3D Systems Q2 2024 Financial Results
3D Systems Corporation, a leading additive manufacturing solutions provider, has released its financial results for the second quarter of 2024, ending June 30, 2024. The company reported a mixed performance with some areas of growth and others facing challenges.
Financial Highlights
For the second quarter of 2024, 3D Systems reported revenue of $113.3 million, marking a 10.1% increase quarter-over-quarter but an 11.7% decrease year-over-year. The decline was primarily attributed to lower printer sales, partially offset by growth in services. The gross profit margin improved to 41.6% from 39.0% in the same period last year, driven by a favorable product mix.
The company reported a net loss of $27.3 million, or $0.21 per diluted share, compared to a net loss of $28.9 million, or $0.22 per diluted share, in the same period last year. Non-GAAP diluted loss per share was $0.14, including approximately $2 million of transient fees related to the extended 2023 audit.
Adjusted EBITDA was negative $12.9 million, reflecting the impacts of lower total sales volume and higher operating expenses, primarily driven by 2023 audit-related costs.
Business and Operational Highlights
Revenue from Healthcare Solutions decreased by 19.7% to $48.9 million, primarily due to a decline in printer sales to a large orthodontics customer. However, the personalized health services business saw growth. Industrial Solutions revenue decreased by 4.4% to $64.4 million, with declines noted year-over-year in both hardware and materials but increasing on a consecutive quarter basis.
Gross profit margin for the second quarter was 41.6%, compared to 39.0% for the same period last year. Non-GAAP gross profit margin was 40.9%, up from 38.9% in the same period last year, primarily due to a favorable product mix.
Strategic Initiatives and Corporate Developments
3D Systems has updated its guidance for the remainder of FY 2024, now expecting full-year revenues within the range of $450 million to $460 million. The company anticipates continued sequential revenue improvements in the third and fourth quarters. Non-GAAP gross profit margin for the full year is expected to be within the range of 40% to 42%, and Non-GAAP operating expenses are projected to be less than $60 million for Q4 2024.
At the end of June 2024, the company had cash and cash equivalents of $192.7 million, a decrease of $138.8 million since December 31, 2023. This decrease was primarily due to cash used in operations, capital expenditures, and repayment on borrowings.
Management's Perspective
Dr. Jeffrey Graves, President and CEO of 3D Systems, commented, "We are encouraged by the sequential revenue progress we delivered during the second quarter despite a challenging operating environment. Our top-line improved 10% quarter-over-quarter, reflecting strong performance by our Industrial and Healthcare markets for hardware, materials, and services. While our second-quarter revenue saw a year-over-year decline, this was primarily due to reduced printer sales to a specific dental customer and ongoing macroeconomic pressures on customer capital spending."
Dr. Graves added, "Looking forward, we believe our in-sourcing and restructuring actions, which have favorably impacted our cost-of-goods this year, will continue to drive gross margin expansion moving forward. Additionally, we are beginning to demonstrate steady improvement with respect to our operating expenses, which should accelerate in the second half of the year."
Future Outlook
3D Systems has updated its financial guidance for the remainder of 2024, expecting full-year revenues within the range of $450 million to $460 million, with continued sequential revenue improvement in Q3 and Q4. The company also anticipates a Non-GAAP gross profit margin for the full year within the range of 40% to 42% and Non-GAAP operating expenses of less than $60 million for Q4 2024. Adjusted EBITDA is expected to be near break-even for Q4 2024.
SEC Filing: 3D SYSTEMS CORP [ DDD ] - 8-K - Aug. 29, 2024