Second Quarter Revenue of $117.6 million

Second Quarter GAAP net loss of $28.0 million, or ($0.51) per diluted share, and non-GAAP net loss of $7.4 million, or ($0.13) per diluted share

Used $9.7 million of cash from operations - $313.0 million net cash position with no debt

MINNEAPOLIS & REHOVOT, Israel — (BUSINESS WIRE) — August 5, 2020 — Stratasys Ltd. (NASDAQ: SSYS) announced financial results for the second quarter of 2020.

Q2 2020 Financial Results Summary:

Revenue for the second quarter of 2020 was $117.6 million, compared to $163.2 million for the same period last year. The 27.9% reduction was primarily driven by the adverse impact of COVID-19 on the company’s customers throughout the industries into which the company sells its products and services.

• GAAP gross margin was 37.2% for the quarter, compared to 49.7% for the same period last year.
• Non-GAAP gross margin was 45.4% for the quarter, compared to 52.5% for the same period last year.
  • Gross margin decline is primarily due to the lower proportion of consumables out of the total revenue mix due to the COVID-19 crisis, not to discounting or material ASP reductions. The company strongly believes that gross margins will recover as our customers return to their pre-COVID utilization levels.
• GAAP operating loss for the quarter was $29.3 million, compared to operating income of $0.8 million for the same period last year.
• Non-GAAP operating loss for the quarter was $8.1 million, compared to non-GAAP operating income of $9.1 million for the same period last year.
• Non-GAAP EBITDA was ($1.6) million for the quarter, compared to $15.5 million for the same period last year.
• GAAP net loss for the quarter was $28.0 million, or ($0.51) per diluted share, compared to net income of $1.2 million, or $0.02 per diluted share, for the same period last year.
• Non-GAAP net loss for the quarter was $7.4 million, or ($0.13) per diluted share, compared to non-GAAP net income of $8.5 million, or $0.16 per diluted share, for the same period last year.
• The Company used $9.7 million of cash from operations during the second quarter and ended the period with $313.0 million in cash, cash equivalents and short-term deposits. The Company has no debt.

“3D Printing continues to penetrate further into manufacturing across every relevant business sector,” stated Yoav Zeif, CEO of Stratasys. “Despite the current macro slowdown due to COVID-19, we remain very optimistic about where our business and our industry is headed. The largest opportunity for us in 3D Printing is in Polymers, and the fastest-growing area is manufacturing. We are already a leader in Polymer additive manufacturing and expect to increase our presence through new offerings that will focus on delivering incremental customer value, especially in the fast-growing manufacturing applications, where we see the longest runway for growth through new technologies that we will offer,” continued Zeif. “We have the ecosystem, resources and strategy to further expand our leadership as we enhance and broaden our technology offerings to serve significantly more Polymer applications and offer a full suite of solutions. We believe that these efforts will reboot growth in the short to medium-term, provide us with access to a greater customer share of wallet, and leverage our core competencies to more than double our addressable market, driving our future profitable growth.”

Stratasys Ltd. Q2 2020 Conference Call Details

The Company plans to hold the conference call to discuss its second quarter 2020 financial results on Wednesday, August 5, 2020 at 8:30 a.m. (ET).

The investor conference call will be available via live webcast on the Stratasys Website at investors.stratasys.com, or directly at the following web address:

https://78449.themediaframe.com/dataconf/productusers/ssys/mediaframe/39720/indexl.html

To participate by telephone, the U.S. toll-free number is 877-407-0619 and the international dial-in is +1-412-902-1012. Investors are advised to dial into the call at least ten minutes prior to the call to register. The webcast will be available for 6 months at investors.stratasys.com, or by accessing the above-provided web address.

Stratasys (Nasdaq: SSYS) is a global leader in additive manufacturing or 3D printing technology and is the manufacturer of FDM^®, PolyJet™, and stereolithography 3D printers. The company’s technologies are used to create prototypes, manufacturing tools, and production parts for industries, including aerospace, automotive, healthcare, consumer products and education. For more than 30 years, Stratasys products have helped manufacturers reduce product-development time, cost, and time-to-market, as well as reduce or eliminate tooling costs and improve product quality. The Stratasys 3D printing ecosystem of solutions and expertise includes 3D printers, materials, software, expert services, and on-demand parts production.

To learn more about Stratasys, visit www.stratasys.com, the Stratasys blog, Twitter, LinkedIn, or Facebook. Stratasys reserves the right to utilize any of the foregoing social media platforms, including the company's websites, to share material, non-public information pursuant to the SEC's Regulation FD. To the extent necessary and mandated by applicable law, Stratasys will also include such information in its public disclosure filings.

Stratasys is a registered trademark and the Stratasys signet is a trademark of Stratasys Ltd. and/or its subsidiaries or affiliates. All other trademarks are the property of their respective owners.

Cautionary Statement Regarding Forward-Looking Statements

The statements in this press release regarding Stratasys' strategy, and the statements regarding its projected future financial performance, including the financial guidance (or withdrawal of guidance) concerning its expected results for 2020, are forward-looking statements reflecting management's current expectations and beliefs. These forward-looking statements are based on current information that is, by its nature, subject to rapid and even abrupt change. Due to risks and uncertainties associated with Stratasys' business, actual results could differ materially from those projected or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to: the degree of our success at introducing new or improved products and solutions that gain market share; the degree of growth of the 3D printing market generally; the duration of the global COVID-19 pandemic, which, if extensive, may continue to impact, in a material adverse manner, our operations, financial position and cash flows, and those of our customers and suppliers; the impact of potential shifts in the prices or margins of the products that we sell or services that we provide, including due to a shift towards lower-margin products or services; the impact of competition and new technologies; potential further charges against earnings that we could be required to take due to impairment of additional goodwill or other intangible assets; to the extent of our success at successfully consummating acquisitions or investments in new businesses, technologies, products or services; potential changes in our management and board of directors; global market, political and economic conditions, and in the countries in which we operate in particular (including risks related to the impact of coronavirus on our operations, supply chain, liquidity, cash flow and customer orders); costs and potential liability relating to litigation and regulatory proceedings; risks related to infringement of our intellectual property rights by others or infringement of others' intellectual property rights by us; the extent of our success at maintaining our liquidity and financing our operations and capital needs; the impact of tax regulations on our results of operations and financial condition; and those additional factors referred to in Item 3.D “Key Information - Risk Factors”, Item 4, “Information on the Company”, Item 5, “Operating and Financial Review and Prospects,” and all other parts of our Annual Report on Form 20-F for the year ended December 31, 2019 (the “ 2019 Annual Report ”), which we filed with the Securities and Exchange Commission (the “ SEC ”) on February 26, 2020. Readers are urged to carefully review and consider the various disclosures made throughout our 2019 Annual Report and the Report of Foreign Private Issuer on Form 6-K that attaches Stratasys’ unaudited, condensed consolidated financial statements and its review of its results of operations and financial condition, for the quarterly period ended June 30, 2020, which we are furnishing to the SEC on or about the date hereof, and our other reports filed with or furnished to the SEC, which are designed to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations and prospects. Any guidance provided, and other forward-looking statements made, in this press release are made as of the date hereof, and Stratasys undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.