what happened
Shares of 3D Printer Manufacturer 3D systems (NYSE: DDD) jumped just 84.5% in 11:30 EST trading – and yes, you read that right.
Early this morning, 3D announced the successful sale of its “non-core software business for approximately $ 64 million in cash returns”. It also added a preview of its Q4 2020 financial results, which predicted revenue would exceed analysts’ expectations and be between $ 170 million and $ 176 million for the quarter.
Image Source: Getty Images.
Approximately
In the latest report, analysts, of course, told investors to expect less than $140 million in Q4 sales from 3D, so what we are looking at here is an almost certain merit of historical proportions – but even that was not the end of the good news that 3D had to report.
With the $ 64 million cash windfall in hand, 3D says it has been able to pay off all of its “senior secured term debt,” and no longer has to keep selling shares, and diluting shareholders through its previously announced ” on-the-market “stock selling program. (By the way – at this stage a hat is suitable for the analysts of the investment bank Craig-Hallum, who predicted everyone of the above two months ago).
Now what
In essence, it is now debt-free and free to concentrate on its two core industries for 3D printers (industrial and healthcare), the company also noted that in addition to better-than-expected sales, it is likely to start from $ 11 million to pro forma profit of $ 19 million for Q4. Generally Accepted Accounting Results (GAAP) can still be as bad as a loss of $ 8.6 million, but there is at least the possibility that 3D will make a GAAP profit of as much as $ 0.5 million this quarter.
After a second quarter of 20% -plus in revenue growth, and with GAAP profitability finally within its grasp, Jeffrey Graves, CEO of 3D Systems, closed his note this morning, saying: “With the benefits of our organizational determination, our technology and application leadership and our relentless focus on operational execution, we are more optimistic than ever about the exciting future we will see in 2021 and beyond. ‘
Investors seem to agree with the rating.