3D Systems Reports Higher Revenue and Improved Operating Results

"We believe that as of the end of the second quarter, most of the significant abnormally high accounting and legal costs related to our restatement, our 2006 year-end audit and the implementation of our new ERP system are behind us, and that the majority of our operational issues have been resolved successfully. We remain confident in our overall direction and believe that the key initiatives and investments that we undertook throughout 2006 have provided us with the right platform to achieve our long-term objectives," continued Reichental. "We believe that, apart from these abnormally high costs, our quarterly operating expenses have begun to resume a more normalized run rate, and accordingly we expect our SG&A expenses for the second six months of this year to fall into the range of $22 to $26 million."

The company's continuing high level of work on selected new product developments, including its new V-Flash(TM) Desktop 3-D Modeler, led to the higher research and development expenses in each 2007 period. The company announced its plans to introduce the V-Flash(TM) Modeler in January and plans to unveil it at the company's World Conference in September. The company expects targeted commercial shipments of its V-Flash(TM) Modeler to commence around its September World Conference. The company expects to incur $12.0 million to $13.0 million of research and development expenses in 2007.

Net loss available to the common stockholders for the second quarter of 2007 declined to $5.3 million, or a $0.27 loss per fully diluted share, from $11.5 million, or a $0.71 loss per fully diluted share, for the 2006 quarter. Net loss available to the common stockholders for the first six months of 2007 declined to $8.4 million, or a $0.44 loss per fully diluted share, from $13.5 million, or an $0.85 loss per fully diluted share, for the first six months of 2006.

The improvements in net loss for both the second quarter and first half of 2007 were due to the lower operating loss in each 2007 period and the absence of dividends paid on outstanding shares of preferred stock before they were converted into common stock in June 2006. This improvement was partially offset by increased interest expense and changes to the tax provision.

The company ended the second quarter of 2007 with $29.2 million of unrestricted cash compared to $14.3 million of cash at December 31, 2006, which included $8.2 million of borrowings under the company's Silicon Valley Bank revolving credit facility at each date. This increase in cash resulted from $23.0 million of cash provided by financing activities and a favorable $0.4 million effect of exchange rate changes on cash that were partially offset by $7.6 million of cash used in operating activities and $1.0 million of cash used in investing activities during this six-month period.

The higher level of cash provided by financing activities resulted primarily from the $20.6 million in net proceeds that the company received in June 2007 from the private placement of 1,250,000 shares of Common Stock. The lower level of cash used in investing activities resulted from lower capital expenditures through June 30, 2007 due to the completion of the major capital investment projects that the company carried out in 2006.

The company also continued to improve its management of inventories and accounts receivable. Inventories, which declined by $0.9 million at June 30, 2007 from December 31, 2006, declined by $5.5 million from March 31, 2007 to June 30, 2007. The company expects to reduce its inventories further during the remainder of 2007.

Accounts receivable, net decreased by $8.3 million to $26.2 million at June 30, 2007 from $34.5 million at December 31, 2006. This decline was primarily attributable to the timing of collections, which resulted in a reduction of days sales outstanding to 65 days at June 30, 2007 from 74 days at December 31, 2006.

After the end of the second quarter of 2007, all of the company's 6% convertible subordinated debentures were converted into common stock, and the company repaid the $8.2 million of outstanding borrowings under the Silicon Valley Bank credit facility, effectively reducing its outstanding indebtedness by $23 million. While the company expects to replace this credit facility before it expires on October 1, 2007, with its currently stronger cash position, the company does not currently expect to borrow under it.

Also after the end of the second quarter, the company was informed that the U.S. Department of Justice had closed the investigation that the company had previously disclosed in its periodic SEC filings as it pertained to the company and to individuals associated with the company and that the Department of Justice would take no action with respect to the company or those individuals. We expect the end of this proceeding to contribute to a lower level of legal expense that the company incurred in responding to the Department's inquiries for the remainder of 2007.

"We believe that our stronger financial position resulting from our substantially reduced indebtedness and improved working capital management provides us with the flexibility to pursue our near-term growth opportunities vigorously," concluded Reichental.

Conference Call and Audio Webcast Details

3D Systems will hold a conference call and audio Webcast to discuss its financial results for the second quarter and first six months of 2007 tomorrow morning, August 7, 2007, at 8:00 a.m., Eastern Time.

To access the Conference call, dial 1-888-336-3485 (or 706-634-0653 from outside the United States). A recording will be available two hours after completion of the call for five days. To access the recording, dial 1-800-642-1687 (or 706-645-9291 from outside the United States) and enter 12237492, the conference call ID number.

To access the audio Webcast, log onto 3D Systems' website at www.3dsystems.com. The link to the Webcast is provided on the homepage of the website. To ensure timely participation and technical capability, we recommend logging on a few minutes prior to the conference call to activate your participation. The Webcast will be available for replay beginning approximately 48 hours after completion of the call at: www.3dsystems.com under the Investor Relations' section.

Forward-Looking Statements

Certain statements made in this release that are not statements of historical or current facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-Looking statements may involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the company to be materially different from historical results or from any future results expressed or implied by such forward-looking statements. In addition to statements that explicitly describe such risks and uncertainties, you are urged to consider statements in the conditional or future tense or that include terms as "believes," "belief," "expects," "estimates," "intends," "anticipates" or "plans" to be uncertain and forward-looking. Forward-looking statements may include comments as to the company's beliefs and expectations as to the future events and trends affecting its business and expectations and are necessarily subject to uncertainties, many of which are outside the control of the company. The factors described under the headings "Forward-Looking Statements," "Cautionary Statements and Risk Factors," and "Risk Factors" in the company's periodic filing with the Securities and Exchange Commission, as well as other factors, could cause actual results to differ materially from those reflected or predicted in forward-looking statements.

About 3D Systems Corporation

3D Systems is a leading provider of 3-D Modeling, Rapid Prototyping and Rapid Manufacturing solutions. Its systems and materials reduce the time and cost of designing products and facilitate direct and indirect manufacturing by creating actual parts directly from digital input. These solutions are used for design communication and prototyping well as for production of functional end-use parts: Transform your products.

More information on the company is available at www.3dsystems.com, or via email at moreinfo@3dsystems.com.

- tables follow -

                        3D SYSTEMS CORPORATION
           Condensed Consolidated Statements of Operations
  Three Months and Six Months Ended June 30, 2007 and June 30, 2006
               (in thousands, except per share amounts)

                            Three Months Ended   Six Months Ended June
                                  June 30,                30,
                           --------------------- ---------------------
                                                          2007              2006              2007              2006
                                                      -----------  ---------  -----------  ---------
                                                                (Unaudited)                      (Unaudited)

  Products                                          $27,591    $  18,933          $56,150    $  43,185
  Services                                              8,835          8,198            17,208        17,589
                                                      -----------  ---------  -----------  ---------
                  Total  revenue                  36,426        27,131            73,358        60,774

Cost  of  sales:
  Products                                            15,864        14,490            29,928        27,500
  Services                                              7,083          6,805            14,048        13,833
                                                      -----------  ---------  -----------  ---------
                  Total  cost  of
                    sales                                22,947        21,295            43,976        41,333

                                                      -----------  ---------  -----------  ---------

Gross  profit                                      13,479          5,836            29,382        19,441

                                                      -----------  ---------  -----------  ---------

Operating  expenses:
  Selling,  general  and
    administrative                              14,872        10,910            29,764        20,967
  Research  and  development              3,528          2,974              6,615          6,231
  Restructuring  costs                                -          2,280                      -          3,918

                                                      -----------  ---------  -----------  ---------
                  Total  operating
                    expenses                          18,400        16,164            36,379        31,116

                                                      -----------  ---------  -----------  ---------

Loss  from  operations                      (4,921)    (10,328)          (6,997)    (11,675)

Interest  expense  and  other,
  net                                                            559              158              1,245              325
                                                      -----------  ---------  -----------  ---------

Loss  before  provision  for
  income  taxes                                    (5,480)    (10,486)          (8,242)    (12,000)
Provision  for  (benefit  of)
  income  taxes                                        (177)              39                  181                62

                                                      -----------  ---------  -----------  ---------
Net  loss                                              (5,303)    (10,525)          (8,423)    (12,062)

Preferred  stock  dividends                      -          1,003                      -          1,414

                                                      -----------  ---------  -----------  ---------
Net  loss  available  to
  common  stockholders                    $(5,303)  $(11,528)        $(8,423)  $(13,476)

                                                      ===========  =========  ===========  =========

Shares  used  to  calculate
  basic  and  diluted  net  loss
  available  to  common
  stockholders  per  share  (1)        19,361        16,324            19,240        15,851

                                                      ===========  =========  ===========  =========
Basic  and  diluted  net  loss
  available  to  common
  stockholders  per  share  (1)      $  (0.27)  $    (0.71)        $  (0.44)  $    (0.85)
                                                      ===========  =========  ===========  =========

(1)See  Schedule  1  for  the  calculation  of  basic  and  diluted  net  loss
  available  to  common  stockholders  per  share.

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