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US-based 3D printer manufacturer 3D Systems has announced its financial results for Q2 2024, highlighting a Y/Y revenue decline alongside Q/Q revenue growth. A delay in the publication of previous results was attributed to a change in the audit firm.
In Q2 2024, 3D Systems’ revenue stood at $113.3 million, reflecting an 11.7% decline Y/Y compared to $128.1 million in Q2 2023. Despite this drop, the company saw a sequential Q/Q increase of 10.1% from Q1 2024’s revenue of $102.9 million. This Y/Y decline was largely attributed to a fall in software printer sales, with materials remaining flat and services providing partial offset growth.
Similar to the previous quarter, 3D Systems reported improved gross margin. This was 41.6% for Q2 2024, up by 2.6 pts compared to 39.0% in Q2’23.
Dr. Jeffrey Graves, President and CEO of 3D Systems said, “We are encouraged by the sequential revenue progress we delivered during the second quarter despite a challenging operating environment. Our top-line improved 10% quarter-over-quarter, reflecting strong performance by our Industrial and Healthcare markets for hardware, materials, and services.”
Q/Q growth amid market challenges
3D Systems’ Q2 2024 financial performance was affected by higher operational expenses due to the extended 2023 audit, with normalization expected by Q4 2024. Printer hardware sales were weak in Q1, driven by inflation, interest rates, and geopolitical tensions, but Q2 showed a 10% sequential sales growth, with further improvement anticipated in Q3 and Q4.
Despite these conditions, the demand for 3D Systems’ consumables and services remained strong, particularly in the healthcare and industrial sectors.
| Revenue ($) | Q2 2024 | Q2 2023 | Variance ($) thousands | % |
| Healthcare | 48.9M | 60.9M | -12M | -19.7% |
| Industrial | 64.4M | 67.3M | -2.9M | -4.3% |
| Total revenue | 113.3M | 128.2M | -14.9M | -11.7% |
Healthcare revenue for Q2 2024 was $48.9 million, down 19.7% Y/Y from $60.9 million but up 7.7% Q/Q from $45.4 million in Q1 2024. Additionally, revenue for the first half of 2024 was $94 million, reflecting a 14.2% decrease compared to $109.6 million in the first half of 2023.
Reduced printer sales primarily drove the decline in healthcare sector revenue, as customers cut back on capital expenditures due to macroeconomic factors like high inflation and rising interest rates.
However, strong performance in materials and services partially offset the drop, with service growth supporting future demand for printers and consumables. The company expects Y/Y comparisons to improve in Q3 2024, driven by its long-term clear aligner supply agreement and growth in orthopedic applications.
Meanwhile, in the industrial sector, 3D Systems saw revenue of $64.4 million for Q2 2024, down 4.3% Y/Y from $67.3 million but up 12% Q/Q from $57.5 million in Q1 2024. Revenue for the first half of 2024 was $122 million, representing a 12.7% decline compared to $139.8 million in the first half of 2023. As per 3D Systems, the industrial sector has been slower to recover, with service growth helping to offset declines in printer and material sales.
Regardless of strong demand from the semiconductor, aerospace, and defense industries, these gains were not enough to counterbalance the overall decline in hardware and materials sales across other markets.
3D Systems eyes growth through new contracts and launch
In addition to the results, the company also noted increasing interest in 3D printing from high-volume industries such as medical, and electrical manufacturing, among others.
This year in June, 3D Systems’ stock jumped 19% to $4.11 after announcing a $250 million contract to produce clear dental aligners over five years. Despite being down 46% for the year, the company plans to launch direct aligner printing technology by 2025 and expand its dental portfolio, aiming to provide cost-effective solutions for dental patients.
Moreover, Saudi Arabia-based AM service provider National Additive Manufacturing & Innovation (NAMI) company has acquired multiple metal and polymer 3D printers from 3D Systems to produce parts for the Saudi Electricity Company (SEC), aiming to create an efficient, localized supply chain.
This deal will support SEC, the largest energy producer in the Middle East, by reducing production time and costs with 3D printing. NAMI’s collaboration with SEC aligns with Saudi Arabia’s Vision 2030, which aims to build localized manufacturing capabilities and reduce reliance on oil, focusing on defense, energy, and manufacturing sectors.
Elsewhere, at RAPID + TCT 2024, 3D Systems introduced the EXT 800 Titan Pellet 3D printer, targeting large-format production with affordability and scalability. Designed for prototyping, tooling, and end-use parts, this machine offers cost savings through pellet-based materials.
Capable of producing tens of thousands of parts, it addresses challenges like supply chain issues and sustainability. The EXT 800 is suited for industries such as furniture, metal casting, and more, reflecting 3D Systems’ focus on distributed manufacturing and flexible, on-demand production.
Guidance for FY 2024
Due to ongoing macroeconomic and geopolitical conditions, 3D Systems has updated its financial outlook for the remainder of 2024. The company now projects full-year revenue to fall between $450 million and $460 million, with sequential growth expected in both the third and fourth quarters.
The Non-GAAP gross profit margin for 2024 is anticipated to range between 40% and 42%. Additionally, non-GAAP operating expenses are forecasted to be under $60 million for Q4, with total annual expenses estimated to be between $248 million and $253 million.
The company also expects adjusted EBITDA to approach break-even by the fourth quarter of 2024.
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Featured image shows 3D Systems’ new EXT 800 Titan Pellet 3D printer. Photo by 3D Printing Industry.
