Q2 2025 Stratasys Ltd Earnings Call

I would like to hand, the call over to Jan <unk>, Chief Communications Officer, and Vice President of Investor Relations for Stratasys. Mr. Boyd. Please go ahead.

Good morning, everyone and thank you for joining us to discuss our 2025 second quarter financial results on the call with US today are our CEO, Dr. Jan <unk> and our CFO <unk> Zamir.

I would like to remind you that access to today's call, including the slide presentation is available online at the web address provided in our press release and.

In addition, a replay of today's call, including access to the slide presentation will also be available and can be accessed through the investor Relations section of our website.

Please note that some of the information provided during our discussion today will consist of forward looking statements, including without limitation those regarding our expectations as to our future revenue gross margin operating expenses taxes, and other future financial performance and our expectations for our business outlook.

Speaker #3: Good day and welcome to today's conference call to discuss Stratasys' second quarter 2025 financial results. My name is Kevin, and I'm your operator for today's call.

Yonah Lloyd: Good day, and welcome to today's conference call to discuss Stratasys' second quarter 2025 financial results. My name is Kevin, and I'm your operator for today's call. Now I'd like to hand the floor over to Yonah Lloyd, Chief Communications Officer and Vice President of Investor Relations for Stratasys. Mr. Lloyd, please go ahead.

Speaker #3: Now I'd like to hand the floor over to Yonah Lloyd, Chief Communications Officer and Vice President of Investor Relations for Stratasys. Mr. Lloyd, please go ahead.

The future performance events expectations or results are forward looking statements.

Speaker #4: Good morning, everyone, and thank you for joining us to discuss our 2025 second quarter financial results. On the call with us today are our CEO, Dr. Yoav Zeif, and our CFO, Eitan Zamir.

Eitan Zamir: Good morning, everyone, and thank you for joining us to discuss our 2025 second quarter financial results. On the call with us today are our CEO, Dr. Yoav Zeif, and our CFO, Eitan Zamir. I would like to remind you that access to today's call, including the slide presentation, is available online at the web address provided in our press release. In addition, a replay of today's call, including access to the slide presentation, will also be available and can be accessed through the Investor Relations section of our website. Please note that some of the information provided during our discussion today will consist of forward-looking statements, including without limitation, those regarding our expectations as to our future revenue, gross margin, operating expenses, taxes, and other future financial performance, and our expectations for our business outlook. The future performance, events, expectations, or results are forward-looking statements.

All results or trends could differ materially from our forecast for risks that could cause actual results to be materially different from those set forth in forward looking statements. Please refer to the risk factors discussed or referenced in Stratasys annual report on form 20-F for the 2024 year. Please also refer to that annual report along.

Speaker #4: I would like to remind you that access to today's call, including the slide presentation, is available online at the web address provided in our press release.

Speaker #4: In addition, a replay of today's call, including access to the slide presentation, will also be available and can be accessed through the Investor Relations section of our website.

With our reports filed with or furnished to the SEC throughout 2025 for additional operational and financial details.

Speaker #4: Please note that some of the information provided during our discussion today will consist of forward-looking statements, including without limitation, those regarding our expectations as to our future revenue gross margin, operating expenses, taxes, and other future financial performance, and our expectations for our business outlook.

Reports on form 6K that are furnished to the SEC on a quarterly basis and throughout the year provide updated current information regarding the company's operating results and material developments concerning our company.

Stratasys assumes no obligation to update any forward looking statements or information, which speak as of their respective dates.

Speaker #4: The future performance events expectations or results are forward-looking statements. Actual results or trends could differ materially from our forecast. For risks that could cause actual results to be materially different, from those set forth in forward-looking statements, please refer to the risk factors discussed or referenced in Stratasys' annual report on Form 20-F for the 2024 year.

As in previous quarters today's call will include GAAP and non-GAAP financial measures. The non-GAAP financial measures should be read in combination with our GAAP metrics to evaluate our performance non-GAAP to GAAP reconciliations are provided in tables in our slide presentation and today's press release I will now turn the call over to our Chief Executive Officer.

Eitan Zamir: Actual results or trends could differ materially from our forecast. For the risks that could cause actual results to be materially different from those set forth in forward-looking statements, please refer to the risk factors discussed or referenced in Stratasys' annual report on Form 20F for the 2024 year. Please also refer to that annual report along with our reports filed with or furnished to the FCC throughout 2025 for additional operational and financial details. Reports on Form 6K that are furnished to the FCC on a quarterly basis and throughout the year provide updated current information regarding the company's operating results and material developments concerning our company. Stratasys assumes no obligation to update any forward-looking statements or information which speak as of their respective dates. As in previous quarters, today's call will include GAAP and non-GAAP financial measures.

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Speaker #4: Please also refer to that annual report, along with our reports filed with or furnished to the SEC throughout 2025, for additional operational and financial details.

Thank you Donna and good morning, everyone.

And thank you for joining us.

Our second quarter results.

Aligned with expectation is.

Speaker #4: Reports on Form 6-K that are furnished to the SEC on a quarterly basis and throughout the year provide updated current information regarding the company's operating results and material developments concerning our company.

As revenue grew slightly over the second quarter of last year.

Reflecting the resilience of our recurring revenue streams and.

And the continued reliance customers place on our additive manufacturing technologies.

Speaker #4: Stratasys assumes no obligation to update any forward-looking statements or information which speak as of their respective dates. As in previous quarters, today's call will include gap and non-gap financial measures.

Customer engagements for our solution remains strong.

Spite the global operating environment.

Speaker #4: The non-gap financial measures should be read in combination with our gap metrics to evaluate our performance. Non-gap to gap reconciliations are provided in tables in our slide presentation and today's press release.

Eitan Zamir: The non-GAAP financial measures should be read in combination with our GAAP metrics to evaluate our performance. Non-GAAP to GAAP reconciliations are provided in tables in our slide presentation and today's press release. I will now turn the call over to our Chief Executive Officer, Dr. Yoav Zeif. Yoav?

Marked by ongoing uncertainty around challenged macroeconomic conditions and Terry policy.

The result is customer maintaining disciplined capital spending approaches.

Speaker #4: I will now turn the call over to our Chief Executive Officer, Dr. Yoav Zeif. Yoav,

A weight size of normalcy.

Our marriage.

Speaker #5: Thank you, Yonah. Good morning, everyone. And thank you for joining us. Our second quarter results aligned with expectations. As revenue grew slightly over the second quarter last year, reflecting the resilience of our recurring revenue streams, and the continued reliance customers place on our additive manufacturing technologies.

Yoav Zeif: Thank you, Yonah. Good morning, everyone, and thank you for joining us. Our second quarter results aligned with expectations, as revenue grew slightly over the second quarter last year, reflecting the resilience of our recurring revenue streams and the continued reliance customers place on our additive manufacturing technologies. Customer engagement for our solution remains strong despite a global operating environment marked by ongoing uncertainty around challenged macroeconomic conditions and tariff policies. The result is customers maintaining disciplined capital spending approaches as they await signs of normalcy to emerge. Importantly, we are making meaningful progress in crafting and delivering key use cases with major customers that we believe will eventually begin flowing through to our financial results at some point in the future.

Importantly, we are making meaningful progress in crafting and delivering key use cases with two major customers that we believe will eventually begin flowing through to our financial results at some point in the future. Furthermore, our ongoing investment and commitment to R&D excellence bolstered by our strong balance sheet.

<unk> us well to continue delivering innovative product materials and software capabilities further solidify our leadership in digital not a fixture.

Speaker #5: Customers engagement for our solution remains strong. Despite a global operating environment, marked by ongoing uncertainty, around challenged macroeconomic conditions, and tariff policies. The results is customers maintaining disciplined capital spending approaches, as they await signs of normalcy.

Particularly when customer spending eventually.

And evidently retail.

Innovation and execution remain the foundation of our long term growth strategy.

Centered on capturing opportunity within high growth sectors that have been transformed.

Speaker #5: Importantly, we are making meaningful progress in crafting and delivering key use cases, with major customers that we believe will eventually begin flowing through to a financial result at some point in the future.

The key Mega trends.

It includes the drive towards supply chain localization and onshoring the evolution of next generation mobility platforms.

Advancing sustainability requirement and a relentless focus on operational efficiency and cost optimization by companies around the globe.

Speaker #5: Furthermore, our ongoing investment and commitment to R&D excellence bolstered by our strong balance sheet positions us well to continue delivering innovative products, materials, and software capabilities that further solidify our leadership in digital manufacturing.

Yoav Zeif: Furthermore, our ongoing investment and commitment to R&D excellence, bolstered by our strong balance sheet, positions us well to continue delivering innovative products, materials, and software capabilities that further solidify our leadership in digital manufacturing, particularly when customer spending eventually and inevitably returns. Innovation and execution remain the foundation of our long-term growth strategy, which centers on capturing opportunities within high-growth sectors that are being transformed by key megatrends. These include the drive towards supply chain localization and onshoring, the evolution of next-generation mobility platforms, advancing sustainability requirements, and a relentless focus on operational efficiency and cost optimization by companies around the globe. By maintaining our disciplined approach to end-use development, prioritizing the most compelling applications while working to preserve margin integrity, we have built a platform that will enable Stratasys to emerge stronger as market dynamics stabilize.

By maintaining our disciplined approach to end use development prioritizing the most compelling applications, while working to preserve margin integrity. We have build a platform that will enable us to emerge stronger as the market dynamics stabilize.

Speaker #5: Particularly, when customers' spending eventually and inevitably returns. Innovation and execution remain the foundation of our long-term growth strategy. With centers on capturing opportunities within high-growth sectors, that are being transformed by key megatrends.

While the tariff environment continues to evolve.

It is worth re emphasizing.

That additive manufacturing can be an ideal solution in terry sensitive environments by enabling local rapid and cost effective production capabilities.

Speaker #5: These include the drive towards supply chain localization, and onshoring, the evolution of next-generation mobility platforms, advancing sustainability requirements, and a relentless focus on operational efficiency and cost optimization by companies around the globe.

Tariff policies can actually accelerate adoption of our technology and we anticipate increased customer engagement as we continue to highlight these strategic advantages.

Speaker #5: By maintaining our disciplined approach to end-use development, prioritizing the most compelling applications, while walking to preserve margin integrity, we have built a platform that will enable Stratasys to emerge stronger as market dynamics stabilize.

Turning to new technology offerings and customer success.

During the quarter, we launched the North American Stratasys tooling center in collaboration with automation intelligence.

Flint, Michigan location.

This facility is a dedicated hub to element of fixtures validate and scale additive manufacturing applications in production environment.

Speaker #5: While the tariff environment continues to evolve, it is worth re-emphasizing that additive manufacturing can be an ideal solution in tariff-sensitive environments by enabling local rapid and cost-effective production capabilities.

Yoav Zeif: While the tariff environment continues to evolve, it is worth reemphasizing that additive manufacturing can be an ideal solution in a tariff-sensitive environment by enabling local, rapid, and cost-effective production capabilities. Tariff policies can actually accelerate adoption of our technology, and we anticipate increased customer engagement as we continue to highlight these strategic advantages. Turning to new technology offerings and customer success. During the quarter, we launched the North American Stratasys Tooling Center in collaboration with Automation Intelligence at their Flint, Michigan location. This facility is a dedicated hub to help manufacturers validate and scale additive manufacturing applications in production environments. The center operates Stratasys F3300 and F900 3D printers to demonstrate practical tooling solutions, including jigs, fixtures, end-of-arms tooling, and automotive components, enabling customers to explore how additive manufacturing can streamline operations, reduce costs, and accelerate response to manufacturing challenges.

The center operates Stratasys F 3300, and F 903, D printers to demonstrate practical tooling solutions, including Jeep fixtures and advanced tooling and automotive components, enabling customers to explore our additive manufacturing can stream.

Speaker #5: Tariff policies can actually accelerate adoption of our technologies, and we anticipate increased customer engagement as we continue to highlight this strategic advantages. Turning to new technology offerings and customer success.

Line operation.

<unk> cost and accelerate response to manufacturing challenges.

By combining additive manufacturing technologies with traditional capabilities. This new center addresses the growing demand for localized on demand production solutions.

Speaker #5: During the quarter, we launched the North American Stratasys Tooling Center in collaboration with Automation Intelligence at their Flint, Michigan, location. This facility is a dedicated hub to help manufacturers validate and scale additive manufacturing applications in production environments.

While providing manufactures with validated proof.

It's additive polymer tooling is both viable and cost effective production environment.

Speaker #5: The center operates Stratasys F3300 and F900 3D printers to demonstrate practical tooling solutions, including jigs, fixtures, end-of-arm tooling, and automotive components, enabling customers to explore how our additive manufacturing can streamline operations.

Our strategic collaboration with General Motors exemplifies the transformative power editing manufacturer brings to automotive production.

For over two decades, we have helped GM revolutionize its manufacturing processes through our industrial <unk> printing solution.

<unk> I think in <unk> launch of its additive.

Speaker #5: Reduce costs and accelerate response to manufacturing challenges. By combining additive manufacturing technologies with traditional capabilities, this new center addresses the growing demand for localized, on-demand production solutions while providing manufacturers with validated proof that additive polymer tooling is both viable and cost-effective for production environments.

Ovation and entities industrialization centers in Michigan.

Yoav Zeif: By combining additive manufacturing technologies with traditional capabilities, this new center addresses the growing demand for localized on-demand production solutions while providing manufacturers with validated proof that additive polymer tooling is both viable and cost-effective for production environments. Our strategic collaboration with General Motors exemplifies the transformative power additive manufacturing brings to automotive production. For over two decades, we have helped GM revolutionize its manufacturing processes through our industrial 3D printing solutions, culminating in GM's launch of its Additive Innovation and Additive Industrialization Center in Michigan, one of North America's largest and most advanced additive manufacturing facilities. This collaboration has expanded with many F900 systems deployed across over 15 high-value GM plants throughout North America, achieving excellent utilization rates and demonstrating the mature, production-ready nature of our technology. The results demonstrate substantial value delivery to enterprise customers.

One of North America's largest and most advanced additive manufacturing facilities.

This collaboration has expanded with many F 900 systems deployed across over 15 high value GM plants throughout North America, achieving excellent utilization rates and demonstrating the mature production ready nature.

Speaker #5: Our strategic collaboration with General Motors exemplifies the transformative power additive manufacturers bring to automotive production. For over two decades, we have helped GM revolutionize its manufacturing processes through our industrial 3D printing solutions.

Of our technology.

The results demonstrate substantial value delivery to enterprise customers.

GM has achieved significant cost reduction on additive tooling compared to traditional methods, while streamlining manufacturing workflow.

Speaker #5: Culminating in GM's launch of its additive innovation and additive industrialization centers in Michigan, one of North America's largest and most advanced additive manufacturing facilities.

And accelerating tooling lead time.

From weeks to days or even hours. This provides critical competitive advantage, enabling a faster ramp of new vehicles in both internal combustion engine and electric vehicle programs.

Speaker #5: This collaboration has extended with many F900 systems, deployed across over 1,500 high-value GM plants, throughout North America, achieving excellent utilization rates and demonstrating the mature production-ready nature of our technology.

We are supporting Gms aggressive EV launch schedules with rapid production of specialized tools.

For battery and high voltage component handling, while improving operator safety through lightweight costume polymer tooling solutions.

Speaker #5: The results demonstrate substantial value delivery to enterprise customers, GM as a chief significant cost reduction on additive tooling compared to traditional methods while streamlining manufacturing workflow.

Importantly, our solution have GM achieved localized supply chain, resiliency and security, reducing dependencies and transportation requirements, while enabling faster response to urgent production needs.

Yoav Zeif: GM has achieved significant cost reduction on additive tooling compared to traditional methods while streamlining manufacturing workflow and accelerating tooling lead times from weeks to days or even hours. This provides a critical competitive advantage, enabling a faster ramp of new vehicles in both internal combustion engine and electric vehicle programs. We are supporting GM's aggressive EV launch schedules with rapid production of specialized tools for battery and high-voltage component handling, while improving operator safety through lightweight, custom polymer tooling solutions. Importantly, our solution helps General Motors achieve localized supply chain resilience and security, reducing dependencies and transportation requirements while enabling faster response to urgent production needs. Also within automotive, we recently shared a video highlighting our strong multi-year partnership with Toyota, featuring testimonials from their production engineering group around the critical value our technology plays in their production planning.

Speaker #5: An accelerating tooling lead time from weeks to days or even hours provides a critical competitive advantage, enabling a faster ramp of new vehicles in both internal combustion engine and electric vehicle programs.

Also we think automotive.

We recently shared a video highlighting our strong multiyear partnership with Toyota.

Featuring testimonials from their production engineering group around the critical value our technology plays in their production plans.

Speaker #5: We are supporting GM's aggressive EV launch schedules with rapid production of specialized tools for battery and high-voltage component handling. While improving operator safety through lightweight custom polymer tooling solutions, importantly, our solution helped GM achieve localized supply chain resilience.

Through this collaboration Toyota has achieved significant cost reduction by producing.

Tools admittedly compared to traditional methods, we have had compressed lead times from weeks to days or even hours.

Allow programs to reach production readiness.

Speaker #5: And security, reducing dependencies and transportation requirements while enabling faster response to urgent production needs. Also, within automotive, we recently shared a video highlighting our strong multi-year partnership with Toyota.

<unk> faster and supporting rapid replacement of.

Damage tools to minimize production line downtime.

Our additive solutions enable Toyota to create highly precise custom fit tools that reduce manufacturing variation and support consistent assembly.

Speaker #5: Featuring testimonials from their production engineering group, around the critical value our technology plays in their production plans. Through this collaboration, Toyota has achieved significant cost reduction by producing tools additively compared to traditional methods.

Light weight ergonomic designs reduced operators train and improve walks place safety.

Is Toyota fix to compress vehicle development time by nearly 33%.

Yoav Zeif: Through this collaboration, Toyota has achieved significant cost reduction by producing tools additively compared to traditional methods. We have helped compress lead times from weeks to days or even hours, allowing programs to reach production readiness far faster and supporting rapid replacement of damaged tools to minimize production line downtime. Our additive solutions enable Toyota to create highly precise custom-fit tools that reduce manufacturing variation and support consistent assembly, while lightweight, ergonomic designs reduce operator strain and improve workplace safety. As Toyota seeks to compress vehicle development time by nearly 33%, our additive manufacturing technology is integral to meeting these accelerated targets. Our system provides parts Toyota cannot produce using conventional methods with comparable speed or accuracy, often creating polymer components stronger than metal alternatives.

Our additive manufacturing technology is integral to meeting these accelerated targets.

Speaker #5: We have helped compress lead times from weeks to days or even hours, allowing programs to reach production readiness far faster and supporting rapid replacement of damaged tools to minimize production line downtime.

Our system.

Provide power Toyota cannot produce using conventional methods.

With comparable speed or accuracy.

And creating polymeric component stronger than metal alternatives.

Toyota utilizes all five of our additive technologies, plus our grub cut software to manage their printer fleet.

Speaker #5: Our additive solutions enable Toyota to create highly precise, custom-fit tools that reduce manufacturing variation and support consistent assembly while lightweight ergonomic designs reduce operator strain and improve workplace safety.

Simplifying how we partner with customers to expand their understanding and adoption of <unk> printing and an opportunity that could be far greater than today's market penetration.

Speaker #5: As Toyota seeks to compress vehicle development time by nearly 33%, our additive manufacturing technology is integral to meeting these accelerated targets. Our systems provide parts Toyota cannot produce using conventional methods.

Also during the quarter.

Our aerospace customer Blue origin purchased multiple new 800, SF systems for the production of investment casting patterns.

Blue origin is a leading aerospace manufacturers and space technology Trailblazer in reusable rocket technology.

Speaker #5: With comparable speed or accuracy, often creating polymer components stronger than metal alternatives. Toyota utilizes all five of our additive technologies, plus our GrabCAD software, to manage their printer fleet.

And a major participant.

NASA contract, including declined Artemis program.

Yoav Zeif: Toyota utilizes all five of our additive technologies, plus our GrabCAD software, to manage their printer fleet, exemplifying how we partner with customers to expand their understanding and adoption of 3D printing in an opportunity that could be far greater than today's market penetration. Also during the quarter, our aerospace customer, Blue Origin, purchased multiple NEO 800 SL systems for the production of investment casting patterns. Blue Origin is a leading aerospace manufacturer and space technology trailblazer in reusable rocket technology, and a major participant in NASA contracts, including the current Artemis program, planned to bring astronauts to the moon in 2027. Stratasys is also participating in this program. This partnership represents more than just today's application.

Planned to bring astronauts to the Moon in 2027.

Stratasys is also participating in this program.

This partnership represents more than just today's application.

Speaker #5: Exemplifying how we partner with customers to expand their understanding and adoption of 3D printing, in an opportunity that could be far greater than today's market penetration.

Blue origin is validating the strength and durability of our polymer product.

For space flight applications, which could translate to approval for us.

Speaker #5: Also, during the quarter, our aerospace customer, Blue Origin, purchased multiple Neo 800SL systems for the production of investment casting patterns. Blue Origin is a leading aerospace manufacturer and space technology trailblazer in reusable rocket technology.

In the tens of thousands of aerospace part.

Steel made by hand to date, the rigorous quality and data security standards.

Faced slides demand position our technology.

<unk> significant future aerospace production application.

This is in line with our manufacturing strategy around aerospace production pump demonstrating how our technology attributes to phase III to date oil potentially enabling next generation <unk> solution.

Speaker #5: And a major participant in NASA contracts, including the current Artemis program, planned to bring astronauts to the moon in 2027. Stratasys is also participating in this program.

It could extend far beyond basic exploration tomorrow.

Speaker #5: This partnership represents more than just today's applications. Blue Origin is validating the strength and durability of our polymer products for spaceflight applications. Which could translate to approval for use in the tens of thousands of aerospace parts, still made by hand today.

In the medical sector.

Yoav Zeif: Blue Origin is validating the strength and durability of our polymer products for space flight applications, which could translate to approval for use in the tens of thousands of aerospace parts still made by hand today. The rigorous quality and data security standards that space flights demand position our technology for potentially significant future aerospace production applications. This aligns with our manufacturing strategy around aerospace production parts, demonstrating how our technology contributes to space travel today while potentially enabling next-generation travel solutions that could extend far beyond space exploration tomorrow. In the medical sector, utilizing Stratasys' advanced 3D printing capabilities proved critical in preparing for complex lifesaving procedures, showcasing how 3D printing technology is revolutionizing lifesaving medical applications and unprecedented preoperative planning capabilities.

Utilizing stratasys and three D printing capabilities.

Critical in preparing for a complex lifesaving procedures.

<unk> pacing, how <unk> printing technology is revolutionizing lifesaving medical applications.

Unprecedented pre operative planning capabilities.

Speaker #5: The rigorous quality and data security standards that spaceflights demand position our technology for potentially significant future aerospace production applications. This aligns with our manufacturing strategy around aerospace production parts, demonstrating how our technology contributes to space travel today while potentially enabling next-generation travel solutions that could extend far beyond space exploration tomorrow.

As a reminder, last year, we launched the <unk> system.

And affordable and ophthalmic model solution targeting thousands of hospital worldwide and we are seeing positive traction and life saving example.

One such recent case wasn't.

How various events has done Biofabrication Institute created a life sized three D printed model based on a patient scan.

Speaker #5: In the medical sector, utilizing Stratasys' advanced 3D printing capabilities proved critical in preparing for complex life-saving procedures. Showcasing how 3D printing technology is revolutionizing life-saving medical applications and unprecedented pre-operative planning capabilities.

Let's revisit he was walking around with a ticking time bomb.

Inside this chest.

The aorta the biggest blood vessels in the body it ballooned to about four times the usual cycle.

Leaving it.

In danger of.

<unk> a medical emergency is likely to have cost him his life.

Speaker #5: As a reminder, last year we launched the J5 DAP system, an affordable anatomical model solution targeting thousands of hospital worldwide. And we are seeing positive traction and life-saving examples.

Yoav Zeif: As a reminder, last year we launched the J5 DAP system, an affordable anatomical model solution targeting thousands of hospitals worldwide, and we are seeing positive traction and lifesaving examples. One such recent case was how Brisbane's Hearstone Biofabrication Institute created a life-size 3D printed model based on a patient's scan that revealed he was walking around with a ticking time bomb inside his chest. The aorta, the biggest blood vessel in the body, had ballooned to about four times the usual size, leaving it in danger of rupturing, a medical emergency likely to have cost him his life. The printed model enabled the surgeons at Prince Charles Hospital to better understand the complex anatomy and to plan and practice on the life-like model prior to the operation.

Printed model enables the surgeons to Prince Charles Hospital to better understand the complex anatomy and to plan in practice on the lifelike model prior to the operation.

This allows them to optimize execution of the surgery.

Speaker #5: One such recent case was how Brisbane's Hurston Biofabrication Institute created a life-size 3D printed model based on a patient's scan that revealed he was walking around with a ticking time bomb.

And minimize potential risks and complications.

In the end saving the patient's life.

The anatomical motor opportunity for Stratasys.

This training in pre surgical planning is one $8 billion annually.

Speaker #5: Inside his chest, the aorta, the biggest blood vessel in the body, had ballooned to about four times the usual size, leaving it in danger of rupturing—a medical emergency likely to have cost him his life.

On the material side, we commercially launched <unk> silicon 25.

A high performance material developed through strategic collaborations with global Silicon leader <unk>.

The largest chemical company in Japan.

Speaker #5: The printed model enabled the surgeons at Prince Charles Hospital to better understand the complex anatomy and to plan and practice on the lifelike model prior to the operation.

It is designed exclusively for the Stratasys origin DLP platform to produce flexible path.

Next to additionally, moderate silicon performance.

Speaker #5: This allowed them to optimize the execution of the surgery and minimize potential risks and complications, ultimately saving the patient's life. The anatomical model opportunity for Stratasys, such as training and pre-surgical planning, is $1.8 billion annually.

This breakthrough material addresses a critical gap in industrial <unk> printing by delivering genuine silicon, Bob with precision durability, and repeatability, while eliminating tooling costs.

Yoav Zeif: This allowed them to optimize the execution of the surgery and minimize potential risks and complications, in the end saving the patient's life. The anatomical model opportunity for Stratasys, such as training and pre-surgical planning, is $1.8 billion annually. On the material side, we commercially launched P3 Silicon 25A, a high-performance material developed through strategic collaboration with global silicon leader Shin-Etsu, the largest chemical company in Japan. It is designed exclusively for the Stratasys Origin One DLP system to produce flexible parts that match traditionally molded silicon performance. This breakthrough material addresses a critical gap in industrial 3D printing by delivering genuine silicon parts with precision, durability, and repeatability while eliminating tooling costs, reducing lead times, and enabling localized low-volume production for applications including seals, gaskets, vibration dampers, and soft-touch components.

Using lead times, and enabling localized low volume production for applications, including <unk>.

Speaker #5: On the material side, we commercially launched P3 silicon 25A, a high-performance material developed through strategic collaboration with global silicon leader Shinetsu. The largest chemical company in Japan, it is designed, exclusively for the Stratasys Origin DLP platform to produce flexible parts that match traditionally molded silicon performance.

Gaskets vibration dampers and soft touch component.

The material is past <unk>, biocompatibility and flame retardant <unk> certification representing the first.

In our plant portfolio of silicon materials that combining strategies production grade Petri DLP technology, which in essence silicon chemistry expertise to.

Deliver trusted performance back.

By repeatable results in real World data.

Speaker #5: This breakthrough material addresses a critical gap in industrial 3D printing by delivering genuine silicon parts with precision, durability, and repeatability while eliminating tooling costs.

On the software side, our progress reflects our commitment to delivering complete use case solutions that align with customer needs in.

Speaker #5: Reducing lead times and enabling localized low-volume production for applications including seals, gaskets, vibration dampers, and soft-touch components. The material has passed Shinetsu's biocompatibility and flame retardance certification, representing the first in a planned portfolio of silicon materials that combine Stratasys' production grade P3 DLP technology with Shinetsu's silicon chemistry expertise to deliver trusted performance backed by repeatable results and real-world data.

In the second quarter, we signed an exclusive agreement with <unk> <unk>, a German based software company to integrate its fixture made software into status. This graph greensborough, enabling users to design and generate production ready.

Yoav Zeif: The material has passed Shin-Etsu's biocompatibility and flame retardancy certification, representing the first in a planned portfolio of silicon materials that combine Stratasys' production-grade P3 DLP technology, which enables silicon chemistry expertise to deliver trusted performance backed by repeatable results and real-world data. On the software side, our progress reflects our commitment to delivering complete use case solutions that align with customer needs. In the second quarter, we signed an exclusive agreement with Trinkl 3D GmbH, a German-based software company, to integrate its fixture-made software into Stratasys' GrabCAD Print flow, enabling users to design and generate production-ready fixtures weekly without CAD experience needed. This capability, launched in GrabCAD Print flow 2025, uses intelligent automation in designing custom fixtures, allowing manufacturers to create secure, precise workholding solutions in minutes.

Pictures quickly without cat experience needed.

This capability launching graphene throughout 2025 uses intelligence automation in designing custom fixtures, allowing manufacturers to create secure precise walk coding solutions in minutes.

This combined solution eliminates the manual effort and complexity traditionally associated with fixture design, enabling accelerated adoption of three D printing by removing the constraints of needing and expresscard designer shifting fixture design too.

Speaker #5: On the software side, our progress reflects our commitment to delivering complete use case solutions that align with customer needs. In the second quarter, we signed an exclusive agreement with Rinkel 3D GmbH, a German-based software company to integrate its fixture-made software into Stratasys GrabCut Print Pro, enabling users to design and generate production-ready fixtures quickly without CAD experience needed.

Editing operators.

And reducing fixtures creation time from days to hours.

These results.

In a higher utilization of the printers and higher rates of three D printing adoption.

Speaker #5: This capability launched in GrabCut Print Pro 2025 uses intelligent automation in designing custom fixtures allowing manufacturers to create secure, precise work-holding solutions in minutes.

A new photos for 50, AMC, we mentioned last quarter exemplifies our complete solution approach, providing an integrated tooling solution combining software print there and material in our factory ready packaged.

Speaker #5: This combined solution eliminates the manual effort and complexity, traditionally associated with fixture design, enabling accelerated option of 3D printing by removing the constraint of needing an expert CAD designer shifting fixture design to additive operators and reducing fixtures' creation time from days to hours.

We are also receiving great feedback from customers regarding our software ecosystem, which continues to drive customer value.

Yoav Zeif: This combined solution eliminates the manual effort and complexity traditionally associated with fixture design, enabling accelerated adoption of 3D printing by removing the constraint of needing an expert CAD designer, shifting fixture design to additive operators, and reducing fixtures' creation time from days to hours. This results in a higher utilization of the printers and a higher rate of 3D printing adoption. The new Fortus 450 MC we mentioned last quarter exemplifies our complete solution approach, providing an integrated tooling solution combining software, printer, and materials in a factory-ready package. We are also receiving great feedback from customers regarding our software ecosystem, which continues to drive customer value. NASCAR's Tim Murphy recently said that what sets our partnership with Stratasys apart is the complete ecosystem, from our in-house machine to streamlined cross-software to on-demand production.

NASCAR team Murphy recently stated.

That was our partnership with Stratasys part is the complete ecosystem.

From our <unk> machine to streamline process software to on demand production.

Speaker #5: These results in a higher utilization of the printers and higher rate of 3D printing adoption. The new photos 450 MC we mentioned last quarter exemplifies our complete solution approach providing an integrated tooling solution combining software, printer, and materials in a factory-ready package.

<unk> now manage hundreds of parts through a single platform.

And then transform three D printing from a support function into strategic business unit with full P&L tracking.

Furthermore to continue to scale the success across our customer base. We are launching a dedicated software customer success management team in the third quarter to enhance Onboarding drive engagement and support renewals for both Rob cuts to improve and streamline pro users.

Speaker #5: We are also receiving great feedback from customers regarding our software ecosystem. Which continues to drive customer value. NASCAR's Team Murphy recently states that what sets our partnership with Stratasys apart is the complete ecosystem.

These are all real World example.

So far we are pushing forward.

So our leadership position despite longer than expected market headwinds.

Speaker #5: From our in-house machine to streamlined process software to on-demand production, NASCAR now manage hundreds of parts through a single platform and has transformed 3D printing from a support function into a strategic business unit with full P&L tracking.

We are excited by the innovation across our portfolio.

Yoav Zeif: NASCAR now manages hundreds of parts through a single platform and has transformed 3D printing from a support function into a strategic business unit with full P&L tracking. Furthermore, to continue to scale this success across our customer base, we are launching a dedicated software customer success management team in the third quarter to enhance onboarding, drive engagement, and support renewals for both GrabCAD Print flow and streamlined flow users. These are all real-world examples of how we are pushing forward with our leadership position despite longer-than-expected market headwinds. We are excited by the innovation across our portfolio, making meaningful inroads into a multitude of high-growth industries and customer opportunities. Our customer spending has remained challenged for longer than expected, impacting our near-term view of the business, but our long-term outlook for our company and industry remains intact.

Making meaningful inroads.

Into a multitude of high growth industries and customer opportunities.

Our customer spending has remained challenged for longer than expected.

Speaker #5: Furthermore, to continue to scale this success across our customer base, we are launching a dedicated software customer success management team in the third quarter to enhance onboarding drive engagement and support renewals for both GrabCut Print Pro and streamlined Pro users.

Impacting our near term view of the business.

But our long term outlook for our company.

And industry remains intact.

We have the financial strength to invest and innovate.

So that our leadership position expand overtime with that I would like to turn the call to <unk> to review our financial data.

Speaker #5: These are all real-world examples. Of how we are pushing forward. Our leadership position despite longer-than-expected market headwinds. We are excited by the innovation across our portfolio making meaningful inroads into a multitude of high-growth industries and customer opportunities.

Thank you.

And good morning, everyone.

The second quarter results once again demonstrate the resilience of our operating model as we delivered positive adjusted operating income and adjusted net income compared to losses in both in the year ago period.

This despite an only slight revenue increase relative to the second quarter last year.

Speaker #5: Our customers' spending has remained challenged for longer than expected. Impacting our near-term view of the business. But our long-term outlook for our company and industry remains intact.

And lower gross margin.

These results were in.

In part to full run rate contribution from the cost control initiatives, we began in the middle of last year.

Speaker #5: We have the financial strength to invest and innovate so that our leadership position expands over time with debt I would like to turn the call to Eitan to review our financials.

Yoav Zeif: We have the financial strength to invest and innovate so that our leadership position expands over time. With that, I would like to turn the call to Eitan to review our financials. Eitan?

Now, let me get into the details of our numbers.

For the second quarter consolidated revenue of $138 1 million was slightly higher as compared to the same quarter in 2024.

Speaker #5: Eitan? Thank you, Yoav. And good morning, everyone. The second quarter results once again demonstrate the resilience of our operating model. As we delivered positive adjusted operating income and adjusted net income compared to losses in both in the year ago period.

Eitan Zamir: Thank you, Yoav, and good morning, everyone. The second quarter results, once again, demonstrate the resilience of our operating model, as we delivered positive adjusted operating income and adjusted net income compared to losses in the year-ago period. This despite an only slight revenue increase relative to the second quarter last year and lower gross margins. These results were thanks in part to full run-rate contributions from the cost control initiative we began in the middle of last year. Let me get into the details of our numbers. For the second quarter, consolidated revenue of $138.1 million was slightly higher as compared to the same quarter in 2024, as customers continue to defer major capital spending until market uncertainty subsides. Product revenue in the second quarter was $94.8 million compared to $93.6 million in the same period last year.

As customers continue to defer major capital spending until market uncertainty subsides.

Product revenue in the second quarter was $94 8 million compared to $93 6 million in the same period last year.

Service revenue was $43 3 million compared to $44 4 million in the same period last year.

Speaker #5: This despite an only slight revenue increase relative to the second quarter last year. And lower gross margins. These results were thanks in part to full run rate contributions from the cost control initiatives we began in the middle of last year.

Within product revenue system revenue was $30 6 million up from $29 million, we produced in the same period last year.

Consumables revenue was $64 2 million compared to $64 6 million in the same period last year and up two 6% sequentially over the first quarter as utilization rates of the system. We absorbed remained strong.

Speaker #5: Now let me get into the details of our numbers. For the second quarter, consolidated revenue of $138.1 million was slightly higher as compared to the same quarter in 2024.

Speaker #5: As customers continue to defer major capital spending, until market uncertainty subsides. Product revenue in the second quarter was $94.8 million, compared to $93.6 million in the same period last year.

Within service revenue customer support revenue was $30 1 million compared to $30 5 million in the same period last year.

Now turning to gross margins.

<unk> gross margin was 43, 1% for the quarter compared to 43, 8% for the same period last year non.

Speaker #5: Service revenue was $43.3 million, compared to $44.4 million in the same period last year. Within product revenue, system revenue was $30.6 million, up from $29 million we produced in the same period last year.

Eitan Zamir: Service revenue was $43.3 million compared to $44.4 million in the same period last year. Within product revenue, system revenue was $30.6 million, up from $29 million we produced in the same period last year. Consumables revenue was $64.2 million compared to $64.6 million in the same period last year and up 2.6% sequentially over the first quarter, as the utilization rates of the system we have sold remain strong. Within service revenue, customer support revenue was $30.1 million compared to $30.5 million in the same period last year. Turning to gross margins, GAAP gross margin was 43.1% for the quarter compared to 43.8% for the same period last year. Non-GAAP gross margin was 47.7% for the quarter compared to 49% in the same period last year.

non-GAAP gross margin was 47, 7% for the quarter.

Compared to 49% in the same period last year.

The change versus the prior year period was primarily due to the mix in product revenues and higher absorption due to reduced inventory levels.

Speaker #5: Consumables revenue was $64.2 million, compared to $64.6 million in the same period last year. And up 2.6% sequentially over the first quarter as the utilization rates of the system we have sold remain strong.

Which have come down from June 2024 to June 225 by over 30 million, partially offset by operational efficiency.

GAAP operating expenses were $76 1 million 55, 1% of revenue compared to $86 5 million or 62, 7% of revenue during the same period last year.

Speaker #5: Within service revenue, customer support revenue was $30.1 million, compared to $30.5 million in the same period last year. Now turning to gross margins. Gap gross margin was $43.1% for the quarter.

The improvement in expenses was due to our cost saving initiatives among other items.

Speaker #5: Compared to $43.8% for the same period last year. Non-gap gross margin was $47.7% for the quarter. Compared to 49% in the same period last year.

non-GAAP operating expenses improved to $64 7 million.

46, 9% of revenue compared to $70 9 million or 51, 3% of revenue during the same period last year.

Speaker #5: The change versus the prior year period was primarily due to the mix in product revenues and higher absorption due to reduced inventory levels. Which have come down from June 2024 to June 2025 by over 30 million.

Eitan Zamir: The change versus the prior year period was primarily due to the mix in product revenues and higher absorption due to reduced inventory levels, which have come down from June 2024 to June 2025 by over $30 million, partially offset by operational efficiency. GAAP operating expenses were $76.1 million, 55.1% of revenue compared to $86.5 million or 62.7% of revenue during the same period last year. The improvement in expenses was due to our cost-saving initiatives, among other items. Non-GAAP operating expenses improved to $64.7 million, 46.9% of revenue compared to $70.9 million or 51.3% of revenue during the same period last year, due primarily to lower employee-related costs, including benefits from the cost-savings initiative announced last year. Regarding our consolidated earnings, GAAP operating loss for the quarter was $16.6 million compared to a loss of $26 million for the same period last year.

Due primarily to lower employee related costs, including benefits from the cost savings initiatives announced last year.

Speaker #5: Partially offset by operational efficiency. Gap operating expenses were 76.1 million. 55.1% of revenue compared to 86.5 million or 62.7% of revenue during the same period last year.

Regarding our consolidated earnings.

GAAP operating loss for the quarter was $16 6 million compared to a loss of $26 million for the same period last year non.

non-GAAP operating income for the quarter was $1 1 million compared to an operating loss of $3 2 million for the same period last year, reflecting the impact of improved operating expenses due to our cost cutting efforts.

Speaker #5: The improvement in expenses was due to our cost-saving initiatives among other items. Non-gap operating expenses improved to $64.7 million. 46.9% of revenue compared to $70.9 million or 51.3% of revenue during the same period last year.

GAAP net loss for the quarter was $16 7 million or <unk> 20 per diluted share.

Compared to a net loss of $25 7 million or <unk> 36 cents per diluted share for the same period last year.

Speaker #5: Due primarily to lower employee-related costs including benefits from the cost-saving initiatives announced last year. Regarding our consolidated earnings. Gap operating loss for the quarter was $16.6 million, compared to a loss of $26 million for the same period last year.

non-GAAP net income for the quarter was $2 2 million or <unk> <unk> per diluted share.

Compared to a net loss of 3 million or four cents per diluted share in the same period last year.

Adjusted EBITDA was $6 1 million for the quarter compared to $2 3 million in the same period last year.

Speaker #5: Non-gap operating income for the quarter was $1.1 million. Compared to an operating loss of $3.2 million for the same period last year. Reflecting the impact of improved operating expenses due to our cost-cutting efforts.

From a cash flow perspective, we used $1 1 million in cash for operating activities.

Eitan Zamir: Non-GAAP operating income for the quarter was $1.1 million compared to an operating loss of $3.2 million for the same period last year, reflecting the impact of improved operating expenses due to our cost-cutting efforts. GAAP net loss for the quarter was $16.7 million or $0.20 per diluted share, compared to a net loss of $25.7 million or $0.36 per diluted share for the same period last year. Non-GAAP net income for the quarter was $2.2 million or $0.03 per diluted share, compared to a net loss of $3 million or $0.04 per diluted share in the same period last year. Adjusted EBITDA was $6.1 million for the quarter, compared to $2.3 million in the same period last year. From a cash flow perspective, we used $1.1 million in cash for operating activities, compared to the use of $2.4 million in Q2 of last year.

Compared to the use of $2 4 million in the second quarter of last year.

We expect to generate positive operating cash flow for the full year 2025.

Speaker #5: Gap net loss for the quarter was $16.7 million, or $0.20 per diluted share. Compared to a net loss of $25.7 million or $36.00 per diluted share for the same period last year.

We ended the quarter with $254 6 million in cash cash equivalents and short term deposits, which reflect the $120 million investment during the quarter by 40 FEMA.

Speaker #5: Non-gap net income for the quarter was $2.2 million. Or $0.03 per diluted share. Compared to a net loss of $3 million or $0.04 per diluted share in the same period last year.

We are now even better positioned to act on value enhancing opportunities.

Regarding our outlook for 2025, they returned to normalized capital spending has been pushed out further than we anticipated when we issued our guidance for 2025.

Speaker #5: Adjusted EBITDA was $6.1 million for the quarter. Compared to $2.3 million in the same period last year. From a cash flow perspective, we used $1.1 million in cash for operating activities.

While customer engagement remains strong.

Sales cycles are still longer than usual.

Speaker #5: Compared to the use of $2.4 million in the second quarter of last year. We expect to generate positive operating cash flow for the full year 2025.

Specifically.

There have been several substantial opportunities focused on production applications that have been in the works for some time and are advancing towards the final stages, but the exact timing.

Eitan Zamir: We expect to generate positive operating cash flow for the full year 2025. We ended the quarter with $254.6 million in cash, cash equivalent, and short-term deposits, which reflects the $120 million investment during the quarter by Fortissimo. We are now even better positioned to act on value-enhancing opportunities. Regarding our outlook for 2025, the return to normalized capital spending has been pushed out further than we anticipated when we issued our guidance for 2025. While customer engagement remains strong, sales cycles are still longer than usual. Specifically, there have been several substantial opportunities focused on production applications that have been in the works for some time and are advancing towards final stages. While we had expected them to close this year, they could move into 2026. Therefore, we are adjusting our guidance for this year accordingly.

Speaker #5: We ended the quarter with $254.6 million in cash, cash equivalent, and short-term deposits. Which reflect the $120 million investment during the quarter by Fortissima.

While we had expected them to close this year they could move into 2026.

Therefore, we are adjusting our guidance for this year Accordingly, we believe the depth and quality of these anticipated awards combined with the use case momentum were seeing across a number of our end use segments.

Speaker #5: We are now even better positioned to act on value-enhancing opportunities. Regarding our outlook for 2025. The return to normalized capital spending has been pushed out further than we anticipated when we issued our guidance for 2025.

Positions us well for 2026 and beyond.

As part of our disciplined approach regarding profitability, we plan to introduce some additional cost mitigation with the primary benefit and impact expected in the fourth quarter. This year.

Speaker #5: While customer engagement remains strong, sales cycles are still longer than usual. Specifically, there have been several substantial opportunities focused on production applications that have been in the works for some time.

It is important to note that these relate to targeted non essential costs that will not impact our investment in technology innovation and future growth.

Speaker #5: And we are advancing towards the final stages. While we had expected them to close this year, they could move into 2026. Therefore, we're adjusting our guidance for this year accordingly.

We still expect sequential revenue growth in the second half of 2025.

Third quarter expected to range from slightly lower to slightly higher than Q2 and.

Speaker #5: We believe the debt and quality of these anticipated awards combined with the use case momentum we are seeing across a number of our end-use segments positions us well for 2026 and beyond.

And fourth quarter higher sequentially.

Eitan Zamir: We believe the depth and quality of these anticipated awards, combined with the use case momentum we are seeing across a number of our end-use segments, positions us well for 2026 and beyond. As part of our disciplined approach regarding profitability, we plan to introduce some additional cost mitigation with the primary benefit and impact expected in Q4 this year. It is important to note that these relate to targeted non-essential costs that will not impact our investment in technology innovation and future growth. We still expect sequential revenue growth in the second half of 2025, with the third quarter expected to range from slightly lower to slightly higher than Q2 and the fourth quarter higher sequentially. We expect that full-year 2025 revenue will range between $550 million to $560 million.

We expect that full year 2025 revenue will range between $5 $50 million to $560 million.

non-GAAP gross margins are expected to range from 46, 7% to 47% due to a number of factors, including a different mix in product revenue.

Speaker #5: As part of our disciplined approach regarding profitability, we plan to introduce some additional cost mitigation, with the primary benefit and impact expected in Q4 this year.

And higher absorption cost due to reduced inventory levels.

Speaker #5: It is important to note that these relate to targeted non-essential costs that will not impact our investment in technology innovation and future growth. We still expect sequential revenue growth in the second half of 2025.

Full year non-GAAP operating margins are expected to range from one 5% to 2%.

With adjusted earnings per share of <unk> 13 to 16.

While adjusted EBITDA should range from $30 million to $32 million.

Speaker #5: With third quarter expected to range from slightly lower to slightly higher than Q2. And fourth quarter higher sequentially. We expect that full year 2025 revenue will range between $550 to $560 million.

Note that with the cost mitigation and mentioned earlier adjusted EBITDA in the fourth quarter is expected to be 8% or higher.

Recall that we previously targeted 8% for the full year, if revenues would be flat relative to 2024.

Speaker #5: Non-gap gross margins are expected to range from $46.7% to $47.00. Due to a number of factors, including a different mix in product revenue, tariffs, and higher absorption costs due to reduced inventory levels.

Eitan Zamir: Non-GAAP gross margins are expected to range from 46.7% to 47% due to a number of factors, including a different mix in product revenue, tariffs, and higher absorption costs due to reduced inventory levels. Full-year non-GAAP operating margins are expected to range from 1.5% to 2%, with adjusted earnings per share of $0.13 to $0.16, while adjusted EBITDA should range from $30 million to $32 million. Note that with the cost mitigation I mentioned earlier, adjusted EBITDA in the fourth quarter is expected to be 8% or higher. Recall that we previously targeted 8% for the full year if revenues would be flat relative to 2024. While the updated forecast indicates lower revenue for the full year, in any revenue scenario for Q4, we expect to deliver at least 8% adjusted EBITDA, reflecting the overall improvement in our operating model.

While the updated forecast indicates lower revenue for the full year in any revenue scenario for Q4, we expect to deliver at least 8% adjusted EBITDA, reflecting the overall improvement in our operating model.

Speaker #5: Full year non-GAAP operating margins are expected to range from 1.5% to 2%. Adjusted earnings per share are projected to be between $13.00 and $16.00, while adjusted EBITDA should range from $30 million to $32 million.

And we expect operating cash flow to be positive for the year.

Please see the press release for further details.

As you have mentioned despite the stubbornly prolonged challenges.

Over the near term or.

Speaker #5: Note that with the cost mitigation mentioned earlier, adjusted EBITDA in the fourth quarter is expected to be 8% or higher. Recall that we previously targeted 8% for the full year if revenues would be flat relative to 2024.

Our excitement for the future and our expanding leadership position within it remain intact.

With that let me turn the call back over to you for closing remarks.

<unk>.

Stratasys differentiated approach.

Speaker #5: While the updated forecast indicates lower revenue for the full year, in any revenue scenario for Q4, we expect to deliver at least 8% adjusted EBITDA, reflecting the overall improvement in our operating model.

And business model.

Continue to demonstrate remarkable adaptability.

Due to our cost discipline innovation leadership and increasingly mission critical role our solutions play in customer operations, our focus on high value applications.

Speaker #5: And we expect operating cash flow to be positive for the year. Please see the press release for further details. As Yoav mentioned, despite the stubbornly prolonged challenges of the near term, our excitement for the future and our expanding leadership position within it remain intact.

Eitan Zamir: We expect operating cash flow to be positive for the year. Please see the press release for further details. As Dr. Yoav Zeif mentioned, despite the stubbornly prolonged challenges of the near term, our excitement for the future and our expanding leadership position within it remain intact. With that, let me turn the call back over to Dr. Yoav Zeif for closing remarks. Dr. Yoav Zeif?

Combined with enhanced customer education.

And go to market execution.

Continuous building the foundation for accelerated adoption when investment confidence rebounds.

With our recently bolstered balance sheet, we're extremely well positioned to continue leading the industry in system material and software innovation.

Speaker #5: With that, let me turn the call back over to Yoav for closing remarks. Yoav? Thank you, Eitan. Stratasys' differentiated approach and business model continue to demonstrate remarkable adaptability.

Yoav Zeif: Thank you, Eitan. Stratasys' differentiated approach and business model continue to demonstrate remarkable adaptability due to our cost discipline, innovation leadership, and the increasingly mission-critical role our solutions play in customer operations. Our focus on high-value applications, combined with enhanced customer education and go-to-market execution, continues building the foundation for accelerated adoption when investment confidence rebounds. With our recently bolstered balance sheet, we are extremely well positioned to continue leading the industry in system, material, and software innovations, as well as the scaling of additive solutions towards more widespread manufacturing applications as macro conditions eventually normalize. The stability inherent in our recurring revenue streams, paired with our commitment to operational efficiency and margin discipline, creates a platform designed to help us mitigate near-term volatility while positioning us to deliver compelling long-term returns.

As well as the scaling of editing solution towards more widespread manufacturing applications as macro conditions eventually normalize.

Speaker #5: Due to our cost discipline, innovation leadership, and the increasingly mission-critical role our solutions play in customer operations. Our focus on high-value applications combined with enhanced customer education and go-to-market execution continues building the foundation for accelerated adoption when investment confidence rebounds.

The stability inherent in our recurring revenue stream.

Third with our commitment to operational efficiency and margin discipline.

Creative platform designed to help us mitigate near term volatility.

While positioning us to deliver compelling long term returns.

As industry leaders.

With a comprehensive technology portfolio.

Speaker #5: With our recently bolstered balance sheet, we are extremely well positioned to continue leading the industry in system material and software innovation. As well as the scaling of additive solutions towards more widespread manufacturing applications as macro-conditions eventually normalize.

Spanning hardware materials and software solutions, we are uniquely positioned to capture the significant opportunities that will emerge when uncertainty subsides.

And customers eventually resume normal capital deployment cycle and embraced the localized manufacturing advantages our platforms deliver.

Speaker #5: The stability inherent in our recurring revenue streams paired with our commitment to operational efficiency and margin discipline creates a platform designed to help us mitigate near-term volatility.

With that let's open it up for questions operator.

Thank you, we'll now be conducting a question and answer session if you'd like to be placed in the question queue. Please press star one on your telephone keypad.

In the interest of time, we ask you. Please ask one question and one follow up once again Thats star one to be placed in the question queue and we ask you. Please ask one question and one follow up.

Speaker #5: While positioning us to deliver compelling long-term returns. As industry leaders with a comprehensive technology portfolio spanning hardware, materials, and software solutions, we are uniquely positioned to capture the significant opportunities that will emerge when uncertainties subside.

Yoav Zeif: As industry leaders with a comprehensive technology portfolio, spanning hardware, materials, and software solutions, we are uniquely positioned to capture the significant opportunities that will emerge when uncertainty subsides and customers eventually resume normal capital deployment cycles and embrace the localized manufacturing advantages our platforms deliver. With that, let's open it up for questions. Operator?

First question today is coming from Brian Drab from William Blair. Your line is now live.

Yes.

Good morning, this is Tyler on for Brian job.

Just starting off with the revenue guidance regarding the lowered guidance what areas.

Speaker #5: And customers eventually resume normal capital deployment cycles and embrace the localized manufacturing advantages our platforms deliver. With that, let's open it up for questions.

While you've cited delays in customer decision, making and macro uncertainty can you clarify which specific verticals or regions are seeing the most pronounced slowdown or delays and I have a follow up.

Speaker #5: Operator?

Speaker #6: Thank you, and happy conducting your question and answer session. If you'd like to be placed in the question queue, please press *1 on your telephone keypad.

Operator: Thank you. We are now conducting a question and answer session. If you would like to be placed into the question queue, please press star one on your telephone keypad. In the interest of time, we ask you to please ask one question and one follow-up. Once again, that is star one to be placed into the question queue, and we ask you to please ask one question and one follow-up. Our first question today is coming from Brian Drab from William Blair. Your line is now live.

Hey, Tyler.

Thank you for your question.

There is no slowdown there is only delayed ought to be very clear.

Speaker #6: In the interest of time, we ask that you please ask one question and one follow-up. Once again, that's *1 to be placed in the question queue, and we ask that you please ask one question and one follow-up.

Maybe we take a step back and I'll try to explain the situation.

We are going as a leader in this industry.

We're going through a shift the shift towards production application.

Speaker #6: Our first question today is coming from Brian Drab from William Blair, your line is now live.

And by nature, those production applications tons with cloud yours.

Speaker #7: Good morning, this is Tyler on for Brian Drab. Just starting off with the revenue guidance. Regarding the lowered guidance, what are while you've cited the ways in customer decision-making and macro uncertainty, can you clarify which specific verticals or regions are seeing the most pronounced slowdown or delays?

Pal Aaron: Good morning. This is Pal Aaron for Brian Drab. Just starting off with the revenue guidance regarding the lower guidance, while you have cited delays in customer decision-making and macro uncertainty, can you clarify which specific verticals or regions are seeing the most pronounced slowdown or delays? I will have a follow-up.

These sites and longer sales cycles.

But this is like a new situation that we are hedging the entire industry.

And then where we are looking at our pipeline.

We need to look at it completely differently.

So when we are deciding to adjust the outlook.

Speaker #7: And I'll have a follow-up.

It is related to the uncertainty around those.

Speaker #5: Hey, Tyler. Thank you for your question.

Yoav Zeif: Hey, Tyler. Thank you for your question. There is no slowdown, there is only delay. I want to be very clear. Maybe we take a step back, and I will try to explain the situation. We are going, as a leader in this industry, through a shift, a shift towards production applications. By nature, those production applications come with larger deal size and longer sales cycles. This is a new situation that we are heading the entire industry into. When we are looking at our pipeline, we need to look at it completely differently. When we are deciding to adjust the outlook, it is related to the uncertainty around those large deals and the exact timing to close them. We have less diversified low-value deals. We have large deals in production. Those deals may be delayed this year, but definitely not canceled.

Large deal and the exact timing to close them.

Speaker #7: Well, there is no slowdown. There is only delay. I want to be very clear. And maybe we take a step back and I'll try to explain the situation.

So we have less debt.

Diversified low low low value deal.

<unk> large DRAM production.

Speaker #7: We are going as a leader in this industry we're going to shift a shift forward production applications and by nature those production applications come with larger deal size and longer sales cycles.

ABB late this year, but definitely not canceled.

When I look at the overall pipeline is strong.

And despite the delaying.

And customer spending we see many leads coming.

Speaker #7: So this is like a new situation that we are having the entire industry into it. And then when we are looking at our pipeline, we need to look at it completely differently.

But the real difference is those large deals that take us into manufacturing like the deals that we just emphasized in the.

Script about Toyota about GM those are transformative deal we are becoming the backbone of some operations of the largest companies on air.

Speaker #7: So when we are deciding to adjust the outlook, it is related to the uncertainty around those large deals and the exact timing to close them.

This is a breakthrough.

Whereas the manufacturer.

So when we look forward and we are obligated historically, we are always trying to be as transparent as possible without any vessel.

Speaker #7: So we have less diversified low, low, low value deals. We have large deal in production. Those deals may be delayed this year but definitely not canceled.

So once we saw that it might be delayed.

Okay.

Speaker #7: When I look at the overall pipeline, it is strong and despite the delayed in customer spending, we see many leads coming. But the real difference is those large deals that take us into manufacturing.

Yoav Zeif: When I look at the overall pipeline, it is strong. Despite the delay in customer spending, we see many leads coming. The real difference is those large deals that take us into manufacturing, like the deals that we just emphasized in the script about Toyota, about General Motors. Those are transformative deals. We are becoming the backbone of some operations of the largest companies on Earth. This is a breakthrough for additive manufacturing. When we look forward, you know we are obligated historically, we are always trying to be as transparent as possible with our investors. Once we saw that it might be delayed, we said, "Okay, let's put it on the table." When I look at the verticals, we have large customers, best relationships in the industries with those large customers.

Let's put it on the table.

But when I look at the vertical we have large customers.

That relationship in the industry with those large customers in key verticals you take government Aero defense.

Speaker #7: Like the deals that we just emphasized in the script about Toyota, about GM. Those are transformative deals. We are becoming the backbone of some operations of the largest companies on earth.

Very high level of engagement.

Especially for example, with the government and defense and Aero.

Customers.

And the guidance is.

A reflection of discontinued situations that we're in.

Speaker #7: This is a breakthrough. For additive manufacturing. So when we look forward and you know we are obligated historically we are always trying to be as transparent as possible with our investors.

And I want to emphasize that.

Our across multiple vertical.

Both new and existing customer.

They are also diversified across verticals like like Arrow.

Speaker #7: So, once we saw that it might be delayed, we said, "Okay, let's put it on the table." But, when I look at the verticals, we have large customers with the best relationships in the industries with those large customers.

Tooling dental medical.

I appreciate you providing more color on that just wanted to ask a follow up on the fourth quarter. Adjusted EBITDA margin, you mentioned that it should be 8% or more of revenue.

Speaker #7: In key verticals, you take government, aero defense, very high level of engagement. Especially, for example, with the government and defense and aero customers. And the guidance is a reflection of this new situation that we are in.

Yoav Zeif: In key verticals, you take government, aero defense, very high level of engagement, especially, for example, with the government and defense and aero customers. The guidance is a reflection of this new situation that we are in. I want to emphasize that those deals are across multiple verticals, both new and existing customers. They are also diversified across verticals like aero, tooling, dental, medical.

What assumptions are baked into that ramp outside of cost controls are there any specific customer deals that are expected to pick up product launches or seasonal trends.

Last year's fourth quarter was particularly stronger than the other quarters. So just any more color you can provide on the ramp up in margin. Thank you.

Speaker #7: And I want to emphasize that those deals are across multiple verticals, involving both new and existing customers. They’re also diversified across verticals like aerospace, tooling, dental, and medical.

Thanks, Tyler for the question so.

It's actually.

To complement.

Your answer to that to the last question.

Those large deals are not baked into our 2025 model. They are not baked into our Q4 model if there were still.

Hi, probable to be in Q4, the guidance would have been higher.

Speaker #6: I I appreciate your providing more color on that. Just wanted to ask a follow-up on the fourth quarter adjusted EBITDA margin. You mentioned that it should be 8% or more of revenue.

Pal Aaron: I appreciate you providing more color in that. I just wanted to ask a follow-up on the fourth quarter adjusted EBITDA margin. You mentioned that it should be 8% or more of revenue. What assumptions have baked into that ramp outside of cost controls? Are there any specific customer deals that are expected to pick up, product launches, or seasonal trends? Because last year's fourth quarter was particularly stronger than the other quarters. So just any more color you can provide on the ramp-up in margin. Thank you.

To answer your question. It is largely associated for Q4 based on the new model. It is largely associated with cost.

Speaker #6: What assumptions have baked into that ramp outside of cost controls? Are there any specific customer deals that are expected to pick up product launches or seasonal trends?

Tight cost monitoring and some cost reduction.

Okay. Thank you.

Thank you. Your next question is coming from Greg Palm from Craig Hallum. Your line is now live.

Speaker #6: Because last year's fourth quarter was particularly stronger than the other quarters. So just any more color you can provide on the ramp-up in margin.

Yeah, Thanks for taking the questions.

Speaker #6: Thank you.

All right.

I think you maybe cover the revenue guide well.

Speaker #5: Thanks, Tyler, for the question. So it's actually to complement Yoav's answer to the last question. Those large deals are not baked into our 2025 model.

Yoav Zeif: Thanks, Tyler, for the question. It is actually to complement Yoav Zeif's answer to the last question. Those large deals are not baked into our 2025 model. They are not baked into our Q4 model. If they were still high probability to be in Q4, the guidance would have been higher. To answer your question, it is largely associated for Q4 based on the new model. It is largely associated with cost, tight cost monitoring, and some cost reduction.

Well, but I'm still a little bit unclear on call. It the magnitude of of the earnings reduction can you just talk.

Speaker #5: They are not baked into our Q4 model. If they were still high probable to be in Q4, the guidance would have been higher. So to answer your question, it is largely associated for Q4 based on the new model.

Talk a little bit about.

One what is specifically impacting the gross margin.

As much as it is.

Just to be clear can you give us some sense on.

Speaker #5: It is largely associated with cost tight cost monitoring and some cost reduction.

The magnitude of this new cost reduction effort.

You seem to be alluding to that that takes place or it takes into account in Q4.

Speaker #7: Okay, thank you.

Pal Aaron: Okay. Thank you.

Thank you Greg.

Speaker #6: Thank you. Next question is coming from Greg Paul from Craig Hallam in Wyoming is now live.

Operator: Thank you. The next question is coming from Greg Palm from Craig-Hallum. Your line is now live.

Thank you for the question I cannot be specific about each deal.

Speaker #8: Yeah, thanks for taking the questions. I think you maybe covered the revenue you know guide you know well, but you know I'm still a little bit unclear on you know call it the magnitude of of the earnings reduction.

Greg Palm: Thanks for taking the questions. I think you had maybe covered the revenue guide well, but I am still a little bit unclear on, call it the magnitude of the earnings reduction. Can you just talk a little bit about what is specifically impacting the gross margin as much as it is? To be clear, can you give us some sense on the magnitude of this new cost reduction effort that you seem to be alluding to that takes place or takes into account Q4?

But the.

The magnitude is more or less the gap between the new guidance and that was the guidance.

Maybe a little bit more.

That's more or less the magnitude of those days.

Greg on the cost side.

Speaker #8: Can you just you know talk a little bit about you know one, what is specifically impacting the gross margin as as much as as it is?

So.

Our gross margin in specifics.

It is associated.

By a few factors one is that changes in the sales mix.

Speaker #8: And and just to be clear, can you give us some sense on you know the the magnitude of this new cost reduction effort that you you seem to be alluding to that that takes you know place or takes a new account Q4?

And these are small changes that are aggregated and the other element is is the absorption associated with the inventory reduction.

<unk>.

Our inventory levels year over year from Q2, 2024th to Q2 2025 inventory levels went down by $30 million, that's something that has a big positive impact and we've discussed this with you every call in the last couple of years, our efforts to reduce inventories and thats something that is all.

Speaker #5: Thank you, Greg. Thank you for the question. I cannot be specific about each deal size, but the magnitude is more or less the gap between the new guidance and the old guidance.

Yoav Zeif: Thanks for Greg. Thank you for the question. I cannot be specific about each deal size, but the magnitude is more or less the gap between the new guidance and the old guidance, maybe a little bit more. That is more or less the magnitude of those deals. Greg, on the cost side, our gross margin in specific is associated by a few factors. One is changes in the sales mix, and these are small changes that are aggregated. The other element is the absorption associated with the inventory reduction. Our inventory levels went year over year from Q2 2024 to Q2 2025. Inventory levels went down by $30 million. That is something that has a big positive impact.

Speaker #5: Maybe a little bit more. That's more or less the magnitude of those deals.

So meaningful for our future cash flow. So that's something that is definitely a good thing, but in the short term.

Speaker #7: To To be Greg on the cost side, so our gross margin in specific. So it is associated by a few factors. One is changes in the sales mix.

It has an impact on the absorption.

And that has a negative impact temporarily on the gross margin. So that's the second element and the third element is associated with Torrey.

And our biggest production.

Speaker #7: And these are small changes that are aggregated. The other element is the absorption associated with the inventory reduction. Our inventory levels went year over year from Q2 2024 to Q2 2025.

In the U S, but we do produce outside of the U S and the change of entire it had some impact.

We have mitigation plan that is ongoing.

It will take few months it will take a short period to complete everything and Thats why we have.

Speaker #7: Inventory levels went down by 30 million. That's something that has a big positive impact and we've discussed this with you. Every call in the last couple of years our efforts to reduce inventories and that's something that is also meaningful for our future cash flow.

A temporary impact on our gross margin between now and the rest of the year.

Yoav Zeif: We have discussed this with you every call in the last couple of years, our efforts to reduce inventories, and that is something that is also meaningful for our future cash flow. That is something that is definitely a good thing. But in the short term, it has an impact on the absorption, and that has a negative impact temporarily on the gross margins. That is a second element. The third element is associated with tariffs. Our biggest production is in the U.S., but we do produce outside of the U.S., and the changes in tariffs had some impact. We have a mitigation plan that is ongoing. It will take a few months. It will take a short period to complete everything. That is why we have a temporary impact on our gross margin between now and the rest of the year.

With respect to the to the cost mitigation that you I believe you also asked about these are and non essential projects, mainly variable cost and some discretionary items like travel and this is more or less.

Speaker #7: So that's something that is definitely a good thing. But in the short term, it has an impact on the absorption and that has a negative impact temporarily on the gross margin.

The era of the savings.

Speaker #7: So that's a second element. And the third element is associated with tariffs. Our biggest production is in the US, but we do produce outside of the US and the changes in tariffs had some impact.

Okay. So.

Maybe more sort of short term temporary reductions my follow up would be just.

Thinking about fiscal 'twenty six.

What's your comfort level on call it 8% EBITDA margins under a lower revenue relative to 2024.

Speaker #7: We have mitigation plans that is ongoing. It will take a few months. It will take a short period to complete everything. And that's why we have a temporary impact on our gross margin between now and the rest of the year.

So Greg.

Maybe I'll say I think it's very important to say we.

Well look quarter by quarter, we're a public company, but we structure our company.

Speaker #7: With respect to the cost mitigation that you I believe you also asked about, these are non-essential projects mainly variable cost and some discretionary items like travel.

Yoav Zeif: With respect to the cost mitigation that you, I believe you also asked about, these are non-essential projects, mainly variable costs and some discretionary items like travel. This is more or less the area of saving.

With a cost infrastructure that will help us make us profitable and much more profitable when revenue increase so to your question. We will plan 2026 in the next few months as we build our budget for next year, but we design the company with truck to the company in a way.

Speaker #7: This is more or less the area of savings.

Speaker #8: Okay, so maybe more sort of short-term temporary reductions my follow-up was going to be just kind of thinking about fiscal 26 you know what's your comfort level on you know call it 8% EBITDA margins under a lower revenue relative to 2024?

Greg Palm: Okay. So maybe more sort of short-term temporary reductions. My follow-up was going to be just kind of thinking about fiscal 2026. What's your comfort level on, call it 8% adjusted EBITDA margins under a lower revenue relative to 2024?

We have next year, 8% or better when we finish this plan.

Okay, Alright, I appreciate the color. Thanks.

Thank you as a reminder, that star one to be placed in the question queue. Our next question is coming from Jim Ricchiuti from Needham <unk> Company. Your line is now live.

Speaker #5: So So So Greg, maybe I'll say I think it's very important to say. We look quarter by quarter for public companies. But we structure a company with a cost infrastructure that will help us make us profitable and much more profitable when revenue increase.

Thank you.

Yoav Zeif: So, Greg, maybe I will say I think it is very important to say. We.

So he may anytime you may have answered. This next question in response to Greg's earlier question, but it was it's a little surprising to have seen the slightly lower.

Eitan Zamir: Look quarter by quarter. We are a public company, but we structure a company with a cost infrastructure that will help us make us profitable and much more profitable when revenue increases. To your question, we will plan 2026 in the next few months as we build our budget for next year. We designed the company, we structured the company in a way to have next year 8% or better when we finish this plan.

Gross margin in Q2 versus Q1, even though the revenues were up sequentially modestly, but including sequential growth.

Speaker #5: So, to your question, we will plan for 2026 in the next few months as we build our budget for next year. But we designed the company.

Consumables, so what what occurred there was that an absorption or tariff related impact maybe you could just shed a little bit more light on that.

Speaker #5: We structured the company in a way to have next year 8% or better when we finish this plan.

Sure so so.

So I guess at the start I will say that our gross margin in Q1 was.

Speaker #8: Okay, all right. Appreciate the color. Thanks.

Kevin: Okay. All right. Appreciate the color. Thanks.

Speaker #6: Thank you. As a reminder, that's *1 to be placed in the question queue. Our next question is coming from Jim Rashudi from Needham & Company.

Yonah Lloyd: Thank you. As a reminder, that is star one to be placed into the question queue. Our next question is coming from Jim Ricchiuti from Needham & Company. Your line is now live.

48, 3%.

Gross margin in Q2 is $47 seven the difference to start with is not that significant however to address your question.

Speaker #6: Your line is now live.

Speaker #9: Thank you. So you may

Eitan Zamir: Thank you. You may, Eitan, you may have answered this next question in response to Greg's earlier question, but it was a little surprising to have seen the slightly lower gross margin in Q2 versus Q1, even though the revenues were up sequentially, modestly, but including sequential growth in consumables. What occurred there? Was that an absorption or tariff-related impact? Maybe you could just shed a little bit more light on that.

There are two main elements one is the absorption that I mentioned and you mentioned also in your question that's something that has had them.

Some impact on this on this change of small change and the other element in the tariff.

<unk> did not have a significant impact on Q2, but again when we bridge between 48, 3% to $47 seven that's part of the bridge.

Okay.

And Uh huh.

I noticed that.

Eitan Zamir: Sure. I will say that gross margin in Q1 was 48.3%. Gross margin in Q2 is 47.7%. The difference to start with is not that significant. However, to address your question, there are two main elements. One is the absorptions that I mentioned, and you mentioned also in your question, that is something that had some impact on this change, small change. The other element is the tariffs. Tariffs did not have significant impact on Q2, but again, when we bridge between 48.3% to 47.7%, that is part of the bridge.

The company acquired some some of that the next assets and I was wondering I see yeah.

No this is fairly insignificant, but which of these.

Next with three D printing processes is more part of the asset purchase and.

I Wonder if you.

If you have any.

Elaborate on what your plans are for some of this are these assets that were acquired.

Hi, Jim.

Hi.

So we are in a very unique situation in our industry practice.

Practically there is a shakeout.

And we are lucky that we work so hard to build.

Situation, where we deliver.

Eitan Zamir: Okay. I noticed that the company acquired some of the Nexa assets. I was wondering which of these Nexa 3D printing processes were part of the asset purchase. I wonder if you could elaborate on what your plans are for some of these assets that were acquired.

We are not burning cash we are stable.

I would even say that we are one of the best operators in the industry, because we have the infrastructure so infrastructure synergies.

And it led us to be.

Financially healthy.

In terms of the balance sheet with the cash with no debt $255 million.

Currency positive operating cash flow on an annualized basis.

And a very strong position with the best customers on Eric in terms of relationship.

Eitan Zamir: All right, Jim. Yoav, thank you for your.

When you take when you take all of the above and you blend it put us in the best position to acquire.

Yonah Lloyd: Go ahead.

Eitan Zamir: We are in a very unique situation in our industry. Practically, there is a shakeup. We are lucky that we work so hard to be in a situation where we deliver. We are not burning cash. We are stable. I would even say that we are one of the best operators in the industry because we have the infrastructure. Infrastructure is coming with synergy. It led us to be financially healthy, both in terms of the balance sheet, with the cash, with no debt, $255 million on our balance sheet, positive operating cash flow on an annual basis, and a very strong position with the best customers on Earth in terms of relationships.

I would say.

Companies do it.

Really good value for remaining of the company.

Prices no one could even dream about them only two years ago and.

And we can capture this opportunity and we did.

Similar team.

Yeah with two companies, which as you said they are not insignificant immaterial, but we acquired for them from the solvent.

And we are now rebuilding gaped in forward a M P.

Tim with amazing portfolio of IP and materials.

That are unique and position us much stronger and key use cases that are part of our strategy.

Eitan Zamir: When you take all the above and you blend, it puts us in the best position to acquire, I would say, companies with really good value or remaining of companies with prices that no one could even dream about them only two years ago. We can capture this opportunity. We did a similar thing with two companies, which, as you said, are not insignificant in material. We acquired Ford AM from the insolvent, and we are now rebuilding it. Ford AM came with an amazing portfolio of IP and materials that are unique and position us much stronger in key use cases that are part of our strategy. Great people as well, researchers, chemists, product managers that know the material arena better than anyone else in this industry. This is one example.

And great people as well.

<unk>.

Tammy.

Product managers.

No the material arena than anyone else in this industry. So this is one example.

If you take next and IP of course, and if you take nectar, which is another example.

They had a tremendous success only few years ago in terms of their ability to deliver great.

And machines to the market, but the shakeout.

In India, where for them as well.

And we acquired them.

Again, I would say in favorable terms.

And we received not an operational company.

But we received a great IP portfolio.

No.

R&D knowledge and it will position us again and those use cases that we are focusing on like aerospace and defense for example, with the ability to have significant R&D shortcut.

Eitan Zamir: If you take Nexa, and IP, of course, and if you take Nexa, which is another example, they had tremendous success only a few years ago in terms of the ability to deliver great parts and machines to the market. The shakeout didn't do well for them as well. We acquired them, again, I would say, in favorable terms. We received not an operational company, but we received a great IP portfolio with know-how with R&D knowledge, and it will position us again in those use cases that we are focusing on, like aerospace and defense, for example, with the ability to have significant R&D shortcuts. Both those opportunities demonstrate the strength of Stratasys as a healthy company, both on the financial side, but more importantly, on the operational side and on the go-to market. We are very happy with it.

So both those opportunities demonstrate the.

The strength of strategy is there.

Has the company both on the financial side, but more importantly on the operational side.

And on the go to market.

We are very happy with it of course, there is a lot of work to do because we need to rebuild those businesses well.

We would do it.

Got it thanks very much.

Thank you next question is coming from Troy Jensen from Cantor Fitzgerald. Your line is now live.

Gentlemen, congrats on the nice results here in a tough environment.

Maybe not for any time.

Hum.

On the when you guys talk about the deals that kind of slipped or haven't closed yet are delayed if I remember correctly coming into the year with related with the F 3300, and maybe automotives.

Opportunities.

Alright.

That's right sorry, we couldnt hear the question can you repeat it.

Yeah, sure I think coming into the year, you guys had pretty good confidence on the second half ramp and now you're talking about some deals slipping right. So yes, I guess that's out there associated with the F 33, hundreds. So I'm wondering if you could just kind of confirm that maybe that the automotive opportunities slip to the right or and just update us on the F 33, 9%.

Eitan Zamir: Of course, there is a lot of work to do because we need to rebuild those businesses, but we will do it.

Kevin: Got it. Thanks very much.

Yonah Lloyd: Thank you. Next question is coming from Troy Jensen from Cantor Fitzgerald. Your line is now live.

Pedro Thank you for the question happy to update on this.

Yoav Zeif: Gentlemen, congrats on the nice results here in a tough environment. Maybe for Eitan, you are welcome. Just on the, when you guys talk about the deals that kind of slipped or have not closed yet or delayed, if I remember correctly, coming into the year, were these related with the F3300 and maybe automotive opportunities?

As you know.

3300.

Is a key.

Our use case strategy.

So it's practically the best tooling machine.

Out there in terms of.

Throughput and reliability by far.

Eitan Zamir: Sorry, Troy.

And it is great for aerospace and defense.

Yoav Zeif: Go ahead.

Eitan Zamir: Troy, sorry, we couldn't hear the question. Can you repeat it?

And we already have customers that are using it in aerospace and defense.

Yoav Zeif: Yeah, sure. I think coming into the year, you guys had pretty good confidence on the second half, right? But now you are talking about some deals slipping, right? So I guess I thought they were associated with the F3300. So I am wondering if you could just kind of confirm that maybe the automotive opportunities slipped to the right or just update us on the F3300, please.

We're very happy and they have repeatable.

Purchasing of the same machine.

And there is no connection between the deal sleep and if that the 300. This is about how those guys are building the infrastructure how they are building their workflow how they collaborate how they prepare.

Eitan Zamir: Hey, Troy, thank you for the question. Happy to update on this. The F3300 is a key in our use case strategy. It is practically the best tooling machine out there in terms of throughput and reliability by far. It is great for aerospace and defense. We already have customers that are using it in aerospace and defense and are very, very happy. They have repeatable purchasing of the same machine. There is no connection between the deal slip and F3300. This is about how those guys are building the infrastructure, how they are building the workflow, how they collaborate, how they prepare within the organization, the site. This is the type of challenges that we are facing. On the contrary, F3300 is a major, I would say, promoter of us being the one being considered for those deals. Actually, we are very happy with F3300.

Prepare within the organization.

Side. This is the type of challenges that we're facing on the contrary. After 300 is a major I would say promoter.

I think the one.

Being considered for those deals.

So until we are very happy with F 3300.

The most reliable to date, the most reliable and it will be better and better at the most reliable Nvidia machines that we have.

<unk> printing the speed no. One has this level of reliability no. One has this level of accuracy of nickel has come together to a bit there does feel for our customers Troy I will add that the plan.

The model that we've just released with the new guidance.

Reflect more FSP 300 in 2025 compared to 2054 when we.

Yeah, that's good to know thank you daytime.

And maybe just a follow up for you too.

In the second half guidance is there any revenue or Opex from Florida and in next year.

We are just acquired the two businesses we are rebuilding it.

Eitan Zamir: It is the most reliable today, the most reliable, and it will be better and better, the most reliable FDM machine that we have. No one can print in this speed. No one has this level of reliability. No one has this level of accuracy. It all comes together to a better TCO for our customers. Troy, I will add that the plan, the model that we just released with the new guidance reflects more F3300 in 2025 compared to 2024 when we launched.

Once we have a better and.

Understanding.

The situation.

And ER market traction.

Are you better off currently.

Immaterial.

Okay.

Okay. So thank you for the answers and good luck going forward.

Thanks Troy.

Thank you. Your next question is coming from Alex <unk> from loop capital markets. Your line is now live.

Hey, guys. Thank you for taking my question. This is Alex on for a number.

Yoav Zeif: That's good to know. Thank you, Eitan. Maybe just a follow-up for you too. In the second half guidance, is there any revenue or OpEx from Ford AM and Nexa?

So given the success of your strategic collaborations with general moral motor Central Europe and bombing your F 900 systems.

You guys anticipate this momentum to lead to additional partnerships with other vehicle Oems, especially in light of the growing emphasis on localized manufacturing.

Eitan Zamir: We just acquired the two businesses. We are rebuilding it. Once we have a better understanding of the situation and the market traction, we will be better off. Currently, it is immaterialized.

Alright, Thank you for the question.

You put oh.

A light on a very important.

I would say trend in additive.

We need to penetrate new use cases.

Yoav Zeif: Okay. All right, guys. Well, thank you for the answers and good luck going forward here.

And in order to penetrate we need proven used cases, we need to prove the concept.

Eitan Zamir: Thanks, Troy.

Yonah Lloyd: Thank you. Next question is coming from Alek Valero from Loop Capital Markets. Your line is now live.

And it's through for automotive, but it's also true for Delta and it's also true for aerospace but.

Operator: Hey, guys. Thank you for taking my question. This is Alek Valero from Ananda Baruah. Given the success of your strategic collaborations with General Motors and Toyota involving your F900 systems, do you guys anticipate this momentum to lead to additional partnerships with other vehicle OEMs, especially in light of the growing emphasis on localized manufacturing?

Let me start with GM and Toyota by the way goes out.

Super respectable.

Leading in their area and they decided to go with Stryker.

And I want to relate to three points here. The first one that is a proof of concept.

Of the use case in production because practically what they have done.

Eitan Zamir: Alek, thank you for the question. I think you put a light on a very important, I would say, trend in additive. We need to penetrate new use cases. In order to penetrate, we need proven use cases. We need to prove the concept. It is true for automotive, but it is also true for dental, and it is also true for aerospace. Let me start with General Motors and Toyota. By the way, those are super respectable, leading in their areas, and they decided to go with Stratasys. I want to relate to three points here. The first one, that it is a proof of concept of the use case in production. Because practically what they have done, and if you look at General Motors as an example, they standardize the AM workflow in manufacturing. It is something that they are able to replicate and extend.

And if you look at GM as an example.

They standardized the AAM workflow.

In manufacture.

So, it's something that they'll be able to replicate.

And next thing.

The second point is about the demonstration of the value proposition of.

Additive and our strategies offering.

And those production application and the value proposition here is mainly by the way on both Toyota and GM is about the speed.

And it's about the cost savings.

Leading in their area and they decided to go with strategies.

And of course speed also save a lot of course, so when you look at Toyota.

And I want to relate to three points here. The first one that is a proof of concept.

It is part of their program to reduce 33 per cent.

The time of developing a new product this is huge.

Of the use case in production because practically what they have done.

And in terms of GM Bacon printed tool not in months, but in Howard.

And if you look at GM as an example.

They standardized the a M work flow.

Again huge contribution to their competitiveness.

In manufacture.

So, it's something that they'll be able to replicate.

MGM cost saving in some cases the two they are printing is less than 10% than the cost of the traditional tool. So it's a real demonstration of the value proposition.

And next thing.

Eitan Zamir: The second point is about the demonstration of the value proposition of additive and of Stratasys offering in those production applications. The value proposition here is many, by the way, on both Toyota and General Motors, is about the speed and it is about the cost saving. Of course, speed also saves a lot of cost. When you look at Toyota, it is part of their program to reduce 33% of the time of developing a new product. This is huge. In terms of General Motors, they can print a tool not in months, but in hours. That is, again, a huge contribution to their competitiveness. General Motors cost saving, in some cases, the tool that they are printing is less than 10% than the cost of the traditional tool. It is a real demonstration of the value proposition. The third thing is all about how it creates growth.

The second point is about the demonstration of the value proposition of additive and our strategies offering.

And the third thing is all about how we create growth in relating to your question you can expand within the customer because it is standardized so to other plants and receipt it is happening.

Windows production application and the value proposition here is mainly by the way on both Toyota and GM is about the speed.

It's about the cost savings.

We can replicate it to other Oems.

And of course speed also save a lot of course, so when you look at Toyota.

So we are very happy with this result, we have similar results by the way in dental we are.

As part of their program to reduce 33 per cent of the time of developing a new product. This is huge.

We are the first one.

And in terms of the competitive landscape I don't know what other thing, but we are the first in the market to be solution inkjet solution monolithic den chair that utilize multiple materials in a single print process no one did it before us even if they play.

And in terms of GM, they can create the tool not in months, but in ours.

Again huge contribution to their competitiveness.

MGM cost saving in some cases the two they are printing is less than 10% and the cost of the traditional tool.

And already we have 85000 venture printed so thousands of paper are going with our adventure.

So it's a real demonstration of the value proposition.

And that created the momentum the proven use case.

And the third thing is all about how we create growth in relating to your question you can expand within the customer because it is standardized so to other plants and we see it is happening.

Eitan Zamir: Relating to your question, you can expand within the customer because it is standardized, so to other plants, and we see it, it is happening. We can replicate it to other OEMs. We are very happy with this result. We have similar results, by the way, in dental. We are the first one, and in terms of the competitive landscape, I do not know what others are saying, but we are the first in the market to be with solution, inkjet solution, monolithic denture that utilizes multiple materials in a single print process. No one did it before us, even if they claim. Already we have 85,000 dentures printed. Thousands of people are going with our dentures. That creates the momentum. The proven use case creates the ability to replicate and expand. Thank you.

Creates the ability to replicate and expand.

Thank you.

Super helpful guys, just a quick follow up.

We can replicate it to other Oems.

Again on the general Motors and Toyota So I understand the consumables recurring recurring revenue stream that that's tied to a post sell or can you speak to any of the opportunities you foresee with general motors and Toyota as well as any with any future collaborations.

So we are very happy with this result, we have some of the results by the way in dental we.

Uh Huh, we are the first one.

In terms of the competitive landscape I don't know what the other thing, but we are the first in the market to be solution inkjet solution monolithic den chair that utilize multiple materials in a single print process no one did it before us even if they play.

Definitely there is an upsell opportunity here to others. So we are discussing here by the way I encourage I would be great. If the listeners could watch the video seeing is believing I can tell here for hours, but once you receive a video you will understand.

And already we have 85000 venture sprinted. So thousands of paper are going with our adventures.

The value prop.

And that created the momentum the proven use case.

The value proposition of editing and the value proposition of Stratasys and wife's processes within entity. Please.

Creates the ability to replicate and expand.

Please click the link on the slide it's so simple and it will explain better.

Thank you.

Super helpful guys, just a quick follow up again.

Pal Aaron: Super helpful, guys. Just a quick follow-up, again, on General Motors and Toyota. I understand the consumables recurring revenue stream that is tied post-sale. Could you speak to any upsell opportunities you foresee with General Motors and Toyota, as well as any with any future collaborations?

Definitely better English better than anything that I can say.

Again on general Motors, and Toyota So I understand the consumables recurring recurring revenue stream, that's tied post sell well can you speak to any upsell opportunities you foresee with general Motors and Toyota as well as any with any future collaborations.

So please click the link.

There so when im looking at the opportunity. It is huge not only on the hardware side, but those are manav texturing machines. They are being used in.

Up to sometimes around the 85%.

Definitely there is an upsell opportunity here to either so we are discussing here by the way.

Eitan Zamir: Definitely, there is an upsell opportunity here to others. We are discussing here. By the way, I encourage, it would be great if the listeners could watch the video. Seeing is believing. I can talk here for hours. But once you receive a video, you will understand the value prop, the value proposition of additive, and the value proposition of Stratasys, and why Stratasys within additive. Please click the link on the slide. It is so simple, and it will explain better, definitely in better English, better than anything that I can say. Please click the link there. When I am looking at the opportunity, it is huge, not only on the hardware side, but those are manufacturing machines. They are being used in up to sometimes around the 85% utilization and more. What does it mean?

<unk> and more.

And what does it mean that they you know rule of thumb.

Carriage I would be great.

They consume sometimes 10 times more than a rapid prototyping same machine used in terms of materials to the consumption of material can be 10 times, sometimes more.

The listeners could watch the video seeing is believing I can talk for hours, but once you receive a video you will understand the value prop.

The value proposition of additive and the value proposition of Stratasys and widespread disease with United It. Please.

Then a prototyping machine. This is the essence of what we're doing here.

We are moving into real production.

Please click the link on the slide it's so simple and it will explain better.

And with production consumes more material.

But you need to meet the production requirements.

Definitely in better English better than anything that I can say.

So please click the link.

Stratasys is one off.

There so when I'm looking at the opportunity. It is huge not only on the hardware side, but those are minor texturing machines that are being used in.

Not many companies that can meet those requirements and definitely leading the industry.

Thank you guys.

Up to sometimes around the 85% utilization and more.

Thank you we reached end of our question and answer session I would like to turn the floor back over to talk to you all designed for any further closing comments.

And what does it mean that they you know rule of thumb.

Eitan Zamir: That they, rule of thumb, they consume sometimes 10 times more than a rapid prototyping same machine used in terms of material. The consumption of material can be 10 times, sometimes more than a prototyping machine. This is the essence of what we are doing here. We are moving into real production, and real production consumes more material. But you need to meet the production requirement. Stratasys is one of not many companies that can meet those requirements and definitely leading the industry again.

Thank you for joining us looking forward to updating you again next quarter.

They consume sometimes 10 times more than a rapid prototyping same machine used in terms of materials to the consumption of material can be 10 times, sometimes more.

Thank you that does conclude today's teleconference and webcast you may disconnect. Your lines at this time and have a wonderful day, we thank you for your participation today.

Then a prototyping machine. This is the essence of what we are doing here.

We are moving into real production.

And with production consumes more material.

But you need to meet the production requirements.

And Stratasys is one off.

Not many companies that can meet those requirements and definitely leading the industry.

Thank you guys.

Yonah Lloyd: Thank you, guys. Thank you. We have reached the end of our question and answer session. I would like to turn the floor back over to Dr. Yoav Zeif for any further closing comments.

Thank you we reached end of our question and answer session I would like to turn the floor back over to Dr. Zhao for any further closing comments.

Thank you for joining us looking forward to updating you again next quarter.

Eitan Zamir: Thank you for joining us. Looking forward to updating you again next quarter.

Thank you that does conclude today's teleconference and webcast you may disconnect. Your lines at this time and have a wonderful day, we thank you for your participation today.

Yonah Lloyd: Thank you. That does conclude today's teleconferencing webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.