Q4 & FY 2025 Q4 2025 Financial Highlights February 6, 2026 Forward-looking Statements and Non-GAAP Measures 2 • These slides may contain forward-looking statements. These statements relate to future events or to future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or imp ...

Revenue Performance - Record quarterly revenue of $136.5 million, a 12.1% increase year-over-year[1] - Record annual revenue of $533.1 million, a 6.4% increase year-over-year[1] - Total revenue for the three months ended December 31, 2025, was $136.493 million, a 12.1% increase from $121.750 million in the same period of 2024[22] - For the full year 2025, total revenue was $533.127 million, a 6.4% increase from $500.890 million in 2024[34] - The revenue growth in the United States for Q4 2025 was 15.9%, reaching $111.986 million, while Europe experienced a decline of 2.6%[34] Profitability - Net income for Q4 2025 was $6.0 million, or $0.25 per diluted share, compared to a net loss of $(0.4) million in Q4 2024[5] - Non-GAAP net income for Q4 2025 was $10.7 million, or $0.44 per diluted share, compared to $9.4 million, or $0.38 per diluted share in Q4 2024[5] - Net income for the twelve months ended December 31, 2025, was $21.241 million, compared to $16.593 million in 2024, reflecting a 28.0% year-over-year increase[24] - Non-GAAP net income for the twelve months ended December 31, 2025, was $40.200 million, slightly down from $41.168 million in 2024[25] - GAAP net income for Q4 2025 was $5.999 million, compared to a loss of $0.404 million in Q4 2024, resulting in a GAAP net income margin of 4.4%[32] Operating Metrics - Cash generated from operations was $74.5 million in 2025[5] - Operating expenses for the three months ended December 31, 2025, totaled $53.572 million, compared to $53.452 million in the same period of 2024[22] - The company reported a non-GAAP operating margin of 9.1% for Q4 2025, compared to 7.6% in Q4 2024[30] - Adjusted EBITDA for Q4 2025 was $19.939 million, with an adjusted EBITDA margin of 14.6%, up from $16.861 million and 13.8% in Q4 2024[32] Cash and Investments - Cash and investments balance was $142.4 million as of December 31, 2025[5] - Cash and cash equivalents at the end of the period were $110.826 million, up from $89.071 million at the beginning of the period[24] - The company invested $14.842 million in property, equipment, and other capital assets during the twelve months ended December 31, 2025[24] Customer Metrics - Customer contacts decreased to 19,621 in Q4 2025 from 21,558 in Q4 2024, while revenue per customer contact increased to $6,956 from $5,648[40] - The company reported a total of 48,415 customer contacts for the full year 2025, down from 51,552 in 2024[40] Future Outlook - Protolabs expects revenue growth between 6% and 8% in fiscal year 2026[12] - For Q1 2026, Protolabs expects revenue between $130.0 million and $138.0 million[12] - The company expects Q1 2026 GAAP diluted net income per share to be between $0.18 and $0.26, with non-GAAP diluted net income per share projected between $0.36 and $0.44[42] Segment Performance - CNC Machining revenue grew 25.0% year-over-year in Q4 2025[5] - The CNC Machining segment generated $65.496 million in revenue for Q4 2025, a significant increase from $52.389 million in Q4 2024[22] - The CNC Machining service line saw a revenue increase of 25.0% in Q4 2025, reaching $65.496 million compared to $52.389 million in Q4 2024[36] Gross Profit - Gross profit for the same period was $60.372 million, resulting in a gross margin of 44.2%, up from 42.7% in Q4 2024[28]

Core Insights - Proto Labs, Inc. reported strong momentum in Q4 2025, achieving accelerated growth, record revenue, and solid earnings [1] Financial Performance - The company closed 2025 with record revenue and solid earnings in the fourth quarter [1] - The financial results indicate a positive trajectory for the company as it heads into 2026 [1] Future Outlook - 2026 is highlighted as a pivotal year for transformation and acceleration for the company [1]

Group 1 - Proto Labs (PRLB) has pioneered the field of manufacturing-as-a-service, helping customers with on-demand manufacturing to avoid overstocking or shortages [1] - The company offers reduced lead time through rapid production and delivery, enhancing efficiency for its clients [1] - Design complexity is addressed by Proto Labs, allowing for more intricate designs in manufacturing processes [1] Group 2 - The investment focus is on growth companies, particularly in mid-cap segments, with an emphasis on sectors such as biotechnologies, computer chips, cloud technology, energy, and commodities [1] - A systematic balance sheet analysis will be conducted, as growing businesses often face challenges in funding [1] - Long-term capital appreciation is prioritized over short-term speculation, indicating a strategic investment approach [1]

Group 1 - Proto Labs (PRLB) has pioneered the field of manufacturing-as-a-service, helping customers with on-demand manufacturing to avoid overstocking or shortages [1] - The company offers reduced lead time through rapid production and delivery, as well as managing design complexity [1] Group 2 - The investment focus is on growth companies, particularly in mid-cap segments, with an emphasis on sectors such as biotechnologies, computer chips, cloud technology, energy, and commodities [1] - A systematic balance sheet analysis will be performed, as growing businesses often face funding challenges [1] - Long-term capital appreciation is preferred over short-term speculation [1]

Core Insights - Adecco Group anticipates an increase in hiring in 2026, driven by rising defense spending and a shift in companies from a wait-and-see approach to actively hiring new employees [1] Company Summary - The CEO of Adecco Group highlights that the expected upturn in hiring will be influenced by external factors such as increased defense budgets [1] - The staffing company is positioning itself to benefit from the changing dynamics in the labor market as companies begin to take on new workers [1]

Core Insights - The efficiency ratio serves as an indicator of a company's financial health, reflecting how effectively it utilizes its assets and liabilities internally [1] - Companies that have passed the screening process for efficiency ratios include Owlet (OWLT), Proto Labs (PRLB), and Las Vegas Sands (LVS) [1][8] Efficiency Ratios to Consider - **Receivables Turnover**: This ratio measures a company's ability to extend credit and collect debts, with a higher ratio indicating better performance [2] - **Asset Utilization**: This ratio assesses how well a company converts its assets into sales, with higher values suggesting greater efficiency [3] - **Inventory Turnover**: This ratio indicates a company's ability to manage inventory relative to its cost of goods sold, with higher values reflecting better inventory management [4] - **Operating Margin**: This ratio measures the efficiency of a company in controlling operating expenses, with higher values indicating better expense management [5] Screening Criteria - The screening process utilized efficiency ratios that are above industry averages, narrowing down a universe of over 7,906 stocks to 14 potential candidates [7] - A favorable Zacks Rank of 1 (Strong Buy) was also included in the screening criteria to enhance profitability [6] Top Stocks Identified - **Owlet (OWLT)**: Achieved a positive earnings surprise of 87.8% over the last four quarters, indicating strong performance [9] - **Proto Labs (PRLB)**: Known for its quick-turn custom parts manufacturing, with an average earnings surprise of 18.6% [10] - **Las Vegas Sands (LVS)**: Operates integrated resorts in the U.S. and Asia, with a 14.5% average earnings surprise [11]

Group 1 - Proto Labs (PRLB) is a notable stock in the Industrial Products sector, currently outperforming the sector with a year-to-date return of approximately 28% compared to the sector average of 5% [4] - The Zacks Rank for Proto Labs is 1 (Strong Buy), indicating a positive outlook based on earnings estimates and revisions [3] - The Zacks Consensus Estimate for PRLB's full-year earnings has increased by 6.5% over the past quarter, reflecting improved analyst sentiment [4] Group 2 - Proto Labs is part of the Rubber - Plastics industry, which is currently ranked 190 in the Zacks Industry Rank, with an average loss of 1.7% this year, further highlighting PRLB's strong performance [6] - Another stock in the Industrial Products sector, AB SKF (SKFRY), has a year-to-date return of 39.2% and also holds a Zacks Rank of 1 (Strong Buy) [5] - The Manufacturing - Tools & Related Products industry, to which AB SKF belongs, is ranked 45 and has seen a year-to-date increase of 1.9% [6]

Industry Overview - 3D Printing, also known as additive manufacturing, has transformed product design and production since its introduction in the 1980s, offering precision, customization, and efficiency [1] - The technology has evolved from a prototyping technique to a comprehensive manufacturing solution across various sectors, including healthcare, aerospace, automotive, and consumer goods [2][4] - Additive manufacturing reduces waste, allows for complex designs, and supports on-demand production, which is particularly advantageous for industries with fluctuating demand [3] Market Dynamics - North America holds over 35% of the 3D Printing market share, driven by strong R&D investments and advanced manufacturing infrastructure, while the Asia-Pacific region, led by China and India, is rapidly advancing in this field [5] - The adoption of 3D Printing is accelerating due to its cost-effectiveness, customization capabilities, and sustainability compared to traditional manufacturing methods [3] Key Players - Proto Labs is recognized as a leader in rapid prototyping and on-demand production, operating over 120 additive manufacturing machines and producing more than 250,000 parts monthly [7] - AMETEK specializes in high-performance metal powders for additive manufacturing, with a diverse range of alloys tailored for various processes [12][13] - ATI Additive Manufacturing offers comprehensive capabilities across the additive supply chain, focusing on both Electron Beam Melting and Direct Metal Laser Melting technologies [15][16] Recent Developments - Proto Labs has expanded its manufacturing capacity in response to rising demand for metal 3D-printed parts and introduced advanced technologies like Axtra3D Hybrid PhotoSynthesis [9][8] - AMETEK's acquisition of Faro Technologies for $920 million enhances its 3D metrology portfolio, complementing previous acquisitions to strengthen its precision scanning capabilities [14] - ATI has launched a state-of-the-art facility for additive manufacturing, integrating design, printing, and inspection processes to serve high-performance markets [17]

Core Insights - The article emphasizes the importance of efficiency ratios as indicators of a company's financial health and operational efficiency [1] Efficiency Ratios - **Receivables Turnover**: This ratio measures a company's ability to extend credit and collect debts, with a higher ratio indicating better performance [2] - **Asset Utilization**: This ratio assesses how effectively a company converts its assets into sales, with higher values suggesting greater efficiency [3] - **Inventory Turnover**: This ratio indicates a company's ability to manage inventory relative to its cost of goods sold, with higher values reflecting better inventory management [4] - **Operating Margin**: This ratio measures the efficiency of a company in controlling operating expenses relative to sales, with higher values indicating better expense management [5] Screening Criteria - The screening process identified stocks with efficiency ratios above industry averages, narrowing down from over 7,906 stocks to 11 [7] - Stocks that met Zacks' criteria for superior efficiency ratios and a Strong Buy rank include Indivior, Proto Labs, Las Vegas Sands, and Oceaneering International, all of which posted double-digit average earnings surprises [8] Company Profiles - **Indivior (INDV)**: A specialty pharmaceutical company focused on treatments for addiction and related conditions, with a four-quarter average positive earnings surprise of 68% [9] - **Proto Labs (PRLB)**: An online manufacturer of custom parts for prototyping, with an average four-quarter positive earnings surprise of 18.6% [10] - **Las Vegas Sands (LVS)**: A leading developer of integrated resorts, primarily in the U.S. and Asia, with a four-quarter average positive earnings surprise of 14.5% [11] - **Oceaneering International (OII)**: A supplier of offshore equipment and technology solutions to the energy sector, with a four-quarter average positive earnings surprise of 12.3% [12]