Stratasys cuts outlook; says easy growth over for 3D printing

3D printing giant Stratasys cut its third quarter outlook, pulled guidance for 2015 and said the market is transitioning to slower growth. Blame extra capacity, Asia and perhaps a pause before HP's 2016 debut.
Written by Larry Dignan, Contributor

Stratasys said the 3D printing market is "transitioning to a period of slower growth" and customers are digesting previous purchases. Stratasys yanked 2015 financial guidance and cut its outlook for the third quarter.

The news comes as Stratasys reported second quarter results. Stratasys' outlook also comes as established 3D printing makers away Hewlett-Packard's entry to the market in 2016.

Stratasys said the 3D printing market is being hit by customers utilizing existing capacity for additive manufacturing and economic woes in Asia.

In the long run, Stratasys, which owns the MakerBot unit for consumer systems but makes its money on the enterprise, said it is confident in its industry-focused strategy and product pipeline.

Also: MakerBot, Stratasys announce partnership to tackle Asian markets | 3D Systems stumbles: A sign of 3D printing woes or HP? | Carbon3D's 3D printing technology highlights risk to HP strategy | HP to enter 3D printing market in 2016: Will customers wait? | 3D Systems acquires Chinese 3D printing sales firm Easyway | HP selects Intel Core i7 chip to power 3D printing

Given Stratasys' lack of visibility, the company said third quarter revenue will be about $175 million to $190 million with non-GAAP earnings of 3 cents a share to 13 cents a share.

Wall Street was expecting third quarter non-GAAP earnings of 47 cents a share on revenue of $216.5 million.

That sizeable miss for the third quarter comes amid a second quarter that was in line with expectations. Stratasys reported a second quarter net loss of $22.9 million, or 55 cents a share, on revenue of $182.3 million.

Stratasys in the second quarter sold 6,731 3D printing and additive manufacturing systems.

The slowdown in 3D printing could reflect HP's eventual entry into the market as customers evaluate systems, but more likely the slowdown in China's economy plays a big role. Asia is the manufacturing hub of the world and it stands to reason that the brakes are being tapped as economies in that region slow.

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