London, 16 January 2024 – Shipments of 3D Printers struggled in many
segments across the globe in the third quarter of 2023 as key
end–markets fought against inflation and high interest rates. While
publicly traded 3D Printing companies made most of the headlines in
the industry in the second half of the year, they were responsible for
just 33% of recent global system revenues. Almost none of them –
whether “pure play” businesses deriving most or all of their revenues
from 3D printing or larger firms offering 3D printing systems and
services as part of a portfolio* – have a significant presence in the
hot Entry–level sector of the market. Most focus on Industrial systems
with just over half (51%) of Q3 2023 revenues in this price class
coming from publicly traded companies. Many public 3D printing firms
in the West began shifting their attention from market growth to
profitability and have recently been distracted by failed mergers and
layoffs. Although these woes were reflected in the wider global market
as well, there were pockets of opportunity and glimpses of strength in
some 3D printer segments, especially in the often–overlooked
Entry–level portion of the market.
Chart 1: Global 3D printer system
unit shipments by price class
(note different scales)
INDUSTRIAL SYSTEMS
Global shipments of $100K+ 3D printers dropped –11% year on year
(YoY) in Q3 2023. Industrial polymer printer shipments dropped –17%
while Industrial metal printer shipments were down –3%. Shipments of
Industrial printers to China, which continues to be the largest market
for this price class, were –16% less than in the previous year mostly
due to weak polymer printer shipments. Vat photopolymerization
printers –the largest category of the polymer printer segment –
performed particularly poorly (if excluded from the analysis, then
Industrial polymer printer shipments were actually up 2% from a year
ago). Reduced demand in certain dental end market segments contributed
to poor results for some companies (such as 3D Systems) but the Covid
pandemic is still casting a long shadow over global growth figures.
The recent performance of market leader UnionTech has been lumpy and
inconsistent, and shipments dropped by –28% YoY in the period partly
because the comparison is to a time when the company was in
accelerated recovery from the Shanghai lockdowns of Q1 and Q2 2022. In
spite of all this, Q3 2023 global revenues from Industrial printers
were up 2% on the previous year.
Chart 2: Global Industrial 3D
printer system unit shipments by material and
process
INDUSTRIAL METAL PRINTERS
Industrial metal 3D printer shipments were down –3% in Q3 2023
with most of the shortfall coming from a –9% fall in those of powder
bed fusion (PBF) systems – the largest (and most strategically
important) category. There were YoY shipment falls for Industrial
metal printer shipments in the two top regions in Industrial metal
shipments: China (–8%) and North America (–6%). However,
inflationary price increases and the growing popularity of larger
build–volume, multi–laser powder bed fusion systems – initially from
Western vendors such as Velo3D and Nikon SLM Solutions but now also
from Chinese companies including Farsoon, Eplus3D and Xi’an BLT as
well – mean that overall metal revenues were 8% higher than in Q3 2022.
INDUSTRIAL POCKETS OF GROWTH
While shipments of most Industrial metal 3D printer systems were
down in the period, one modality seeing strength was the Directed
Energy Deposition (DED) segment. Recent quarters have seen the
emergence of new entry–level products in this segment with Spain’s
Meltio driving the charge and now leading the category in
market–share. The DED category saw further growth outside of the
low–end as well as Australia’s SPEE3D accelerated defence shipments to
support the war effort in Ukraine. Pockets of growth were also seen in
some polymer segments as well with excellent YoY growth in shipments
of polymer PBF systems from one of the biggest companies in this
category, EOS. Meanwhile, Stratasys, one of the largest and
highest–profile global vendors, saw a healthy 11% YoY increase in
shipments of its wide range of Industrial polymer printers.
MIDRANGE SYSTEMS
In Q3 2023, Midrange printer shipments fell –5% YoY (–2%
sequentially). The drop would have been worse were it not for two
factors that also affected results in the previous quarter: (1) strong
shipments of a new class of low–end PBF systems, mainly from Formlabs;
and (2) rising domestic shipments in China of vat photopolymerization
printers, almost exclusively from UnionTech. If Formlabs and UnionTech
are excluded from the analysis, then shipments in this price class
would have been down –17% as key market leaders performed poorly:
shipments for product in this category were down –17% for Stratasys,
–28% for 3D Systems and –33% Markforged. Recognising challenges in
this price class, companies like Formlabs have adeptly added products
in new modalities and at new price points to their offering. This
portfolio–expanding tactic, which has been used time and time again in
the global 3D Printing market over recent years, is a recipe for
success that not only helps the innovating company but also lifts the
entire market.
PROFESSIONAL SYSTEMS
The Professional price class continued its downward trajectory
with –41% fewer printers shipped in Q3 2023 than a year before. This
is the sixth consecutive quarter in which global shipments have
fallen YoY and the third in which the drop has been –30% or more.
The strategy in recent years of market leaders UltiMaker and
Formlabs had generally been to offer more feature–rich products at
incrementally higher price points and, until recently, customers
have been receptive. However, in these inflationary times, demand
has clearly shifted to “good enough” solutions that can be found in
the Entry–level price class. With the exception of newcomer Nexa3D,
every vendor of Professional printers saw a double–digit YoY decline
in shipments of such products in the period.
ENTRY–LEVEL SYSTEMS
(This price class includes all 3D printers costing less than
$2,500 and combines CONTEXT’s previous Personal and Kit&Hobby categories.)
There was 9% growth in shipments of Entry–level 3D printers in Q3
2023, thanks largely to the cannibalization of sales from more
expensive Professional printers. End–market buyers in many sectors –
including dental, automotive, medical & healthcare, aerospace,
jewellery and consumer products – are increasingly recognising that
they can get similar functionality from much cheaper models so these
printers are no longer the preserve of hobbyists and general
consumers. While China’s Creality continues to stand head and
shoulders above other vendors in terms of global market share, recent
growth is best exemplified by brands like Bambu Lab (in the FDM space)
and Elegoo (in the LCD space).
OUTLOOK
A challenging 2023 has set the stage for a rebound and 3D printer
shipments look to accelerate in the years to come. Currently it
appears that global interest rates will remain elevated through at
least the first half of 2024, however which could mean Industrial
system shipments remain stagnant in the near term. Fears of regional
recessions have largely abated and the fundamental value of additive
manufacturing is well recognized across industries, clearing the way
toward accelerated growth once the cost of capital lowers in the
second half of the year and on into 2025.
Although the market may appear to have settled after the very
public failed mergers of 2023, many companies have openly stated that
they are more privately investigating strategic alternatives, meaning
that sales, mergers, acquisitions and divestures may yet lie ahead.
Indeed, as 2023 closed, Nano Dimension renewed its offer to take over
Stratasys with other companies – like BigRep – also separately
announced plans to go public in the year. An additional area ripe for
investment is the Entry–level category as more and more companies have
come to recognise this recently overlooked category.
* Pure 3D printing companies include Stratasys, 3D Systems,
Desktop Metal, Velo3D, Markforged, Prodways, voxeljet, Massivit3D,
Freemelt, Xi’an BLT, Farsoon, Nano Dimensions, Zortrax and Nano
Dimensions. Larger publicly traded companies which offer 3D printing
systems and services include HP, Nikon SLM Solutions (now fully
integrated into Nikon), GE Additive, DMG Mori, Renishaw and others.
