3D Systems Corporation

Greetings, and welcome to the 3D Systems first quarter 2026 earnings conference call and webcast. At this time, all participants are in listen-only mode. A question and answer session will follow the formal presentation, and you may be placed into question queue at any time by pressing star 1 on your telephone keypad. As a reminder, this conference is being recorded. If anyone should require operator assistance, please press star 0. It's now my pleasure to turn the call over to Vice President, Investor Relations, Monica Gould. Monica, please go ahead.

Hello, and welcome to 3D Systems' first quarter 2026 earnings conference call. With me on today's call are Dr. Jeffrey Graves, President and CEO, and Phyllis Nordstrom, Chief Financial Officer. The webcast portion of this call contains a slide presentation that we will refer to during the call. Those following along on the phone who wish to access the slide portion of this presentation may do so on the investor relations section of our website. The following discussion and responses to your questions reflect management's views as of today only and will include forward-looking statements as described on this slide. Actual results may differ materially. Additional information about factors that could potentially impact our financial results is included in our latest press release and our filings with the SEC, including our most recent annual report on Form 10-K and quarterly reports on Form 10-Q. During this call, we will discuss certain non-GAAP financial measures. In our press release and slides accompanying this webcast, you will find additional disclosures regarding these non-GAAP measures, including reconciliations with comparable GAAP measures. And with that, I'd like to turn the call over to our President and CEO, Dr. Jeffrey Graves, for opening remarks.

Thank you, Monica, and good morning, everyone. Building on the momentum we achieved in the fourth quarter of last year, I'm pleased to report a strong first quarter performance for 2026. I'll start today by reviewing a few highlights from our first quarter and provide some comments on overall market conditions. I'll then provide an update on our business strategy and key growth initiatives. After this, I'll turn things over to our CFO, Phyllis Nordstrom, to summarize the quarter's financials. When Phyllis concludes, we'll open up the call for Q&A. So let's turn to slide five. The additive manufacturing industry is now beginning to emerge from a multi-year trough, driven largely by global economic and geopolitical challenges that led customers to severely curtail capital spending. Our company's targeted investments in research and development, which we sustained in the face of intense cost pressures over this period, are now enabling us to introduce a completely refreshed portfolio of new products, spanning from direct metal printing systems to the five major polymer printing platforms. No company in our industry can match this range of technologies, nor the product performance that these systems can deliver. While it's been a painful period, the results can now begin to be seen in our performance. and there's much more excitement to come. I want to thank our dedicated employees for their hard work over the last few years in a highly cost-constrained environment. Speaking directly to my colleagues around the world, the success we're now seeing is a direct reflection of your talent and commitment to our company and to our customers. To derive the highest value from R&D investments, we focused them intensely on our three key growth markets, aerospace and defense, medtech, and dental. These markets in particularly derive enormous value from 3D printing and are all expected to grow significantly in the years ahead. They are also the most challenging markets to penetrate, given the extreme requirements for quality, precision, reproducibility, and regulatory oversight. Fortunately, we have a rich history and strong foundation in each of these markets, which provides the critical infrastructure and expertise needed for success. On slide six, our Q1 highlights tell a story. Solid growth in printer sales, increased momentum in part sales, strong growth in healthcare material sales. These results reflect the impact of our technology and market focus. From a product standpoint, we saw double-digit year-over-year growth in printer and material sales, as well as parts manufacturing, particularly in metals. We also saw balanced growth across both of our business units, healthcare and industrial. Turning to slide seven, in med tech, we continue to build on our market leading position. During the first quarter, we saw strong double digit year over year growth in several key areas, including medical parts manufacturing, printer sales, and surgical planning services. Medical parts manufacturing demand was driven specifically by titanium spinal implants, and both titanium and cobalt chrome joint implants used in replacement procedures. Printer revenue was led by sales of our DMP350 metal printer to medical device customers who are now entering a refresh and expansion cycle. This growth was partially offset by lower than expected sales to one key customer due to a temporary disruption in their internal operations, which was resolved by the end of the quarter. We're already seeing a recovery in their demand and expect a solid rebound in the second quarter. We also saw increased requirements for print know-how transfer by a large global healthcare customer as they prepare to purchase printers and transition to high volume parts manufacturing, likely to complete in 2027. This example illustrates the three phase growth model that we discussed on our Q4 call, namely process development, low to intermediate volume part production, and ultimately full system sales. As highlighted on slide eight, momentum in dental is accelerating across the full spectrum of our solutions, which we classify as straighten, repair, replace, and protect. We saw strong year-over-year double-digit growth in dental material sales, driven by both an increase in demand for aligners as well as in prosthetic materials for tooth repair, which we sell under our Vertex brand. Our Vertex dental materials have been a mainstay in Europe for many years, and we were pleased to gain U.S. regulatory approval late last year following a protracted trademark negotiation. This doubled the size of the market for Vertex, and it's now beginning to be reflected in our dental revenue performance. Now turning to slide nine. As you know, we've been very excited about our new product launch in the denture market. Two quarters into sale of these marvelous platforms, I can tell you that the reception by our dental lab customers and dentists alike has been terrific. As an example, yesterday we announced a major commercial milestone reflecting the enthusiasm of our denture technology is generating. In this case, Rho Dental Laboratory, one of the nation's premier full-service digital dental labs, became the first major U.S. dental lab to deploy an extensive fleet of our NextDent 300 jetted denture printing systems across their multiple sites. Following our U.S. launch in the fall of 2025, Roe has expanded their purchases, effectively tripling their manufacturing capacity for high-precision, multi-material, monolithic dentures. As B.J. Kowalski, CEO of Roe Dental Labs, said, The NextGen 300 has exceeded our expectations in production efficiency, dentist acceptance, and patient satisfaction. Adding more systems at this early stage allows us to triple output while maintaining the highest standards of quality and consistency. From a market standpoint, following our U.S. regulatory approval last year, we recently received the equivalent EU Phase IIa approval for our denture printing solution, two months ahead of schedule. With both U.S. and E.U. regulatory approvals now in place, we've significantly expanded our addressable market to more than 60 million indentureless patients, roughly one-third of the global market. This represents a multibillion-dollar opportunity as dental labs around the world transition from traditional labor-intensive methods to scalable, high-margin digital workflows. We expect to announce regulatory approvals in additional countries as they are gained throughout the year. Looking ahead for our denture platform, we've built a solid order backlog moving into our second quarter and are raising our internal production targets for the second half of the year. The Next Dent 300 has been the most successful new product launch since my arrival at 3D Systems five years ago. With very few installation issues, rapid integration in lab workflows, and acceptance by dentists, often upon initial exposure to the product. From a patient standpoint, these printed dentures look wonderful, fit perfectly and can be worn with confidence due to their toughness and wear resistance, a winning equation for the lab, the dentist, and the patient. I fully expect our portfolio of dental solutions to be a major contributor to our revenue and profitability for many years to come. Moving to slide 10. Before shifting our focus to aerospace and defense markets in detail, I want to first make clear the way in which 3D printing is used for these critical applications. What many investors do not appreciate is that our company is unique in offering two complementary approaches to the manufacture of high reliability metal components, both of which are seeing a rapid rise in demand. The first is direct metal printing, often called DMP for short, of components, which uses high powered lasers to directly center metal powder under a tightly controlled environment to form fully dense parts. In this process, it's essential that there is no binder or other contaminant in the system as these will degrade the performance of the part. This is the way the very highest performing metal parts are manufactured and it will remain so. Those that do not have this technology will simply not be able to participate in this high value portion of the market. The second path for making metal parts is through the use of high-precision SLA printed patterns for investment casting of specialty metals. This approach gives customers the flexibility on part size, material, and design at a cost and performance level that's virtually impossible to achieve with any other approach. Many complex aerospace systems, such as those used in rockets and aircraft propulsion systems, increasingly make use of both methods for the manufacture of critical flight components. Without them, we could not be routinely discussing space exploration, hypersonic flight, or many other advanced systems that are an integral part of our country's future. For the last several years, we've targeted leadership in both of these metal technologies, the culmination of which has been our DMP350 triple laser system and the SLA825 polymer platform that we've released over the last several months and that are rapidly gaining traction with key customers around the world. As you can see on slide 11, our metal printer portfolio now includes the DMP Flex 200, the DMP 350 Triple, the DMP 500, and our next generation large format metal printer system, the development of which has been supported in large part by the US government. This $28 million development program is designed to ensure leadership for U.S. in metal printing for the future. These systems deliver significant performance benefits and lay the foundation for further expansion in capacity, productivity, and material flexibility as the 3D printed metal market continues to expand. And finally, turning to slide 12, aerospace and defense, which we discussed extensively in our last earnings call, remains the largest and one of the fastest growing segments within our industrial solutions business. Examples of the project's driving growth include titanium antenna brackets for satellite systems that are 25% lighter and can be produced in half the time compared with traditional methods, as well as the mass production of turbine blades for jet engines and industrial turbines that improve performance and efficiencies in both flight systems and ground-based energy applications. Given our unmatched breadth of defense-focused printing technology, we continue to expect over 20% growth in our air and defense markets this year, equating to approximately $35 million in revenue in 2026. This growth will be largely driven by space, naval, and aero propulsion applications, as well as the expanding use of sophisticated flight and weapon systems in unmanned aerial vehicles and precision munitions. In response to the rapidly growing demand for aerospace and defense components, we're investing in a significant expansion to our Littleton, Colorado facility, adding 80,000 square feet of manufacturing space for the production of metal components. The grand opening of our new facility is on track for late summer, and we're excited about these new growth opportunities that this new facility opens for our company. Looking ahead on slide 13, We have the largest installed base of production printing systems in the industry, a refreshed portfolio on both polymers and metals, new printer systems that are gaining traction with customers, and rapidly expanding opportunities in high growth, high reliability markets. Acceptance of additive manufacturing is accelerating, and we're well positioned to capitalize on it. While the world situation never fails to present new challenges, I am more excited than ever about the future of our company. With that overview, I'll turn to slide 14 and hand the call over to Phyllis to walk through the financial results for Q1 in detail. Phyllis.