Why 3D Systems Stock Just Dropped 10%

Just a day later Stratasys (SSYS -3.47%) the stock suffered a 15% loss after reporting weak sales and a large GAAP loss for the second quarter of 2024, 3D systems (DDD -9.01%) — Stratasys rival in 3D printing — reported its earnings for the same quarter.

The results were similar… but worse.

As with Stratasys, 3D missed Wall Street’s sales targets, reporting $102.9 million for the quarter when The Street had hoped for $116.5 million. Unlike Stratasys, which reported a smaller-than-expected loss, 3D also missed the Street’s earnings target, reporting a non-GAAP loss of $0.14 per share, where analysts were expecting a loss of just $0.04.

Investors are obviously not happy about this. As of 12:30 PM ET, 3D stock is down 10.5%.

3D Systems T2 Earnings

Like its rival, 3D reported an increase in services, while blaming weak hardware sales for its revenue decline, which was 12% year-on-year. Also, like its rival, 3D reported weaker earnings results when calculated according to generally accepted accounting principles (GAAP) than when calculated non-GAAP.

GAAP loss for the quarter was $0.21 per share — 50% weaker than the non-GAAP number.

Is 3D Systems stock a sell?

So far, so bad — but now here’s the good news. As Stratasys responds to weak sales by restructuring its business, laying off workers and promising a huge loss in the upcoming third quarter, 3D announced today that as its sales increased sequentially (although decreasing year by year), feels confident in lift orientation for the rest of this year.

Management expects 2024 sales to range from $450 million to $460 million.

That said, this probably won’t be good enough to bring 3D back to profitability in 2024 (or soon). Sales will continue to decline significantly from 2023 — the company’s fourth consecutive year of declining sales. And the most promising management is “Adjusted EBITDA close to break-even for the fourth quarter“(emphasis) only from 2024.

Simply put, business looks bad for both of these 3D stocks today. I wouldn’t buy Stratasys stock — and I wouldn’t buy 3D Systems stock either.