Sign in
3S

3D SYSTEMS CORP (DDD)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 revenue of $91.2M declined 19% YoY on lower volumes and Geomagic divest mix; non-GAAP diluted EPS was $(0.08) and adjusted EBITDA was $(10.8)M, with gross margin compressing to 32.3% as printer-heavy mix and the absence of a Q2 RegMed milestone weighed on profitability .
  • Versus S&P Global consensus, revenue modestly missed ($91.25M vs $93.04M*) while non-GAAP EPS modestly beat (−$0.08 vs −$0.085*); EBITDA missed (−$10.8M vs −$8.2M*), reflecting gross margin pressure despite OpEx progress .
  • Management guided Q4 revenue to grow sequentially by 8–10%, with gross margin and OpEx roughly flat q/q; CFO also targets Q4 OpEx marginally below Q3, with >$50M annualized savings on track by year-end .
  • Strategic catalysts: launch of jetted monolithic dentures in the U.S. (buildup underway; EU approval targeted mid-2026), new MJP 300W Plus printer for jewelry, software portfolio realignment (divestiture of Oqton/3DXpert to focus on 3D Sprint), and expanding A&D/AI infrastructure applications and Saudi NAMI momentum (including SEC investment and Lockheed collaboration) .

Note: Consensus figures marked with an asterisk (*) are Values retrieved from S&P Global.

What Went Well and What Went Wrong

  • What Went Well

    • Cost actions continuing to flow through: non-GAAP OpEx fell to $44.7M (−24% YoY ex-Geomagic) with >$50M annualized savings on track by year-end; management expects Q4 OpEx marginally below Q3 .
    • Healthcare MedTech and PHS remain growth engines; management reiterated double-digit growth for PHS in FY25 and highlighted accelerating adoption of printed PEEK implants and trauma as fastest-growing area .
    • New product momentum and pipeline: U.S. launch of jetted monolithic dentures with growing backlog; MJP 300W Plus introduced for jewelry (30% productivity, 20% lower material usage vs prior); A&D and AI infrastructure applications progressing .

  • What Went Wrong

    • Top-line softness persisted: revenue down 19% YoY to $91.2M, with Healthcare Solutions −22% and Industrial Solutions −16%; dental aligner demand remained a headwind .
    • Margin pressure: gross margin fell to 32.3% from 36.9% YoY and from 38.1% in Q2, driven by lower volumes, mix, manufacturing variances, and tariffs; EBITDA missed consensus .
    • Regenerative Medicine revenue declined sequentially after a Q2 LUNG milestone; management cited Q3 seasonal slowing and mix shift toward printers weighing margins near term .

Financial Results

MetricQ1 2025Q2 2025Q3 2025
Revenue ($M)$94.5 $94.8 $91.2
Gross Margin % (GAAP)34.6% 38.1% 32.3%
Diluted EPS (GAAP)$(0.28) $0.57 $(0.14)
Non-GAAP Diluted EPS$(0.21) $(0.07) $(0.08)
Adjusted EBITDA ($M)$(23.9) $(5.3) $(10.8)
Cash & Equivalents ($M)$135.0 $116.4 $95.5
Total Debt ($M)$212.3 $122.6 $122.6

Segment revenue

Segment Revenue ($M)Q1 2025Q2 2025Q3 2025
Healthcare Solutions$41.3 $45.0 $42.8
Industrial Solutions$53.2 $49.8 $48.5

Product vs Services mix

Revenue Mix ($M)Q1 2025Q2 2025Q3 2025
Products$54.7 $53.8 $52.3
Services$39.8 $41.0 $38.9
Gross Profit ($M)$32.7 $36.2 $29.4
Non-GAAP OpEx ($M)$61.6 $46.8 $44.7

Actual vs S&P Global consensus (Q3 2025)

MetricActualConsensus (S&P Global)*Surprise*
Revenue ($M)$91.249 $93.039*Miss $(1.79)M (−1.9%)*
Primary EPS (non-GAAP)$(0.08) $(0.085)*Beat $0.005*
Adjusted EBITDA ($M)$(10.78) $(8.17)*Miss $(2.61)M*

Note: Consensus figures marked with an asterisk (*) are Values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueQ4 2025None disclosedSequential +8% to +10% vs Q3Introduced
Gross MarginQ4 2025None disclosedStabilize; flat q/qMaintained/stable
Operating ExpensesQ4 2025None disclosedIn line with Q3; targeting marginally below Q3Lowered marginally
Cost Savings Run-RateYE 2025~$50M targetOn track to deliver >$50M annualized savings by YEReaffirmed/raised
CapExNext 1–2 yearsHistoric ~4% of sales (benchmark)“Meaningfully below” that; “probably less than half” over next couple yearsLowered

Earnings Call Themes & Trends

TopicQ1 2025 (Prev-2)Q2 2025 (Prev-1)Q3 2025 (Current)Trend
AI/Tech initiativesInvesting across metals/polymers; strong interest in new systems A&D apps scaling; process breadth across polymers/metals AI infrastructure focus (semicap, copper heat exchangers, turbine components) Improving
Supply chain/tariffs/macroCapex delays amid tariff risks; withdrew FY guide ~$1M tariff cost in Q2; offset by efficiencies Tariff headwinds persist; printer mix pressures GM near term Stabilizing headwind
Dental trendsMaterials stable; aligner inventory management headwind Dental down; aligner demand weak Dental stabilizing; denture launch/backlog building; EU approval mid-2026 targeted Stabilizing/Improving
Regenerative Medicine—$2M LUNG milestone in Q2 Sequential decline after milestone recognition Normalizing post-milestone
A&D/DefenseEarly strength; U.S./EMEA footprint A&D +84% YoY; +53% seq; >$30M annual rev run-rate Lockheed/NAMI collaborations; SEC invests; new contracts (USAF $7.65M) Strong momentum
Portfolio actions—Geomagic sale benefit; balance sheet actions Oqton/3DXpert divest; focus 3D Sprint & AI Streamlining

Management Commentary

  • CEO on outlook and mix: “We expect [sales] to increase sequentially by a range of 8% to 10% in the fourth quarter… driven by our Healthcare business, Industrial… and increased sales into consumer markets… Gross margins are also expected to stabilize… while [a] heavier mix of printers puts pressure on gross margins, it bodes well for future sales of consumables and services” .
  • CFO on discipline and priorities: “We remain focused on maintaining financial discipline, continuing to streamline our cost structure and strengthening our balance sheet” .
  • CEO on dentistry: “First to market… jetted monolithic dentures… We’ve already placed these printers with a dozen of the leading U.S. dental labs… backlog for the fourth quarter… [U.S. approved], targeting European regulatory approval… mid-2026” .
  • CEO on AI infrastructure and A&D: “We participate in semiconductor chip manufacturing… data centers… and gas turbine engines… [A&D] applications… from rocketry to naval… customers… encourage us… to support them from development through initial component fabrication” .

Q&A Highlights

  • Gross margin drivers: Q3 GM decline driven by absence of Q2 RegMed milestone (~$2M), manufacturing variances/scrap/slow-moving inventory cleanup; going forward, higher printer volumes offset by mix and steady tariff drag .
  • OpEx trajectory and break-even: Further OpEx reductions through H1’26; facilities exits paced by lease timing; $70M original target for cost takeout seen as enabling positive cash flow in a more normalized volume/mix environment .
  • Dental stabilization and denture opportunity: Aligner demand stabilizing; dentures seen as more non-discretionary, structurally growing with aging demographics; strong lab feedback; global regulatory expansion underway .
  • CapEx outlook: Historic benchmark ~4% of sales; for next couple of years “meaningfully below” that, “probably less than half” given prior investments and low capital intensity .
  • NAMI/Defense traction: SEC’s 30% investment in NAMI and Lockheed collaboration expected to accelerate local manufacturing workflows and A&D component adoption in Saudi Arabia .

Estimates Context

  • Q3 actuals vs S&P Global consensus: revenue $91.25M vs $93.04M* (slight miss), Primary EPS −$0.08 vs −$0.085* (modest beat), adjusted EBITDA −$10.8M vs −$8.2M* (miss) .
  • Implications: The small revenue miss plus EBITDA shortfall reflect lower GM from mix/variances and lack of Q2 milestone; with Q4 guided +8–10% q/q and GM stable, models may shift near-term EBITDA lower but raise Q4 revenue sequentially, while leaving FY25 narrative anchored on cost-out and printer-to-materials pull-through mix over time .

Note: Consensus figures marked with an asterisk (*) are Values retrieved from S&P Global.

Key Takeaways for Investors

  • Revenue softness continued (−19% YoY) but Q4 guided +8–10% sequentially; watch order momentum in dental dentures, A&D, and consumer channels into year-end .
  • Margins under pressure near term from printer-heavy mix and tariffs; management expects GM stabilization q/q as volumes lift, with consumables pull-through supporting future margin recovery .
  • Execution on cost program is tangible: non-GAAP OpEx down to $44.7M; Q4 OpEx targeted marginally below Q3; >$50M annualized savings by YE in sight .
  • Strategic focus sharpened: divesting Oqton/3DXpert to concentrate on 3D Sprint and core hardware/materials; potential to broaden ecosystem via partnership model .
  • Healthcare: PHS double-digit FY growth outlook intact; printed PEEK implants and denture rollout present multi-year growth vectors (EU denture approval targeted mid-2026) .
  • Industrial: Jewelry MJP 300W Plus and A&D/AI infrastructure applications provide diversified growth avenues; NAMI/SEC/Lockheed relationships underpin international A&D opportunity .
  • Balance sheet/liquidity: $95.5M cash and $122.6M debt at Q3; maturities laddered to 2026/2030; CapEx expected “meaningfully below” historical 4% of sales for the next couple of years .