3D Systems(US:DDD)2025-11-04 21:41Revenue Performance - Revenue for the three months ended September 30, 2025, was $91.2 million, a decrease of $21.7 million (approximately 19.3%) compared to $112.9 million for the same period in 2024[144]. - Revenue for the nine months ended September 30, 2025, was $280.6 million, down $48.5 million (approximately 14.7%) from $329.1 million in the prior year[144]. - For the three months ended September 30, 2025, total revenue decreased by $21.7 million, or 19.2%, to $91.2 million compared to the same period in 2024, primarily due to a decline in product revenue of $20.7 million[146]. - For the nine months ended September 30, 2025, total revenue decreased by $48.5 million, or 14.7%, to $280.6 million compared to the same period in 2024, driven by a decline in product revenue of $47.9 million[147]. Cost and Expenses - Cost of sales for the three months ended September 30, 2025, was $61.8 million, a decrease of $9.4 million (approximately 13.2%) from $71.2 million in 2024[144]. - Selling, general and administrative expenses (SG&A) for the three months ended September 30, 2025, were $34.7 million, down $23.3 million (approximately 40.2%) from $58.0 million in 2024[144]. - Research and development expenses (R&D) for the three months ended September 30, 2025, were $16.0 million, a decrease of $4.7 million (approximately 22.8%) compared to $20.8 million in 2024[144]. - Selling, general and administrative expenses (SG&A) for the three months ended September 30, 2025, decreased by $23.3 million, or 40.1%, compared to the same period in 2024[151]. - Research and development expenses (R&D) for the three months ended September 30, 2025, decreased by $4.7 million, or 22.8%, compared to the same period in 2024[152]. Profitability - The company reported a loss from operations of $21.3 million for the three months ended September 30, 2025, an improvement of $159.4 million compared to a loss of $180.8 million in the same period of 2024[144]. - Gross profit for the three months ended September 30, 2025, decreased by $12.3 million, or 29.4%, to $29.4 million, with a gross profit margin of 32.3% compared to 36.9% in the prior year[149]. - Gross profit for the nine months ended September 30, 2025, decreased by $31.5 million, or 24.3%, to $98.3 million, with a gross profit margin of 35.0% compared to 39.4% in the prior year[150]. Business Transactions - The company recorded a pre-tax gain of $125.7 million from the sale of its Geomagic software business in the nine months ended September 30, 2025[135]. - The company completed the sale of its 3DXpert and Oqton businesses for $3.5 million plus a potential revenue-based royalty of up to $12.9 million[137]. - The gain on disposition of $125.7 million for the nine months ended September 30, 2025, was due to the sale of the Geomagic business on April 1, 2025[168]. Cash Flow and Debt - Cash and cash equivalents totaled $95.5 million, a decrease of $75.8 million since December 31, 2024, primarily from cash used in operations of $73.1 million and capital expenditures of $8.0 million[174]. - Cash flow used in operating activities was $73.1 million during the nine months ended September 30, 2025, an increase of $36.0 million compared to the prior year[178]. - Net cash provided by investing activities was $108.3 million during the nine months ended September 30, 2025, an increase of $121.4 million, driven primarily by proceeds from the sale of the Geomagic business[178]. - Net cash used in financing activities was $98.3 million during the nine months ended September 30, 2025, an increase of $7.6 million, primarily due to net repayments of long-term debt of $81.4 million[179]. - As of September 30, 2025, the company had $126.7 million of outstanding long-term debt, comprising $34.7 million of 2026 Notes and $92.0 million of 2030 Notes[187]. Restructuring and Future Plans - The company expects to incur approximately $8.5 million to $14.5 million in pre-tax restructuring costs by the end of the second fiscal quarter of 2026[133]. - The company has initiated a 2025 Restructuring Plan aimed at delivering sustainable growth and profitability through cost savings and streamlining operations[132]. Market and Risk Assessment - The company has no material changes to its critical accounting estimates as described in the 2024 Annual Report on Form 10-K[200]. - There have been no material changes or developments affecting the market risk assessment since December 31, 2024[201]. - The company evaluates its estimates and assumptions on an ongoing basis, acknowledging that actual results may differ from these estimates[193]. Goodwill and Impairment - Goodwill is assigned to the Healthcare reporting unit, and the company assesses goodwill for impairment at least annually[195][196]. - The remaining goodwill assigned to the Healthcare reporting unit could be subject to impairment if there is a decrease in its estimated fair value[199]. - The quantitative goodwill impairment test compares the carrying value of a reporting unit to its fair value, with charges recognized when the carrying value exceeds fair value[197]. - Impairment losses are measured as the excess of the carrying value of a long-lived asset over its estimated fair value, determined using discounted projected cash flows[194]. - The company uses a guideline company valuation method to estimate fair values, which involves selecting appropriate comparable publicly traded companies[198].