Stratasys (SSYS) Reports In Line Earnings, Pulls 2015 Guidance On Uncertainties, Stock Tanks
It’s that time of year again, earnings season for the majority of the larger 3D printing companies listed on US exchanges. To kick things off, Stratasys (NASDAQ:SSYS) was the first to report their second quarter financial results only moments ago. The company, who has seen their shares drop by close to 75% over the last eight months, certainly could use some positive news to brighten the outlook of investors after lawsuits, poor earnings growth, particularly from their MakerBot unit, and a general decline within the 3D printing sector has all led to these recent shortcomings.
While analysts had been expecting $0.15 per share on approximately $183 million in revenue, the company has reported numbers which are pretty much in line with these expectations. Revenue for the second quarter came in at $182.3 million compared to $178.5 million for the same quarter last year. Additionally, earnings per share matched the $0.15 that analysts had been expecting.
“The merger between Stratasys and Objet in 2012 created synergies that combined with the heightened level of mainstream media attention within our industry, have contributed to a period of extraordinary growth for our company and industry over the past two years,” said David Reis, chief executive officer of Stratasys. “We believe our industry is transitioning through a period of slower growth, as users digest their investments in 3D printing and expand the utilization of recently acquired capacity. Despite these headwinds, and certain ongoing macroeconomic challenges in Asia, we are encouraged by sequential improvement in areas of our business, and remain optimistic about our longer-term growth prospects.”
Although growth has slowed, the important fact is that growth is continuing in both the consumer and industrial targeted areas of the business. In addition to the revenue and EPS figures, the report also revealed the following information regarding this quarter’s results:
- 6,731 3D printers sold in the quarter, down from 7,536 last quarter
- GAAP net loss of $22.9 million or ($0.55) per diluted share, compared to a loss of $173,000 for the second quarter of 2014.
- Utilized $15.6 million in cash for operations this last quarter, leaving them with $502.6 million in cash, cash equivalents and short term bank deposits.
- R&D expenditures for the quarter were approximately $22.5 million, which represented 12% of total revenue
- Non-GAAP EBITDA was $12.1 million for the quarter
“We are observing positive indicators and are beginning to see tangible results that reaffirm our strategy of developing targeted solutions within key market verticals,” continued Reis. “Short-term, we will continue to make adjustments to our expenses to align with current market conditions. Long-term, we remain committed to our growth initiatives that include enhancing vertical solution capabilities, expanding customer support services, accelerating product development, and growing the sales and marketing infrastructure – all of which are designed to drive future growth.”
Stratasys has also decided to pull their full-year revenue guidance because of a difficulty in gauging the timing for future improvements of growth. Instead they’ve decided to only provide guidance for the current quarter, in which they expect to generate $175-$190 million in revenue and earn between $0.03 and $0.13 per diluted share.
While the report was not particular bad, the market has reacted quite negatively in pre-hours trading, with traders likely looking for an earnings beat, and perhaps disappointed with the company withdrawing their full-year guidance. Back in May, Stratasys predicted a total of $800 to $860 million in revenue and an EPS between $1.20 and $1.70 for the year. In order to meet those projections the company would need to have quite a stellar second half of 2015.
The stock is trading down over 20% in premarket trading. Let us know if you are an investor in SSYS and what your thoughts on this report are. Discuss in the Stratasys Stock forum thread on 3DPB.com.
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