3D Printing Company Desktop Metal Slashes FY23 Revenue Outlook, Misses Q3 Earnings Expectations

Desktop Metal Inc DM reported a third-quarter FY23 revenue decline of 9.2% year-over-year to $42.75 million, missing the consensus of $49.77 million. 

The decline was driven by lower product sales, a focus on sales of products with higher margins, and partially offset by increased services sales.

Adjusted net loss per share was $(0.08), missed the consensus of $(0.05).

Adjusted net loss narrowed to $(24.51) million from $(33.05) million a year ago.

Q3 GAAP gross margin was 4.5%, and adjusted gross margin was 21.9%, an improvement of 193 bps YoY.

Adjusted EBITDA stood at $(20.5) million, an improvement of $7.7 million from 3Q22.

Also Read: 3D Printing Solutions Provider Stratasys Seeks Strategic Options As Desktop Metal Merger Fails

Desktop Metal held cash and equivalents of $108.2 million as of September 30, 2023.

"Revenue in the third quarter was disappointing for Desktop Metal and also for the entire additive manufacturing industry. However, while we are dissatisfied with our top-line performance, I am incredibly proud of the progress that Team DM has made in executing our $100 million of annualized cost reductions announced in June 2022," commented Ric Fulop, Founder and CEO of Desktop Metal.

"Despite softer revenue in the third quarter, our recurring revenue streams continue to perform well, contributing to a positive shift in adjusted EBITDA and a path towards reaching breakeven in the fourth quarter of 2023," Fulop noted.

FY23 Outlook, lowered: Desktop Metal expects revenue of $187 million-$207 million (prior expectation $210 million-$260 million) versus consensus of $212.18 million.

The company sees Adjusted EBITDA of $(70) million-$(50) million (prior $(50) million-$(25) million) with an expectation to achieve Adjusted EBITDA breakeven before year end 2023.

Price Action: DM shares are trading higher by 6.05% at $0.9606 on the last check Thursday.