3D Systems Corporation DDD recently announced that it will showcase its entire range of offerings (both existing and upcoming) at the globally distinguished electronics and technology trade show, International Consumer Electronics Show (“CES”) 2016. The trade convention is being held in Las Vegas, NV from Jan 6 to Jan 9.
Ideally the news should have caused a positive vibe among investors as they will have a glimpse of the upcoming head turners. However, the news failed to impress investors. The company’s shares plunged 3.1% to close at $9.00 during the regular trading session on Friday, primarily due to unfavorable broader market conditions and sluggish industry trends.
Inside the Headlines
3D Systems will extend its entire range of 3D printers, software and services to demonstrate how 3D solutions are penetrating every aspect of human life, gradually obliterating traditional manufacturing and related processes.
The highlights of the showcase event include the company’s growing family of MultiJet 3D printers that are being widely adopted across a broad range of applications such as meticulous jewelry designing, dental wax-ups and functional test prototypes. On the other hand, the Vibrant ColorJet Printing products will help customers understand how the technology is gaining rapid momentum in the modern market of photorealistic models used for product design and architecture.
3D Systems also plans to unveil its recent collaboration with America-based footwear manufacturer New Balance, and demonstrate how its Selective Laser Sintering technology is supporting the latter’s “commercial running shoe”. Under Direct Metal Printing, currently very popular in sectors like aerospace, automotive and healthcare, 3D Systems plans to introduce its next-generation Direct Metal Printer series including the ProX DMP 320. This latest edition is engineered for better throughput and high precision direct metal printing.
Also, customers can expect to witness advanced editions of Cube and CubePro series, desktop and classroom solutions for engineering personnel. Other products like Quickparts, offering tailor-made manufacturing service, highly advanced engineering software & hardware tools and healthcare solutions, will also be showcased.
To Conclude
3D technology has the potential to revolutionize manufacturing and improve the commercial space. Various companies, ranging from hospital managers to car manufacturers, are now opting for varied 3D solutions to address simple make-to-stock orders as well as complex, engineer-to-order production strategies. To maximize its growth potential, 3D Systems is currently focusing on three strategic initiatives, namely, improvement of existing 3D printers, strengthening partnerships and enhancing productivity, to fuel its growth engine.
Echoing similar sentiments, market research firm Canalys stated in its Sep 2015 report that 3D printer shipments jumped 52% year over year in the first half of 2015 on a global basis backed by robust demand. Overall, sales of 3D printers and associated materials & services rose 20% to about $1.8 billion in first-half 2015. Going forward, the company expects its portfolio of innovative products to drive more than 30% organic growth over the next couple of years, thereby enhancing its margins and earnings.
However, persistently challenging market conditions, in the last few quarters, have been affecting customers' capital investment cycles, reducing demand across all geographies. This, in turn, has adversely impacted 3D System’s financial performance. At the same time, factors such as foreign currency fluctuations, intensifying competition from other established players like Stratasys Ltd. SSYS, Materialise NV MTLS and Voxeljet AG VJET, and the dynamic nature of the industry add to the concerns of this Zacks Rank #5 (Strong Sell) stock.
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