Stratasys Reports Record Third Quarter Financial Results

Company reports $204 million in revenue, which included a strong contribution from Makerbot and a 35% increase in organic revenue over the same period last year

Company reports non-GAAP net income growth of 50% over the same period last year to $30.1 million, or $0.58 per diluted share; GAAP net loss was $31.3 million, or ($0.62) per basic share

MINNEAPOLIS & REHOVOT, Israel — (BUSINESS WIRE) — November 5, 2014 — Stratasys Ltd. (NASDAQ: SSYS) today announced record third quarter financial results.

Total revenue for the third quarter of 2014 was $204 million, which included a 35% increase organically when compared to the same period last year and a 62% increase when including revenue from acquisitions.

Revenue from MakerBot branded products and services increased by over 80% when compared to the pro forma revenue that MakerBot generated during the third quarter of 2013. MakerBot product and service revenue is calculated as organic revenue beginning on August 15, 2014.

Non-GAAP net income for the third quarter increased by 50% over the same period last year to $30.1 million, or $0.58 per diluted share. GAAP net loss for the period was $31.3 million, or ($0.62) per basic share.

During the third quarter, Stratasys closed the acquisitions of Solid Concepts and Harvest Technologies, creating a leading additive manufacturing services platform that will support the company’s expansion into end-use-parts production, and the introduction of applications within targeted vertical markets.

The company also announced and closed the acquisition of GrabCAD, a leading cloud-based platform for 3D CAD users that provides tools to facilitate 3D design collaboration, and has the potential to improve access to the company’s 3D printing products and services.

Additionally, Stratasys established MakerBot Europe by acquiring MakerBot’s German distributor, HAFNER’S BÜRO. MakerBot Europe will manage existing resellers as well as expand the company’s reach and develop additional strategic partnerships in the European market.

The company adjusted its financial guidance for fiscal 2014 to account for the recent acquisition of GrabCAD, with the expectation that ongoing development costs, as previously disclosed, are expected to negatively impact the fourth quarter by $0.03 to $0.05 per share. Non-GAAP net income guidance was adjusted to $2.21 – $2.31 per diluted share; versus previous guidance of $2.25 – $2.35 per diluted share.

Q3-2014 Financial Results Summary:

  • Revenue for the third quarter of 2014 was $203.6 million, representing a 62% increase, and 35% on an organic basis, over non-GAAP revenue of $126.1 million reported for the same period last year.
  • GAAP net loss for the third quarter was $31.3 million, or ($0.62) per basic share, compared to a net loss of $6.6 million, or ($0.16) per basic share, for the same period last year.
  • Non-GAAP net income was $30.1 million for the third quarter, or $0.58 per diluted share, compared to non-GAAP net income of $20.0 million, or $0.45 per diluted share, for the same period last year.
  • Third quarter per share calculations relative to last year were impacted by the issuance of approximately 5.2 million new ordinary shares in the September 2013 public offering, which raised a net amount of approximately $463 million; the approximate 3.9 million new ordinary shares issued in consideration for the acquisition of MakerBot in August of 2013; and the approximately 1.2 million shares issued in consideration for the acquisitions of Solid Concepts and Harvest Technologies in July and August of 2014, respectively.
  • Operating expenses expanded materially in the third quarter over last year driven by the addition of expenses from Solid Concepts, Harvest Technologies and MakerBot, as well as from significant incremental investments to support new product initiatives and the company’s accelerating growth.
  • The company invested a net amount of $19.2 million in R&D projects (non-GAAP basis) during the third quarter, representing 9.4% of revenue; R&D expense was $23.4 million on a GAAP basis.
  • The company utilized $10.7 million in cash for operations during the third quarter, driven primarily by one-time employee bonuses and retention payments related to recent acquisitions; and currently holds $459 million in cash and cash equivalents, and short-term bank deposits, amounting to approximately $9 per share. The cash balance includes a $50 million drawdown on the company’s revolving debt facility.
  • Non-GAAP EBITDA for the third quarter amounted to $40.0 million; and EBITDA based on GAAP net income was ($22.2) million.
  • The company sold 10,965 3D printing and additive manufacturing systems during the quarter, and on a combined pro forma basis, a cumulative 110,494 systems worldwide through September 30, 2014.

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