3D Systems Shocking Financial Results

3D System’s shocking 2017Q2 results

As is customary, 3D Systems announced their latest quarterly financial results and the results were quite shocking. 

The company reported revenue growth of only 1%, less than what was expected, and also posted a GAAP loss of USD$0.08 per share, double over the same quarter in 2016. Even their gross margin on sales dropped slightly, all negative signs. 

3D Systems’ Chief Vyomesh Joshi explained: 

We are pleased with the growth in production printers, materials, software and healthcare. However, we have work to do in the second half of this year to improve our execution across the company and position ourselves well for long term success and profitable growth in 2018 and beyond.    

That doesn’t sound good, does it? 

In fact, the stock market reacted surprisingly strongly, as 3D Systems’ stock price dropped more than 20% in the days after the announcement. Check the stock graph here to see the effect. This is not good, unless you see this as an opportunity to scoop up 3D Systems stock on the cheap, hoping for it to rise later. 

 3D Systems' stock price drops sharply!
3D Systems’ stock price drops sharply!

But that’s the thing here: 3D Systems went through a massive change after the departure of their previous CEO. With his departure followed significant changes in management, processes and even slicing off whole lines of business. 

The outcome was expected to be improvements to the financials after all this reshaping took place, with the new administration being in place now for almost a year and a half. 

However, these quarterly financial results do not reflect that outcome and it seems that the investment community has judged that 3D Systems is less capable of recovering than previously thought, hence the drop in their stock price. 

They are still, as measured by market capitalization (the total value of all shares) the largest dedicated 3D printer company on the planet, being slightly ahead of Stratasys. In order to maintain that position, they have some work to do. 

Via 3D Systems

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