Athletic brand New Balance launched its first 3-D printed running shoe last week, but despite all the recent hype about how the technology could change the fashion industry for the better, adoption has been thin on the ground—and now falling revenue has caused some companies to trim their operations.
“While we are continuing investments in new products…we are taking decisive steps to further reduce our cost structure and better prioritize our resources around near-term opportunities,” David Styka, chief financial and accounting officer at 3D Systems, said earlier this month on a conference call with analysts to discuss the company’s third-quarter results. For the three months ended Sept. 30, revenue decreased 9 percent to $151.6 million.
Styka added, “These measures include additional facility consolidations and headcount reductions.”
Stratasys also reported a steep dip in revenue in the third quarter, down from $203.6 million to $167.6 million. The company sold a mere 5,467 3-D printing and additive manufacturing systems during the period.
“We believe the current environment is primarily a result of weak investment in capital equipment, which has combined with the negative impact of excess capacity that we believe was created during a period of extraordinary growth for Stratasys, and the overall industry, during 2013 and 2014,” said David Reis, chief executive officer, adding, “Although we believe that overall penetration in the prototyping market remains low, the segment has matured to an extent that our customers now have a wide selection of technology offerings to evaluate, resulting in lengthened sales cycles.”
MakerBot, a Brooklyn-based Stratasys subsidiary, now has less than 400 workers after announcing two rounds of layoffs this year, and its parent company has hinted there are more cuts to come in the business as a whole.
Reis noted, “We are focused on long-term objectives and remain confident we will overcome near-term challenges. We will respond to the current market environment by implementing adjustments to our costs and operating structure, while remaining committed to a plan that we believe will help unlock the significant potential within our industry for our innovative solutions.”