Hello and welcome to the 3D Systems third quarter 2025 earnings conference call. I'll provide some commentary on the overall market and then focus the remainder of my comments on our strategy and growth initiatives. This can be seen in our third quarter revenue of $91.2 million, which was down 13.8% year-over-year, soft but consistent with our normal seasonality trends. As such, we've taken aggressive actions to adjust our cost structure while maintaining core R&D investments to position the company for long-term growth when market conditions improve.
As you may know, these software platforms are not proprietary but were designed to serve the entire industry. We expect the financial impact of this disposition on our fourth quarter results to be approximately $1.2 million in revenue and $1 million on gross margin. In the industrial segment, we introduced the MJP 300W Plus at the Istanbul Jewelry Show in early October. We're building backlog for the fourth quarter and are very excited about this market opportunity, which we believe will reach $1 billion in industry revenue across the U.S.
Before I begin a review of the third quarter results, I would like to remind you we completed the divestiture of our Geomagic software business on April 1st of this year. With that, let's begin with a summary of our revenue which you'll find on slide 12. Third quarter consolidated revenue was $91.2 million, down 19% year-over-year or 14% when excluding Geomagic. Sequentially, revenue declined modestly, primarily reflecting typical third quarter seasonality and the absence of a regenerative medicine milestone that was recognized in the prior quarter.
| Metric | Period | Current guidance |
|---|---|---|
| Geomagic-style disposition impact (Oqton/3DXpert) | Q4 2025 | Approximately $1.2 million in revenue and $1 million on gross margin impact, reflected in Q4 guidance |
| Non-GAAP operating expense | Q4 2025 | Marginally below the current quarter, with continued declines through the first half of 2026 |
| Annualized cost savings | Year end 2025 | On track to deliver over $50 million in annualized savings |
| Gross margin | Q4 2025 | Flat quarter-over-quarter |
| Revenue | Q4 2025 | Sales picking up in Q4 (per CEO commentary) |
| CapEx | Next couple of years | Substantially less than 4%, probably less than half that level |
| Metric | YoY | Note |
|---|---|---|
| Consolidated revenue | Down 13.8% (19% reported, 14% excluding Geomagic) to $91.2M | Customers' muted CapEx spending for new production capacity from tariff uncertainty, plus normal Q3 seasonality |
| Industrial Solutions revenue | Down 16% (down 4.5% excluding Geomagic) to $48M | Softness in printers and material sales in consumer-facing end markets, partially offset by ~50% aerospace and defense growth |
| Healthcare Solutions revenue | Down 22% to $43M | Predominantly lower dental sales, with 2024 representing higher purchase volumes from a specific customer; medtech up 8% |
| Non-GAAP gross margin | 33% vs. 38% prior year | Lower sales volume and reduced material sales, partially offset by reduced inventory reserves; sequentially hurt by absent RegMed milestone and higher manufacturing variances |
| Adjusted EBITDA | -$10.8M, improved $3.5M | Cost reduction initiatives delivering meaningful expense reductions |
| GAAP loss per share | -$0.14 vs. -$1.35 prior year | Absence of prior-year asset impairment charges, lower amortization expense, and lower operating expenses |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Non-core asset rationalization | Geomagic divested April 1, 2025 | Sale of Oqton and 3DXpert software platforms closed at end of October to transition them to an independent developer as industry standards | — |
| NextDent dentures commercialization | Ramping production, POs starting (Q2) | Full U.S. commercial release; printers placed with a dozen leading labs, backlog building, with a projected ~$1 billion U.S./Europe industry opportunity | — |
| Cost reduction and facility footprint | Targeting low-$40M OpEx | Five or six facilities exited and on the market; OpEx declines continuing through first half 2026 toward original $70M takeout target | — |
| Aerospace and defense partnerships | — | New partnerships highlighted including Lockheed Martin and Saudi JV initiatives leveraging local-sourcing defense requirements | — |