Nov 4, 2015 | By Kira
At least we can’t say they didn’t warn us. Just under two weeks ago, 3D printer manufacturer Stratasys forewarned shareholders and investors that its upcoming third quarter earnings would fall dramatically short of expectations. Today, the company announced the official results, and the numbers are more or less as they feared. They’ve reported earnings of $167.6 million, as predicted, however their third quarter GAAP net loss soared to $983 million (or $18.06 per basic share), which the company attributes primarily to a $910 million write-down of troubled acquisition Makerbot as well as “increased uncertainty in the 3D printing environment.”
Putting these numbers into perspective, Stratasys’ revenue for the same period last year was $203 million, while their GAAP net loss was at only $31.3 million. For this period, their non-GAAP income was $0.7 million, compared to $30.1 million during the third quarter of 2014. The report also indicated that the company has sold 5,467 3D printing and additive manufacturing systems during the third quarter.
“Our third quarter results are a reflection of the difficult global macro-economic environment we have observed through the year that is negatively impacting most of our product lines,” said CEO David Reis. He said that the current market environment is characterized by weak investment in capital equipment and excess capacity—i.e. an increasing rise in competing consumer offerings—that followed a period of extraordinary growth for Stratasys and for the overall 3D printing industry in 2013-2014.
Additionally, given that the 3D printing market has matured and there are now many more offerings for consumers to evaluate (as well as HP’s upcoming entry to the 3D printing market, which customers are certainly waiting to judge), the sales cycles have lengthened. These factors, (along with MakerBot’s well-documented troubles,) are contributing to the increased uncertainty for consumers looking to invest in the 3D printing market.
The major question for investors, as for anyone interested in the 3D printing market, is whether or not Stratasys can pull through. According to the company, of course, the answer is yes. “Despite these near-term challenges, we continue to observe significant market potential, and remain confident in our long-term growth prospects,” said Reis.
To reinforce this position, for the fourth quarter of 2015, Stratasys projects revenue of $160 to $175 million, with a non GAAP loss in the range of $9 to $3 million (or 17 to 6 cents a share.) Stratasys also outlined its plans to turnaround and streamline operations for the future.
These plans include launching a new brand initiative that positions Stratasys as the leader in the 3D printing market; further developing their go-to-market strategies that focus on providing specialized expertise and tailored 3D printing solutions; and continuing the ongoing restructuring of MakerBot. Finally, Stratasys announced that they will be showcasing their additive manufacturing ecosystem at the Formnext 2015 exhibition in Frankfurt, Germany, taking place from November 17-20.
Stratasys held a conference call this morning to discuss its third quarter results. During the call, Reis confidently delivered what seems to be a solid future plan, while emphasizing that there is real growth ahead in rapid prototyping. All that remains is to wait and see how future entrants, such as HP, will disrupt the presently ‘uncertain’ market, and wether there will be enough demand to go around and keep Stratasys on its feet.
Posted in 3D Printer Company
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