Good afternoon. Thank you for attending NUBURU, Inc.'s third quarter 2023 financial results conference call. All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end. I would now like to turn the conference over to your host, Ralf Esper, External Director of Investor Relations at Gateway Group. Thank you. You may proceed, Mr. Esper.
Thank you, operator, and thanks to everyone for joining us on NUBURU's third quarter 2023 earnings conference call. Joining the call today are Brian Knaley, NUBURU's Chief Executive Officer, and Ron Nicol, Executive Chairman, to discuss our third quarter results. During this call, certain statements we make will be forward-looking.
These statements are subject to risks and uncertainties, including those set forth in our safe harbor provisions for forward-looking statements that can be found at the end of our earnings release and also in our Form 10-Q that will be filed today and provide further details about the risks related to our business.
Additionally, except as required by law, we undertake no obligation to update any forward-looking statement. We will also provide non-GAAP information regarding certain of our historical and targeted results to supplement the results provided in accordance with GAAP.
This information should not be considered superior to or as a substitute for the comparable GAAP measures. Reconciliation of historical non-GAAP measures can be found in our third quarter earnings release, published this afternoon and posted on the investor relations section of our website at ir.nuburu.net. I will now turn the call over to Ron.
Thank you, Ralf, and thanks to everyone for joining us today for our third quarter 2023 earnings call. In light of recent corporate developments, I'd like to start today's discussion by reviewing the changes we've made to our executive management team to transition the company to its next stage of growth.
Following that, I will turn it over to Brian to discuss further operational updates, the financial results of the quarter, and our outyear objectives. At the halfway point of the year, the board of directors had very carefully assessed the current status of NUBURU. Our cutting-edge blue laser is at the forefront of technological advancements for manufacturing. Since the inception of NUBURU in 2015, our focus was on developing blue lasers to leverage fundamental physics and their high brightness, high power design.
I want to thank Mark Zediker for his tireless efforts over the past years to lay the foundations for the company's success. Looking forward, our primary objectives will revolve around three central elements: strengthening our commercial efforts, scaling our production, and streamlining our administrative functions. These actions are pivotable as we strive to not only ensure customer satisfaction, but also drive shareholder value growth as a public company.
As I step into my newly extended role as Executive Chairman, my key responsibilities will encompass offering strategic guidance during this transformative phase, as well as serving as a valuable resource to Brian in his new position as Chief Executive Officer, in addition to supporting the rest of our highly talented management team. Brian Knaley is an accomplished and respected leader with over 25 years of experience in scaling and operating public companies.
The board of directors and myself are confident in his abilities to lead NUBURU next phase of growth. I'll now turn the call over to Brian to update you on further operational highlights, discuss our third quarter performance and out-year strategic objectives. Brian?
Thanks, Ron. It's a great honor for me to lead NUBURU's next phase of growth as Chief Executive Officer. I want to thank the board of directors for their trust in me, and I'm looking forward to working with Ron, the board, and the excellent NUBURU team in this position as we continue to execute on the vast commercial opportunities that lay ahead of us.
Speaking of which, I would like to start today's operational update with two very recent exciting examples. Earlier today, we announced fantastic news regarding our work with GE Additive for the U.S. Air Force. The completion of the contract awarded by the U.S. Air Force follows our successful demonstration of blue laser-based area printing to develop scalable 3D printing manufacturing systems.
Achieving this first-ever milestone is critical to accelerate the implementation of blue laser technology into large-scale additive manufacturing systems for defense, aerospace, and several other critical markets. This announcement comes on the heels of a purchase order we've received from a major multinational electronics manufacturer with manufacturing capabilities across Asia, Latin America, Europe, and the U.S.
We are excited about the opportunity to deliver our industry-disrupting BL-250 for next-generation 3C device manufacturing. Our transformational blue laser technology will be utilized at the manufacturer in a research and development capacity to demonstrate the integration of its laser welding capabilities as an alternative to conventional soldering manufacturing techniques. As you can tell, there is no shortage of interest in our technology, and we are excited about the opportunities that lay ahead of us. But Q3 also came with challenges.
As mentioned on our second quarter earnings call, going into the second half of the year, we were cognizant that the supply chain conditions have presented bottlenecks in the procurement process for scanner components, in particular, the scanner and lens-related components, respectively, associated with our BL product line.
While we've seen such material constraints abate throughout the third quarter, largely attributable to our alternative sourcing initiatives that we have implemented, we have seen a clear impact on our ability to ship systems to our customers. During the third quarter, we were also confronted with additional headwinds from the integration of our systems into customer applications and subsequently experienced further delays in the shipment of our products.
For those unaware of our sales cycle, while we benefit from deep integration into our customers' manufacturing processes, we need to customize our solutions to specific applications of their end markets. I'm confident in the solutions that we have developed, not only will enhance our BL-250 product offerings, but also streamline the manufacturing process to improve the application and integration of our technologies within their respective end markets going forward.
Turning now to our third quarter results, further details on which can be found in our 10-Q that will be on file with the SEC. Our third quarter sales were $0.2 million, which is a 78% decrease compared to the third quarter of 2022, primarily due to a decrease in the number of laser system sales during the period as a result of the challenges I've described earlier.
Our gross profit was a $0.9 million loss, compared to a loss of $1.0 million in the third quarter of 2022, primarily attributable to a decrease in cost of revenue following a decrease in the production of laser systems as the company focuses on the manufacturing of the BL series and offset by the decrease in revenues.
Our gross margin was a -497%, compared to a gross margin of a -111% in the third quarter of 2022, primarily driven by decreasing revenue and partially offset by lower cost of revenues following the retirement of the AO series.
Total operating expenses in the third quarter of 2023 were $4.2 million, compared to $2.9 million in the third quarter of 2022. The increase is primarily attributable to increased costs associated with becoming and operating a public company. Further contributors to the increase were increased research and development, personnel expenses, and the addition of a new chief marketing and sales officer in March of 2023.
Our net loss was $5.1 million, or $0.14 per share, compared to a net loss of $3.9 million, or $0.71 per share in the third quarter of 2022. This is primarily related to the mentioned one-time expenses detailed previously.
Our EBITDA was negative $4.8 million, compared to negative $3.8 million in the third quarter of 2022. In the quarter, we had a free cash flow usage of $4.9 million, compared to a usage of $2.7 million, primarily attributable to decreasing revenue and an increase in total operating expenses.
And as of September thirtieth, 2023, the company had cash and cash equivalents of $1.6 million. Looking forward, I am pleased to tell you that we are very well positioned to have updates forthcoming regarding our short-term financing as well as longer-term solutions. We are not quite ready to announce at this point, but we will keep the market updated as we are on track to bolster our balance sheet.
With the anticipation of a rebound in deliveries of our laser systems during the fourth quarter of 2023, we have adjusted our full year 2023 outlook accordingly and are eagerly awaiting the positive impact of our technological improvements.
As such, we are revising our full year 2023 outlook for total revenue to $2.1 million, EBITDA to be in the range between of -$18 million and -$21 million, and free cash flow to be in the range of -$17 million and -$20 million. In closing, while quarter three was without challenges, we are, we are more than ever excited about the growth opportunity ahead of us.
With growing commercial interest for our technology-driven solutions, our market outlook remains robust, with momentum and revenue generation accelerating in 2024 and beyond as we roll out more of our BL and SM systems. Finally, we would like to thank our employees and our customers for their continued efforts and dedication to the company, which ultimately drives our success as an organization.
Together, we're focused on driving innovation, supporting the global transition to sustainable solutions, and delivering strong, profitable growth for our shareholders. We are entering a new phase as we transition toward the commercialization of our technology, and I hope you all are with us for the journey. I will now turn the call back over to the operator, who will assist us in taking your questions. Operator?
Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press the star followed by the one on your touchtone phone. You will hear a tone prompt acknowledging your request. Questions will be taken in the order received.
Should you wish to cancel your request, please press the star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. Once again, that is star one should you wish to ask a question. Your first question is from Ananda Baruah with Capital. Please ask your question.
Hey, yes, thanks, guys. Good afternoon. Appreciate it. Yeah, so a couple things. I jumped on. I have a few companies reporting this evening. I jumped on a few minutes late. Could you just talk through again, what—like, just the source of the...
And I apologize for really asking to hear this again. The source of the constraints and what it is. It sounds like you feel like you have your arms around it, but, and the things that are leading you to feel like you have your arms around it. Like, that context would be super helpful. Thanks.
Absolutely, Ananda. Thanks for the question. Appreciate it. As we said a little bit before, you know, and as we said in the second quarter, you know, summary. You know, we were experiencing supply chain restrictions on scanner and the ancillary type of support related to our peripherals in that supply chain.
So we were experiencing that coming out of the second quarter and into the third quarter here. We're seeing it abate a little bit. It really for two reasons. One, you know, looking for alternative solutions, and we have identified a few as we move through, as well as some of that shortfall or constraint is starting to abate. You know, some of those lead times have come down.
But again, that has not really happened until the end of the quarter.
Got it. And that's super helpful. And is there a sort of the genesis of the constraint? Is this just all market related, or is there anything that's sort of more specific than market related that-
Not specific to us. It's across, really across the market and in these critical peripherals.
Okay, awesome. Awesome. And this is more of a sort of high-level, a housekeeping question, I guess, but Brian, are you—I mean, are you guys looking for a standalone CFO as well, or what's the situation right now?
Absolutely, another. We're going to... We're actively looking for a CFO now. So, you know, my role will transition straight into the CEO role, and then, you know, bringing a good CFO coming into the company.
Okay. Okay, great. That's great to hear. And, I guess the last one for me for now is, can you remind us if the AO series retirement was that planned or is that some... Or was that a decision made intra-quarter to do that?
That was planned as we brought on the BL-250, you know, into 1 kW. That was planned to sunset.
Okay. Awesome. Just wanted to housekeep that. I appreciate it. Thanks, guys.
Thanks for the questions.
Thank you. Once again, please press star one should you wish to ask a question. There are no further questions at this time, sir. Please proceed.
Thank you, everybody, for joining the quarter three, NUBURU earnings call. We look forward to talking to you in the next quarter.
Thank you. Ladies and gentlemen, the conference has now ended. Thank you all for joining. You may all disconnect.