Today's call is accompanied by two important announcements: our earnings results and the beginning of a leadership transition plan, both of which I will address this morning. I'll then turn the call over to Phyllis Nordstrom, our CFO, who will summarize the quarter's financial results and outlook, and will then open the call up for Q&A. A major theme clearly emerging this year is the return of capital spending by our customers in key markets. Industrial business revenue was modestly lower year-over-year as older systems in our installed base are now being increasingly replaced by our new printer platforms.
Despite this dynamic, our two key industrial focus markets, aerospace and defense and data center infrastructure, both delivered strong double-digit growth again this quarter. Sales of both platforms into our key markets have been very strong, with Q2 growth of roughly 90% and 125% respectively year-over-year. Given this rapid rise in demand for 3D-printed metal parts, we're also significantly expanding our internal metal parts production capacity. This is an important element of our growth strategy, and I'll touch on it in more detail in a few moments.
Before beginning our review, I'd like to remind you that we completed the divestiture of our legacy software businesses during 2025. Q2 revenue increased year-over-year, driven by strong demand across our target markets and increasing sales of our new polymer and metal printer platforms. Adjusted EBITDA also improved notably from the prior year period as a result of higher revenue, disciplined cost management, and ongoing operational efficiencies. Performance across our key strategic markets remained strong in the quarter as med tech, aerospace and defense, and data center infrastructure each delivered double digit year-over-year growth.
| Metric | Period | Current guidance |
|---|---|---|
| Revenue | Q3 2026 | Mid-single-digit sequential growth at the midpoint (unusual seasonal growth from Q2 to Q3), driven by broad-based strength across printers, materials, and parts |
| Adjusted EBITDA | Q3 2026 | Small loss expected (approaching but not yet at positive) |
| Gross margin | H2 2026 | Pressured by a printer-heavy mix, especially in a seasonally printer-heavy Q4 |
| Operating expenses | H2 2026 | Expected to be similar to first-half levels, reflecting stabilized opex |
| Full-year / 2027 outlook | FY2026 / 2027 | Not provided; company deliberately guides only one quarter out given macro volatility |
| Metric | YoY | Note |
|---|---|---|
| Total revenue | +1.4% to $94.6M (adjusted) | Strong printer sales and core-market growth offset by legacy/consumer-facing weakness; presented excluding 2025 software divestitures. |
| Printer (hardware) sales | +>45% (>20% sequential) | Return of customer capital spending meeting a three-year product-portfolio refresh; led by DMP 350, SLA 825, and denture platforms. |
| Healthcare segment | +6.8% to $48.1M | Strong med tech demand (orthopedic implant OEMs), PHS surgical-planning/trauma growth, and NextDent 300 denture adoption. |
| Industrial segment | -3.7% to $46.5M (+2.4% sequential) | Closure of a non-core product line and lower legacy services revenue, partly offset by aerospace/defense and data-center strength. |
| DMP 350 metal printer | +~90% | Rising demand for direct metal (laser powder bed fusion) printed parts in med tech and aerospace/defense. |
| SLA 825 polymer printer | +~125% | Demand for high-quality metal-casting patterns, including the large reusable-rocket order. |
| Data center infrastructure | +>20% | Increasing demand for metal parts used in critical airflow and thermal-management components for semiconductor manufacturing equipment. |
| Non-GAAP gross margin | 36.7% | Higher hardware mix and less favorable materials mix plus a prior-year regenerative-medicine milestone comparison, partly offset by cost actions and $2.6M of tariff refunds. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Return of customer capital spending | Multi-year industry recession and severe headwinds | Capital spending is returning across key markets just as a three-year portfolio refresh completes, driving >45% printer growth and management's view that the industry is emerging from recession. | — |
| Four strategic growth markets | Broad, unfocused portfolio | Focus narrowed to med tech, dental, aerospace/defense, and data center infrastructure -- all 'firing on all cylinders' -- with revenue expected to shift away from competitive consumer-facing markets over time. | — |
| Two metal-part production paths | Direct metal printing emphasis | Both direct metal printing (DMP 350) and 3D-printed casting patterns (SLA 825) are scaling; the company is expanding internal metal-parts production capacity and bridging customers from application development to part production to printer sales as a margin driver. | — |
| Dentures (NextDent 300) | Historically tied to the dental aligner market | The purpose-built denture platform is being very well received on comfort-of-fit and dentist productivity; now in ~100 of the several-hundred key labs (some buying 2nd/3rd printers), with FDA/EU-MDR-regulated materials driving high-margin pull-through and a potential revenue stream several times the aligner business by 2027-2028. | — |
| Path to profitability | ~$60M of run-rate cost reductions taken | The lever to positive adjusted EBITDA is volume-driven gross-margin expansion, especially polymer materials pull-through (often regulated/preferred) and metal-part production following installed printers. | — |
| Data center energy / nuclear | Airflow/thermal components for semi equipment | A future opportunity in power generation for data centers (including small nuclear reactors), working with OEMs like GE Vernova and Siemens and hyperscalers, leveraging the Savannah River National Lab tie-in for high-temperature materials -- potentially its own revenue and profit stream in a few years. | — |