What Management Said
Read the full Q2 2026 transcript ↗Today's call is accompanied by two important announcements: our earnings results and the beginning of a leadership transition plan, both of which I will address this morning. I'll then turn the call over to Phyllis Nordstrom, our CFO, who will summarize the quarter's financial results and outlook, and will then open the call up for Q&A. A major theme clearly emerging this year is the return of capital spending by our customers in key markets. Industrial business revenue was modestly lower year-over-year as older systems in our installed base are now being increasingly replaced by our new printer platforms.
Despite this dynamic, our two key industrial focus markets, aerospace and defense and data center infrastructure, both delivered strong double-digit growth again this quarter. Sales of both platforms into our key markets have been very strong, with Q2 growth of roughly 90% and 125% respectively year-over-year. Given this rapid rise in demand for 3D-printed metal parts, we're also significantly expanding our internal metal parts production capacity. This is an important element of our growth strategy, and I'll touch on it in more detail in a few moments.
Before beginning our review, I'd like to remind you that we completed the divestiture of our legacy software businesses during 2025. Q2 revenue increased year-over-year, driven by strong demand across our target markets and increasing sales of our new polymer and metal printer platforms. Adjusted EBITDA also improved notably from the prior year period as a result of higher revenue, disciplined cost management, and ongoing operational efficiencies. Performance across our key strategic markets remained strong in the quarter as med tech, aerospace and defense, and data center infrastructure each delivered double digit year-over-year growth.
What went well
- Printer (hardware) sales grew more than 45% year-over-year (and over 20% sequentially), led by the DMP 350 metal system, the new SLA 825 polymer platform, and MultiJet/NextDent denture systems, as customer capital spending returned across key markets.
- Three of the four strategic focus markets -- med tech, aerospace and defense, and data center infrastructure -- each delivered double-digit year-over-year growth.
- The two flagship metal-path platforms saw exceptional demand, with DMP 350 up roughly 90% and SLA 825 up roughly 125% year-over-year.
- The company booked its strongest industrial polymer printer order activity since 2014 -- a large multi-quarter order for printers critical to producing reusable rockets -- with some units shipped in Q2 and a high-margin consumable-materials stream to follow.
- Adjusted EBITDA improved notably year-over-year to near breakeven on higher revenue, disciplined cost management (~$60 million of run-rate cost reductions), and operational efficiencies, aided by $2.6 million of tariff refunds in the quarter.
- Healthcare, the largest segment, grew 6.8% to $48.1 million on strong med tech demand (orthopedic implant OEMs) and continued NextDent 300 denture-printer adoption across the U.S. and Europe.
What went wrong
- Total revenue of $94.6 million rose only 1.4% year-over-year (on an adjusted basis excluding 2025 software divestitures), as strength in the four core markets was offset by weaker legacy and consumer-facing businesses.
- The industrial segment declined 3.7% year-over-year to $46.5 million, reflecting revenue that did not carry forward after closing a non-core product line and lower services revenue on the legacy installed base.
- Non-GAAP gross margin of 36.7% was pressured by a higher mix of (lower-margin) hardware printer sales, a less favorable materials mix, and a tough comparison to a prior-year regenerative-medicine milestone.
- The company remains just below positive adjusted EBITDA and guided to a small loss in Q3, still needing volume-driven margin improvement to cross into profitability.
- Consumer-facing industrial markets -- service bureaus, jewelry (heavily Middle East-exposed) -- remained challenged, including from Chinese competition, and are not areas of future growth investment.
- The company announced a CEO leadership transition, launching a search for a successor to Dr. Jeffrey Graves, introducing near-term leadership uncertainty even though he will remain for months during the process.
Guidance Changes
| Metric | Period | Current guidance |
|---|---|---|
| Revenue | Q3 2026 | Mid-single-digit sequential growth at the midpoint (unusual seasonal growth from Q2 to Q3), driven by broad-based strength across printers, materials, and parts |
| Adjusted EBITDA | Q3 2026 | Small loss expected (approaching but not yet at positive) |
| Gross margin | H2 2026 | Pressured by a printer-heavy mix, especially in a seasonally printer-heavy Q4 |
| Operating expenses | H2 2026 | Expected to be similar to first-half levels, reflecting stabilized opex |
| Full-year / 2027 outlook | FY2026 / 2027 | Not provided; company deliberately guides only one quarter out given macro volatility |
Performance Breakdown
| Metric | YoY | Note |
|---|---|---|
| Total revenue | +1.4% to $94.6M (adjusted) | Strong printer sales and core-market growth offset by legacy/consumer-facing weakness; presented excluding 2025 software divestitures. |
| Printer (hardware) sales | +>45% (>20% sequential) | Return of customer capital spending meeting a three-year product-portfolio refresh; led by DMP 350, SLA 825, and denture platforms. |
| Healthcare segment | +6.8% to $48.1M | Strong med tech demand (orthopedic implant OEMs), PHS surgical-planning/trauma growth, and NextDent 300 denture adoption. |
| Industrial segment | -3.7% to $46.5M (+2.4% sequential) | Closure of a non-core product line and lower legacy services revenue, partly offset by aerospace/defense and data-center strength. |
| DMP 350 metal printer | +~90% | Rising demand for direct metal (laser powder bed fusion) printed parts in med tech and aerospace/defense. |
| SLA 825 polymer printer | +~125% | Demand for high-quality metal-casting patterns, including the large reusable-rocket order. |
| Data center infrastructure | +>20% | Increasing demand for metal parts used in critical airflow and thermal-management components for semiconductor manufacturing equipment. |
| Non-GAAP gross margin | 36.7% | Higher hardware mix and less favorable materials mix plus a prior-year regenerative-medicine milestone comparison, partly offset by cost actions and $2.6M of tariff refunds. |
Earnings Call Themes & Trends
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Return of customer capital spending | Multi-year industry recession and severe headwinds | Capital spending is returning across key markets just as a three-year portfolio refresh completes, driving >45% printer growth and management's view that the industry is emerging from recession. | — |
| Four strategic growth markets | Broad, unfocused portfolio | Focus narrowed to med tech, dental, aerospace/defense, and data center infrastructure -- all 'firing on all cylinders' -- with revenue expected to shift away from competitive consumer-facing markets over time. | — |
| Two metal-part production paths | Direct metal printing emphasis | Both direct metal printing (DMP 350) and 3D-printed casting patterns (SLA 825) are scaling; the company is expanding internal metal-parts production capacity and bridging customers from application development to part production to printer sales as a margin driver. | — |
| Dentures (NextDent 300) | Historically tied to the dental aligner market | The purpose-built denture platform is being very well received on comfort-of-fit and dentist productivity; now in ~100 of the several-hundred key labs (some buying 2nd/3rd printers), with FDA/EU-MDR-regulated materials driving high-margin pull-through and a potential revenue stream several times the aligner business by 2027-2028. | — |
| Path to profitability | ~$60M of run-rate cost reductions taken | The lever to positive adjusted EBITDA is volume-driven gross-margin expansion, especially polymer materials pull-through (often regulated/preferred) and metal-part production following installed printers. | — |
| Data center energy / nuclear | Airflow/thermal components for semi equipment | A future opportunity in power generation for data centers (including small nuclear reactors), working with OEMs like GE Vernova and Siemens and hyperscalers, leveraging the Savannah River National Lab tie-in for high-temperature materials -- potentially its own revenue and profit stream in a few years. | — |
Q&A Summary
James Ricchiuti (Needham) asked how to think about the NextDent denture deployment into 2027 based on current market feedback.
CEO Jeffrey Graves said he is thrilled with receptivity, citing comfort-of-fit (fewer patient revisits) and dentist productivity; 3D Systems is now in about 100 of the roughly 8,000 U.S./European labs (a few hundred of which drive most revenue), with some buying second and third printers, has raised production plans twice, and sees a regulated-materials pull-through opportunity potentially several times larger than the aligner business by 2027-2028.
Ricchiuti also asked (to CFO Phyllis Nordstrom) how to think about gross margins and opex in the back half.
Nordstrom said H2, especially Q4, will be printer-heavy (year-end CapEx), slightly pressuring gross margin mix, while opex should remain stable and similar to the well-controlled first half.
Greg Palm (Craig-Hallum) asked why the CEO transition is happening now and whether the search has started.
Graves said the search is just getting underway and could take many months; with the hard work of cost-cutting, portfolio refresh, and market focus done and cash on the balance sheet, it is an attractive, well-positioned moment to hand off to a successor with a long (roughly decade) runway, rather than transitioning from a position of distress.
Palm also asked about the record industrial polymer order and whether 3D Systems can return to double-digit growth.
Graves confirmed a very large multi-quarter order for printers critical to reusable-rocket production (some shipped in Q2, high-margin material pull-through to follow) and agreed the trend points toward becoming a growth company again, but declined to commit to a timeline, preferring to guide one quarter out given world volatility.
Kieran McCabe (Cantor Fitzgerald) asked about visibility in more cyclical/price-sensitive markets (like aligners) and the levers to reach positive adjusted EBITDA.
Graves said dental/aligners have stabilized at more modest growth and remain a solid foundation, while consumer-facing service bureaus and jewelry stay challenged (including Chinese competition); the key profitability lever is volume-driven gross-margin expansion via polymer materials pull-through and metal-part production following printer installs.
McCabe also asked whether the data-center energy work is with hyperscalers behind-the-meter or utilities/grid.
Graves said 3D Systems works primarily with traditional power-generation OEMs (e.g., GE Vernova, Siemens) and hyperscalers that must bring their own power, is increasingly involved in small nuclear reactors for data centers, and leverages the Savannah River National Lab tie-in for high-temperature, hard-to-manufacture materials ideal for 3D printing -- a future opportunity he believes will warrant its own revenue and profit stream.
More on 3D Systems Corp
Reported 2026-08-04 · figures from the 3D Systems Corp Q2 2026 earnings call.
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