Proto Labs, Inc.

Second quarter revenue was a company record $149.3 million, up 10.2% year over year in constant currencies. U.S. revenue grew 10.9% and Europe grew 7.3% in constant currencies; CNC Machining revenue grew 13.1%, Injection Molding grew 12.9%, 3D printing declined 2.7%, and sheet metal grew 3.5%. Non-GAAP gross margin was 46.8%, up 200 basis points year over year, and adjusted EBITDA was $25.1 million, or 16.8% of revenue, versus $19.7 million, or 14.6%, in Q2 2025. Non-GAAP EPS was $0.60, up $0.19 or 45% year over year. Cash from operations was $15.4 million, the company repurchased $5 million of stock, and it ended the quarter with $162.9 million of cash and investments and no debt. For Q3 2026, management expects revenue of $145 million to $153 million and non-GAAP EPS of $0.56 to $0.64. Full-year 2026 revenue growth guidance was raised to 8% to 10% year over year.

Suresh Krishna framed the quarter as proof that Proto Labs' transformation is starting to show up in the numbers, with record revenue, margin expansion and stronger engagement from larger customers. He emphasized a strategy centered on elevating customer experience, reigniting innovation, expanding into production, and driving operational efficiency. He also pointed to Europe's restructuring, AI/"physical AI" investments, and the company's growing role in faster-moving end markets like aerospace, defense, robotics and data centers as key parts of the long-term story.

Dan Schumacher focused on the financial upside from the quarter: revenue of $149.3 million, gross margin of 46.8%, adjusted EBITDA of $25.1 million, and EPS of $0.60. He noted adjusted operating expenses were $52 million, or 34.8% of revenue, helped by targeted cost reductions in Europe and the U.S., while cash from operations reached $15.4 million and the company bought back $5 million of stock. He said Q3 gross margin and SG&A should be slightly lower sequentially, and that the company ended June with $162.9 million of cash and investments and no debt.

Analysts pressed on the split between factory and network, new-customer trends, AI use cases, SG&A, and whether production capabilities could be expanded organically or through M&A. Management said network revenue was flat and network gross margin was 33.6%, while the customer experience changes in Europe and broader friction reduction were helping both retention and new-customer acquisition. On M&A, Dan said there is a healthy pipeline and that opportunities would be aimed at adding production-type applications within existing services; on AI, Suresh pointed to the company's 15 million-plus CAD files, homegrown MES software, and uses in pricing, instant quoting, design for manufacturability, sourcing, and speed. They also said aerospace and defense was about 25% of revenue and that Europe remains a medium-term profitability fix rather than a quick turnaround.