3D Systems DDD reported a non-GAAP loss of 12 cents per share in third-quarter 2024, wider than the Zacks Consensus Estimate of a loss of 9 cents. The bottom-line results also compared unfavorably with the year-ago quarter’s earnings of a penny.
The disappointing quarterly performance has turned investors cautious about the company’s prospects. Shares of 3D Systems traded 14.4% lower in the pre-market session today. The stock has plunged 46.3% against the Zacks Computer and Technology sector’s rise of 27.6% in the year-to-date period.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
DDD reported revenues of $112.9 million for the third quarter of 2024, down 8.8% year over year. The top line also missed the Zacks Consensus Estimate of $120 million.
3D Systems Corporation Price, Consensus and EPS Surprise
3D Systems Corporation price-consensus-eps-surprise-chart | 3D Systems Corporation Quote
The decline was primarily attributed to reduced printer sales, led by macroeconomic challenges impacting hardware demand. However, this was partially offset by growth in consumables sales.
Product revenues declined 9.3% year over year to $73 million in the third quarter, contributing 64.6% to total revenues.
Services revenues, which accounted for 35.4% of total revenues, declined 7.8% year over year to $40 million.
DDD’s Quarterly Details
Based on the industry verticals it serves, the company operates through two reportable segments — Healthcare Solutions and Industrial Solutions. Healthcare Solutions encompasses dental, medical devices, personalized health services and regenerative medicine, whereas Industrial Solutions covers aerospace, defense, transportation and general manufacturing.
In the third quarter, Healthcare revenues rose 5% year over year to $55.1 million, led by strong growth in Dental and Personalized Healthcare solutions.
The Industrial Division’s revenues fell 18.9% year over year to $57.9 million. However, customer interest in 3D printing applications has continued to gain momentum, with revenues in the Application Innovation Group growing 26% year over year, particularly across the industrial markets.
3D Systems’ non-GAAP gross profit fell 23.4% year over year to $42.5 million. The non-GAAP gross profit margin declined 720 basis points to 37.6% due to unfavorable absorption associated with lower volumes and higher inventory reserve provisions.
Adjusted EBITDA fell $19.1 million year over year to a loss of $14.3 million in the third quarter. The downside in adjusted EBITDA primarily reflects decreased revenues, a lower gross margin and increased operating expenses.
3D Systems’ Balance Sheet
As of Sept. 30, 2024, cash and cash equivalents were $190 million, lower than $192.7 million as of June 30, 2024.
As of Sept. 30, 2024, DDD had a total debt of $211.7 million, up from $211.4 million as of June 30, 2024.
DDD’s 2024 Guidance
For 2024, the company expects revenues between $440 million and $450 million.
The non-GAAP gross profit margin for 2024 is likely to be 38-40%.
Zacks Rank & Stocks to Consider
Currently, 3D Systems carries a Zacks Rank #3 (Hold).
Broadcom AVGO, Guidewire Software GWRE and Workday WDAY are some better-ranked stocks that investors can consider in the broader sector.
Broadcom, Guidewire Software and Workday currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Broadcom’s shares have soared 47.6% year to date. AVGO is scheduled to release fourth-quarter fiscal 2024 results on Dec. 12.
Guidewire Software’s shares have surged 87.6% year to date. GWRE is scheduled to release first-quarter fiscal 2025 results on Dec. 05.
Workday’s shares have lost 11.6% year to date. WDAY is set to report third-quarter fiscal 2025 results on Nov. 26.
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