3D printing company 3D Systems (NYSE: DDD) reported revenue ahead of Wall Street’s expectations in Q2 CY2026, but sales were flat year on year at $94.6 million. Its non-GAAP loss of $0.04 per share was $0.01 above analysts’ consensus estimates.

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Company Overview

Founded by the inventor of stereolithography, 3D Systems (NYSE: DDD) engineers, manufactures, and sells 3D printers and other related products to the aerospace, automotive, healthcare, and consumer goods industries.

Revenue Growth

A company’s long-term performance is an indicator of its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Over the last five years, 3D Systems’s demand was weak and its revenue declined by 8.9% per year. This was below our standards and is a sign of poor business quality.

Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. 3D Systems’s annualized revenue declines of 7.7% over the last two years suggest its demand continued shrinking.

3D Systems also breaks out the revenue for its most important segments, Industrial and Healthcare, which are 50.8% and 49.2% of revenue. Over the last two years, 3D Systems’s Industrial revenue (aerospace, defense, and transportation manufacturing) averaged 6% year-on-year declines while its Healthcare revenue (dental and medical devices) averaged 3.5% declines.

This quarter, 3D Systems’s $94.6 million of revenue was flat year on year but beat Wall Street’s estimates by 1%.

Looking ahead, sell-side analysts expect revenue to grow 1.1% over the next 12 months. While this projection suggests its newer products and services will fuel better top-line performance, it is still below average for the sector.

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Operating Margin

Operating margin is one of the best measures of profitability because it tells us how much money a company takes home after procuring and manufacturing its products, marketing and selling those products, and most importantly, keeping them relevant through research and development.

3D Systems’s high expenses have contributed to an average operating margin of negative 39.8% over the last five years. Unprofitable industrials companies require extra attention because they could get caught swimming naked when the tide goes out. It’s hard to trust that the business can endure a full cycle.

Looking at the trend in its profitability, 3D Systems’s operating margin decreased by 2.6 percentage points over the last five years. 3D Systems’s performance was poor no matter how you look at it - it shows that costs were rising and it couldn’t pass them onto its customers.

This quarter, 3D Systems generated a negative 11.2% operating margin. The company’s consistent lack of profits raises a flag.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Sadly for 3D Systems, its EPS declined by 22.4% annually over the last five years, more than its revenue. This tells us the company struggled because its fixed cost base made it difficult to adjust to shrinking demand.

We can take a deeper look into 3D Systems’s earnings to better understand the drivers of its performance. As we mentioned earlier, 3D Systems’s operating margin expanded this quarter but declined by 2.6 percentage points over the last five years. Its share count also grew by 22%, meaning the company not only became less efficient with its operating expenses but also diluted its shareholders.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For 3D Systems, its two-year annual EPS growth of 20.4% was higher than its five-year trend. Its improving earnings are an encouraging data point, but a caveat is that its EPS is still in the red.

In Q2, 3D Systems reported adjusted EPS of negative $0.04, up from negative $0.07 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects 3D Systems to improve its earnings losses. Analysts forecast its full-year EPS will improve from negative $0.26 to negative $0.13.

Key Takeaways from 3D Systems’s Q2 Results

We were impressed by how significantly 3D Systems blew past analysts’ EBITDA expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. Zooming out, we think this was a solid print. The stock traded up 9% to $3.06 immediately following the results.

3D Systems put up rock-solid earnings, but one quarter doesn’t necessarily make the stock a buy. Let’s see if this is a good investment. When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).