Q3 2025 3D Systems Corp Earnings Call
Greetings and welcome to the 3D Systems, third quarter 2025 earnings conference calling webcast.
At this time, all participants are in listen-only mode.
A question and answer session will follow a formal presentation.
You may be placed into question include any time by pressing star 1 on your telephone keypad.
As a reminder, this conference is being recorded if anyone should require operator assistance. Please press star zero. This is my pleasure to turn the Clover to your host, Monica ghouls investor relations for 3D Systems. Please go ahead. Monica.
Thank you.
Hello and welcome to the 3D Systems third quarter 2025 earnings conference call.
With me on today's call our Dr. Jeffrey Graves president and CEO and Phyllis Nordstrom interim CFO.
The webcast portion of this. Call contains a slide presentation that we will refer to during the call. Those following along on the phone who wish to access the slide portion of the presentation may do. So on the investor relations section of our website.
The following discussion and responses to your questions, reflect Management's views. As of today, only, it will include forward-looking statements as described on this slide
Actual results May differ materially additional information about factors that could potentially impact our financial results is included in our latest press release and our filings with the SEC.
Including the most recent annual report on form 10K and quarterly reports on form 10q.
During this call we will discuss certain non-gaap Financial measures in our press release and slides. Accompanying this webcast, you'll find additional disclosures regarding these non-gaap measures.
including reconciliations with comparable, gaap measures
finally, unless otherwise stated all comparisons in this call will be against our results for the comparable periods of 2024.
And with that, I'll turn the call over to our CEO. Jeff Graves for opening remarks.
Thank you, Monica, and good morning, everyone.
I'll start today with a brief recap of our third quarter results. I'll provide some commentary on the overall markets and then Focus. The remainder of my comments on our strategy and growth initiatives.
I'll then turn things over to our interim CFO Phyllis Nordstrom to provide details on the quarters financials.
For Q&A.
So, let's turn to slide 5.
I'll start by reviewing our third quarter results at a high level.
The macro environment.
For our company and 3D printing, oems broadly remains challenging. This can be seen in our third quarter, revenue of 91.2 million, which was down, 13.8% year-over-year soft. But consistent with our normal, seasonality trends,
As has been the case over the last several quarters, this overall softness continues to be driven by our customers, muted capex. Spending for new production capacity stemming from uncertainty around tariffs.
as such, we've taken aggressive actions to adjust our cost structure while maintaining core R&D Investments to position the company for long-term growth, when market conditions improve
As part of this effort, we've been rationalizing, non-core assets, including the recently announced sale of Octan and 3D experts which closed at the end of October.
As you may know, these software platforms are not proprietary but were designed to serve the entire industry. And while we will continue to remain very involved with this software, we believe the transitioning. These solutions to an independent software developer will help drive them as the industry standard which will help accelerate OEM adoption of additive manufacturing broadly.
We expect the financial impact of this disposition. On our fourth quarter results to be approximately 1.2 million in revenue and 1 million on gross margin.
This impact is reflected in our guidance for Q4.
Turning the slide 6.
We remain very focused on our core assets and continue, our strategic investments in metal and polymer printing technology with emphasis on R&D activities, that will drive our future growth and profitability.
During the quarter, we launched some very important new printer platforms. Derived in this case, from our expertise, in photopolymer jetting technology.
Jetting is a very special 3D printing technology that involves the simultaneous deposition of thousands of fine droplets of photopolymer.
These droplets are cured by ultraviolet light, as they're deposited onto the bill platform.
The process can be simultaneously, can simultaneously deposit, multiple materials in a fast, the precise pattern to create a monolithic structure, having distinct regions of coloration, geometry and mechanical performance.
It's a preferred approach where speed Precision surface finish and multi-materials are required for an application.
In the industrial segment. We introduced the mjp 300w plus that the Istanbul jewelry show in early October.
This new generation of jetting, technology, prints extremely intricate wax patterns used for casting precious metal jewelry.
Improving productivity by 30% and reducing gold silver or platinum, waste by 20%.
While the global jewelry market is competitive.
It's transforming rapidly into a digital manufacturing ecosystem where designer can Embrace custom creativity without sacrificing cost competitiveness in the market.
Our advantage in this growing Market is our recognized expertise in jetting technology.
Including both the printer itself and the custom wax materials that are essential for the post-print casting process.
As well as our expert Channel partners that serve the thousands of local jewelry, manufacturers around the world, customer feedback on our new printing, systems has been very positive and we've already begun to accept orders for this new printer platform, which given the size of this Global Market we expect to accelerate rapidly in the quarters ahead.
Well, find jewelry is viewed broadly as a consumer business.
It's embedded deeply in the culture of many countries around the world, which drives continuing demand growth, and the uniqueness of our wax materials combined with the high rate of their consumption and the casting process continue to make it an attractive market for our company.
On to slide 7.
And applying jetting technology to the dental Market.
In the third quarter, we announced the full commercial release of our next in jetted denture solution for the US market.
Our consistent investment in this revolutionary. Dental technology has culminated in a truly outstanding denture product.
With Associated. Excellent, economics for dental Labs, across the Americas Europe. And even in Asia.
This results in a faster more cost-effective and highly scalable alternative to traditional denture man Manufacturing.
Enabling both an outstanding patient experience and a strong return on investment for dental Labs that provide these products to local dentist Dental professionals each day.
We've already placed these printers with a dozen of the leading us Dental Labs that serve the American market and feedback has been excellent.
We're building backlog for the fourth quarter and our very excited about this Market opportunity, which we believe will reach a billion dollars in Industry Revenue across the US and Europe alone over the next several years. As the market transitions to 3D printing and away from Machining and hand assembly.
given the success that we've seen with our us product launch,
in parallel with the European regulatory approval which we're targeting for Mid 2026,
we continue to work aggressively through the regulatory process in other markets, throughout Central and South America. And in Asia, which we expect to follow rapidly.
With the addition of the addition of our denture solutions to our industry-leading positions, in both the liner technology and our next Dental materials portfolio. We expect Dentistry to be 1 of our single largest revenue streams in the years ahead, given the custom nature of the applications, and the strict regulatory standards.
Starting to slide 8. Another core area of focus for core area of focus for us is the Medtech half of our health care business.
For 3 systems, Medtech comprises our historical personalized Health Services business.
Our small, but important point of care business.
Medical implants and traditional printer and consumable sales to Medical oems.
What we are most often prohibited from discussing details of our point of care after long periods of time, these groups live within leading research and Specialty, hospitals, around the world.
Focusing on new and highly Innovative applications of our medical 3D printing technology which are extraordinary in terms of patient impact and provide the best indicators of where 3D printing can bring the most value to patients in Hospital Systems in the future.
As these applications are successful, we're well positioned to gain any required regulatory approvals, and then bring them to the market, broadly.
While there are quarter to quarter fluctuations in growth rates, for Medtech, particularly driven by seasonality of pre-planned, Orthopedic procedures.
This business remains on track to grow in a double digit rate. Once again this year.
To drive this consistent, strong growth, we can continue to build on our Market leading position with new applications materials and printing Technologies. The vast majority of which ultimately require regulatory approvals.
This not only provides a strong pipeline of new patient indications that we can address. But also opens new markets for medical 3D printing such as trauma which is now the fastest growing element of our PHS business.
Key area for Focus for us in Medtech is accelerating the use of our printed medical grade Peak materials.
It's a polyether ether Ketone for short.
These materials are biocompatible with properties. Very similar to Native human bones and it can be custom printed very quickly in economically.
Importantly, they can complement titanium implants, which have similar strengths and compatibility. But instead of blocking radiation used for Imaging, or the treatment of cancer Peak materials are transparent to it, allowing doctors to observe and treat the underlying tissue when required
These printed Peak materials are now being used in real life patient applications such as reconstruction of the face and skull from defects or injuries and even addressing post-cancer related surgical procedures and even trauma cases.
An example of printed Peak for a spinal application is shown on the right side of slide 8.
In this case, we printed a porous peek implant tailored for enhanced bone growth.
The results of which can easily be seen in the x-rays.
In addition to the patient benefits, our technology Investments have brought the cost and response time down to the point where bones can be repaired in hours or days. Instead of weeks further opening the range of cases that can be addressed from pre-planned, complex surgeries to Rapid responses needed for trauma cases.
We expect this trend to continue in the years ahead.
Now, let's turn to slide 9.
In addition to new printer and materials Technologies. We also recently announced several important milestones in our Saudi Arabian growth initiative,
Ing, Innovation company or Nami for short.
Through a partnership with the Saudi Arabian Industrial Investments Company.
The goal of this Venture was to enable Saudi Arabia's Vision 2030 program.
Which aims to create a strong, local manufacturing base and enable the kingdom to industrialize, more rapidly through the adoption of industrial scale 3D printing.
3D Systems is the exclusive provider of printers and materials, both polymers and metals, to the joint venture of Nami, providing local application, expertise, service, and support for customers.
Recently, we were proud to announce that the Saudi electric company or SEC. For short, the middle east's largest electricity, producer signed an agreement to make a Strategic investment in Nami. Acquiring a 30% stake in the Venture with a goal of reducing costs and Lead times for high demand spare parts, through the creation of local, manufacturing, capability, combined, with Advanced, Digital warehousing,
This partnership strengthens Nami. While deepening collaboration with sec to establish new workflows that. Accelerate the adoption of 3D printing for critical energy, infrastructure applications and to develop a skilled National Workforce.
Additionally the modern Isotopes Factory or mif for short, a Saudi electric company, a Saudi company established a support, the expanding need for radioactive sources. For industrial applications has signed a framework agreement of 26 million with nami for the manufacturer of up to 2,000. Tungsten core components used in non-destructive testing
devices for pipelines and weldment inspection.
And in the key Market of defense and Aerospace Lockheed Martin, recently announced a collaboration with nami to qualify and use additive manufacturing to develop critical military and Aerospace. Components of Saudi Arabia. Utilizing 3D Systems. Direct metal printing technology.
It has taken time to establish the local capabilities needed to support these customers. We're very excited to see our efforts, begin to bear fruit. In what we believe will be an increasingly important element of our Global growth strategy in high reliability industrial markets in future years.
Turning to slide 10, I'll briefly touch on additional critical Market opportunities. Before, turning the call over to Phyllis,
AI infrastructure is shown on the the left hand side of slide, 10 and Aerospace. And defense, highlighted on the right are 2 of the emerging growth opportunities that I'm most excited about. Given the exceptional level of Investments. Now, being made in these areas,
Starting with AI infrastructure.
There are 3 key areas where we participate.
These include semiconductor chip manufacturing where our 3D metal printing capability provides critical componentry for chip fabrication equipment.
Data centers, where our ability to print 3D 3D print copper based heat transfer components to help. Keep these high-intensity computational units, cool are increasingly valuable
and for components used in gas turbine engines that are used to create the electricity that powers the data center,
These markets are beginning to receive enormous Investments around the world. And we've been developing key applications for them for several years in anticipation of increasing demand.
From an aerospace and defense standpoint. As printing, technology has scaled and key materials for high temperature and aggressive environment, applications have come online.
The applications for 3D printing of rapidly expanded.
These customers are are not only working on a wide range of new applications or our technology, but encouraging us on a selective basis to support them from the developmental phase. Through initial component fabrication, particularly for low-volume challenging part types.
We select this work very carefully so that we can ultimately Bridge. The customer from limited Park Supply to full-scale production either within their factories or to supplier of their choice.
This business model is unique and we believe will be a highly will be highly effective. As we work, hard to grow this portion of our business, both in the US, and in Europe from our regional locations in Colorado and in
So with that, I'd like to introduce Phyllis Nordstrom. Our interim CFO, I've had the pleasure of working with Phyllis in several capacities for many years and I'm very pleased that she stepped into this important role as such a challenging time for our industry.
Folks.
Thank you, Jeff. I appreciate everyone joining us today.
Officer and then chief administrative officer.
In early September, I stepped into the role of interim Chief Financial Officer.
My background is in Finance and Accounting and throughout my career of held a variety of roles within these areas. Most recently, I'd let audit and risk management teams and MTS systems and price Waterhouse Coopers where I focused on advancing strategic priorities. Driving operational excellence and strengthening discipline around risk and controls. Before I begin our review of the third quarter results, I would like to remind you. We completed the vesture of our geomagic software business, on April 1st of this year.
As a result throughout today's call, we will reference both reported results and adjust the comparisons that exclude. Our geomagic business allowing for an Apples to Apples comparison of her performance across periods.
With that. Let's begin with a summary of our Revenue, which you'll find on slide 12.
Third quarter, Consolidated, Revenue was 91.2 Million down, 19% year-over-year or 14% when excluding geomagic.
Sequentially Revenue decline modestly, primarily reflecting typical third quarter seasonality and the absence of a regenerative medicine Milestone. That was recognized in the prior quarter.
Within our segments, industrial Solutions revenue of 48 million declined, 16% year-over-year or 4.5%? Excluding geomagic?
These declines were primarily driven by softness and our printers and material sales and consumer facing and markets.
This was partially offset by continued momentum in Aerospace and defense which grew nearly 50% over the prior year.
Healthcare Solutions revenue of 43 million decreased 22% from prior year, predominantly driven by lower sales within Dental.
With 2024 representing higher purchase volumes from a specific customer.
Outside of her dental business Medtech delivered, solid growth up, 8% from the prior year and slightly ahead of last quarter.
Additionally, we continue to see momentum in our PHS business with year-to-date growth of 10% through Q3.
Now, to 513.
For the third quarter, we reported a GAAP margin of 33% compared to 38% in the prior year and 34% when adjusted to exclude Geomagic.
The year-over-year growth margin decline was modest primarily driven by lower sales volume and reduced material sales.
These impacts were partially offset by reduced inventory reserves compared to the prior year.
Gross margin declined, sequentially reflecting the absence of the prior quarters regenerative medicine, Milestone, as previously discussed, as well as higher manufacturing variances in the period.
Turning to slide 14 and 15.
We continue to demonstrate strong cost Management in the quarter with non-gaap operating expenses of 44.7 million.
Down 24% year-over-year when adjusted to exclude, your magic and down 4 and a half percent sequentially.
This Improvement reflects the impact of our cost reduction initiatives, which run through the first half of 2026.
Our cost actions are well underway and continue to focus on optimizing. Our organizational capacity streamlining our facilities footprint and reducing expenses across the business.
Looking ahead. We expect continued reductions in expenses. Through the end of the year and are targeting fourth quarter. Operating expenses to be marginally below the current quarter.
To date. We are in track to deliver over 50 million in annualized savings by year end.
As we look ahead to the fourth quarter and the first half of next year, our cost savings initiatives will be closely aligned to the company's strategic priorities for 2026.
Focusing our investments on the products and markets that offer the greatest opportunity, both for growth and profitability.
Turning now to slide 16 to finalize the p&l.
Adjusted Eva for the third quarter was -10.8 million and Improvement of 3 and a half million compared to the prior year.
We've reported a gap that loss of 18 million for the quarter, or a gap loss for share of 14 cents, a meaningful Improvement, compared to the dollar 35 for share in the prior year period.
The Improvement was primarily related to the absence of Prior year asset impairment charges, as well as lower amortization expense and lower operating expenses in the current quarter.
In the non-GAAP basis, loss per share was $0.08, an improvement from $0.12 in the prior year period.
This progress, reflects our focus on cost reductions across the business.
Turning now to slide 17 for a review of the balance sheet.
Equivalents and $19 million in restricted cash.
Total debt. Net of deferred financing costs was 123 million as of the end of the quarter.
Of that total 35 million is due on the fourth quarter of 2026 with the remaining balance due in 2030.
We have successfully reduced cash usage over the past two quarters and expect continued improvement as we execute on our remaining cost savings actions through the first half of next year.
As we enter the fourth quarter, my priority is remain focused on completing our cost reduction initiatives. While working closely with the business to prioritize key, markets, products, services and Investments. These efforts are aimed at delivering meaningful impact. Both in the near term and throughout 2026.
So with that we thank you for your time and support of 3D Systems. We'll now open the line for questions, operator.
Thank you. And another conducting your question and answer session. If you'd like, to be placed into question queue, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2. If you'd like to move your question from the queue.
For participants using speaker equipment, may be necessary to pick up your handset before pressing star 1.
1 moment please while we post your questions.
Our first question today is coming from Troy Jensen, from Lake Street Capital markets, your line is now live.
Hey, good morning, Jeff. Uh, welcome, Phyllis. Thanks for taking my question here.
Morning Troy.
Hey, sill. A quick uh, either 1 of you guys, um, just gross margins kind of dropped a lot sequentially. Here is looked like it was mainly in products, but, uh, maybe in both, uh, products and services. Can you just touch a little bit on the, uh, on the decline growth Market?
Thanks Troy. I think.
Gross margins quarter of a quarter is really 2 main components as they highlighted um regmed we recognize a milestone under our lung program in the prior quarter, that was about, you know, 2 in a million, 2 million dollars of that total revenue that dropped down to the bottom line. We also had some manufacturing variances recognized in the quarter, which also had an impact to our margin. I don't think those will pick going forward but there was some scrap and some inventory reserves. So sure some slower moving inventory that we had that we cleaned up this quarter. Um, so looking ahead, you can see that we said, gross margin would be flat quarter of a quarter again, Jeff will touch on some of that, you know, printer Revenue that we're seeing with the new products that'll come in next quarter as well.
All right, so Troy that, that explains Q3, if you look at, look at going forward, there's offsets there's offsetting factors. So on the positive side volumes going up, you know, the launch of our new products. We're, we're selling more product in in but it is concentrated in Printers right now, printers, faster than materials. So, there'll be a mixed effect going forward. Offsetting the volume benefit through the factories. So that's largely it. We have a slight drag continuing on tariffs, but it is, it's relatively constant, it's there, and it's relatively constant quarter by quarter.
Um that's that's it. It's pretty simple, pretty simple puts and takes.
Yeah. All right. Understood and then, uh, Phil this is for you, too, on. Um, just on the appex. Um, I think I heard you say down slightly sequentially. But, um, is there more to do on the cost? Cut efforts? I know you guys had some facility consolidations that were depending on timing. I guess what, I'd ultimately like to get to is this Revenue level. You think you guys need to hit? Once all these Cost Cuts are in place, that'll get us to a break, even
The trail start with the first part of your question and I'll, I'll let Jeff handle the second part of your question. The first part of the question there is still more to go get. We take out a lot of the organizational capacity actions already. There's still a little bit left to do but the vast majority of that behind us the facilities, take a little longer, there's more to do we've made I think significant strides in getting ourselves into a place where the facilities will be ready to be exited that we've identified. Um, it's a timing issue just with the market and ensuring we can get those things.
Um, closed out. So that'll happen. I think at the first part of next year
Um in terms of Opex you're going to see a continued decline through the first half of 2026. Um it'll be a little bit of puts and takes in terms of timing to achieve our our total cost savings objectives here as far as Revenue. Um I'll let Jeff sort of cover where our Opex would need to be in terms of Revenue Outlook. It's something that we're doing right now as part of our 2026 budgeting
Really drive profitability and and positive cash flow for the business. It's high, highly dependent obviously on on gross margin that we derive from sales. So it'll be sales. Volume dependent gross margin dependent. The good thing right now is we are selling a lot of high materials used printers. Our new products are, are largely focused on those. Is this these jetting Solutions? Consume a lot of materials in the markets. They serve the new SLA printers, we have the large SLA, printers, the large SLS printer that we, we go to market with those consumer. A lot of materials. So um you'll continue to see us innovating on SLA and and in fact in all those product lines, they pull through a lot of materials. So there's a lag when you first sell the printer on gross margin, but we should see some nice, continuous gross, margin lift as they pull through materials.
So the the Opex the Opex, You could argue it to a couple of different levels depending on sales volume for factory efficiencies and the gross margin we derive from those sales. So I'm not giving you a crisp answer, our original Target of 70 million for these for these rounds of cost takeout.
We believe in a, in a, a little bit more normalized environment, but not great environment, but a little bit more normalized environment, through our gross margin estimates. We believe that would get us to, uh, positive, uh, cash flow and profitability, I still believe that it it's, it's, it's all it all is dependent on the, on the volume and mix that that comes with increased sales. Good news is sales are picking up a q Q4 as we've guided to. And and you know we all all fingers crossed for 2026 at the world continues to improve.
All right. Well, thank you. Um, good looking forward.
Yeah, thanks Joy.
Thanks your next question. Is coming from Greg Palm from Craig Howland. Your line is now live.
Hi, good morning. Can you hear me?
Yes, good morning.
Perfect. Uh this is Jackson Trader on for Greg Palm. Um just kind of wanted to talk a little bit more about the what was press release last week. Um with some of the new Partnerships to talk about with Lockheed Martin. Um some of the stuff out in the Middle East, can you talk a little bit more about that? Give some detail and maybe, I mean obviously the End Market and a and d but also kind of the products and what you're working on with them.
Sure. Yeah, absolutely. It's so we, we work with Lockheed Martin around the world and obviously in the US, it's they're they're a very big defense contractor. So very excited about business in the US, the unique thing about the, our Saudi initiative is when the Saudi is a big consumer of American defense products obviously. Um, and with that consumption goes a commitment from oems generally to spend money in the kingdom and so it drives them to look for Innovation and and local manufacturing of products.
So that is very consistent with why we set up our joint venture there in the first place. A lot of the JB's directed at the local, Saudi infrastructure like oil and gas and electricity. But it, it defense does benefit it substantially because of the requirement of the, of the, of the global, uh, defense oems to spend money in the Kingdom. So it's very good for us. It helps build things. And the the part types that they're interested in are very specific to what they sell in that part of the world. And I I can't comment on those. So, uh, but but it's, it's all the normal systems you would associate Lockheed with both both aircraft and missile systems the associated them with their um, their their activity is, is very focused and aggressive because they have these local sourcing requirements. So it's it's a great end with a terrific customer and we're uniquely positioned to.
To serve that. Obviously, in the US, there's other folks that can serve them as well, but these relationships take a while to develop and the technology takes a while to prove. So whether we prove it the us, we approve it in Europe or we we proved it in Saudi Arabia, it all goes to the same endpoint.
And and in terms of the systems and applications, again I shouldn't talk about that for any customer, but in that case, it's it's all the normal kind of flight systems, you would expect and the things that Propel those flight systems engines and and Rocket Motors things like that are all fair game.
Got it um and then as an off-topic follow-up maybe I missed this talking about cash generation for next year. Um could you touch more on capex? Expectations for that?
That quickly, we we we generally assemble products. We mix materials, they're not highly capex. Uh, intensive manufacturing processes.
So that that works in our favor. We um, we have traditionally if you drew a line through the past said 4% of sales on capex, is a is a good long-term average. But I, I would tell you over the next couple of years. The number can be meaningfully below that because we've spent pretty heavily in the last several years on building out what we needed in terms of building infrastructure stuff like that. So so 4% as a historic Benchmark in you know in a perfect world you know, and everything's growing that's probably the level to model us at. But for the next couple of years I would tell you we can get by with substantially less than that probably less than half of that. Um, when we're still putting things together for 2026 but but we can, we can get by with substantially less than that because again, the nature of our manufacturing operations, not very Capital intensive.
Perfect. Appreciate the caller. Leave it at that.
Okay, thanks for the question.
Thank you as a reminder that star 1 to be placed into question Q. Our next question today is coming from Alec Valero from loop capital markets for Line is now live.
Hey guys, thanks for taking my question.
um, so my first question is, um,
I saw on the press release that that you mentioned that the dental business is is seen more stability. I wanted to ask what is driving the dental business to stabilize? And I also wanted to ask on monolithic Dentures. I want to see if you could speak to the opportunity there and when we can, uh, possibly see it become a meaningful part of Revenue.
Yes, the the 2 good questions. So on the, on the first 1, in terms of stabilization, obviously there, there are several. We have several revenue streams today. In dentistry 1 is our historic stream in in materials to repair teeth if you will, uh, which is next in and vertex that market is, is, is consistent. Okay. And it, it runs pretty consistently, and we've got approvals in the US and Europe for a long time. So, that's a pretty consistent performer. The volatility, uh, Revenue stream, um, which is is great. We love it. But it's more volatile, is the liner, uh, Revenue Stream. So that really, um, you can follow that through public statements by the customers that we serve.
That market fluctuates because in tougher Economic Times some people uh consumers view those as luxury items and they don't spend as much money on them. There's also um a number of different age groups that those those uh oems try to serve from from younger folks to to you know, middle-aged older folks with the growth in video conferencing and stuff. Straight teeth have become very popular and it also varies by geography. So us, Europe Asia.
So we serve, we're we're a big provider in that market. I think we're the leader in providing uh, printing technology and materials in that market by far. And we kind of go, we kind of live with the volatility that that, that encounters. So, if you want to understand the driver of that, you can easily either public companies, you can use to easily tie into their earnings calls. And I think what you would hear right now is that market is has, has has declined in the last couple of quarters but is now stabilizing uh, for them in terms of in, in product sales. So if you work back through the supply chain, you would you it's consistent with our commentary on. We see Revenue stabilizing in that market and and you know that's it's it continues to be a great business. It's stable. Now love to see it return to to faster growth. Um but we're you know, it it we kind of live with that volatility and consumer spending
The Denture part of your question is very interesting. Um, Dentures today are you know, largely handmade products.
I'm I'm sure the patients that the consumers of those products don't appreciate the labor content that goes into a denture historically.
Asia to access lower cost labor but that's the way it's gone. That is all going to change now. But with with digital Dentistry, um, the scanners that dentists employ now are are excellent, so you can get a good scan of someone's someone's, um, teeth or their needs from their jaw Construction.
You can send that image to a lab but now, instead of being made by hand, you can 3D print a denture and you can print it in in minutes and hours not days. Okay? And and finish it. It is beautiful. It is durable. Um, it it it in many cases matches or exceeds current products standards and within a year or 2, it'll be the full spectrum of colors performance, everything that people expect today will be embodied in these Dentures. So I'm thrilled with the product. I love the process because it takes enormous time and cost.
Out of manufacturing and what the patient experiences at the end. When they buy the Denture is excellent now, so it it wins on every front and the economics are absolutely compelling. So, what is paced by and this, this is, you know, that we're we're the rubber hits. The road for investors is, okay, you talk about a billion dollar market. What has to happen to make that happen.
We need to, we've got full regulatory approval in the United States. We need now to mimic that in your up and we're working our way through that will happen in 26.
We need then to have these Dental Labs, try the try the manufacturing process and accept it, and phase it in. And that's I wish that process were faster, but it is, it's it is becoming a very sticky product. They like the product, they're going to wring it out and try it and make sure their Economics work. I'm very confident they do. And then I, I then will be selling a lot more machines. So our production rates are ramping. We've we've brought an inventory to make the product and the materials are fantastic. So I expect revenues to continue to grow in that market. Um, that we want to assess as much of that billion Market billion dollar market as we can because I think this beats any manufacturing process out there, we are also
But because of requests now, seeking regulatory approval and Central and South America several countries. There would like to, to adopt the technology as well. Some of them use us standards, some use Europeans, some use a blend, every country is different and take some time to get through those. But I I have yet to see us ship a product to a lab and then say, wow, this this does not work for me, okay? Everybody that, that tries, it loves the output of it right now, right? And if there's any hesitations it gets down to the details of the market, they serve in terms of coloration, you know,
Gums and teeth that varies by demographics reason the world, all of that. So there's a little more work to do on on some some areas of the market but fantastic acceptance. We're excited about the growth and now it's just working through there. So so all in all Dentistry for us, I think it's going to be a great business. It already is
Repair materials will always be needed for caps and crowns and all of that. The aligner product is very well accepted. It may become a little bit more of a volatile Market with consumer spending in some parts of the world but it's a it's great. It'll continue to consume uh a lot of material and printer uh printer investment. Um it is the most this the largest application for 3D printing today. Over a million of those are made per per day, uh, through 3D printing because they're all unique to each person's uh, teeth. So, materials will be strong, aligners will be strong for us. We're doing some really good work on uh, night guards as well and obviously the, um,
And I would say direct printing of aligners to to to change both the both the markets, they serve, and the way the products manufactured we're doing some good work there. And then, of course, Dentures is our biggest New Growth initiative. So thank you for the question. I I'm super excited about the about the product and the process of the acceptance. Look forward to updating you more in the future.
Got it. I have a quick follow up. If that's okay.
Sure.
Yeah, no.
Thank you. Uh, no. I was just gonna ask on the bench for opportunity, uh, just taking a little bit deeper, so that denture seems to be kind of like a more non-discretionary product for that. But if and when that, that initiative, uh, start turns into Revenue, would that become kind of like a more stable part of the, the dental Revenue.
And that that's a very good question. Absolutely. If you look at the liners, they, they truly for for many people that buy them. They, they are, they are discretionary. I mean, a lot of people have very good teeth. They're discretionary objects, um, although I would tell you the applications are expanding for aligners into into folks that need more manipulation of teeth, you know, and and Beyond Cosmetics. So, for for actual functionality of of tuning stuff. So that's so that market is, is continuing to expand. Dentures are exactly what you said, they are in, in my mind of a, an essential item to people, um, you know, particularly in the developed countries. And even in the non-developed countries it's 1 of the first things people want and life expectancies. Continue to expand. So you have you have an aging population. There's more demand if you will for teeth replacement and uh this product wins both aesthetically and economically in addressing that need. So it should be a more stable Revenue.
Stream, a growing Revenue stream as the manufacturers converted.
And because the AG population and growing demand profile, so we're thrilled by it. It's it's it's a great. I think it'll be a great business for us.
and I think you'll see Dentistry for us,
Be neck and neck with our uh the the balance of our Healthcare business on Orthopedics be 2 of our our largest and most valuable revenue streams in the future.
Very helpful. Thank you.
Thanks for the questions.
Thank you. We appreciate our question and answer session. I'd like to turn the floor back over to Jeff for any further. Closing comments.
So, thank you all for calling this morning. We look forward to updating you again as we wrap up the year and report Q4 and full-year results in the springtime. Thanks very much for the call.
Thank you that does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. You thank you for your participation today.