Hello, and welcome to 3D Systems' first quarter 2026 earnings conference call. I'll then provide an update on our business strategy and key growth initiatives. The additive manufacturing industry is now beginning to emerge from a multi-year trough, driven largely by global economic and geopolitical challenges that led customers to severely curtail capital spending. To derive the highest value from R&D investments, we focused them intensely on our three key growth markets: aerospace and defense, medtech, and dental.
Solid growth in printer sales, increased momentum in part sales, strong growth in healthcare material sales. From a product standpoint, we saw double-digit year-over-year growth in printer and material sales as well as parts manufacturing, particularly in metals. We also saw balanced growth across both of our business units, healthcare and industrial. During the first quarter, we saw strong double-digit year-over-year growth in several key areas, including medical parts manufacturing, printer sales, and surgical planning services.
Medical parts manufacturing demand was driven specifically by titanium spinal implants and both titanium and cobalt chrome joint implants used in replacement procedures. Printer revenue was led by sales of our DMP 350 metal printer to medical device customers who are now entering a refresh and expansion cycle. This growth was partially offset by lower than expected sales to one key customer due to a temporary disruption in their internal operations, which was resolved by the end of the quarter. We're already seeing a recovery in their demand and expect a solid rebound in the second quarter.
| Metric | Period | Current guidance |
|---|---|---|
| Q2 revenue | Q2 2026 | $93 million-$95 million, reflecting customary seasonality |
| Q2 adjusted EBITDA | Q2 2026 | Loss in the range of -$2 million to -$4 million |
| Full-year adjusted EBITDA | FY 2026 | Breakeven adjusted EBITDA or better for the full year |
| Operating expense | Remainder of 2026 | Largely stable through the remainder of the year with normal seasonal fluctuations |
| Cost reduction program completion | End of Q2 2026 | Defined cost reduction/efficiency programs expected complete by end of Q2, concluding a six-quarter effort |
| Aerospace and defense growth | 2026 | Delivered over 20% year-over-year growth in Q1 |
| Metric | YoY | Note |
|---|---|---|
| Consolidated revenue | +11% to $95.5M | Solid return to growth driven by double-digit growth across medtech, dental, and aerospace and defense; printers, materials, and parts each grew double digits |
| Industrial Solutions revenue | +1.6% to $45.4M | Aerospace and defense up over 20% plus a return to growth in automotive and semiconductor, partially offset by lower jewelry demand from the Middle East conflict |
| Healthcare Solutions revenue | +21% to $50.1M, surpassing Industrial | Strong performance across dental (aligner and Vertex repair materials) and medtech, with strong healthcare parts demand for orthopedic implants |
| Non-GAAP gross margin | 36.1%, up 6 pts ex-divestitures | Improved manufacturing absorption from higher production/sales volume, favorable consumables mix, improved printer margins, and cost reduction benefits |
| Non-GAAP operating expense | $36.6M, down 35% (-$20.1M) ex-divestitures | Incremental savings from 2025 cost reduction initiatives and reduced R&D as the portfolio refresh completes |
| Adjusted EBITDA | Positive $2.1M, up $26M ($28.2M ex-divestitures) | Higher sales volumes, favorable product mix, and the majority of improvement from OpEx reductions |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Industry inflection | Q4 viewed as return to growth | Additive manufacturing industry now beginning to emerge from a multi-year trough; CEO more positive than in two or three years | — |
| NextDent denture rollout | Order backlog building, EU approval targeted mid-2026 (Q4) | ROE Dental Lab fleet deployment tripling capacity; EU Phase IIA approval received two months early; addressable market expanded to 60M+ edentulous patients; most successful launch in CEO's five-year tenure | — |
| Cost reduction program | ~$55M annualized savings completed in 2025 (Q4) | Over $55M delivered through Q1; defined programs to complete by end of Q2, ending a six-quarter effort | — |
| R&D spending normalization | Throttling back, still double-digit (Q4) | Launches substantially complete; transitioning to a more balanced R&D level focused on targeted enhancements | — |
| Littleton metal-parts expansion | Capacity expansion underway (Q4) | Adding 80,000 sq ft adjacent building for industrial/aerospace part manufacturing, grand opening anticipated late summer | — |