Dive Brief:

• Yelp alum James Miln is taking on the CFO seat for AI-powered manufacturing marketplace Xometry, effective Friday, the company announced Thursday in a press release.
• Miln, 50, will assume the finance chief role at the North Bethesda, Maryland-based company from James Rollo, who will step down as of March 1. Rallo will remain with the company to help ensure an effective transition up to 60 days from Friday, according to a filing with the Securities and Exchange Commission.
• “Xometry is a fast-growing technology company that is doing something no other company is — digitizing manufacturing, arguably the most important industry in the world,” Miln said in a statement emailed to CFO Dive. “As an executive of major tech and consumer brands, I see the incredible opportunity for Xometry to scale further and become the leading global marketplace that drives our buyers' and suppliers' businesses."

Dive Insight:

Miln is joining the company as a spotlight continues to shine on AI-powered tools and services. Xometry has utilized AI tools since its inception in 2013, offering an AI-powered marketplace for the on-demand manufacturing space to help match buyers and sellers. The marketplace offers instant quoting based on factors including location and material, according to a 2021 write up by Forbes following its initial public offering. 

The CFO swap came on the heels of Xometry’s fourth quarter and full year 2023 earnings results, also reported Thursday. Xometry reported gross profit of $178 million for the full year, a 22% increase year-over-year, and reduced its net loss by $12 million year-over-year to $67 million, according to its earnings release. 

Rallo is leaving the company after a four-year tenure at the organization. Joining in 2020, he “successfully executed our initial public offering, and helped drive growth and scale in our business, including expanding internationally,” Xometry co-founder and CEO Randy Altschuler said Thursday during the company’s earnings call.

Miln will take on the company’s CFO position after a five-year stint at review site Yelp, where he most recently served as SVP of finance and investor relations. He also served as its VP of financial planning and analysis and a term as its interim CFO, according to his LinkedIn profile. Before Yelp, he held executive and financial roles at eBay, Yahoo and Unilever.

As Xometry’s CFO, he will receive an annual base salary of $425,000, as well as a one-time sign-on bonus of $125,000, according to the SEC filing. Miln will also be eligible for an annual discretionary bonus of up to 65% of his base salary, and will receive an initial equity grant of restricted stock units with an aggregate value of $1.7 million.

Miln’s appointment will “help drive Xometry’s long-term growth and profitability,” according to a statement in the earnings release. The company posted record revenue and profit for its Q4 2023, with revenue for the quarter ending Dec. 31 rising 31% year-over-year to reach $128 million. It posted gross quarterly profit of $49.1 million, a 39% jump from the prior year period.

Xometry’s quarterly results come as investors continue to pay close attention to AI, with key players such as Google parent Alphabet and Microsoft jostling for the top spot in the emerging space. Last year, Xometry inked a partnership with Google to bring AI further into its auto quoting engine, and will continue to tap the technology to help improve its marketplace menu and functionality, Altschuler said Thursday.

While the company has seen “a softer start to the year as reflected in our outlook, we remain confident in our initiatives to drive long term profitable growth,” Altschuler said in a statement included in the earnings release. Xometry is continuing to experiment with AI applications, enabling it to “increase the breadth of what we can offer,” he said Thursday — with the company expecting “robust growth in 2024 and for many years to come.”

Economic headwinds are still blowing, however. The company was “taken aback” by weaker-than expected growth in January, Altschuler said in response to analyst questions, with the number of large orders slumping. While orders saw an uptick in February, “we just want to be prudent as we think about the guide for Q1 and beyond,” he said.

The slower growth in January came as people held back budgets, he said. Inflationary concerns have resurfaced in recent months, causing Federal Reserve policymakers to hang back from declaring victory in their fight against pricing pressures, CFO Dive previously reported. 

Taking that prudent mindset into account, Xometry is expecting similar trends throughout 2024. The company anticipates it will hit adjusted EBITDA profitability in the third quarter of 2024.

“Since underlying Marketplace metrics are healthy, we're going to continue to execute on our road map,” Altschuler said Thursday. “We will, of course, tightly control operating expenses as well as make strategic investments in technology and growth to help us achieve our long-term growth and operating margin goals.”

2024 growth will be boosted by growth initiatives such as its plans to expand its supplier and buyer networks and expanding its marketplace menu, according to the earnings release.