US-based 3D printer manufacturer 3D Systems (NYSE: DDD) has released its financial results for the first quarter of 2024, revealing a significant revenue decline.
Reporting a revenue of $102.9 million, a 15.1% Y/Y decrease, from $121.2 million in Q1 2023, the company also experienced a 10.4% Q/Q decline from the previous quarter’s $114.8 million. This drop in revenue was primarily attributed to lower printer sales driven by ongoing macroeconomic pressures, partially offset by growth in materials and services.
Conversely, 3D Systems saw an improvement in its gross profit margin for Q1 2024, reaching 39.8%, a 2.5-point increase compared to 38.8% in Q1 2023. According to the company, this growth was mainly attributed to a favorable product mix.
Dr. Jeffrey Graves, President and CEO of 3D Systems, explained that the Q1 2024 report was delayed due to the extended 2023 audit, which resulted from the company’s switch to a new audit firm and the increased complexity stemming from the company’s growth. This transition led to higher costs and a longer audit process, raising operating expenses by approximately $5 million due to increased auditor and service fees.
However, when excluding these exceptional costs, first-quarter operating expenses decreased compared to both Q1 and Q4 2023, highlighting the early success of the company’s ongoing restructuring efforts.
He continued, “While the impacts associated with the 2023 filing will continue to create a short-term headwind through the third quarter, they will quickly abate and our restructuring initiatives then present a meaningful opportunity to reduce G&A costs by the end of the year. We believe the actions taken to date provide the framework for us to continue investing in mission-critical R&D while driving sustainable profitability in the bright future we see on the horizon ahead. We look forward to providing a comprehensive update on the first half performance and full-year expectations when we file our second quarter results next week.”
3D Systems’ detailed financial results
3D Systems reports its financials via two primary segments: healthcare and industrial. Both segments reported revenue decline as opposed to Q1 2023 and Q4 2023 results.
| Revenue ($) | Q1 2024 | Q1 2023 | Variance ($) thousands | % |
| Healthcare | 45.4M | 48.7M | -3.3M | -6.8% |
| Industrial | 57.5M | 72.5M | -15M | -20.7% |
| Total revenue | 102.9M | 121.2M | -18.3M | -15.1% |
The healthcare segment generated $45.4 million in revenue for Q1 2024, a 6.8% Y/Y decline from $48.7 million in Q1 2023 and down 11.3% from Q4 2023. Despite the drop in hardware sales, materials, and services performed well in this segment, bolstered by an established installed base.
3D Systems remains optimistic about future growth in its dental initiatives, thanks to a multi-year agreement with a major clear dental aligner provider. The company also highlighted over 9% growth in its Personalized Healthcare offerings, which is expected to present significant opportunities moving forward.
In the industrial segment, 3D Systems reported Q1 2024 revenue of $57.5 million, down 20.7% Y/Y from $72.5 million and a 9.6% sequential decrease from Q4 2023. The industrial segment has faced challenges due to a decline in capital spending, overshadowing strong performance in the aerospace and defense sectors.
The company also highlighted that interest in AM applications remained strong in early 2024, with several significant partnerships announced.
Previously, Italian additive manufacturing company WeAreAM added 3D Systems’ DMP Flex 350 Dual to its new Center of Excellence. This addition expanded WeAreAM’s capabilities across industries such as oil & gas, automotive, and aerospace. Gruppo Grazioli, 3D Systems’ partner in Italy, provided training and services to help WeAreAM maximize the new system’s benefits.
Two months later, industrial machining and metal 3D printing service provider Wilting announced the addition of three metal 3D printers from 3D Systems: two DMP Flex 350 and one DMP Flex 350 Dual. These new machines were acquired to meet increasing production demands and are dedicated to materials such as Titanium and Stainless Steel for 24/7 production. The collaboration with 3D Systems has enabled Wilting to optimize components for semiconductor equipment and expand into new markets.
Additionally, 3D Systems introduced a new solution for jetted, monolithic dentures using custom materials for teeth and gums. Including NextDent Jet Denture Teeth and NextDent Jet Denture Base, this new offering is designed to improve aesthetics, wear resistance, and production efficiency for dental labs.
Guidance for Q2 2024
For Q2 2024, 3D Systems expects revenues to fall between $113.0 million and $113.5 million, with continued sequential improvements anticipated throughout the remainder of the year.
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Featured image shows 3D Systems SLS 300 ecosystem. Photo by Michael Petch.
