Stratasys’ third quarter results met Wall Street’s revenue expectations, but the market reacted negatively as year-over-year sales declined and margin pressures persisted. Management attributed the top-line softness to continued macro-driven caution in capital equipment spending, particularly in industrial and manufacturing sectors. CEO Yoav Zeif emphasized that cost discipline and operational efficiencies were key in generating positive operating cash flow and non-GAAP earnings. He pointed to “strong execution by our team to leverage notably improved lower adjusted operating expenses by 440 basis points year over year,” even as gross margin remained under pressure from higher tariffs and unfavorable product mix.
Is now the time to buy SSYS? Find out in our full research report (it’s free for active Edge members).
Stratasys (SSYS) Q3 CY2025 Highlights:
- Revenue: $137 million vs analyst estimates of $136.6 million (2.2% year-on-year decline, in line)
- Adjusted EPS: $0.02 vs analyst estimates of $0 ($0.02 beat)
- Adjusted EBITDA: $5.04 million vs analyst estimates of $5.39 million (3.7% margin, 6.5% miss)
- The company reconfirmed its revenue guidance for the full year of $555 million at the midpoint
- Management reiterated its full-year Adjusted EPS guidance of $0.15 at the midpoint
- EBITDA guidance for the full year is $31 million at the midpoint, above analyst estimates of $30.43 million
- Operating Margin: -16.6%, up from -18.2% in the same quarter last year
- Market Capitalization: $716.8 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Stratasys’s Q3 Earnings Call
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Brian Drab (William Blair) asked about the gross margin trajectory and how quickly improvement from pricing actions would materialize. CEO Yoav Zeif explained that the full effect of price increases would be seen in the next quarter, with gradual improvement anticipated into 2026, but specific targets were not provided.
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Brian Drab (William Blair) inquired about the significance of recent wins with a major technology company for future revenue. Zeif stated these opportunities, especially in high-value manufacturing, are expected to contribute to growth next year, particularly in aerospace, defense, and tooling applications.
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Greg Palm (Craig Hallum Capital Group) followed up on the timing of larger production application deals and whether sales cycles were improving. Zeif indicated that while progress was being made and some improvement was noted, these cycles remain lengthy, often stretching up to two years, and the company remains focused on high-impact use cases.
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Troy Jensen (Cantor Fitzgerald) asked whether operating expenses would increase sequentially or remain controlled. CFO Eitan Zamir replied that operating expenses are expected to trend slightly down in the next quarter, balancing tight cost management with continued investment in R&D and sales.
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Alek Valero (Loop Capital Markets) requested more details on the dental market opportunity and timing. Zeif emphasized the company’s focus on restorative dental applications and highlighted recent leadership hires and customer wins, but did not provide specific market size or timing projections.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will be monitoring (1) the effectiveness of recently implemented price increases and their impact on gross margin, (2) the pace of adoption in key end-markets such as aerospace, defense, and dental, and (3) the company’s ability to maintain cost discipline while investing in R&D and sales. Execution on high-value manufacturing opportunities and the scaling of new leadership in dental will also be critical signposts for progress.
Stratasys currently trades at $8.46, down from $9.54 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free for active Edge members).
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