3D Printing Financials: 3D Systems Adjusts 2022 Guidance Range After Mixed Q1 Earnings Results
For a while, it seemed companies worldwide were recovering from a two-year hiatus due to the pandemic. But then 2022 turned out to be another year of uncertainties, driven primarily by raging inflation in the U.S. and Europe, coupled with the geopolitical developments, particularly between Ukraine, Russia, and now Finland. As a result, stock markets keep plunging into what many experts consider the brink of a bear market. With prolonged price declines that could last well into the second half of the year, it isn’t easy to anticipate what things will look like for the 3D printing industry’s public businesses by the year’s end. By now, we have seen many of them report mixed results when it came to first-quarter earnings for 2022, and 3D Systems (NYSE: DDD) is no different.
In fact, CEO Jeff Graves suggested in an earnings call with investors on May 10, 2022, that the business has been hard at work during the last two years to become fully organized into two core business units (healthcare and industrial solutions), but “the operating environment has been difficult and largely unpredictable.” This is probably reflected in the stock price of the last 12 months, as 3D Systems plunged 55.5% from $22.71 on May 17, 2021, to $10.10 today, after having navigated some pretty high share prices throughout the entire last year, with peaks near $50.
This year’s first quarter started with revenue of $133 million, a 9% decline compared to the same period last year, solely due to businesses divested during 2021. Still, the firm says that it grew 10% over the same period the previous year when excluding revenue from divestitures. Yet, compared to the fourth quarter of 2021, company revenue decreased 11.9% due to seasonality.
The strong divestiture-adjusted revenue growth is primarily attributed to increased product and service demand across both business segments. Adjusted for divestitures, revenue in the first quarter for healthcare increased by 4.6%, and industrial increased by 15.7% compared to the same period last year. According to Chief Financial Officer (CFO) Jagtar Narula, the rebound in industrial began in Q4 of 2020 and continued through 2021 and into the first quarter of 2022, making the fifth consecutive quarter of year-over-year organic growth in the industrial segment.

As for healthcare, Graves pointed out that management had anticipated stronger results at the beginning of the year, being driven in part by the introduction of 3D Systems’ new DMP 350 Dual, a high-productivity version of its well-proven metal printer, the DMP 350, which has been a mainstay for many of the brand’s healthcare customers in recent years. These customers are now qualifying the new dual laser system and updating their procurement plans to optimize their production workflow.
“These acceptance qualifications are proceeding very well,” said Graves. “We expect increasing sales of both our 350 platforms later this year. In addition, the Covid resurgence in the resulting postponement of optional elective procedures are particularly impactful in healthcare as certain customers delayed capital purchases and experienced lower-than-anticipated growth rates. Given the underlying fundamentals and customer feedback on market conditions, we expect these factors to lessen as we move through the year.”
Also, on the healthcare side, 3D Systems recently received a 510k clearance from the FDA for its new Virtual Surgical Planning or VSP Bolus solution. Designed for improved radiotherapy treatments for approximately 50% of patients diagnosed with cancer, the VSP Bolus helps target the radiation on the desired location during treatment and is customized to a patient’s specific anatomy and treatment plan. Graves said the company has begun marketing the bolus solutions with key customers and expects to see solid demand for this family of products in the future.
“This is one example of a broad trend in healthcare toward mass customization enabled through 3D printing of patient-specific solutions. It is the key growth driver for our healthcare business across all of our end markets,” described Graves.
In addition to the 510k for the new bolus product, 3D Systems applied for another 510k clearance for 3D printed peak polymers for craniomaxillofacial reconstruction via its recently acquired startup Kumovis one of the only medical 3D printing technology manufacturers with clean-room technology.

Overall, the firm reported net losses of $26.8 million or 21 cents per share, a steep downturn compared to 2021’s first-quarter net income of $45.2 million, or 37 cents per share. In addition, the company ended the quarter with $745.6 million of cash and short-term investments on hand, which declined by approximately $44 million since the end of the fourth quarter of 2021, primarily as a result of operating loss, higher inventory levels, advanced tax payments, investment in Enhatch, and cash payments related to net share settlements on stock-based compensation.
Graves said management is “reasonably pleased with the first-quarter results, especially given the macroeconomic conditions and ongoing geopolitical events.” Looking ahead, he expects the remaining quarters to be even stronger, following a pattern similar to the seasonality experienced last year. However, 3D Systems is narrowing its full-year 2022 guidance and now expects revenue to be within a range of $580 million and $625 million, a tightening of the range.
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.”
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