(Adds details, analyst comment, updates shares)
Feb 5 3D Systems Corp slashed its profit
estimate for 2013, reviving fears of a bubble in the 3D printing
industry and sending its shares down as much as 28 percent.
Shares of other 3D printer makers also fell sharply after
the profit warning from the largest listed 3D printer maker,
which along with rival voxeljet AG has been the target
of short-seller Citron Research.
3D Systems cut its 2013 adjusted profit estimate to 83-87
cents per share from 93 cents-$1.03, citing higher spending on
research, manufacturing and marketing.
The company also forecast adjusted earnings for 2014 below
the average analyst estimate.
Shares of 3D printer makers have had a good run over the
past couple of years as the companies adapt to the consumer
market a technology used by manufacturers for decades.
The technology was highlighted by U.S. President Barack
Obama in his State of the Union address last year, when he said
it had "the potential to revolutionize the way we make almost
However, 3D Systems said on Wednesday demand for its
consumer printers was softer than its expectation during the
fourth quarter, while demand for its professional printers was
Citron Research last year accused the chief executive of 3D
Systems of exaggerating advances in the technology and
contributing to a bubble in shares of companies in the sector.
Citron also questioned voxeljet's first-quarter results,
saying the company extended loans to customers to generate sales
and avoid posting a loss.
Stratasys Ltd shares fell 12 percent on Wednesday,
Exone Co dropped 13 percent and voxeljet fell about 10
3D Systems shares have gained 60 percent in the past six
months, while Stratasys jumped 31 percent. Voxeljet shares
doubled on their market debut on Oct. 18.
3D Systems said it was willing to tolerate earnings
reduction and gross profit margin compression in the near term
to accelerate its growth rate and market share.
The company is positioned to double revenue over the next
couple of years on organic growth of at least 30 percent, CEO
Avi Reichental said in a statement.
3D Systems forecast 2014 adjusted earnings of 73-85 cents
per share, missing analysts' average estimate of $1.27 per
share, according to Thomson Reuters I/B/E/S.
But its revenue forecast of $680 million-$720 million came
in ahead of analysts' average forecast of $671.3 million.
3D printing companies are making aggressive investments,
making investors concerned about profitability but that doesn't
mean that the growth or demand of 3D printing is falling,
Gabelli & Co analyst Hendi Susanto told Reuters.
Of 19 analysts covering 3D Systems, 14 have a "buy" or a
"strong buy" rating, according to StarMine data. Only one has a
"sell" rating on the stock.
However, investors seem to be concerned with the profit
3D Systems' shares were down 15 percent in afternoon
trading. The company is set to lose more than $1 billion in
market capitalization if the loss holds until close.
Shares of rivals also recouped some losses.
3D Systems expects to report fourth-quarter and full-year
2013 results on Feb. 28.
(Reporting by Sampad Patnaik and Supantha Mukherjee in
Bangalore; Editing by Savio D'Souza and Sriraj Kalluvila)