3D Systems (DDD) Q1 Earnings Lag Estimates, Guidance Stable
Zacks Investment Research | May 03, 2017 09:40PM ET
3D Systems Corporation’s (NYSE:DDD) earnings streak came to an end in first-quarter 2017, after three back-to-back quarters of impressive beats. The company reported adjusted earnings (including share-based compensation expense) of 2 cents per share for the quarter, which was way below the Zacks Consensus Estimate of 7 cents.
However, non-GAAP earnings came in at 6 cents per share, up 20% from the prior-year quarter figure of 5 cents. Modest top-line growth as well as a fall in operating expenses proved conducive to earnings growth.
Inside the Headlines
The 3D printer maker reported revenues of $156.4 million, reflecting a year-over-year increase of 2.5%. Stellar demand for the company’s healthcare solutions, along with steady demand for the software offerings drove the top-line performance. Revenues came in line with the Zacks Consensus Estimate of $156 million.
3D Systems’ Healthcare revenues were up 29% to $43 million year over year, primarily attributable to high demand for printers and materials from medical and dental customers. Also, Materials revenue rose 11% to $43 million, thanks to strong production orders and robust contribution from the previously acquired Vertex-Global. Software revenues totaled $20 million, flat on a year-over-year basis. The company’s Printer revenues were down 4% to $31 million.
In the quarter, gross margin expanded 50 basis points on a year-over-year basis to 51.8%, mainly driven by cost savings accrued from supply-chain betterment initiatives and manufacturing improvements.
In addition, the company’s operating expenses decreased (down 5.3%) to $89.3 million, as SG&A (down 10.3%) expenses fell significantly, stemmed by the company’s successful productivity improvement efforts. However, R&D expense (down 12.8%) was up year over year, mainly on account of a rise in focused investments in production application solutions, including Figure 4 and materials.
3D Systems Corporation Price, Consensus and EPS Surprise
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