Stratasys Releases Fourth Quarter and Full Year 2023 Financial Results

Stratasys Ltd. (Nasdaq: SSYS), a leader in polymer 3D printing solutions, today announced financial results for the fourth quarter and full year 2023.

Dr. Yoav Zeif, Stratasys’ Chief Executive Officer stated, “We continued to differentiate ourselves in 2023, achieving our tenth consecutive quarter of profitability on an adjusted basis. We also delivered 1.3% full year revenue growth when adjusted for divestitures despite a persistently challenging backdrop for our customers. Revenue in the fourth quarter was driven by another record for consumables sales, demonstrating how utilization of our systems remains strong, while a relentless focus on cost control contributed to improved margins.”

Dr. Zeif continued, “We are innovating and investing as we expand our leadership in additive manufacturing. Our newest and most advanced FDM offering, the F3300, is building a strong pipeline of interest after announcing Toyota as its first customer, and engagement across our entire suite of offerings remains robust. As macro-economic conditions normalize and capital spending constraints ease, we believe the pent-up demand for our best-in-class offerings will unlock, driving the next phase of outsized growth and increased profitability for our company.”

Summary - Fourth Quarter 2023 Financial Results Compared to Fourth Quarter 2022:

• Revenue of $156.3 million compared to $159.3 million.
• GAAP gross margin of 44.7%, compared to 43.1%.
• Non-GAAP gross margin of 48.8%, compared to 48.4%.
• GAAP operating income of $5.7 million, compared to operating income of $1.6 million.
• Non-GAAP operating income of $2.0 million, compared to operating income of $5.1 million.
• GAAP net loss of $15.0 million, or $0.22 per diluted share, compared to a net loss of $2.4 million, or $0.04 per diluted share.
• Non-GAAP net income of $1.6 million, or $0.02 per diluted share, compared to net income of $4.6 million, or $0.07 per diluted share.
• Adjusted EBITDA of $7.7 million, compared to $10.7 million.
• Cash used in operations of $7.7 million, compared to cash used in operations of $18.1 million.

Summary - 2023 Financial Results Compared to 2022:

• Revenue of $627.6 million compared to $651.5 million.
• GAAP gross margin of 42.5%, compared to 42.4%.
• Non-GAAP gross margin of 48.2%, compared to 48.0%.
• GAAP operating loss of $87.6 million, compared to an operating loss of $57.2 million.
• Non-GAAP operating income of $12.6 million, compared to operating income of $13.5 million.
• GAAP net loss of $123.1 million, or $1.79 per diluted share, compared to a loss of $29.0 million, or $0.44 per diluted share.
• Non-GAAP net income of $7.7 million, or $0.11 per diluted share, compared to net income of $10.3 million, or $0.15 per diluted share.
• Adjusted EBITDA of $35.0 million, compared to $36.1 million.
• Cash used in operations of $61.6 million, compared to cash used in operations of $75.4 million.

Financial Outlook:

Based on current market conditions and assuming that the impacts of global inflationary pressures, relatively high interest rates and supply chain costs do not impede economic activity further, the Company is providing the following outlook for 2024:

• Full year revenue of $630 million to $645 million, improving sequentially through the year.
  • Compare to 2023 revenue of approximately $616 million excluding divestments and annualizing Covestro.
• Based on current logistics and materials costs, full year gross margins of 49.0%-49.5%, improving sequentially through the year.
• Full year operating expenses in a range of $292 million to $297 million.
• Full year non-GAAP operating margins in a range of 2.5% to 3.5%.
• GAAP net loss of $88 million to $72 million, or ($1.24) to ($1.01) per diluted share.
• Non-GAAP net income of $9 million to $14 million, or $0.12 to $0.19 per diluted share.
• Adjusted EBITDA of $40 million to $45 million.
• Capital expenditures of $20 million to $25 million.
• Positive cash flow from operating activities.

Non-GAAP earnings guidance excludes $29 million to $31 million of projected amortization of intangible assets, $26 million to $28 million of share-based compensation expense, and reorganization and other expenses of $29 million to $35 million. Non-GAAP guidance includes tax adjustments of $2 million to $3 million on the above non-GAAP items.

Appropriate reconciliations between historical GAAP and non-GAAP financial measures are provided in a table at the end of our press release and slide presentation, with itemized detail concerning the non-GAAP financial measures.

Stratasys Ltd. Fourth Quarter 2023 Webcast and Conference Call Details

The Company plans to webcast its conference call to discuss its fourth quarter 2023 financial results on Thursday, March 7, 2024, at 8:30 a.m. (ET).

The investor conference call will be available via live webcast on the Stratasys Web site at investors.stratasys.com, or directly at the following web address:

https://event.choruscall.com/mediaframe/webcast.html?webcastid=cZzaGlQ ...

To participate by telephone, the U.S. toll-free number is 877-407-0619 and the international dial-in is [phone]. Investors are advised to dial into the call at least ten minutes prior to the call to register. The webcast will be available for six months at investors.stratasys.com, or by accessing the above-provided web address.

Stratasys is leading the global shift to additive manufacturing with innovative 3D printing solutions for industries such as aerospace, automotive, consumer products, healthcare, fashion and education. Through smart and connected 3D printers, polymer materials, a software ecosystem, and parts on demand, Stratasys solutions deliver competitive advantages at every stage in the product value chain. The world’s leading organizations turn to Stratasys to transform product design, bring agility to manufacturing and supply chains, and improve patient care.

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 concerning its expected results for 2023 and beyond, 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 extent of our success at introducing new or improved products and solutions that gain market share; the extent of growth of the 3D printing market generally; the global macro-economic environment, including headwinds caused by inflation, relatively high interest rates, unfavorable currency exchange rates and uncertain economic conditions; changes in our overall strategy, including as related to any restructuring activities and our capital expenditures; 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; the outcome of our board of directors’ comprehensive process to explore strategic alternatives for our company; potential further charges against earnings that we could be required to take due to impairment of additional goodwill or other intangible assets; the extent of our success at successfully consummating and integrating into our existing business acquisitions or investments in new businesses, technologies, products or services; the potential adverse impact of recent global interruptions and delays involving freight carriers and other third parties on our supply chain and distribution network; global market, political and economic conditions, and in the countries in which we operate in particular; potential adverse effects of Israel’s retaliatory war against the terrorist organization Hamas; 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, 2023, which we expect to file with the U.S. Securities and Exchange Commission, or SEC, in the coming days (the “2023 Annual Report”). Readers are urged to carefully review and consider the various disclosures made throughout our 2023 Annual Report and the Reports of Foreign Private Issuer on Form 6-K that attach Stratasys’ unaudited, condensed consolidated financial statements and its review of its results of operations and financial condition, for the quarterly periods throughout 2024, which will be furnished to the SEC throughout 2024, 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 provided or made (as applicable) 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 (i) on an ongoing basis after excluding mergers, acquisitions and divestments related expense or gains and reorganization-related charges or gains, and legal provisions, (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 goodwill, revaluation of our investments and the corresponding tax effect of those items, (iii) for certain non-GAAP measures, after eliminating the impact of changes attributable to currency exchange rate fluctuations, and (iv) after excluding changes in revenues solely attributable to divestitures of former subsidiary companies. 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
(in thousands, except share data)
(Unaudited)
			December 31,				December 31,
			2023				2022
ASSETS
Current assets
Cash and cash equivalents			$	82,585			$	150,470
Short-term bank deposits				80,000				177,367
Accounts receivable, net of allowance for credit losses of $1,449 and $861 as of December 31, 2023 and December 31, 2022, respectively				172,009				144,739
Inventories				192,976				194,054
Prepaid expenses				7,929				5,767
Other current assets				24,596				27,823
Total current assets				560,095				700,220
Non-current assets
Property, plant and equipment, net				197,552				195,063
Goodwill				100,051				64,953
Other intangible assets, net				127,781				121,402
Operating lease right-of-use assets				18,895				18,122
Long-term investments				115,083				141,610
Other non-current assets				14,448				18,420
Total non-current assets				573,810				559,570
Total assets			$	1,133,905			$	1,259,790
LIABILITIES AND EQUITY
Current liabilities
Accounts payable			$	46,785			$	72,921
Accrued expenses and other current liabilities				36,656				45,912
Accrued compensation and related benefits				33,877				34,432
Deferred revenues - short-term				52,610				50,220
Operating lease liabilities - short-term				6,498				7,169
Total current liabilities				176,426				210,654
Non-current liabilities
Deferred revenues - long-term				23,655				25,214
Deferred income taxes				723				5,638
Operating lease liabilities - long-term				12,162				10,670
Contingent consideration				11,900				23,707
Other non-current liabilities				24,200				24,475
Total non-current liabilities				72,640				89,704
Total liabilities				249,066				300,358
Equity
Ordinary shares, NIS 0.01 nominal value, authorized 180,000
shares; 69,656 shares and 67,086 shares issued				195				187
and outstanding at December 31, 2023 and December 31, 2022, respectively				3,091,649				3,048,915
Additional paid-in capital
Accumulated other comprehensive loss				(7,079	)			(12,818	)
Accumulated deficit				(2,199,926	)			(2,076,852	)
Total Equity				884,839				959,432
Total liabilities and equity			$	1,133,905			$	1,259,790

Stratasys Ltd.
Consolidated Statements of Operations
(in thousands, except per share data)
(Unaudited)
		Three Months Ended December 31,								Twelve Ended December 31,
		2023				2022				2023				2022
Revenues
Products		$	110,388			$	111,197			$	433,741			$	452,124
Services			45,949				48,062				193,857				199,359
			156,337				159,259				627,598				651,483
Cost of revenues
Products			58,275				58,180				226,510				234,601
Services			28,304				32,431				134,064				140,415
			86,579				90,611				360,574				375,016
Gross profit			69,758				68,648				267,024				276,467
Operating expenses
Research and development, net			25,078				21,387				94,425				92,876
Selling, general and administrative			39,006				45,665				260,179				240,750
			64,084				67,052				354,604				333,626
Operating income (loss)			5,674				1,596				(87,580	)			(57,159	)
Gain from deconsolidation of subsidiary			-				-				-				39,136
Financial income, net			846				2,309				2,993				229
Income (loss) before income taxes			6,520				3,905				(84,587	)			(17,794	)
Income tax expense			(637	)			(2,658	)			(5,782	)			(5,454	)
Share in losses of associated companies			(20,839	)			(3,637	)			(32,705	)			(5,726	)
Net loss		$	(14,956	)		$	(2,390	)		$	(123,074	)		$	(28,974	)
Net loss per share
Basic		$	(0.22	)		$	(0.04	)		$	(1.79	)		$	(0.44	)
Diluted		$	(0.22	)		$	(0.04	)		$	(1.79	)		$	(0.44	)
Weighted average ordinary shares outstanding
Basic			69,375				66,908				68,666				66,491
Diluted			69,375				66,908				68,666				66,491

			Three Months Ended December 31,
			2023				Non-GAAP				2023			2022				Non-GAAP				2022
			GAAP				Adjustments				Non-GAAP			GAAP				Adjustments				Non-GAAP
			U.S. dollars and shares in thousands (except per share amounts)
		Gross profit (1)	$	69,758			$	6,565			$	76,323		$	68,648			$	8,423			$	77,071
		Operating income (1,2)		5,674				(3,659	)			2,015			1,596				3,456				5,052
		Net income (loss) (1,2,3)		(14,956	)			16,604				1,648			(2,390	)			6,940				4,550
		Net income (loss) per diluted share (4)	$	(0.22	)		$	0.24			$	0.02		$	(0.04	)		$	0.11			$	0.07
(1	)	Acquired intangible assets amortization expense						5,446											7,297
		Non-cash stock-based compensation expense						879											1,041
		Restructuring and other related costs						240											85
								6,565											8,423
(2	)	Acquired intangible assets amortization expense						1,688											2,370
		Non-cash stock-based compensation expense						6,997											7,664
		Restructuring and other related costs						461											874
		Revaluation of investments						-											560
		Contingent consideration						(23,206	)										(19,490	)
		Legal, consulting and other expenses						3,836											3,056
								(10,224	)										(4,967	)
								(3,659	)										3,456
(3	)	Corresponding tax effect and other expenses						489											1,770
		Equity method related amortization, divestments and impairments						19,790											1,714
		Finance expenses						(16	)										-
							$	16,604										$	6,940
(4	)	Weighted average number of ordinary shares outstanding - Diluted		69,375								69,801			66,908								67,231

			Twelve Months Ended December 31,
			2023				Non-GAAP				2023			2022				Non-GAAP				2022
			GAAP				Adjustments				Non-GAAP			GAAP				Adjustments				Non-GAAP
			U.S. dollars and shares in thousands (except per share amounts)
		Gross profit (1)	$	267,024			$	35,764			$	302,788		$	276,467			$	36,016			$	312,483
		Operating income (loss) (1,2)		(87,580	)			100,207				12,627			(57,159	)			70,691				13,532
		Net income (loss) (1,2,3)		(123,074	)			130,783				7,709			(28,974	)			39,235				10,261
		Net income (loss) per diluted share (4)	$	(1.79	)		$	1.90			$	0.11		$	(0.44	)		$	0.59			$	0.15
(1	)	Acquired intangible assets amortization expense						19,603											28,158
		Non-cash stock-based compensation expense						3,701											4,082
		Restructuring and other related costs						12,460											(174	)
		Impairment charges						-											3,949
								35,764											36,016
(2	)	Acquired intangible assets amortization expense						9,167											8,950
		Non-cash stock-based compensation expense						27,917											29,378
		Restructuring and other related costs						7,087											2,737
		Revaluation of investments						4,880											3,777
		Contingent consideration						(22,329	)										(18,293	)
		Legal, consulting and other expenses						37,721											8,126
								64,443											34,676
								100,207											70,691
(3	)	Corresponding tax effect						3,894											4,988
		Equity method related amortization, divestments and impairments						24,871											2,285
		Finance expenses						1,811											406
		Net gain from sale of business						-											(39,136	)
							$	130,783										$	39,235
(4	)	Weighted average number of ordinary shares outstanding - Diluted		68,666								69,233			66,491								67,068

Stratasys Ltd.
Reconciliation of GAAP to Non-GAAP Forward Looking Guidance
Fiscal Year 2024
(in millions, except per share data)
GAAP net loss			($88) to ($72)
Adjustments
Stock-based compensation expense			$29 to $31
Intangible assets amortization expense			$26 to $28
Reorganization and other			$29 to $35
Tax expense (benefit) related to Non-GAAP adjustments			$2 to $3
Non-GAAP net income			$9 to $14
GAAP loss per share			($1.24) to ($1.01)
Non-GAAP diluted earnings per share			$0.12 to $0.19

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240307647578/en/

The Stratasys Stock at the time of publication of the news with a fall of -0,56 % to 10,60EUR on Tradegate stock exchange (07. März 2024, 13:33 Uhr).