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3D Systems Q1 2022 revenues decline 9% as a result of divestitures

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AM industry leader 3D Systems Q1 2022 revenue of $133.0 million declined 9.0% compared to Q1 2021 driven solely by divestitures of non-core assets. Adjusted for divestitures, revenue increased 10% compared to Q1 2021, reflecting continued strength in both the Industrial and Healthcare Solutions segments. Adjusted EBITDA margin(1) of 1.4% reflects continued investments in growth areas of our business and product portfolio, combined with seasonally lower revenue.

Commenting on the results, President and CEO, Dr. Jeffrey Graves said, “I’m pleased that, despite its many challenges, including significant supply-chain pressures, heightened inflation, the ongoing pandemic, and geopolitical tensions arising from the Russian invasion of Ukraine, we experienced continued strong demand for our products and services throughout the first quarter. Because we believe that this demand, driven by new production applications of additive technology will be sustained, we are continuing to invest heavily in new product development, along with improvements in our core infrastructure that are necessary to support sustained double-digit organic growth in the years ahead.”

Compared to the fourth quarter of 2021, 3D Systems Q1 2022 revenue decreased 11.9% due to seasonality in the business. Industrial revenue decreased  6.6% to $68.7 million compared to the same period last year, however, when adjusted for divestitures, Industrial revenue increased 15.7% year over year. Healthcare revenue decreased 11.3% year-over-year to $64.3 million, compared to the same period last year.  Adjusted for divestitures, Healthcare revenue increased 4.6% year-over-year.

3D Systems Q1 2022 revenues decrease by 9% as a result of divestitures. Adjusted for divestitures, revenue increased 10% compared to Q1 2021Dr. Graves continued, “With our organization now fully centered on our two business units, Healthcare and Industrial Solutions, we are focused on offering the strongest and most complete portfolio of additive manufacturing technologies, brought together with the most knowledgeable and creative engineering teams, to solve the most valuable production application needs of our customers. The effectiveness of this approach, which differentiates us in our industry, was demonstrated in the first quarter with revenue growth in our core businesses of 10% when adjusted for divestitures. This growth was led by our Industrial Solutions business, which delivered over 15% revenue growth year-over-year when adjusted for divestitures, reflecting the increased adoption of additive solutions in production environments across the world’s manufacturing community.  Additionally, we also experienced solid revenue growth within our Healthcare segment when adjusted for divestitures, albeit at a slower pace due to supply chain disruptions and the impact of a new product introduction.”

Dr. Graves summarized, “As we now move fully into 2022, there are clear challenges that all companies are facing, the duration of which is unknown. However, I am very encouraged by the resiliency of demand that we continue to see for new production applications of additive manufacturing, driven in part by these same challenges, in combination with the success customers are experiencing as they increasingly move toward full implementation in production-scale environments. With our industry-leading breadth of technology solutions and application expertise, I believe we are well-positioned to meet our customers’ needs and create value for all of our stakeholders.”

3D Systems is narrowing its full-year 2022 guidance. The company now expects revenue to be within a range of $580 million and $625 million. The company expects non-GAAP gross margins to be between 40% to 43%. Given the company’s planned investment profile, the company now expects non-GAAP operating expenses to be between $235 million and $250 million. This 2022 guidance assumes no significant changes in macroeconomic events that could negatively impact our business, such as COVID-19, geopolitical events, or other factors that could impact either demand or disrupt our supply chain. On March 31, 2022, the company had cash and short-term investments on hand of $745.6 million.

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