3D Systems(US:DDD)2023-05-09 17:02Financial Data and Key Metrics Changes - Q1 2023 revenue was $121 million, a decrease of 8.8% year-over-year, with a constant currency decrease of 6.5% due to weakness in the dental orthodontics market [39] - Adjusted EBITDA decreased by $12 million to negative $10 million in Q1 2023 compared to the same period last year, primarily due to lower sales volumes and inflationary impacts [42] - Net loss was $29.4 million, resulting in a diluted loss per share of $0.23 [43] Business Line Data and Key Metrics Changes - Healthcare Solutions revenue decreased by 24.3% to $48.7 million, with dental orthodontics down approximately 46% year-over-year [39] - Non-dental markets within Healthcare Solutions saw revenue growth of over 22% on a constant currency basis [40] - Industrial Solutions revenue increased by 5.6% to $72.5 million, with a 9% increase when excluding foreign exchange impacts [41] Market Data and Key Metrics Changes - The dental orthodontics market is expected to decline approximately 35% for the full year 2023, following a strong first half of 2022 and a significant decline in the second half [40] - The orthopedic segment within Healthcare Solutions continues to show robust growth, contributing to the overall positive performance in non-dental markets [40] Company Strategy and Development Direction - The company is focusing on strategic growth in the orthopedic market and expanding its capabilities in additive manufacturing technologies [9][12] - A restructuring initiative has been announced to improve the profit profile and align operations, including a 6% reduction in headcount [33][45] - Investments in regenerative medicine are planned, with $10 million to $12 million allocated for Systemic Bio and other initiatives [34][48] Management's Comments on Operating Environment and Future Outlook - Management noted a bifurcated market, with the dental orthodontics segment softening while other markets remain strong [6][7] - The company anticipates a return to growth in the dental market by 2024, provided a deep recession is avoided [7] - Management expressed confidence in maintaining full-year guidance despite Q1 softness, citing reasonable estimates based on current economic conditions [58] Other Important Information - The company has a strong balance sheet with approximately $530 million in cash and short-term investments, sufficient to support organic growth and investments [44] - The company is pursuing R&D programs that align with its mission to provide high-value additive manufacturing solutions [20][23] Q&A Session Summary Question: What technologies are driving growth in the industrial sector? - Management indicated that growth is broad-based across metals and polymers, with strong demand in various technologies [54] Question: What is the visibility for the second half of the year? - Management maintains a cautious outlook, expecting stability in the market and tracking the clear aligner market closely [58] Question: Are there differences in demand trends across geographies? - Demand trends are uniform across the US and European markets, with no significant differences noted [62] Question: Can you elaborate on the TE Connectivity partnership? - The partnership is expected to be embedded in the initial guidance, with significant potential for future revenue growth [70] Question: What are the details regarding the Wematter acquisition? - The acquisition aims to enhance market share with a unique product that has a small footprint and excellent recycling capabilities [78]