Stratasys (SSYS) stock falls on Q3 revenue miss amid weakness in Europe; earnings beat

Stratasys Ltd. (NASDAQ: SSYS) reported better-than-expected earnings for the third quarter of 2019, despite a decline in revenues. The company also lowered its full-year revenue guidance. The stock lost sharply during Wednesday’s pre-market trading session, following the announcement.

The company reported a 3% decline in third-quarter revenues to $157.5 million, lower than Wall Street’s projection of $162.1 million. The weakness is attributable to the ongoing slump in the automotive and industrial machinery market in Europe and Asia.

Earnings Beat

On an unadjusted basis, the Rehovot, Israel-based 3D printer maker reported a net loss of $6.9 million or $0.13 per share for the quarter, compared to a loss of $0.7 million or $0.01 per share in the third quarter of 2018. Adjusted earnings moved up to $0.12 per share from $0.11 per share last year. Analysts were looking for earnings of $0.11 per share.

Related: Stratasys Q2 2019 Earnings Conference Call Transcript

Stratasys’ interim CEO Elan Jaglom said, “ Our results in the third quarter reflect a continuation of our track record of delivering earnings and profitability, despite challenging global economic conditions that have impacted customer investments in our target verticals n Europe and Asia.”

Cuts FY19 Outlook

Taking a cue from the challenging market conditions, the management lowered its full-year 2019 revenue guidance to the range of $640 million to $655 million from the previous outlook of $670-$700 million. It is looking for a net loss of $17-$3 million or $ 0.31-$0.05 per share for 2019, on an adjusted basis.

On an adjusted basis, the company expects earnings to be in the range of $30 million to $38 million, or $0.55 per share to $0.70 per share. Adjusted operating margin is expected to be between 5.5% and 6.5%, and capital expenditure between $30 million and $45 million.

CEO Search

Stratasys has been led by interim CEO Jaglom for a long time as the management’s search for a new chief, after the resignation of Ilan Levin more than a year ago, is yet to make any headway. The market will be looking for updates on the matter in the conference call.

Also see: Skyworks Solutions Q4 earnings fall, but top view

Stratasys shares gained 9% since the beginning of 2019, after starting the year on a positive note. The stock closed the last trading session higher but lost sharply early Wednesday.

We’re on Flipboard! Follow us to receive the latest stock market, earnings, and financial news at your fingertips