Stratasys Q3 2024 revenue down by 16% but margins improve
Stratasys, a global leader in polymer 3D printing solutions, reported its third-quarter 2024 financial results, reflecting a 16% revenue decline driven by macroeconomic challenges. Despite this, the company showed improvement in margins and returned to non-GAAP profitability, highlighting the success of its cost optimization and strategic realignment initiatives.
Dr. Yoav Zeif, Stratasys’ Chief Executive Officer, emphasized the company’s resilience and adaptability in a challenging market environment. He highlighted the success of their strategic initiatives in offsetting revenue pressures and expressed optimism for sustained growth and profitability in 2025. Dr. Zeif also noted the company’s continued progress in shifting customer focus from prototyping to manufacturing applications, reinforcing the strength of Stratasys’ recurring revenue model.
For the quarter, the company recorded $140.0 million in revenue, a 16% decrease compared to $162.1 million in the same period of 2023. This decline stemmed from continued customer restraint in capital equipment spending due to macroeconomic conditions. However, Stratasys achieved a GAAP gross margin of 44.8%, significantly up from 40.5% in Q3 2023. Non-GAAP gross margin also improved to 49.6% from 48.3% in the prior year, signaling a stronger operational foundation.
The company’s GAAP net loss narrowed to $26.6 million, or $0.37 per diluted share, compared to a loss of $47.3 million, or $0.68 per share, in Q3 2023. On a non-GAAP basis, Stratasys returned to profitability, reporting net income of $0.4 million, or $0.01 per share. Adjusted EBITDA for the quarter stood at $5.1 million, though lower than $9.8 million in Q3 2023. Cash used in operating activities was $4.5 million, a significant improvement from the $12.7 million used during the same period last year.
Stratasys continues to focus on realigning its business to align with current market realities. The company is ahead of schedule on its restructuring efforts, expecting to achieve $40 million in annual cost savings starting in the first quarter of 2025. These savings are anticipated to enhance operational efficiency and position the company for sustainable growth. Strategic priorities include expanding its presence in high-demand sectors such as aerospace, automotive, and healthcare, supported by the growing adoption of its flagship F3300 platform.
An area of consistent strength has been the company’s recurring revenue from consumables, marking its eighth consecutive quarter of year-over-year growth. This growth reflects strong printer utilization and increasing customer demand for FDM technology in manufacturing applications. While hardware sales remain affected by macroeconomic conditions, the shift from prototyping to manufacturing applications demonstrates a deeper integration of additive manufacturing in industrial workflows.
Looking ahead, Stratasys has maintained its revenue outlook for 2024 while raising its expectations for margins and profitability. The company projects revenue between $570 million and $580 million, with non-GAAP gross margins ranging from 49.0% to 49.2%. Operating expenses are estimated to be $276 million to $278 million, while non-GAAP operating margins are expected to range from 0.6% to 1.3%. Adjusted EBITDA for the year is forecasted at $25 million to $28 million.
