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3D Systems (DDD) Reports Wider-Than-Expected Loss in Q2

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Shares of 3D Systems (DDD - Free Report) depreciated 7% in after-hour trading on Wednesday after the company reported wider-than-expected loss for the second quarter of 2020.

For the second quarter, the company reported non-GAAP loss per share of 13 cents, wider than the Zacks Consensus Estimate of loss of 10 cents. Moreover, the bottom line compares unfavorably with the year-ago quarter’s break-even earnings.

3D Systems’ revenues of $112.1 million missed the consensus mark of $117.9 million as well as declined 28.7% year over year. The company’s overall financial performance reflects the negative impact of lower demand for its products due to the pandemic-led shutdowns or reduced level of business activities.

3D Systems Corporation Price, Consensus and EPS Surprise 3D Systems Corporation Price, Consensus and EPS Surprise

3D Systems Corporation price-consensus-eps-surprise-chart | 3D Systems Corporation Quote

Quarterly Details

3D Systems’ Healthcare segment revenues fell 11.4% to $50 million. The company’s Industrial division revenues plunged 38.5% year over year to $62.1 million

In the reported quarter, non-GAAP gross profit declined 37.6% year over year to $46.3 million, while margin shrunk 610 basis points to 41.3%. This decrease primarily resulted from lower volume and reduced absorption of overhead.

In the second quarter, the company’s non-GAAP operating expenses dropped 20.4% to $57.1 million. This year-over-year decline was chiefly due to the company’s sustained focus on lowering its cost structure. Non-GAAP SG&A costs were down 21.7% and non-GAAP R&D expense slid 17.1%.

3D Systems ended the June-end quarter with cash and cash equivalents of $63.9 million compared with the $112.8 million recorded at the end of the prior quarter. The company used $21 million of cash for operational activities during the first half of 2020.

Zacks Rank and Key Picks

Currently, 3D Systems carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology sector include Benefitfocus , Cogent Communications Holdings (CCOI - Free Report) and Synaptics (SYNA - Free Report) , all carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The long-term earnings growth rate for Benefitfocus, Cogent and Synaptics is currently pegged at 30%, 10.6%, and 10%, respectively.

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