Strong aerospace and rapid prototyping demand sees Materialise grow revenue 12% in Q3 2022

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Belgian 3D printing software and service provider Materialise (MTLS) has announced that its revenue rose 12% last quarter via the publication of its Q3 2022 financials. 

During the quarter, Materialise generated €58.3 million in revenue, which was flat against Q2 2022, but €6.1 million more than it managed to bring in over Q3 2021. On the firm’s earnings call, its CEO Fried Vancraen attributed this growth to the strong performance of its Manufacturing segment. With the division growing 14% through the period, the Belgian said its earnings will “exceed €100 million this year.”

“This result is a combination of reliable and profitable rapid prototyping activity in a mature market and growth of our certified manufacturing activities in selected vertical segments such as aerospace, netting, alternative drive systems and wearables,” added Vancraen. “In those, we are building on early proven and long-term scalable opportunities for additive manufacturing.”

Materialise's Metal Competence Center in Bremen, Germany. Photo via Materialise.
Materialise’s Metal Competence Center in Bremen, Germany. Photo via Materialise.

Materialise’s Q3 2022 financials 

As usual, Materialise has reported its Q3 2022 earnings results across three main segments: Software, Medical and Manufacturing. Having brought in €26.0 million, Manufacturing was the firm’s highest earning and fastest growing segment. This was primarily driven by the company’s core manufacturing business and growing adoption in automotive, which offset the inconsistent sales of new growth lines. 

Next up, performance-wise, was Medical, which generated €21.4 million, 13.2% more than it managed in Q3 2021. On the firm’s earnings call, CFO Johan Albrecht explained how the division was boosted by a 19% revenue rise from software and a 10% jump in medical device income, with overall software sales also up 32%. 

In terms of the company’s dedicated Software arm, this performed less well, generating €10.9 million, just a 3.8% increase on the €10.5 million reported in Q3 2021. Around 37% of Materialise’s sales in this area came from renewed licenses and deferred revenue, with income generated from non-recurring sales decreasing 12% over Q3 2022. 

While Materialise CO-AM was introduced earlier this year, a program being marketed as a cloud-based open-software platform with wide-ranging use cases, it’s still gaining traction among users. As such, Albrecht added that “it will take some time” to convert the positive feedback the firm has received about its CO-AM platform and its future applications into “significant sales growth.”

Revenue (€) Q2 2022Q3 2022 Difference (€) Difference (%) Q3 2021Q3 2022 Difference (€) Difference (%) 
Software 10.6m10.9m+0.3m+2.810.5m10.9m+0.4m+3.8
Medical 20.9m21.4m+0.5m+2.418.9m21.4m+2.5m+13.2
Manufacturing 26.6m26.0m-0.6m-2.322.8m26.0m+3.2m+14.0
Total 58.0m58.3m+0.3m+0.552.2m58.3m+6.1m+12.1

Aerospace and acquisition-led growth?

The growth of Materialise’s manufacturing division in Q3 2022 was boosted by a string of aerospace 3D printing projects. On its earnings call, Vancraen said the company has been “growing its customer base beyond its longstanding relation with Airbus.” In one such initiative, Materialise has begun producing 60 components for each of Atmos’ new series of aerial surveillance drones. 

The company also continues to integrate acquisitions into its business. With the technologies of RSscan and RSprint, for example, the firm has launched a new module for Materialise Motion, which can be used to develop CE-certified medical devices and insoles. According to Vancraen, the platform is “based on years of scientific research” into products that cater for specific foot pathologies. 

In healthcare, Materialise is working to increase its software install base among medical manufacturers and in point-of-care settings, while its surgical planning offering is being expanded to the cloud Mimics platform. With advanced tech usage also rising in clinical settings, Vancraen says his company is able to cater for both large firms and smaller ones preferring a “more out-of-the-box approach.”

To help protect the sensitive data shared as part of such healthcare applications, the firm has acquired security software Identfy3D as well. Moving forwards, Materialise plans to further integrate the software toolkit into CO-AM, in a way that allows users to configure and implement their own secure version of the platform.

“The tools of Identify3D are immediately compatible with the CO-AM platform we launched at Rapid,” explained Vancraen. “CO-AM will also accelerate our own manufacturing and medical production lines, and we will be proud to announce a new set of partnerships at Formnext with CO-AM. Multiple additive manufacturing software suppliers and machine OEMs are joining the platform.”

A physician measuring a patient's foot.
Materialise has launched a new foot scan suite for Materialise Motion. Photo via Materialise.

Materialise issues bold guidance 

Despite facing difficult macro-conditions heading into Q4 2022, Materialise has reiterated its FY 2022 guidance of “at least 10% growth” on the €205.5 million it brought in last year. In the Q&A session of the company’s call, Vancraen explained how supply issues have seen “people turn more to additive manufacturing.”

Consequently, the firm’s Founder said the “3D printing industry is also going to grow in the coming years,” while its in-house sustainability drive should help alleviate any energy cost rises it encounters.

Vancraen added that in its short-term activities such as rapid prototyping, Materialise is able to adjust its pricing to account for changes in material costs, giving it some flexibility to deal with headwinds. That said, he claimed this is “not really happening” at the moment, and the company continues to change these on a regular, pre-planned basis. 

“The revenue growth posted by each of our segments during the first nine months of this year strengthens our confidence that our full year 2022 revenues will be at least 10% higher,” concluded Peter Leys, Executive Chairman of Materialise. “While inflation and pressure on the labor market weigh on our results, we continue to make prudent investments in select growth businesses.”

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Featured image shows Materialise’s Metal Competence Center in Bremen, Germany. Photo via Materialise.