Globes is reporting that Stratasys Inc. (Nasdaq: SSYS) lowered its forecasts for this year.
The company, based in Rehovot, Israel, “issued a revenue and profit warning that sent its shares tumbling 25% in after-hours trading.”
Wall Street had already predicted this kind of set back, “as indicated by the share’s steep descent last year…from its February 2014 peak of $127.61.”
Before this steep drop, the Stratasys “share was at $60, reflecting a $3 billion market cap. At its peak, the company was worth $6.4 billion, meaning that its market cap lost $3.4 billion in less than a year.”
“Going back to last year, the company said its revenue in 2014 would be in the $748-750 million range, compared with the previous forecast of $750-770 million…the main reason is its write-down of good will for the value of its business in desktop printer manufacturer Makerbot, acquired by Stratasys in the summer of 2013.”
Stratasys claims that Makerbot’s poorer than expected performance is one of the reasons for Stratasys’ downwardly revised forecast. According to the company, “Makerbot invested a lot in 2014 in launching the fifth generation of its printers and in expanding its distribution network. During the fourth quarter, however, Makerbot had to cope with challenges posed by the launching of its new solutions, and by its new distribution model.”
Stratasys’ woes are similar to 3D Systems’ issues late last year. The giants of the 3D printing world are running into challenges with the distribution and manufacturing lines for their 3D printers. As a result, investors are, for now, reluctant.
Image Courtesy of Stratasys Inc.
Quotes Courtesy of Globes