates continued revenue growth driven by its focus on larger customer orders and expanding its product offerings. The company expects to invest in technology and personnel to enhance its manufacturing capabilities and improve operational efficiency. With cash and cash equivalents of $90.4 million as of June 30, 2025, Proto Labs believes it has sufficient liquidity to meet its working capital and capital expenditure needs for the next 12 months.