3D Systems 2025 Q1 Earnings Misses Targets as Net Income Declines 129.7%

3D Systems (DDD) reported its fiscal 2025 Q1 earnings on May 12th, 2025. The company's results fell short of analyst expectations, with a revenue decline of 8% to $94.5 million, missing the anticipated $99.46 million mark. Additionally, the firm withdrew its full-year guidance due to anticipated prolonged weakness in customer capital expenditures. Despite the challenging environment, 3D Systems is focusing on aligning its organizational capacity with current demand, emphasizing its strengthened product portfolio for future growth as market conditions improve.

Revenue
3D Systems reported a total revenue of $94.54 million in 2025 Q1, representing an 8.1% decrease from the previous year's Q1 revenue of $102.91 million. The Healthcare Solutions segment contributed $41.32 million, while Industrial Solutions added $53.22 million to the quarterly earnings. The decline primarily reflects challenges in materials sales, with growth in services and hardware systems partly offsetting the downturn.

Earnings/Net Income
3D Systems deepened its losses, recording a $0.28 per share loss, widening from the $0.12 per share loss in 2024 Q1. The net loss for the quarter increased to $-36.99 million from $-16.10 million, marking a 129.7% increase. The significant widening of losses indicates ongoing financial difficulties.

Price Action
The stock price of 3D Systems has climbed 3.24% during the latest trading day, surged 27.50% during the most recent full trading week, and increased 22.60% month-to-date.

Post-Earnings Price Action Review
The strategy of buying DDD when revenues miss expectations and holding for 30 days aligns with a bearish outlook, reflecting current negative sentiment surrounding 3D Systems. This approach assumes that the stock price will not significantly improve in the short term due to ongoing revenue challenges and guidance withdrawal. The recent revenue miss marks a continuation of a trend where the company has not met consensus estimates, raising concerns about its financial performance and market position. The withdrawal of full-year guidance due to uncertainties in customer capital spending further indicates a lack of visibility in future revenue growth. Analysts have set a low average one-year price target of $3.17, suggesting limited upside potential from the current price of $2.55. Despite revenue challenges, 3D Systems has strengthened its financial position with increased cash reserves from the Geomagic portfolio sale, focusing on cost-saving initiatives to navigate the current market conditions.

CEO Commentary
Dr. Jeffrey Graves, CEO of 3D Systems, noted ongoing challenges in revenue generation as customer capital investments are delayed due to uncertainties surrounding tariffs and macroeconomic conditions. Although there was growth in new printer sales, it was affected by these delays. The company experienced significant growth in its Personalized Healthcare and manufacturing operations, driven by a robust technology portfolio. Despite margin pressures, operating expenses improved by $5 million year-over-year due to cost reduction initiatives. The CEO expressed cautious optimism regarding the company's strategic positioning in high-reliability markets and the potential for future growth as customer spending rebounds.

Guidance
The company has withdrawn its full-year guidance due to anticipated prolonged weakness in customer capital expenditures, prioritizing profitability at its current scale. Additional cost reduction actions are expected to yield $20 million in savings for 2025. While maintaining a conservative view on revenue expectations, 3D Systems remains focused on aligning its organizational capacity to the current demand environment, with an emphasis on leveraging its strengthened product portfolio for future growth as market conditions improve.

Additional News
3D Systems has recently completed the sale of its Geomagic software portfolio, resulting in more than $100 million post-tax increase to cash reserves, significantly strengthening the balance sheet. The company announced additional cost reduction initiatives estimated to deliver $20 million in savings for 2025, aligning organizational capacity with current market conditions. Furthermore, 3D Systems has collaborated with the University Hospital Basel to enable world's first facial implant manufacturing at point-of-care, showcasing its innovative capabilities in healthcare solutions.