What changed in Xometry, Inc.'s 2024 10-K compared to 2023?

Across the narrative sections we track, Xometry, Inc. (XMTR) added 138 paragraphs, removed 182, and edited 121 between the 2023 and 2024 10-K filings. The biggest movers are Item 7. Management's Discussion & Analysis (+122/−163), Item 1C. Cybersecurity (+16/−19).

What changed in Xometry, Inc.'s MD&A (Item 7) in 2024?

Item 7 Management's Discussion & Analysis shows 122 new/edited paragraphs and 163 removed paragraphs year-over-year. Read the side-by-side diff to see exactly which revenue, margin, and outlook commentary was rewritten.

Did Xometry, Inc. update its Cybersecurity disclosure (Item 1C) in 2024?

Item 1C Cybersecurity has 16 paragraph-level changes between the 2023 and 2024 filings.

Where does this XMTR 10-K diff come from?

The source filings are Xometry, Inc.'s official 2023 and 2024 Form 10-K annual reports from SEC EDGAR. 10q10k.net parses each filing, aligns paragraphs by section (Item 1, 1A, 1C, 2, 3, 7, 7A), and highlights every added, removed and edited sentence side-by-side.

What changed in Xometry, Inc.'s 10-K — 2023 vs 2024

Paragraph-level year-over-year comparison of Xometry, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+138 added−182 removedSource: 10-K (2025-02-25) vs 10-K (2024-02-29)

Top changes in Xometry, Inc.'s 2024 10-K

138 paragraphs added · 182 removed · 121 edited across 2 sections

Item 7. Management's Discussion & Analysis+122 / −163 · 105 edited
Item 1C. Cybersecurity+16 / −19 · 16 edited

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

16 edited+0 added−3 removed15 unchanged

2023 filing

2024 filing

Biggest changeLeibel, who has previously served as the Senior Director of Engineering at various large technology companies and holds a Master of Information Technology degree from Virginia Tech; and (ii) our Vice President of Information Technology and Security, Mr.

Biggest changeOur cybersecurity risk assessment and management processes are implemented and maintained by certain members of management, including (i) our CTO, Vaidyanathan Raghavan, who previously served as the General Manager of Technology at Wayfair and holds a Master of Science in Electrical Engineering degree from the University of Minnesota ; and (ii) our Vice President of Information Technology and Security, Mr.

Our board of directors receives such reports periodically from the Audit Committee and from our CTO. The board of directors also receive various reports, summaries or presentations related to cybersecurity threats, risk, and mitigation. It em 2. Properties. We believe that our facilities are well maintained and are generally suitable to meet our needs.

Our board of directors receives such reports periodically from the Audit Committee and from our CTO. The board of directors also receive various reports, summaries or presentations related to cybersecurity threats, risk, and mitigation. 41 It em 2. Properties. We believe that our facilities are well maintained and are generally suitable to meet our needs.

We identify and assess risks from cybersecurity threats by monitoring and evaluating our threat environment using various methods including using manual and automated tools, analyzing reports of threats and actors, evaluating our risk profile, conducting audits, conducting threat and vulnerability assessments, and performing tabletop incident response exercises.

We identify and assess risks from cybersecurity threats by monitoring and evaluating our threat 40 environment using various methods including using manual and automated tools, analyzing reports of threats and actors, evaluating our risk profile, conducting audits, conducting threat and vulnerability assessments, and performing tabletop incident response exercises.

Risk Management and Strategy We have implemented and maintain various information security processes designed to identify, assess and manage material risks from cybersecurity threats to our critical computer networks, third party hosted services, communications systems, hardware and software, and our critical data, including intellectual property, confidential information that is proprietary, strategic or competitive in nature, and our customer’s confidential information (“Information Systems and Data”).

Risk Management and Strategy We have implemented and maintain various information security processes designed to identify, assess and manage material risks from cybersecurity threats to our critical computer networks, third party hosted services, communications systems, hardware and software, and our critical data, including intellectual property, confidential information that is proprietary, strategic or competitive in nature, and our customers’ confidential information (“Information Systems and Data”).

However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more matters could have a material adverse effect on our consolidated results of operations, financial condition or cash flows. It em 4. Mine Safety Disclosures. Not applicable. 41 PART II It em 5.

Any future determination regarding the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then-existing conditions, including our financial condition, operating results, contractual restrictions, capital requirements, business prospects and other factors our board of directors may deem relevant. 42 Performance Graph The following performance graph shows a comparison from June 30, 2021 (the date our Class A common stock commenced trading on the Nasdaq Global Select Market) through December 31, 2023, of the cumulative total return for our Class A common stock, the Nasdaq Composite Index, and the Russell 2000 Index.

Any future determination regarding the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then-existing conditions, including our financial condition, operating results, contractual restrictions, capital requirements, business prospects and other factors our board of directors may deem relevant. 43 Performance Graph The following performance graph shows a comparison from June 30, 2021 (the date our Class A common stock commenced trading on the Nasdaq Global Select Market) through December 31, 2024, of the cumulative total return for our Class A common stock, the Nasdaq Composite Index, and the Russell 2000 Index.

We use third-party service providers to assist us from time to time to identify, assess, and manage material risks from cybersecurity threats, including for example, professional services firms, cybersecurity consultants and software providers, managed cybersecurity service providers, penetrating testing firms, and forensic investigators.

All of our offices are leased and we do not own any real property. Our operating leases range in expiration from 2024 to 2029. We have leased offices and/or facilities in the following locations: U.S.

All of our offices are leased and we do not own any real property. Our operating leases range in expiration from 2025 to 2029. We have leased offices and/or facilities in the following locations: U.S.

Depending on the environment and system, we implement and maintain various technical, physical, and organizational measures, processes, standards, and policies designed to manage and mitigate material risks from cybersecurity threats to our Information Systems and Data, including incident detection and response, a vulnerability management policy, business continuity plans, risk assessments, encryption of certain data, access controls, employee training, penetration testing, cybersecurity insurance, systems monitoring and dedicated cybersecurity staff. 39 Our assessment and management of material risks from cybersecurity threats are integrated into our overall risk management processes.

Operating Leases City, State Square Footage North Bethesda, MD 28,068 New York, NY 93,072 (1)(3) Horsham, PA 24,377 (3) Gaithersburg, MD 21,529 (3) Lexington, KY 10,109 Bethesda, MD 6,781 (2) Doraville, GA 5,975 (3) Culver City, CA 5,838 (3) 40 International Operating Leases City, Country Square Footage Ottobrunn, Germany 21,129 Istanbul, Turkey 11,840 Chelmsford, England 3,304 Lyon, France 1,172 Shenzhen, China 3,983 Shanghai, China 760 (1) 50,478 square feet of this office has been sublet.

Operating Leases City, State Square Footage North Bethesda, MD 28,068 New York, NY 93,072 (1)(2) Horsham, PA 24,377 (2) Gaithersburg, MD 21,529 Lexington, KY 10,109 Culver City, CA 5,838 (2) International Operating Leases City, Country Square Footage Ottobrunn, Germany 21,129 Istanbul, Turkey 11,840 Chelmsford, England 3,304 Lyon, France 1,172 Shenzhen, China 3,983 Shanghai, China 2,085 (1) 50,478 square feet of this office has been sublet.

Holders of Record As of February 16, 2024, there were 108 holders of record of our Class A common stock. The actual number of stockholders is greater than this number of record holders and includes stockholders who are beneficial owners but whose shares are held in street name by brokers and other nominees.

Holders of Record As of February 10, 2025, there were 87 holders of record of our Class A common stock. The actual number of stockholders is greater than this number of record holders and includes stockholders who are beneficial owners but whose shares are held in street name by brokers and other nominees.

Certain information about our assessment and management of material risks from cybersecurity threats is included in risk management reports, as applicable, to senior leadership and the Audit Committee.

Our assessment and management of material risks from cybersecurity threats are integrated into our overall risk management processes. Certain information about our assessment and management of material risks from cybersecurity threats is included in risk management reports, as applicable, to senior leadership and the Audit Committee.

The performance graph and related information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act or Exchange Act. 43 Recent Sales of Unregistered Securities None.

(2) All 6,781 square feet of this office has been sublet. (3) All or a portion of these offices are not used by the Company. Ite m 3. Legal Proceedings. From time to time, we are involved in various claims and legal actions that arise in the ordinary course of business.

(2) All or a portion of these offices are not used by the Company. Ite m 3. Legal Proceedings. From time to time, we are involved in various claims and legal actions that arise in the ordinary course of business.

The Audit Committee of our board of directors is responsible for overseeing our cybersecurity risk management processes, including oversight and mitigation of risks from cybersecurity threats. Our cybersecurity risk assessment and management processes are implemented and maintained by certain members of management, including (i) our CTO, Mr.

The Audit Committee of our board of directors is responsible for overseeing our cybersecurity risk management processes, including oversight and mitigation of risks from cybersecurity threats.

As of February 16, 2024, there were two holders of record of our Class B common stock. Dividend Policy We have never declared or paid cash dividends on our capital stock.

As of February 10, 2025, there was one holder of record of our Class B common stock. Dividend Policy We have never declared or paid cash dividends on our capital stock.

Removed

Use of Proceeds On July 2, 2021, we closed our IPO, in which we sold 7,906,250 shares of our common stock at a price of $44.00 per share.

Removed

The offer and sale of the shares in the IPO were registered under the Securities Act pursuant to a registration statement on Form S-1 (File No. 333-256769), which was declared effective by the SEC on June 30, 2021. We raised approximately $325.3 million in net proceeds after deducting underwriting discounts and commissions.

Removed

As of December 31, 2023, we have used all proceeds from the IPO. It em 6. [Reserved]. 44

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

105 edited+17 added−58 removed48 unchanged

2023 filing

2024 filing

Biggest changeNon-GAAP Net Loss We define Non-GAAP net loss, as net loss adjusted for depreciation and amortization, stock-based compensation, amortization of lease intangible, amortization of deferred costs on convertible notes, loss on marketable securities, loss on sale of property and equipment, charitable contributions of common stock, impairment of assets, lease abandonment and termination, restructuring charges, costs to exit the supplies business and acquisition and other adjustments not reflective of our ongoing business, such as adjustments related to purchase accounting, the revaluation of contingent consideration and transaction costs. 51 For the Year Ended December 31, 2023 2022 Non-GAAP Net Loss: Net loss (1) $ (67,465 ) $ (79,043 ) Add (deduct): Depreciation and amortization 10,738 7,819 Stock-based compensation 22,118 19,172 Amortization of lease intangible 950 1,332 Amortization of deferred costs on convertible notes 1,860 1,718 Loss on marketable securities — 1,855 Acquisition and other 824 (676 ) Loss on sale of property and equipment 92 47 Charitable contribution of common stock 1,029 2,272 Lease abandonment and termination 8,778 — Impairment of assets 397 824 Restructuring charge 738 1,549 Costs to exit the supplies business 586 — Non-GAAP Net Loss $ (19,355 ) $ (43,131 ) (1) Net loss for the year ended December 31, 2022 increased by $3.0 million as a result of an immaterial correction of errors.

Biggest changeNon-GAAP Net Loss We define Non-GAAP net loss, as net loss adjusted for depreciation and amortization, stock-based compensation, payroll tax expense related to stock-based compensation, amortization of lease intangible, amortization of deferred costs on convertible notes, loss on sale of property and equipment, charitable contributions of common stock, impairment of assets, lease abandonment and termination, restructuring charges, costs to exit the tools and materials business and acquisition and other adjustments not reflective of our ongoing business, such as adjustments related to purchase accounting, the revaluation of contingent consideration, transaction costs and executive severance. 52 For the Year Ended December 31, 2024 2023 Non-GAAP Net Loss: Net loss $ (50,403 ) $ (67,465 ) Add (deduct): Depreciation and amortization 13,012 10,738 Stock-based compensation 29,322 22,118 Payroll tax expense related to stock-based compensation (1) 965 — Amortization of lease intangible 720 950 Amortization of deferred costs on convertible notes 1,859 1,860 Acquisition and other 686 824 Loss on sale of property and equipment 2 92 Charitable contribution of common stock 1,686 1,029 Lease abandonment and termination — 8,778 Impairment of assets 82 397 Restructuring charges — 738 Costs to exit the tools and materials business — 586 Non-GAAP Net Loss $ (2,069 ) $ (19,355 ) (1) During 2024, we changed the definition of Non-GAAP Net Loss to exclude payroll tax expense related to stock-based compensation.

Investing Activities Cash provided by investing activities was $16.8 million during the year ended December 31, 2023, primarily due to the proceeds from the sale of marketable securities of $50.0 million offset by the purchase of property and equipment (which includes internal-use software development costs) of $18.5 million, $11.6 million for the purchase of marketable securities, and $3.3 million for the acquisition of Tridi.

Cash provided by investing activities was $16.8 million during the year ended December 31, 2023, primarily due to the proceeds from the sale of marketable securities of $50.0 million offset by the purchase of property and equipment (which includes internal-use software development costs) of $18.5 million, $11.6 million for the purchase of marketable securities, and $3.3 million for the acquisition of Tridi.

Financing Activities Cash provided by financing activities was $1.1 million during the year ended December 31, 2023, primarily resulting from $1.9 million of proceeds from the exercise of stock options offset by the payment of contingent considerations related to acquisitions in 2021.

Cash provided by financing activities was $1.1 million during the year ended December 31, 2023, primarily resulting from $1.9 million of proceeds from the exercise of stock options offset by the payment of contingent considerations related to acquisitions in 2021.

Historically, our assumptions, judgments and estimates relative to our critical accounting estimates have not differed materially from actual results. Valuation of Goodwill and Intangible Assets Goodwill has indefinite useful life and is not amortized. Goodwill is tested for impairment at least annually on the first day of the fourth quarter, or more frequently if impairment indicators are present.

Historically, our assumptions, judgments and estimates relative to our critical accounting estimates have not differed materially from actual results. 60 Valuation of Goodwill and Intangible Assets Goodwill has indefinite useful life and is not amortized. Goodwill is tested for impairment at least annually on the first day of the fourth quarter, or more frequently if impairment indicators are present.

We believe the repeat purchase activity from existing accounts reflects the underlying strength of our business and provides us with substantial revenue visibility and predictability. 49 Accounts with Last Twelve-Month Spend of At Least $50,000 Accounts with Last Twelve-Month, or LTM, Spend of At Least $50,000 means an account that has spent at least $50,000 on our marketplace in the most recent twelve-month period.

We believe the repeat purchase activity from existing accounts reflects the underlying strength of our business and provides us with substantial revenue visibility and predictability. 50 Accounts with Last Twelve-Month Spend of At Least $50,000 Accounts with Last Twelve-Month, or LTM, Spend of At Least $50,000 means an account that has spent at least $50,000 on our marketplace in the most recent twelve-month period.

Critical Accounting Estimates Our discussion and analysis of financial condition and results of operations are based upon our financial statements included elsewhere in this Annual Report on Form 10-K. The preparation of our financial statements in accordance with GAAP requires us to 63 make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses.

Critical Accounting Estimates Our discussion and analysis of financial condition and results of operations are based upon our financial statements included elsewhere in this Annual Report on Form 10-K. The preparation of our financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses.

For further discussion of the potential impacts of macroeconomic events on our business, financial condition, and operating results, see the section titled “Risk Factors.” Restructurings In May 2023 and December 2022 , we initiated restructuring actions to help manage our operating expenses by reducing our workforce by approximately 10%.

Expansion of Our International Operations In 2019, we launched Xometry in Europe, followed by Xometry Asia in 2022 and Xometry United Kingdom in 2023. We believe there is significant opportunity in the global manufacturing ecosystem for our marketplace.

Expansion of Our International Operations In 2019, we launched Xometry in Europe, followed by Xometry Asia in 2022 and Xometry United Kingdom and Xometry Turkey in 2023. We believe there is significant opportunity in the global manufacturing ecosystem for our marketplace.

Operations and Support Operations and support expenses are the costs we incur in support of the buyers and suppliers on our platform which are provided by phone, email and chat for purposes of resolving buyer and suppliers related matters.

Every interaction on our marketplace provides rich data insights that allow us to continuously improve our AI models and create new products and services, fueling powerful network effects as we scale. We use proprietary technology to enable product designers, engineers, buyers, and supply chain professionals to instantly access the capacity of a global network of manufacturing facilities.

Each interaction on our marketplace provides rich data insights that allow us to continuously improve our AI models and create new products and services, fueling powerful network effects as we scale. We use proprietary technology to enable product designers, engineers, buyers, and supply chain professionals to instantly access the capacity of a global network of manufacturing facilities.

Adjusted EBITDA and Non-GAAP net loss should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. 52 Components of Results of Operations Revenue Our marketplace revenue is primarily comprised of sales of parts and assemblies to customers through our platform.

Adjusted EBITDA and Non-GAAP net loss should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. 53 Components of Results of Operations Revenue Our marketplace revenue is primarily comprised of sales of parts and assemblies to customers through our platform.

The key drivers of Active Buyer growth are continued account and buyer engagement and the success of our strategy to attract new buyers. 48 Percentage of Revenue from Existing Accounts We define an existing account as an account where at least one buyer has made a purchase on our marketplace.

The key drivers of Active Buyer growth are continued account and buyer engagement and the success of our strategy to attract new buyers. 49 Percentage of Revenue from Existing Accounts We define an existing account as an account where at least one buyer has made a purchase on our marketplace.

Refer to Note 12, Debt and Commitments and Contingencies—Restructuring to of our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. 47 Key Operational and Business Metrics In addition to the measures presented in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K, we use the following key operational and business metrics to help us evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and develop forecasts, and make strategic decisions: Active Buyers We define Active Buyers as the number of buyers who have made at least one purchase on our marketplace during the last twelve months.

Refer to Note 11, Debt and Commitments and Contingencies—Restructuring to of our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. 48 Key Operational and Business Metrics In addition to the measures presented in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K, we use the following key operational and business metrics to help us evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and develop forecasts, and make strategic decisions: Active Buyers We define Active Buyers as the number of buyers who have made at least one purchase on our marketplace during the last twelve months.

Factors that could cause or contribute to such differences include those identified below and those discussed in the section titled “Risk Factors” and other sections of this Annual Report on Form 10-K. Our historical results are not necessarily indicative of the results that may be expected for any period in the future. Overview Xometry Inc.

Xometry's extensible technology platform allows the Company to add new technologies and processes to gain more wallet share with our buyers. We enable buyers to source these processes to meet complex and specific design and order needs across several industries, including Aerospace, Healthcare, Robotics, Industrial, Defense, Energy, Automotive, Government, Education and Consumer Goods.

Xometry's extensible technology platform allows the Company to add new technologies and processes to gain more wallet share with our buyers. We enable buyers to source these processes to meet complex and specific design and order needs across several industries, including Aerospace, Industrial, Medical Devices, Automotive, Consumer Goods, Defense, Government, Energy, Education and Robotics.

We believe the efficiency and transparency of our business model leads to increasing account loyalty and spend over time. Buyers can utilize our marketplace for both one-off and recurring manufacturing opportunities.

We believe the efficiency and transparency of our business model leads to increasing account stickiness and spend over time. Buyers can utilize our marketplace for both one-off and recurring manufacturing opportunities.

With operations throughout the majority of the contiguous United States and customers in Europe and Asia, we have established footholds in major markets around the world. As we have expanded our physical presence, we have also added new language functionality to our platform to reach a wider customer base.

With 47 operations throughout the majority of the contiguous United States and customers in Europe and Asia, we have established footholds in major markets around the world. As we have expanded our physical presence, we have also added new language functionality to our platforms to reach a wider customer base.

If the results of the annual qualitative assessment conclude that it is not more likely than not that the fair value of a reporting unit exceeds its carrying value, or if interim indicators of impairment are identified, a quantitative impairment test is performed. A quantitative impairment test involves comparing the fair value of a reporting unit with its carrying value.

Supplier services revenue includes the sale of marketing and advertising services, and to a lesser extent financial service products, SaaS-based solutions and the sale of supplies which was discontinued during the second quarter of 2023.

Supplier services revenue includes the sale of marketing and advertising services, and to a lesser extent financial service products, SaaS-based solutions and the sale of tools and materials, which was discontinued during the second quarter of 2023.

The following is our discussion of the consolidated results of operations for the year ended December 31, 2023 as compared to the year ended December 31, 2022.

Results of Operations The following is our discussion of the consolidated results of operations for the year ended December 31, 2024 as compared to the year ended December 31, 2023.

Revenue from our marketplace primarily reflects the sales of parts and assemblies on our platform. Revenue from supplier services primarily includes the sale of advertising and to a lesser extent financial service products, SaaS products and supplies.

The net decrease in operating assets and liabilities is primarily driven by changes in accounts receivable of $20.6 million primarily due to our continued growth, lease liabilities of $5.5 million and contract liabilities of $1.4 million, offset by changes in accrued expenses of $7.5 million, accounts payable of $6.7 million and prepaid expenses of $1.7 million.

The net decrease in operating assets and liabilities is primarily driven by changes in accounts receivable of $20.6 million primarily due to our continued growth, lease liabilities of $5.5 million and contract liabilities of $1.4 million, offset by changes in accounts payable and accrued cost of revenue of $12.6 million, prepaid expenses of $1.7 million and other accrued expenses of $1.6 million.

We accounted for the issuance of the 2027 Notes as a single liability measured at its amortized cost, as no other embedded features require bifurcation and recognition as derivatives. As of December 31, 2023, the 2027 Notes have a carrying value of $281.8 million with an effective annual interest rate of 1.6%.

We accounted for the issuance of the 2027 Notes as a single liability measured at its amortized cost, as no other embedded features require bifurcation and recognition as derivatives. As of December 31, 2024, the 2027 Notes have a carrying value of $283.6 million with an effective annual interest rate of 1.6%.

Our inability or failure to do so could harm our business, results of operations and financial condition. 65

Our inability or failure to do so could harm our business, results of operations and financial condition. 62

We define Active Paying Suppliers as individuals or businesses who have purchased one or more of our supplier services, including digital marketing services, data services, financial services or supplies on our platforms during the last twelve months.

We define Active Paying Suppliers as individuals or businesses who have purchased one or more of our supplier services, including digital marketing services, data services, financial services or tools and materials on our platforms during the last twelve months.

Active Paying Suppliers We define Active Paying Suppliers as individuals or businesses who have purchased one or more of our supplier services, including digital marketing services, data services, financial services or supplies on our platforms during the last twelve months.

Active Paying Suppliers We define Active Paying Suppliers as individuals or businesses who have purchased one or more of our supplier services, including digital marketing services, data services, financial services or tools and materials on our platforms during the last twelve months.

A buyer may also recommend our marketplace to other engineers within their organizations who are designing other products and who may use an entirely different set of manufacturing processes, deepening our reach and loyalty with an account. For the quarter ended December 31, 2023, 96% of our revenue was generated from existing accounts.

A buyer may also recommend our marketplace to other engineers within their organizations who are designing other products and who may use an entirely different set of manufacturing processes, deepening our reach and stickiness with an account. For the quarter ended December 31, 2024, 97% of our revenue was generated from existing accounts.

These services help suppliers manage their business more efficiently, even on jobs that they source outside of our platform. In December 2021, we acquired Thomas which significantly expanded our supplier services to include digital advertising, marketing services and data solutions for our suppliers.

These services help suppliers manage their business more efficiently, even on jobs that they source outside of our platform. In December 2021, we acquired Thomas Publishing Company and its subsidiaries (collectively, “Thomas”), which significantly expanded our supplier services to include digital advertising, marketing services and data solutions for our suppliers.

In November 2021, we acquired FactoryFour a cloud-based manufacturing execution system. We provide this order management system to our supplier community which allows shops and shop owners to digitize and automate their operations so they can focus on growing their business.

(d/b/a FactoryFour), a cloud-based manufacturing execution system. We provide this order management system to our supplier community which allows shops and shop owners to digitize and automate their operations so they can focus on growing their business.

Adjusted EBITDA and Non-GAAP net loss are non-GAAP financial measures that we use, in addition to our GAAP financial measures, to evaluate our business. We have included Adjusted EBITDA and Non-GAAP net loss in this filing because they are key measures used by our management to evaluate our operating performance.

We have included Adjusted EBITDA and Non-GAAP net loss in this filing because they are key measures used by our management to evaluate our operating performance.

These estimates and assumptions could have a significant impact on whether an impairment charge is recognized and the amount of any such charge. Estimates of fair value are primarily determined using discounted cash flows and recent transactions. These approaches use significant estimates and assumptions, including projected future cash flows, discount rates, growth rates, margins and determination of appropriate market comparisons.

These estimates and assumptions could have a significant impact on whether an impairment charge is recognized and the amount of any such charge. Estimates of fair value are primarily determined using discounted cash flows and recent transactions. These approaches use significant estimates and assumptions, including projected future cash flows, growth rates, margins, discount rates, working capital requirements and capital expenditures.

We define “suppliers” as individuals or businesses who have been approved by us to either manufacture a product on our platform for a buyer or have utilized our supplier services, including our financial services or the purchase of supplies.

We define “suppliers” as individuals or businesses who have been approved by us to either manufacture a product on our marketplace for a buyer or have utilized our supplier services, including our financial services or the purchase of tools and materials.

These manufacturing processes include computer numerical control (“CNC”) manufacturing, sheet metal forming, sheet cutting, 3D printing (including fused deposition modeling, direct metal laser sintering, PolyJet, stereolithography, selective laser sintering, binder jetting, carbon digital light synthesis, multi jet fusion and lubricant sublayer photo-curing), die casting, stamping, injection molding, urethane casting, tube cutting, tube bending, as well as finishing services, rapid prototyping and high-volume production.

The suppliers on our platform offer a diversified and expanding mix of manufacturing processes. 46 These manufacturing processes include computer numerical control (“CNC”) manufacturing, sheet metal forming, sheet cutting, 3D printing (including fused deposition modeling, direct metal laser sintering, PolyJet, stereolithography, selective laser sintering, binder jetting, carbon digital light synthesis, multi jet fusion and lubricant sublayer photo-curing), die casting, stamping, injection molding, urethane casting, tube cutting, tube bending, as well as finishing services, rapid prototyping and high-volume production.

As of December 31, 2023, customers can access our platform in 14 languages. We will continue to dedicate sales and marketing resources to develop our supplier networks and attract buyers to our marketplace in other regions.

As of December 31, 2024, customers can access our platforms in 18 languages. We will continue to dedicate sales and marketing resources to develop our supplier networks and attract buyers to our marketplace in other regions.

Our suite of marketing and data services provided by Thomas help suppliers grow and more efficiently run their business. We offer suppliers a full slate of marketing services, including website building, search-engine optimization ("SEO") and targeted advertising to buyers, which are resources that will help them further grow their business.

Our suite of marketing and data services provided by Thomas help suppliers grow and more efficiently run their business. We offer suppliers a full slate of marketing services, including website building, SEO and targeted advertising to buyers, which are resources that will help them further grow their business. In November 2021, we acquired Fusiform, Inc.

This growth was a result of an increase in marketplace revenue, partially offset by a decrease in supplier services revenue. Marketplace revenue increased $91.5 million, or 30% from $303.2 million for the year ended December 31, 2022 to $394.8 million for the year ended December 31, 2023.

This growth was a result of an increase in marketplace revenue, partially offset by a decrease in supplier services revenue. Marketplace revenue increased $91.2 million, or 23%, from $394.8 million for the year ended December 31, 2023 to $485.9 million for the year ended December 31, 2024.

We intend to continue investing in acquiring new buyers through traditional paid sales and marketing techniques as well as leveraging our organic referral network to drive awareness and build trust. The number of Active Buyers on our platform reached 55,458 as of December 31, 2023, up 36% from 40,664 as of December 31, 2022.

We intend to continue investing in acquiring new buyers through traditional paid sales and marketing techniques as well as leveraging our organic referral network to drive awareness and build trust. The number of Active Buyers on our platform reached 68,267 as of December 31, 2024, up 23% from 55,325 as of December 31, 2023.

The number of accounts with LTM Spend of at least $50,000 on our platform reached 1,331 as of December 31, 2023, up 30% from 1,027 as of December 31, 2022.

The number of accounts with LTM Spend of at least $50,000 on our platform reached 1,495 as of December 31, 2024, up 12% from 1,331 as of December 31, 2023.

An increase or decrease in the number of Active Paying Suppliers is a key indicator of our ability to engage suppliers on our platform. Active Paying Suppliers has grown over time. The number of Active Paying Suppliers on our platform reached 7,271 as of December 31, 2023, down 6% from 7,715 as of December 31, 2022.

An increase or decrease in the number of Active Paying Suppliers is a key indicator of our ability to engage suppliers on our platform. Active Paying Suppliers has changed over time. The number of Active Paying Suppliers on our platform was 6,582 as of December 31, 2024, down 9% from 7,271 as of December 31, 2023.

An increase or decrease in the number of Active Buyers is a key indicator of our ability to attract, retain and engage buyers on our platform. Active Buyers has consistently grown over time. The number of Active Buyers on our platform reached 55,458 as of December 31, 2023, up 36% from 40,664 as of December 31, 2022.

An increase or decrease in the number of Active Buyers is a key indicator of our ability to attract, retain and engage buyers on our platform. Active Buyers has consistently grown over time. The number of Active Buyers on our platform reached 68,267 as of December 31, 2024, up 23% from 55,325 as of December 31, 2023.

We may redeem for cash all or any portion of the 2027 Notes, at our option, on or after February 5, 2025 if the last reported sale price of our Class A common stock has been at least 130% of the conversion price then in effect for at least 20 trading days at a redemption price equal to 100% of the principal amount of the 2027 Notes to be redeemed, plus accrued and unpaid interest or additional interest, if any.

We may redeem for cash all or any portion of the 2027 Notes, at our option, on or after February 5, 2025 if the last reported sale price of our Class A common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption, at a redemption price equal to 100% of the principal amount of the 2027 Notes to be redeemed, plus accrued and unpaid interest or additional interest, if any.

For the year ended December 31, 2023, Adjusted EBITDA loss was $(27.5) million, compared to Adjusted EBITDA loss of $(44.8) million in 2022. For the year ended December 31, 2023, Adjusted EBITDA decreased to (5.9)% of revenue, as compared to (11.8)% of revenue in 2022, driven primarily by increased operating efficiencies as we continue to scale our business.

For the year ended December 31, 2024, Adjusted EBITDA decreased to (1.8)% of revenue, as compared to (5.9)% of revenue in 2023, driven primarily by increased operating efficiencies as we continue to scale our business.

Cost of Revenue Total cost of revenue increased $50.2 million, or 21%, from $234.9 million for the year ended December 31, 2022 to $285.1 million for the year ended December 31, 2023. This increase was the result of an increase in marketplace cost of revenue offset by a decrease in supplier services costs of revenue.

Cost of Revenue Total cost of revenue increased $44.8 million, or 16%, from $285.1 million for the year ended December 31, 2023 to $329.9 million for the year ended December 31, 2024. This increase was primarily the result of an increase in marketplace cost of revenue offset by a decrease in supplier services costs of revenue.

The increase in marketplace revenue was primarily due to increased buyers activity on the platform for the year ended December 31, 2023, as compared to the prior year period. Supplier services revenue decreased $9.0 million, or 12% from $77.7 million for the year ended December 31, 2022 to $68.7 million for the year ended December 31, 2023.

The increase in marketplace revenue was primarily due to increased buyer activity on the platform for the year ended December 31, 2024, as compared to the prior year period. Supplier services revenue decreased $9.1 million, or 13%, from $68.7 million for the year ended December 31, 2023 to $59.6 million for the year ended December 31, 2024.

Gross Profit and Margin Gross profit increased $32.3 million, or 22%, from $146.0 million for the year ended December 31, 2022 to $178.3 million for the year ended December 31, 2023. The increase in gross profit was primarily due to increases in revenue from marketplace and improved marketplace gross margins as compared to the prior year period.

Gross Profit and Margin Gross profit increased $37.4 million, or 21%, from $178.3 million for the year ended December 31, 2023 to $215.6 million for the year ended December 31, 2024. The increase in gross profit was primarily due to increases in revenue from marketplace and improved marketplace gross margins as compared to the prior year period.

It is possible that our conclusions regarding impairment of goodwill could change in future periods if, for example, our businesses do not perform as projected or overall economic conditions in future periods vary from current assumptions.

The number of active suppliers, which we define as suppliers that have used our platform at least once during the last twelve months to manufacture a product or buy tools or supplies, has grown 36% from 2,529 1 for the year ended December 31, 2022 to 3,429 for the year ended December 31, 2023.

The number of active suppliers, which we define as suppliers that have used our platform at least once during the last twelve months to manufacture a product, has grown 28% from 3,429 for the year ended December 31, 2023 to 4,375 for the year ended December 31, 2024.

An increase or decrease in the number of Active Paying Suppliers is a key indicator of our ability to engage suppliers on our platform. The number of Active Paying Suppliers on our platform was 6,582 as of December 31, 2024, down 9% from 7,271 as of December 31, 2023.

As a percent of total revenue, product development decreased to 7.4% for the year ended December 31, 2023 from 8.1% for the year ended December 31, 2022 General and Administrative General and administrative expense increased $12.7 million, or 22%, from $58.2 million for the year ended December 31, 2022 to $70.9 million for the year ended December 31, 2023.

As a percent of total revenue, product development expenses decreased to 7.2% for the year ended December 31, 2024 from 7.4% for the year ended December 31, 2023. General and Administrative General and administrative expense decreased $6.0 million, or 8%, from $70.9 million for the year ended December 31, 2023 to $65.0 million for the year ended December 31, 2024.

We define “buyers” as individuals who have placed an order to purchase custom-manufactured, on-demand parts or assemblies on our marketplace. Our buyers include engineers, product designers, procurement and supply chain personnel, inventors, entrepreneurs and business owners from businesses of a variety of sizes, ranging from self-funded start-ups to Fortune 100 companies.

We define “buyers” as individuals who have placed an order to purchase custom-manufactured, on-demand parts or assemblies on our marketplace. Our buyers include engineers, product designers, procurement and supply chain personnel, entrepreneurs, technicians and business owners from small businesses to Fortune 500 companies.

For the year ended December 31, 2022, net cash used in operating activities was $62.6 million, primarily due to a net loss of $(79.0) million adjusted for non-cash charges of $42.9 million and a net decrease in our operating assets and liabilities of $26.5 million.

For the year ended December 31, 2023, net cash used in operating activities was $29.9 million, primarily due to a net loss of $(67.5) million adjusted for non-cash charges of $51.2 million and a net decrease in our operating assets and liabilities of $(13.6) million.

Our future capital requirements will depend on many factors, including our revenue growth rate, receivable and payable cycles, the timing and extent of investments in product development, sales and marketing, operations and support and general and administrative expenses.

We may also engage in equity or debt financings to secure additional funds. Our future capital requirements will depend on many 58 factors, including our revenue growth rate, receivable and payable cycles, the timing and extent of investments in product development, sales and marketing, operations and support and general and administrative expenses.

The majority of our revenue is derived from the sale of part(s) and assemblies to our customers on our marketplace, which we refer to as marketplace revenue. The suppliers on our platform offer a diversified and expanding mix of manufacturing processes.

The majority of our revenue is derived from the sale of part(s) and assemblies to our customers on our marketplace, which we refer to as marketplace revenue.

Product Development Product development costs that are not eligible for capitalization are expensed as incurred. This account also includes compensation expenses, including stock-based compensation expenses to our employees performing these functions and certain depreciation and amortization expense.

Product Development Product development costs that are not eligible for capitalization are expensed as incurred. This account also includes compensation expenses, including stock-based compensation expenses to our employees performing routine improvements and maintenance on our platforms not related to a specific capitalizable project, software costs and certain depreciation and amortization expense.

Additionally, in the event of a fundamental change, holders of the 2027 Notes may require us to repurchase all or a portion of the 2027 Notes at a price equal to 100% of the principal amount of 2027 Notes, plus any accrued and unpaid special interest, if any.

In the event of a fundamental change (as defined in the indenture governing the 2027 Notes), subject to certain conditions and limited exceptions, holders of the 2027 Notes may require us to repurchase all or a portion of the 2027 Notes at a price equal to 100% of the principal amount of 2027 Notes, plus accrued and unpaid interest.

As a percent of total revenue, operations and support expenses increased to 12.8% for the year ended December 31, 2022 from 10.8% for the year ended December 31, 2021.

As a percent of total revenue, operations and support expenses decreased to 10.8% for the year ended December 31, 2024 from 11.3% for the year ended December 31, 2023.

Gross margin for our supplier services improved to 82.7% for the year ended December 31, 2023, as compared to 77.9% for the year ended December 31, 2022. The increase in gross margin for supplier services is primarily due to a higher mix of marketing services revenue and the exit from the lower margin supplies business.

Gross margin for our supplier services increased to 89.0% for the year ended December 31, 2024 from 82.7% for the year ended December 31, 2023. The increase in gross margin for supplier services is primarily due to a higher mix of advertising and marketing services revenue and the exit from the lower margin tools and materials business.

Total cost of revenue from marketplace and supplier services for the year ended December 31, 2023 was $273.3 million and $11.9 million, respectively, as compared to $217.8 million and $17.2 million, respectively for the year ended December 31, 2022. Marketplace cost of revenue was driven by order growth and increased activity on our marketplace.

Total cost of revenue from marketplace and supplier services for the year ended December 31, 2024 was $323.4 million and $6.5 million, respectively, as compared to $273.3 million and $11.9 million, respectively, for the year ended December 31, 2023. Marketplace cost of revenue was driven by increased activity and growth on our marketplace which drove increased costs from our suppliers.

Our determination of the fair value of the intangible assets acquired involves the use of significant estimates and assumptions. Refer to our the “Business Combinations” disclosure below. We believe that the fair value assigned to the assets acquired and liabilities assumed are based on reasonable assumptions and estimates that a market participant would use.

We believe that the fair value assigned to the assets acquired and liabilities assumed are based on reasonable assumptions and estimates that a market participant would use.

Excluding the supplies business, Active Paying Suppliers on our platform remained flat year-over-year. 50 Adjusted EBITDA We define Adjusted EBITDA as net loss, adjusted for interest expense, interest and dividend income and other expenses, income tax provision (benefit), and certain other non-cash or non-recurring items impacting net loss from time to time, principally comprised of depreciation and amortization, amortization of lease intangible, stock-based compensation, charitable contributions of common stock, income from an unconsolidated joint venture, impairment of assets, lease abandonment, restructuring charges, costs to exit the supplies business and acquisition and other adjustments not reflective of our ongoing business, such as adjustments related to purchase accounting, the revaluation of contingent consideration and transaction costs.

The decline during the year ended December 31, 2024 is primarily due to our exit from the tools and materials business and the wind down of Thomas non-core services. 51 Adjusted EBITDA We define Adjusted EBITDA as net loss, adjusted for interest expense, interest and dividend income and other expenses, benefit for income taxes, and certain other non-cash or non-recurring items impacting net loss from time to time, principally comprised of depreciation and amortization, amortization of lease intangible, stock-based compensation, payroll tax expense related to stock-based compensation, lease abandonment, charitable contributions of common stock, income from an unconsolidated joint venture, impairment of assets, restructuring charges, costs to exit the tools and materials business and acquisition and other adjustments not reflective of our ongoing business, such as adjustments related to purchase accounting, the revaluation of contingent consideration, transaction costs and executive severance.

Interest and dividend income Interest and dividend income increased by $7.5 million, or 182%, from $4.1 million for the year ended December 31, 2022 to $11.6 million for the year ended December 31, 2023, primarily due to dividend income from our marketable securities.

Interest and dividend income Interest and dividend income decreased by $0.8 million, or 7%, from $11.6 million for the year ended December 31, 2023 to $10.8 million for the year ended December 31, 2024. Interest and dividend income is primarily due to dividend income from our marketable securities .

We expect product development expense to increase in absolute dollars in the future, though in the near-term product development expenses may fluctuate from period-to-period based on total revenue levels and the timing of our investments in our product development functions as these investments may vary in scope and scale over future periods. 54 General and Administrative General and administrative expenses primarily consist of compensation expenses, including stock-based compensation expenses, for executive, finance, legal and other administrative personnel, professional service fees and certain depreciation and amortization expense.

See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.” Interest and Dividend Income Interest and dividend income consists of interest and dividends on our cash, cash equivalents and marketable securities. Other Expenses Other expenses consist primarily of realized and/or unrealized losses on marketable securities, losses on the extinguishment of debt and other expenses.

Other Income (Expenses) Interest Expense Interest expense consists of interest incurred on our outstanding borrowings under our outstanding convertible notes or other borrowings. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.” Interest and Dividend Income Interest and dividend income consists of interest and dividends on our cash, cash equivalents and marketable securities.

The non-cash adjustments primarily relate to stock-based compensation of $19.2 million, depreciation and amortization of $7.8 million, $7.2 million reduction to our right of use lease assets and donated common stock of $2.3 million.

The non-cash adjustments primarily relate to stock-based compensation of $29.3 million, depreciation and amortization of $13.0 million and a $4.5 million reduction to our right of use lease assets.

We may not recognize benefits from these investments, and we may not effectively manage additional risks relating to operating outside the United States, including increased operational and regulatory risks. Expansion of Our Supplier Services In 2020, we launched financial services to help our suppliers manage their cash flow.

We empower suppliers to grow their manufacturing businesses and improve machine uptime by providing access to an extensive, diverse base of buyers. We also offer suppliers supporting products and services to meet their unique needs.

We empower suppliers to grow their manufacturing businesses and improve machine utilization by providing access to an extensive, diverse base of buyers. We also offer suppliers supporting products and services to meet their unique needs. The Thomasnet product sourcing and supplier discovery platform provides access to in-depth profiles of 500,000 North American suppliers.

The following table sets forth our statement of operations data for the years indicated: Year Ended December 31, 2023 2022 (in thousands) Revenue $ 463,406 $ 380,921 Cost of revenue 285,147 234,930 Gross profit 178,259 145,991 Operating expenses: Sales and marketing 93,688 84,371 Operations and support 52,372 48,628 Product development 34,462 31,013 General and administrative 70,916 58,246 Impairment of assets 397 824 Total operating expenses 251,835 223,082 Loss from operations (73,576 ) (77,091 ) Other income (expenses): Interest expense (4,784 ) (4,418 ) Interest and dividend income 11,607 4,115 Other expenses (1,511 ) (2,183 ) Income from unconsolidated joint venture 446 570 Total other income (expenses) 5,758 (1,916 ) Loss before income taxes (67,818 ) (79,007 ) Benefit (provision) for income taxes 353 (36 ) Net loss (67,465 ) (79,043 ) Net income attributable to noncontrolling interest 7 16 Net loss attributable to common stockholders $ (67,472 ) $ (79,059 ) 54 The following table sets forth our statement of operations data expressed as a percentage of total revenue for the years indicated: Year Ended December 31, 2023 2022 Revenue 100.0 % 100.0 % Cost of revenue 61.5 % 61.7 % Gross profit 38.5 % 38.3 % Operating expenses: Sales and marketing 20.2 % 22.1 % Operations and support 11.3 % 12.8 % Product development 7.4 % 8.1 % General and administrative 15.3 % 15.3 % Impairment of assets 0.1 % 0.2 % Total operating expenses 54.3 % 58.5 % Loss from operations (15.8 )% (20.2 )% Other income (expenses): Interest expense (1.0 )% (1.2 )% Interest and dividend income 2.5 % 1.1 % Other expenses (0.3 )% (0.6 )% Income from unconsolidated joint venture 0.1 % 0.1 % Total other income (expenses) 1.3 % (0.6 )% Loss before income taxes (14.5 )% (20.8 )% Benefit (provision) for income taxes 0.1 % — % Net loss (14.4 )% (20.8 )% Net income attributable to noncontrolling interest — % — % Net loss attributable to common stockholders (14.4 )% (20.8 )% The following tables present our disaggregated revenue and cost of revenue.

The following table sets forth our statement of operations data for the years indicated: Year Ended December 31, 2024 2023 (in thousands) Revenue $ 545,529 $ 463,406 Cost of revenue 329,905 285,147 Gross profit 215,624 178,259 Operating expenses: Sales and marketing 108,437 93,688 Operations and support 58,975 52,372 Product development 39,322 34,462 General and administrative 64,957 70,916 Impairment of assets 82 397 Total operating expenses 271,773 251,835 Loss from operations (56,149 ) (73,576 ) Other income (expenses): Interest expense (4,752 ) (4,784 ) Interest and dividend income 10,782 11,607 Other expenses (757 ) (1,511 ) Income from unconsolidated joint venture 452 446 Total other income 5,725 5,758 Loss before income taxes (50,424 ) (67,818 ) Benefit for income taxes 21 353 Net loss (50,403 ) (67,465 ) Net (loss) income attributable to noncontrolling interest (2 ) 7 Net loss attributable to common stockholders $ (50,401 ) $ (67,472 ) 55 The following table sets forth our statement of operations data expressed as a percentage of total revenue for the years indicated: Year Ended December 31, 2024 2023 Revenue 100.0 % 100.0 % Cost of revenue 60.5 % 61.5 % Gross profit 39.5 % 38.5 % Operating expenses: Sales and marketing 19.9 % 20.2 % Operations and support 10.8 % 11.3 % Product development 7.2 % 7.4 % General and administrative 11.9 % 15.3 % Impairment of assets — % 0.1 % Total operating expenses 49.8 % 54.3 % Loss from operations (10.3 )% (15.8 )% Other income (expenses): Interest expense (0.9 )% (1.0 )% Interest and dividend income 2.0 % 2.5 % Other expenses (0.1 )% (0.3 )% Income from unconsolidated joint venture 0.1 % 0.1 % Total other income 1.1 % 1.3 % Loss before income taxes (9.2 )% (14.5 )% Benefit for income taxes — % 0.1 % Net loss (9.2 )% (14.4 )% Net (loss) income attributable to noncontrolling interest — % — % Net loss attributable to common stockholders (9.2 )% (14.4 )% The following tables present our disaggregated revenue and cost of revenue.

Cash used by investing activities was $238.6 million during the year ended December 31, 2022, primarily due to the purchase of $284.1 million of marketable securities with proceeds from the 2027 Notes issuance and $13.7 million of purchases of property and equipment (which includes internal-use software development costs) offset by proceeds of $58.9 million from the sale of marketable securities.

Investing Activities Cash used in investing activities was $20.2 million during the year ended December 31, 2024, primarily due to the purchase of equity securities of $18.8 million and the purchase of property and equipment (which includes internal-use software development costs) of $18.1 million, offset by the proceeds from the sale of marketable securities of $16.5 million.

Operating Expenses Sales and Marketing Sales and marketing expense increased $9.3 million, or 11%, from $84.4 million for year ended December 31, 2022 to $93.7 million for the year ended December 31, 2023, the increase was primarily due to increases in commissions expense and additional sales and marketing employees and compensation costs, including stock-based compensation.

Operating Expenses Sales and Marketing Sales and marketing expense increased $14.7 million, or 16%, from $93.7 million for the year ended December 31, 2023 to $108.4 million for the year ended December 31, 2024, primarily due to additional sales and marketing employees and their compensation costs, including stock-based compensation and to a lesser extent advertising expense.

Impairment indicators may include any significant 64 changes in the manner of our use of the assets or the strategy of our overall business, certain restructuring initiatives, significant negative industry or economic trends and significant decline in our share price for a sustained period.

Impairment indicators may include any significant changes in the manner of our use of the assets or the strategy of our overall business, certain restructuring initiatives, significant negative industry or economic trends and significant decline in our share price for a sustained period. 61 When such events or changes in circumstances occur, we compare the carrying amounts of the asset or asset groups with their respective estimated undiscounted future cash flows.

Impairment of assets Impairment of assets decreased $0.4 million, or 52%, from $0.8 million for the year ended December 31, 2022 to $0.4 million for the year ended December 31, 2023. As a percent of total revenue, impairments of assets decreased to 0.1% for the year ended December 31, 2023 from 0.2% for the year ended December 31, 2022.

As a percent of total revenue, general and administrative expenses decreased to 11.9% for the year ended December 31, 2024 from 15.3% for the year ended December 31, 2023. Impairment of assets Impairment of assets decreased $0.3 million, or 79%, from $0.4 million for the year ended December 31, 2023 to $0.1 million for the year ended December 31, 2024.

If the asset or assets group are determined to be impaired, an impairment charge is recorded in the amount by which the carrying amount of the asset or assets group exceed their fair value. Business Combinations During the fourth quarter of 2021 and the first quarter of 2023, we acquired four businesses that we accounted for as business combinations.

If the asset or assets group are determined to be impaired, an impairment charge is recorded in the amount by which the carrying amount of the asset or assets group exceed their fair value.

Foreign Currency Exchange Risk Our U.S. revenue and costs are principally denominated in U.S. dollars and are not subject to foreign currency exchange risk. Our International operating segment generates revenue outside of the United States that is denominated in currencies other than the U.S. dollar. Our results of operations are impacted by changes in exchange rates.

Our International operating segment generates revenue outside of the United States that is denominated in currencies other than the U.S. dollar. Our results of operations are impacted by changes in exchange rates. Outside the U.S., our International operations generate approximately 16% of our revenues, of which a majority is generated in Euros.

These increases were offset by a reduction to our advertising costs. As a percent of total revenue, sales and marketing expenses decreased to 20.2% for the year ended December 31, 2023 from 22.1% for the year ended December 31, 2022.

As a percent of total revenue, sales and marketing expenses decreased to 19.9% for the year ended December 31, 2024 from 20.2% for the year ended December 31, 2023.

The 2027 Notes will mature on February 1, 2027 unless repurchased, redeemed, or converted in accordance with their terms prior to such date.

The 2027 Notes are unsecured obligations and bear regular interest at 1% per annum, payable on February 1 and August 1 of each year. The 2027 Notes will mature on February 1, 2027 unless repurchased, redeemed, or converted in accordance with their terms prior to such date.

Operations and Support Operations and support increased $3.7 million, or 8%, from $48.6 million for the year ended December 31, 2022 to $52.4 million for the year ended December 31, 2023, primarily due to hiring of additional operations and support employees and their compensation costs, including stock-based compensation, consulting costs and expenses incurred as part of the Company's restructuring and exit from the supplies business.

Operations and Support Operations and support expense increased $6.6 million, or 13%, from $52.4 million for the year ended December 31, 2023 to $59.0 million for the year ended December 31, 2024, primarily due to hiring of additional operations and support employees and their 57 compensation costs including stock-based compensation.

Other (Expenses) Income Interest Expense Interest expense increased by $0.4 million, or 8%, from $4.4 million for the year ended December 31, 2022 to $4.8 million for the year ended December 31, 2023, primarily as a result of the interest on the 2027 convertible notes issued in February 2022.

Other (Expenses) Income Interest Expense Interest expense remained flat at $4.8 million for the year ended December 31, 2024 and 2023. Interest expense is primarily due to the interest on the 2027 Notes issued in February 2022.

The decline during the quarter ended December 31, 2023 is due to our exit from the supplies business. Excluding the supplies business, Active Paying Suppliers on our platform remained flat year-over-year. Macroeconomic Conditions Unfavorable conditions in the economy both in the United States and abroad may negatively affect the growth of our business and our results of operations.

The decline during the year ended December 31, 2024 is primarily due to our exit from the tools and materials business and the wind down of Thomas non-core services. Macroeconomic Conditions Unfavorable conditions in the economy both in the United States and abroad may negatively affect the growth of our business and our results of operations.

The key drivers of Active Paying Suppliers are continued supplier engagement and the success of our strategy to attract new suppliers. The decline during the quarter ended December 31, 2023 is due to our exit from the supplies business.

The key drivers of Active Paying Suppliers are continued supplier engagement and the success of our strategy to attract new suppliers.

Revenue and cost of revenue is presented in the following tables for the years ended December 31, 2023 and 2022 (in thousands): For the Year Ended December 31, 2023 2022 Marketplace Revenue $ 394,754 $ 303,223 Cost of revenue 273,264 217,779 Gross Profit $ 121,490 $ 85,444 Gross Margin 30.8 % 28.2 % Supplier services Revenue $ 68,652 $ 77,698 Cost of revenue 11,883 17,151 Gross Profit $ 56,769 $ 60,547 Gross Margin 82.7 % 77.9 % 55 Comparison of the Years Ended December 31, 2023 and 2022 Revenue Total revenue increased $82.5 million, or 22%, from $380.9 million for the year ended December 31, 2022 to $463.4 million for the year ended December 31, 2023.

Revenue and cost of revenue is presented in the following tables for the years ended December 31, 2024 and 2023 (in thousands): For the Year Ended December 31, 2024 2023 Marketplace Revenue $ 485,946 $ 394,754 Cost of revenue 323,365 273,264 Gross Profit $ 162,581 $ 121,490 Gross Margin 33.5 % 30.8 % Supplier services Revenue $ 59,583 $ 68,652 Cost of revenue 6,540 11,883 Gross Profit $ 53,043 $ 56,769 Gross Margin 89.0 % 82.7 % 56 Comparison of the Years Ended December 31, 2024 and 2023 Revenue Total revenue increased $82.1 million, or 18%, from $463.4 million for the year ended December 31, 2023 to $545.5 million for the year ended December 31, 2024.

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