Stratasys (SSYS) Q4 Earnings and Revenues Beat Estimates

Stratasys SSYS reported fourth-quarter 2021 non-GAAP earnings of a penny per share in contrast to the Zacks Consensus Estimate of a loss of a penny per share. The bottom line came in lower than the year-ago quarter’s earnings of 13 cents per share.

The company’s revenues jumped 17.3% year over year to $167 million and surpassed the consensus mark of $165.4 million. This year-over-year top-line growth was driven by strength in the Systems performance.

Quarter in Detail

Segment-wise, Product revenues were up 19% from the year-ago quarter to $118 million. Within Product revenues, System revenues climbed 25.9% and Consumables revenues jumped 12.3% year over year.

Revenues from Services increased 13.3% year on year to $49 million. Within Service revenues, customer support revenues advanced 7% year over year.

Stratasys, Ltd. Price, Consensus and EPS Surprise

Stratasys, Ltd. Price, Consensus and EPS Surprise

Stratasys, Ltd. price-consensus-eps-surprise-chart | Stratasys, Ltd. Quote

Stratasys’ non-GAAP gross profit increased 10.8% from the year-ago period to $81.3 million. However, non-GAAP gross margin contracted 80 basis points (bps) to 48.7%, mainly due to raw material inflation and rising logistic costs. This was partially offset by a higher mix of Systems and Consumables revenues in sales.

Non-GAAP operating expenses flared up 28% year on year to $79.6 million. As a percentage of revenues, it expanded 40 bps to 47.7%. The increase was mainly driven by factors like a return to five-day work with higher expenses, higher operating costs and commissions due to more revenues and Xaar 3D acquisition-related expenses in the fourth quarter.

Non-GAAP operating income of $1.7 million was down 6.6% from the year-ago quarter’s $8.3 million. Consequently, the margin also fell by 490 bps to 1%.

Adjusted EBITDA plunged 45.9% to $7.9 million.

Balance Sheet & Other Details

The company exited the fourth quarter with cash and short-term deposits of $502.2 million compared with the $308.2 million witnessed at the end of the previous quarter.

As of Dec 31, 2021, there was no long-term debt.

During the October-December quarter, the company generated an operating cash flow of $4.4 million. In full-year 2021, Stratasys generated $35.8 million worth of cash from operations.

Full-Year Highlights

For full-year 2021, Stratasys reported revenues of $607.2 million, up 16.6% year over year.

The company reported a non-GAAP loss of 7 cents per share compared with the prior-year quarter’s loss of 25 cents per share.

Non-GAAP gross profit surged 42.5% to $290.5 million and the margin expanded 20 bps to 47.8.

Non-GAAP operating loss was $1.7 million compared with 2020’s loss of $9.1 million. Adjusted EBITDA was $22.6 million.

Outlook

For 2022, management projects revenues between $680 million and $695 million. Stratasys anticipates non-GAAP earnings in the range of 14 to 19 cents per share in 2022.

Stratasys estimates 2022 operating expenses to increase by $20-$25 million from the 2021 level, chiefly due to the ongoing investments in new products associated with higher revenues.

For 2022, Stratasys expects the non-GAAP operating margin to be slightly above 2%, with small losses in the first half and profitable contributions in the second half of the year.

Adjusted EBITDA is forecast in the band of $38-$41 million.

Zacks Rank & Key Picks

Stratasys currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the broader computer and technology sector include the iPhone maker Apple AAPL and Axcelis Technologies ACLS, both sporting a Zacks Rank #1 (Strong Buy), and Analog Devices ADI carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Apple’s second-quarter fiscal 2022 earnings has been revised upward by 3.6% to $1.43 per share over the past 30 days. For fiscal 2022, earnings estimates have moved north by 5.9% to $6.15 per share in the past 30 days.

Apple’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 20.3%. AAPL stock has appreciated 32.3% in the past year.

The Zacks Consensus Estimate for Axcelis’ first-quarter 2022 earnings has been revised upward by 2 cents to 89 cents per share over the past 30 days. For 2022, earnings estimates have moved north by 10.8% to $3.99 per share in the past 30 days.

Axcelis’ earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 30.3%. Shares of ACLS have rallied 74.6% in the past year.

The Zacks Consensus Estimate for Analog Devices’ first-quarter fiscal 2022 earnings has been revised upward by 23 cents to $2.08 per share over the past seven days. For fiscal 2022, earnings estimates have moved north by 79 cents to $8.32 per share in the past seven days.

Analog Devices’ earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 6%. Shares of ADI have gained 1.8% in the past year.

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