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17 April 2024
2024 Hopes to See Global 3D Printer Industry Revived by Pent-up Demand

London, 17 April 2024 - The fourth quarter of 2023 was a difficult period for many systems’ manufacturers across the global 3D printer landscape with printer shipments across three of the four main price-classes falling from a year ago.

Traditionally, around 30% of all 3D printers sold each year are shipped in the fourth quarter. This trend was bucked in Q4 2023 against a global landscape marked but shifting buying patterns, sticky inflation and the high-cost of capital.

While there was a small (1%) quarter-on-quarter (QoQ) increase for global Industrial price-class ($100K+) printer shipments in Q4-23, volumes were down -13% from Q4-22 as high interest rates across the globe led to businesses waiting for the rate decreases before investing in new capital equipment. Struggling with similar issues seen from Industrial printers, Midrange ($20-$100K) printer shipments were down -7% year-on-year (YoY.) Shipments of Professional ($2.5-$20K) models dropped by -32% as companies impacted by ’sticky’ inflation sought out cheaper alternatives. This had a positive effect on sales of Entry-level printers costing less than $2,500 - however, with shipments of these products up 35% YoY.

In spite of inconsistent regional economic growth and recovery, many aspects of key economies around the globe remain positive. We’re seeing strong GDP growth projections for China and stronger than expected GDP growth and high stock market levels in the US for example. All indications are that demand has simply shifted out.

In aggregate across all price-classes, North America is still the biggest market for 3D printers with shipments to this region generating 41% of all systems’ revenues in Q4 2023. For comparison, shipments into Western Europe were responsible for 26% of revenues and those in China for 18%. Of these three leading regions, the market in China has seen the most growth recently and it remains the top market for the all-important Industrial price-class. From a unit shipment perspective, 33% of the global shipment total for Industrial price-class printers in the period were shipped into domestic China. China’s dominance in the metals space is even more impressive with 43% of the global shipment total of Industrial Metal 3D Printers shipped in the last quarter shipped there. Most of this huge demand is met by domestic suppliers.

Chart 1: Regional distribution of Q4-23 3D printer unit shipments by price class

INDUSTRIAL SYSTEMS

This price category remains key, accounting for just over 50% of all systems’ revenues in 2023. The fourth quarter saw global Industrial shipments drop -13% YoY largely due to a -25% drop in polymer systems with particular weakness in the polymer vat photopolymerization space. UnionTech (in China) and 3D Systems (predominantly in the West) both experienced falls in sales of vat photopolymerisation machines. Shipments of Industrial metals printers were actually up 4% because of growth of the powder bed fusion (PBF) market in China and increasing sales of directed energy deposition (DED) systems worldwide. For the full year, this price-class has been severely impacted by reductions in capital expenditures (due to high interest rates), resulting in aggregate
shipments of Industrial systems dropping -9% from 2022.

INDUSTRIAL METAL SYSTEMS

Although shipments of Directed Energy Deposition (DED) systems grew by 30% YoY in Q4 2023, Powder Bed Fusion (PBF) was still the most common metal technology in class, representing 72% of all Industrial metal additive manufacturing (AM) machines shipped in Q4-23. An overall fall of -1% in shipments of PBF systems in Q4 masks the detail that while unit shipments were down in North America and Europe, shipments were up YoY in China.

Chinese vendors had a weak Q3 last year but bounced back in Q4, shipping 25% more PBF printers that a year ago (mostly to their home region). Indeed, the four top shippers of metal PBF printers in the period - BLT, Farsoon, Eplus3D and HBD – were all Chinese and three of these saw YoY increases: 3% for BLT, 23% for Farsoon and a sizable YoY shipment jump of 100%+ for Eplus3D. Over half (52%) of all Industrial metal PBF printers dispatched worldwide now come from vendors based in China. Western vendors in the space saw unit shipments drop −20% from Q4-22. For the full year, Industrial Metal system shipments dropped -3% as fewer Metal Powder Bed fusion systems shipped globally in 2023 than in 2022. Other metal modalities, including Directed Energy Deposition (DED) and Binder Jetting saw healthy or moderate growth (up 15% and 2% respectively.)

INDUSTRIAL POLYMER SYSTEMS

Vat photopolymerisation shipments fell by -39% YoY in Q4 2023 as the two leading companies both faced challenges.

Shanghai’s UnionTech, which has a 49% share of this category, principally sells into mainland China and is still seeing an uneven recovery from Covid lockdowns in H1 2022 that have left shipments fluctuating unevenly from quarter to quarter.

The Western leader in the category - 3D Systems - continued to be challenged by weak demand from dentistry, its key end-market for this technology. Economic pressures have shifted consumer spending away from cosmetic dental procedures so few companies in the sector are investing in new machines.

Chart 2: Full-year global 3D printer unit shipments by price class

(Note different scales)

MIDRANGE SYSTEMS

In Q4 2023, unit shipments of Midrange systems were up 16% sequentially but fell -7% on the previous year. The category was a bit of mixed bag with shipments from half the vendors falling YoY while the those from the other half were flat or increasing. Among those who had a successful quarter were: UnionTech, whose domestic Vat Photopolymerization shipments were strong throughout the year and continued to grow; Flashforge, who saw increased demand for their WaxJet printer; and Nexa3D, which benefitted from the Polymer Powder Bed Fusion business it acquired from XYZprinting.

Over the year as a whole, the category leaders were Stratasys (once again), UnionTech and Formlabs. UnionTech and Formlabs led growth in the category. While these two vendors enjoyed impressive yearly growth in the category (of 88% and 123% respectively)
the overall segment only saw a marginal YoY growth of 2%. Stalwarts Stratasys, 3D Systems and Markforged all saw a double-digit percentage drop in unit shipments of Midrange machines in 2023. Key drivers in 2023 were Formlabs, who successfully created a market for new low-end polymer PBF models, and UnionTech which focused their attentions on the growing China market.

PROFESSIONAL SYSTEMS

The last quarter of 2023 was another difficult one for products in this price-class. While shipments of Professional 3D printers were 21% higher than in Q3, they were down YoY for a ninth consecutive quarter. Share shifts in this period of globally high inflation have not been so much within the price-class as between this class and the one below. Professional buyers have recognised that Entry- level products, once perceived as being for only for consumers, offer similar functionality to models in this category.

Shipments over the full year dropped precipitously, falling by -33% YoY. Every vendor in the global top 10 - with the exception of start-up Nexa3D - shipped fewer printers in 2023 than in 2022. Over recent years, manufacturers of Professional printers have been able to maintain or increase revenues even as unit sales have fallen by offering new features and raising prices. This strategy proved to be less effective in 2023 as inflation changed end-market purchasing habits however. Key vendors historically focused on this price-class, including UltiMaker, Formlabs and Raise3D, are now poised for product expansions and are aiming to reverse market trends in the coming year.

ENTRY-LEVEL SYSTEMS

Nearly a million (993K) Entry-level 3D printers were shipped worldwide in Q4 2023 - a new quarterly record! Although Creality’s shipment increase in the quarter of 38% YoY was impressive, Bambu Lab’s 3000% growth stands out and was one of the main contributing factors to the performance of the category overall. If these two vendors are excluded from the data, shipment growth in this price-class was only 2%. While some companies, such as Flashforge, also experienced nice levels of growth (36%), others saw shipments drop (by -51% in the case of Toybox, for example).

For the full year, shipments rose 19% from 2022 with global inflation ironically expanding the market base for this type of printer. 94% of Entry-level printers shipped in 2023 came from Chinese vendors (up from 88% in 2019) and 89% came from just four vendors: Creality, Anycubic, Elegoo and Bambu Lab.

OUTLOOK

As Q1 2024 came to a close, many forecasts for 2024 remained conservative. While we expect the projections of Industrial-focused players in particular to remain cautious as they wait to see how interest rates change across the globe, many see strong signs of pent-up demand. GE Additive - part of the newly separated GE Aerospace - has earmarked a good portion of its announced $650M 2024 spend for additive. Other US companies have reported increased demand from defence customers thanks to new federal government investment. In China, UnionTech has announced plans to further expand their product portfolio in 2024 on top of their recent expansion from polymers into metals.

Forecasts for total worldwide shipments in 2024 predict single-digit percentage unit growth in all price-classes (Industrial 5%, Midrange 4%, Professional 3%, Entry-level 8%), rising to double-digit percentage growth by 2025 (2024 to 2025 forecasts are Industrial 16%, Midrange 12%, Professional 13%, Entry-level 11%). However the hope is that the pent-up demand seen on the horizon can be pulled-into 2024.

*Price-class groups: Industrial $100,000+; Midrange $20,000–$100,000; Professional $2,500–$20,000; Entry-level $2,500 (combines former Personal and Kit; Hobby classes)

CONTEXT analytics, forecasts and data management solutions are embedded in the information systems of the world's major technology companies. CONTEXT processes over $200 billion of sales transactions every year for the global ITC Channel, with a team of more than 400 staff operating worldwide from London, Berlin, Paris, Madrid, Milan, Warsaw, Johannesburg, Istanbul, Dubai, Chicago, Buenos Aires, Sao Paulo, Mumbai, Auckland, Singapore, Seoul, Taipei and Tokyo.

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12 October 2023
Failed Mergers and "Laser Wars" Take Centre Stage Amid Regional Variations in 3D Printer Shipments

East-West "Laser Wars" in the Industrial metal powder bed fusion 3D printer market signal accelerated revenue growth ahead

London, 12th October 2023 - The second quarter of 2023 saw contrasting patterns in the shipments of Industrial* 3D printers, according to latest insights by global market intelligence firm CONTEXT. Eastern vendors saw strong year-on-year (YoY) growth, especially in shipments within China, while many Western vendors faced continuing reduction of capital expenditure in key end markets with many distracted by mergers and acquisitions.

"Discussions between the likes of Stratasys, 3D Systems, Desktop Metal and Nano Dimension have so far failed to produce the world's first $1B 3D printing company but efforts to that end have not yet been abandoned", said Chris Connery, head of global analysis at CONTEXT. Although shipments of new Industrial systems were generally weak for the quarter (up just 2% YoY), and those of Professional printers down YoY for the fifth consecutive quarter, they were better than expected in Midrange, Personal and Kit&Hobby price-classes (up 7%, 12% and 3% respectively.) In general, new 3D printer shipment growth across the globe was limited in the period with the latest full-year forecast showing single-digit unit shipment growth in 2023.

INDUSTRIAL SYSTEMS

Industrial 3D printer shipments were also regionally segmented: China-based vendors met most of the demand in that country while Western vendors fulfilled orders in the US and Europe and the rest of the western world. With 38% of Industrial printers shipped in Q2 2023 going to China, it was again the world's largest market - followed by North America (29%) and Western Europe (23%).

In Industrial polymers, growth in the quarter was driven largely by shipments in domestic China. Regional Covid lockdowns in Shanghai just a year ago have led to uneven growth of domestic shipments in China over the last year but, in the second quarter of 2023, unit sales of Industrial polymer machines (particularly from vat photopolymerization products from leading vendor UnionTech) were up 66% against a -15% fall in those from Western vendors.

On the metal side of the Industrial 3D Printing market, market activity remained focused on powder bed fusion with 74% of all Industrial metal systems shipped in the period being of this type. In this category, Western vendor shipments dropped -12% YoY while shipments from Chinese vendors were up 1%. Manufacturers have recently been focusing less on how many machines they sell than on supplying larger, more efficient and more expensive models.

So, although the number of metal powder bed fusion systems shipped by Western vendors was down -5% YoY in H1 2023, revenues from these sales increased by 21%. The trend toward higher efficiency machines - often characterised by use of a larger number of lasers - largely began in the West thanks to companies like Nikon SLM Solutions and Velo3D. Major Chinese players, including BLT (Xi'an Bright Laser), Farsoon, Eplus3D and HBD, have now joined the "laser wars" and are showcasing larger build models with 16, 20 and even 26 lasers. As these new, more efficient machines begin to ship in that region, expectations are that, here too, revenues will increase even if unit shipments drop.

Chart 1: Industrial 3D printer system shipments by material or/and type and vendor HQ location

MIDRANGE SYSTEMS

Shipments of Midrange* printers rose 7% YoY in Q2 2023 and were 2% up on the previous quarter. This is largely down to sales of a sub-class of low-end polymer powder bed fusion machine (most of which come from Formlabs) and rising domestic shipments of vat photopolymerization printers in China (almost exclusively by UnionTech): if UnionTech and Formlabs are excluded from the analysis, then Midrange unit shipments were down -17% YoY. Although Shanghai-based UnionTech benefitted from a weak compare to a Covid-impacted Q2 2022, accelerated sales of its latest line of mid-priced systems have also contributed to recent growth. Formlabs current success springs from essentially creating a new category but shipments of these machines are now beginning to plateau.

PROFESSIONAL SYSTEMS

The Professional* price class continued to struggle as unit shipments dropped -30% YoY in Q2 2023, having seen a similarly precipitous fall in the previous quarter. Systems utilising both leading processes were affected: FDM/FFF printer shipments were down -36% while those of SLA printers fell -30%. Market leaders UltiMaker BV (owner of brands Ultimaker and MakerBot) and Formlabs both saw steep YoY declines in unit shipments of products in this class.

PERSONAL AND KIT&HOBBY PRINTERS

Increases were seen in both unit shipments (up 12% YoY) and for system revenues (22% YoY) in the Personal* price-class in the period thanks entirely to Bambu Lab and to AnkerMake (which continued to deliver against its super-successful Kickstarter campaign.) Bambu Lab has taken the Personal 3D printer market by storm and was the market share leader in this fully-assembled class of Personal printers for the quarter. When these two companies are excluded however, aggregate shipments of Personal printers fell -28% YoY. Although former market leader Creality saw a marginal increase from shipments of its models in the Personal class, most vendors experienced double-digit YoY shipment declines.

Creality still dominates the lower regions of the 3D printer market and remains the undisputed leader in the DIY Kit&Hobby* class where its reported 4% shipment increase drove growth as other vendors saw sales fall (for example, Prusa Research unit shipments were down -7% YoY).

OUTLOOK

Half of the top ten revenue-leaders of 3D printer systems costing more than $2,500 - EOS, UnionTech, HP, Velo3D and Nikon SLM Solutions - saw at least some YoY growth in unit shipments in H1 2023. However, others including Stratasys, Desktop Metal, UltiMaker, 3D Systems and Formlabs all saw shipment decline for the first half of the year.

"In the same way, these companies have outlooks that are mixed, varied and inconsistent, reflecting the wide variation in macroeconomic forecasts", according to Chris Connery. "Many vendors are dealing with longer sales cycles, some facing a push-out of orders while others point to strong demand in Q2 2023; some point to early signs of a recovery but others still see the global economic environment as challenging and uncertain. What is certain is that interest rates remain high across the world and, for many potential buyers, the cost of capital continues to limit spending on new hardware."

Chart 2: Industrial 3D printer system shipments, revenues and forecasts by process and material

Considering all regions, all material types and all printer modalities, projections for the full year now indicate low-single digit unit shipment growth for the year (3%) but mid-teen System Revenue growth (14%.) Focusing on the leading Industrial price-class, growth of 5% is expected in Industrial polymer unit shipments with revenues on track to climb 9% YoY thanks mostly to inflationary price increases since 2022. Industrial metal shipments are expected to be more or less flat (up only 0.4% YoY) but the move to more expensive, more efficient multi-laser metal powder bed fusion systems across the world is expected to augment the effects of inflation and leading to system revenue growth of 15% for the full year, according to CONTEXT.

* Price classes for fully assembled finished goods: Industrial $100,000+; Midrange $20,000-$100,000 (this category was previously known as Design); Professional $2,500-$20,000; Personal <$2,500; Kit&Hobby printers require assembly by purchaser.

CONTEXT analytics, forecasts and data management solutions are embedded in the information systems of the world's major technology companies. CONTEXT processes over $200 billion of sales transactions every year for the global ITC Channel, with a team of more than 400 staff operating worldwide from London, Berlin, Paris, Madrid, Milan, Warsaw, Johannesburg, Istanbul, Dubai, Chicago, Buenos Aires, São Paulo, Mumbai, Auckland, Singapore, Seoul, Taipei and Tokyo.

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16 January 2024
Quarterly Global Industrial 3D Printer Shipments Struggle for Growth

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 up 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 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.

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