3D printer maker Stratasys became the latest company in the sector to warn its sales will fall short of expectations. The company said it will restructure operations its MakerBot unit, which saw sales fall 18 percent in the first quarter.
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Stratasys said the it expects to report first quarter sales between $171 million and $173 million due to a stronger dollar as well as a decline in capital spending. The company added that first quarter earnings will be between 2 cents a share and 4 cents a share. Stratasys will report a net loss between $208 million and $173 million in the first quarter.
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Wall Street was expecting Stratasys to report first quarter non-GAAP earnings of 28 cents a share on revenue of $198.8 million.
The warning from Stratasys comes just a few days after rival 3D Systems cut its outlook. Stratasys and 3D Systems both noted similar issues in the first quarter. Those issues include currency fluctuations, a decline in capital spending, a longer selling cycle for high-end systems and slower growth in emerging markets.
A bigger issue for both large 3D printing players may be a freeze ahead of HP's entry into the market.
David Reis, CEO of Stratasys, said the industry is still in the early innings and the long-term looks strong. Reis said he was "disappointed" with the first quarter results.
As for the 2015 outlook, Stratasys said its revenue will be $800 million to $860 million with non-GAAP earnings of $1.20 a share to $1.70 a share.
Given the turbulence, Stratasys said it will cut its 2015 capital spending to $80 million to $110 million and reorganize its MakerBot unit. Stratasys said:
The company has initiated a reorganization within MakerBot that is intended to focus efforts at MakerBot on improving and iterating products, growing the 3D ecosystem, and expanding the focus on professional, education and consumer markets. As the reorganization progresses, MakerBot growth rates are expected to ramp up to, or exceed, overall company averages by 2016.
Stratasys said the MakerBot overhaul will result in a charge of $150 million to $200 million.