Second Quarter Revenue of $117.6 million
Second Quarter GAAP net loss of $28.0 million,
or ($0.51) per diluted share, and non-GAAP net loss of $7.4
million, or ($0.13) per diluted share
Used $9.7 million of cash from operations -
$313.0 million net cash position with no debt
Stratasys Ltd. (NASDAQ: SSYS) announced financial results for
the second quarter of 2020.
Q2 2020 Financial Results Summary:
Revenue for the second quarter of 2020 was $117.6 million,
compared to $163.2 million for the same period last year. The 27.9%
reduction was primarily driven by the adverse impact of COVID-19 on
the company’s customers throughout the industries into which the
company sells its products and services.
- GAAP gross margin was 37.2% for the quarter, compared to 49.7%
for the same period last year.
- Non-GAAP gross margin was 45.4% for the quarter, compared to
52.5% for the same period last year.
- Gross margin decline is primarily due to the lower proportion
of consumables out of the total revenue mix due to the COVID-19
crisis, not to discounting or material ASP reductions. The company
strongly believes that gross margins will recover as our customers
return to their pre-COVID utilization levels.
- GAAP operating loss for the quarter was $29.3 million, compared
to operating income of $0.8 million for the same period last
year.
- Non-GAAP operating loss for the quarter was $8.1 million,
compared to non-GAAP operating income of $9.1 million for the same
period last year.
- Non-GAAP EBITDA was ($1.6) million for the quarter, compared to
$15.5 million for the same period last year.
- GAAP net loss for the quarter was $28.0 million, or ($0.51) per
diluted share, compared to net income of $1.2 million, or $0.02 per
diluted share, for the same period last year.
- Non-GAAP net loss for the quarter was $7.4 million, or ($0.13)
per diluted share, compared to non-GAAP net income of $8.5 million,
or $0.16 per diluted share, for the same period last year.
- The Company used $9.7 million of cash from operations during
the second quarter and ended the period with $313.0 million in
cash, cash equivalents and short-term deposits. The Company has no
debt.
“3D Printing continues to penetrate further into manufacturing
across every relevant business sector,” stated Yoav Zeif, CEO of
Stratasys. “Despite the current macro slowdown due to COVID-19, we
remain very optimistic about where our business and our industry is
headed. The largest opportunity for us in 3D Printing is in
Polymers, and the fastest-growing area is manufacturing. We are
already a leader in Polymer additive manufacturing and expect to
increase our presence through new offerings that will focus on
delivering incremental customer value, especially in the
fast-growing manufacturing applications, where we see the longest
runway for growth through new technologies that we will offer,”
continued Zeif. “We have the ecosystem, resources and strategy to
further expand our leadership as we enhance and broaden our
technology offerings to serve significantly more Polymer
applications and offer a full suite of solutions. We believe that
these efforts will reboot growth in the short to medium-term,
provide us with access to a greater customer share of wallet, and
leverage our core competencies to more than double our addressable
market, driving our future profitable growth.”
Stratasys Ltd. Q2 2020 Conference Call Details
The Company plans to hold the conference call to discuss its
second quarter 2020 financial results on Wednesday, August 5, 2020
at 8:30 a.m. (ET).
The investor conference call will be available via live webcast
on the Stratasys Website at investors.stratasys.com, or directly at
the following web address:
https://78449.themediaframe.com/dataconf/productusers/ssys/mediaframe/39720/indexl.html
To participate by telephone, the U.S. toll-free number is
877-407-0619 and the international dial-in is +1-412-902-1012.
Investors are advised to dial into the call at least ten minutes
prior to the call to register. The webcast will be available for 6
months at investors.stratasys.com, or by accessing the
above-provided web address.
Stratasys (Nasdaq: SSYS) is a global leader in additive
manufacturing or 3D printing technology and is the manufacturer of
FDM®, PolyJet™, and stereolithography 3D printers. The company’s
technologies are used to create prototypes, manufacturing tools,
and production parts for industries, including aerospace,
automotive, healthcare, consumer products and education. For more
than 30 years, Stratasys products have helped manufacturers reduce
product-development time, cost, and time-to-market, as well as
reduce or eliminate tooling costs and improve product quality. The
Stratasys 3D printing ecosystem of solutions and expertise includes
3D printers, materials, software, expert services, and on-demand
parts production.
To learn more about Stratasys, visit www.stratasys.com, the
Stratasys blog, Twitter, LinkedIn, or Facebook. Stratasys reserves
the right to utilize any of the foregoing social media platforms,
including the company's websites, to share material, non-public
information pursuant to the SEC's Regulation FD. To the extent
necessary and mandated by applicable law, Stratasys will also
include such information in its public disclosure filings.
Stratasys is a registered trademark and the Stratasys signet is
a trademark of Stratasys Ltd. and/or its subsidiaries or
affiliates. All other trademarks are the property of their
respective owners.
Cautionary Statement Regarding Forward-Looking
Statements
The statements in this press release regarding Stratasys'
strategy, and the statements regarding its projected future
financial performance, including the financial guidance (or
withdrawal of guidance) concerning its expected results for 2020,
are forward-looking statements reflecting management's current
expectations and beliefs. These forward-looking statements are
based on current information that is, by its nature, subject to
rapid and even abrupt change. Due to risks and uncertainties
associated with Stratasys' business, actual results could differ
materially from those projected or implied by these forward-looking
statements. These risks and uncertainties include, but are not
limited to: the degree of our success at introducing new or
improved products and solutions that gain market share; the degree
of growth of the 3D printing market generally; the duration of the
global COVID-19 pandemic, which, if extensive, may continue to
impact, in a material adverse manner, our operations, financial
position and cash flows, and those of our customers and suppliers;
the impact of potential shifts in the prices or margins of the
products that we sell or services that we provide, including due to
a shift towards lower-margin products or services; the impact of
competition and new technologies; potential further charges against
earnings that we could be required to take due to impairment of
additional goodwill or other intangible assets; to the extent of
our success at successfully consummating acquisitions or
investments in new businesses, technologies, products or services;
potential changes in our management and board of directors; global
market, political and economic conditions, and in the countries in
which we operate in particular (including risks related to the
impact of coronavirus on our operations, supply chain, liquidity,
cash flow and customer orders); costs and potential liability
relating to litigation and regulatory proceedings; risks related to
infringement of our intellectual property rights by others or
infringement of others' intellectual property rights by us; the
extent of our success at maintaining our liquidity and financing
our operations and capital needs; the impact of tax regulations on
our results of operations and financial condition; and those
additional factors referred to in Item 3.D “Key Information - Risk
Factors”, Item 4, “Information on the Company”, Item 5, “Operating
and Financial Review and Prospects,” and all other parts of our
Annual Report on Form 20-F for the year ended December 31, 2019
(the “2019 Annual Report”), which we filed with the
Securities and Exchange Commission (the “SEC”) on February
26, 2020. Readers are urged to carefully review and consider the
various disclosures made throughout our 2019 Annual Report and the
Report of Foreign Private Issuer on Form 6-K that attaches
Stratasys’ unaudited, condensed consolidated financial statements
and its review of its results of operations and financial
condition, for the quarterly period ended June 30, 2020, which we
are furnishing to the SEC on or about the date hereof, and our
other reports filed with or furnished to the SEC, which are
designed to advise interested parties of the risks and factors that
may affect our business, financial condition, results of operations
and prospects. Any guidance provided, and other forward-looking
statements made, in this press release are made as of the date
hereof, and Stratasys undertakes no obligation to publicly update
or revise any forward-looking statements, whether as a result of
new information, future events or otherwise, except as required by
law.
Use of non-GAAP financial
measures
The non-GAAP data included herein, which excludes certain items
as described below, are non-GAAP financial measures. Our management
believes that these non-GAAP financial measures are useful
information for investors and shareholders of our Company in
gauging our results of operations on an ongoing basis after (i)
excluding mergers, acquisitions and divestments related expense or
gains and restructuring-related charges or gains, and (ii)
excluding non-cash items such as stock-based compensation expenses,
acquired intangible assets amortization, including intangible
assets amortization related to equity method investments,
impairment of long-lived assets, and the corresponding tax effect
of those items. These non-GAAP adjustments either do not reflect
actual cash outlays that impact our liquidity and our financial
condition or have a non-recurring impact on the statement of
operations, as assessed by management. These non-GAAP financial
measures are presented to permit investors to more fully understand
how management assesses our performance for internal planning and
forecasting purposes. The limitations of using these non-GAAP
financial measures as performance measures are that they provide a
view of our results of operations without including all items
indicated above during a period, which may not provide a comparable
view of our performance to other companies in our industry.
Investors and other readers should consider non-GAAP measures only
as supplements to, not as substitutes for or as superior measures
to, the measures of financial performance prepared in accordance
with GAAP. Reconciliation between results on a GAAP and non-GAAP
basis is provided in a table below.
Stratasys Ltd. Consolidated Balance Sheets
(Unaudited) (in thousands, except share data)
June 30,
December 31,
2020
2019
ASSETS Current assets Cash and
cash equivalents
$
284,742
$
293,484
Short-term deposits
$
28,300
$
28,300
Accounts receivable, net
102,212
132,558
Inventories
164,588
168,504
Prepaid expenses
7,056
6,567
Other current assets
19,969
29,659
Total current assets
606,867
659,072
Non-current assets Property, plant and equipment, net
194,437
189,706
Goodwill
385,636
385,658
Other intangible assets, net
75,638
87,328
Operating lease right-of-use assets
17,738
20,936
Other non-current assets
33,744
38,819
Total non-current assets
707,193
722,447
Total assets
$
1,314,060
$
1,381,519
LIABILITIES AND EQUITY Current
liabilities Accounts payable
$
30,600
$
35,818
Accrued expenses and other current liabilities
23,743
28,528
Accrued compensation and related benefits
29,548
34,013
Deferred revenues
48,617
52,268
Operating lease liabilities - short term
8,667
9,292
Total current liabilities
141,175
159,919
Non-current liabilities Deferred revenues - long-term
13,489
16,039
Operating lease liabilities - long term
9,493
12,445
Other non-current liabilities
31,576
35,343
Total non-current liabilities
54,558
63,827
Total liabilities
195,733
223,746
Redeemable non-controlling interests
572
622
Equity Ordinary shares, NIS 0.01 nominal value,
authorized 180,000 thousands shares; 55,030 thousands shares and
54,441 thousands shares issued and outstanding at June 30, 2020 and
December 31, 2019, respectively
150
148
Additional paid-in capital
2,717,963
2,706,894
Accumulated other comprehensive loss
(8,494
)
(7,716
)
Accumulated deficit
(1,591,864
)
(1,542,175
)
Total equity
1,117,755
1,157,151
Total liabilities and equity
$
1,314,060
$
1,381,519
Stratasys Ltd. Consolidated Statements of Operations
(in thousands, except per share data)
Three Months Ended June
30,
Six Months Ended June
30,
2020
2019
2020
2019
(unaudited)
(unaudited)
(unaudited)
(unaudited)
Net sales Products
$
73,877
$
110,341
$
157,049
$
215,432
Services
43,746
52,822
93,481
103,031
117,623
163,163
250,530
318,463
Cost of sales Products
39,969
47,095
79,217
91,264
Services
33,918
34,901
67,707
69,575
73,887
81,996
146,924
160,839
Gross profit
43,736
81,167
103,606
157,624
Operating expenses Research and development, net
21,303
24,040
45,497
46,614
Selling, general and administrative
51,711
56,322
107,287
113,476
73,014
80,362
152,784
160,090
Operating (loss) income
(29,278
)
805
(49,178
)
(2,466
)
Financial income (expense), net
149
1,754
(680
)
2,508
Income (loss) before income taxes
(29,129
)
2,559
(49,858
)
42
Income tax (benefit) expenses
(2,128
)
1,280
(1,907
)
2,498
Share in profits (losses) of associated companies
(950
)
(195
)
(1,788
)
1,228
Net income (loss)
(27,951
)
1,084
(49,739
)
(1,228
)
Net income (loss) attributable to non-controlling interests
35
(68
)
(50
)
(110
)
Net income (loss) attributable to Stratasys Ltd.
$
(27,986
)
$
1,152
$
(49,689
)
$
(1,118
)
Net income (loss) per ordinary share attributable to
Stratasys Ltd. Basic
$
(0.51
)
$
0.02
$
(0.91
)
$
(0.02
)
Diluted
$
(0.51
)
$
0.02
$
(0.91
)
$
(0.02
)
Basic
54,917
54,231
54,733
54,102
Diluted
54,917
54,687
54,733
54,102
Three Months Ended June
30,
2020
Non-GAAP
2020
2019
Non-GAAP
2019
GAAP
Adjustments
Non-GAAP
GAAP
Adjustments
Non-GAAP
U.S. dollars and shares in
thousands (except per share amounts)
Gross profit (1)
$
43,736
$
9,612
$
53,348
$
81,167
$
4,441
$
85,608
Operating income (loss) (1,2)
(29,278
)
21,228
(8,050
)
(805
)
8,246
9,051
Net income (loss) attributable to Stratasys Ltd. (1,2,3)
(27,986
)
20,634
(7,353
)
1,152
7,372
8,524
Net income (loss) per diluted share attributable to Stratasys Ltd.
(4)
$
(0.51
)
$
0.38
$
(0.13
)
$
0.02
$
0.14
$
0.16
(1)
Acquired intangible assets amortization expense
4,065
3,900
Non-cash stock-based compensation expense
497
541
Restructuring and other related costs
5,050
-
9,612
4,441
(2)
Acquired intangible assets amortization expense
2,125
1,783
Non-cash stock-based compensation expense
5,614
5,552
Restructuring and other related costs
3,798
(3,530
)
Other expenses
79
-
11,616
3,805
21,228
8,246
(3)
Corresponding tax effect
(669
)
(874
)
Equity method related amortization, divestments and impairments
75
-
$
20,634
$
7,372
(4)
Weighted average number of ordinary shares outstanding- Diluted
54,917
54,917
54,687
54,687
Six Months Ended June
30,
2020
Non-GAAP
2020
2019
Non-GAAP
2019
GAAP
Adjustments
Non-GAAP
GAAP
Adjustments
Non-GAAP
U.S. dollars and shares in
thousands (except per share amounts)
Gross profit (1)
$
103,606
$
14,026
$
117,632
$
157,624
$
8,693
$
166,317
Operating income (loss) (1,2)
(49,178
)
32,719
(16,459
)
(2,466
)
18,321
15,855
Net income (loss) attributable toStratasys Ltd. (1,2,3)
(49,689
)
31,771
(17,919
)
(118
)
15,299
14,181
Net income (loss) per diluted share attributableto Stratasys Ltd.
(4)
$
(0.91
)
$
0.58
$
(0.33
)
$
(0.02
)
$
0.28
$
0.26
(1)
Acquired intangible assets amortization expense
8,130
7,798
Non-cash stock-based compensation expense
899
895
Restructuring and other related costs
4,997
-
14,026
8,693
(2)
Acquired intangible assets amortization expense
4,267
3,672
Non-cash stock-based compensation expense
10,119
9,427
Restructuring and other related costs
3,829
(3,471
)
Other expenses
478
-
18,693
9,628
32,719
18,321
(3)
Corresponding tax effect
(1,100
)
(1,418
)
Equity method related amortization, divestments and impairments
152
(1,604
)
$
31,771
$
15,299
(4)
Weighted average number of ordinary shares outstanding- Diluted
54,733
54,733
54,102
54,585
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200805005122/en/
Stratasys Investor Relations Yonah Lloyd Vice President -
Investor Relations Yonah.Lloyd@stratasys.com
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