Stratasys SSYS reported a first-quarter 2026 non-GAAP loss of a penny per share, which beat the Zacks Consensus Estimate of a loss of 2 cents by 50%. However, the figure plunged 125% year over year.
Revenues decreased 2.4% year over year to $132.70 million. However, the top line beat the consensus mark of $132 million by 0.75%.
SSYS shares rose 3.9% at the time of writing this article. The stock has declined 7.4% in the year-to-date period compared with the Zacks Industrial Products sector’s return of 16%.
Stratasys’ Q1 Release in Detail
Segment-wise, product revenues decreased 5.3% year over year to $88.8 million. System revenues fell 7.7% year over year to $28.8 million. Consumables revenues declined 4.2% year over year to $60 million.
Stratasys, Ltd. Price, Consensus and EPS Surprise
Stratasys, Ltd. price-consensus-eps-surprise-chart | Stratasys, Ltd. Quote
Services revenues increased 4% year over year to $43.9 million, driven by Stratasys Direct’s 23% organic year-over-year growth after divestments. Customer support revenues were $29.7 million, down 1% from the year-ago quarter. Management noted that recurring revenues from consumables and support continue to provide stability as customers remain cautious in capital equipment spending.
Stratasys’ non-GAAP gross margin contracted 200 basis points (bps) year over year to 46.3% from 48.3% in the same period last year. Management attributed the decline primarily to the impact of $2.4 million in incremental tariff expense, along with the effect of lower revenues.
Stratasys’ non-GAAP operating expenses in the first quarter of 2026 were $64.6 million, representing 48.7% of revenues compared with $62.6 million (46% of revenues) in the year-ago quarter. The increase was largely driven by foreign exchange, with management citing an approximately $3.1 million impact from the appreciation of the Israeli shekel against the U.S. dollar.
Adjusted EBITDA was $2.0 million compared with $8.2 million in the year-ago quarter. The adjusted EBITDA margin contracted 450 bps on a year-over-year basis to 1.5%. The non-GAAP operating loss was $3.2 million compared with an operating profit of $3 million in the year-over-year period.
Stratasys’ Balance Sheet & Cash Flow Details
As of March 31, 2026, Stratasys had $237.8 million in cash, cash equivalents and short-term deposits compared with $244.5 million as of Dec. 31.
The company emphasized that it remains debt-free, preserving flexibility to invest in technology and market development while evaluating inorganic opportunities aligned with its focus on high-requirement use cases.
In the first quarter of 2026, the company reported operating cash flow of $2.4 million compared with $15.1 million in the previous quarter, supported by working-capital discipline.
Stratasys Offers Positive 2026 Outlook
For 2026, Stratasys reiterated its outlook for revenues between $565 million and $575 million, implying sequential growth through the year. The company expects non-GAAP earnings of 9-14 cents per share.
Stratasys continues to forecast non-GAAP gross margin of 46.7-47.1% and non-GAAP operating margin of 0.7-1.5%. The company noted that its outlook remains subject to foreign exchange rate and tariff uncertainty.
Zacks Rank & Stocks to Consider
Currently, SSYS has a Zacks Rank #4 (Sell).
ABB ABBNY, Alamo Group ALG and Enersys ENS are some better-ranked stocks in the broader Zacks Industrial Products sector.
ABBNY sports a Zacks Rank #1 (Strong Buy), whereas Alamo Group and Enersys carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rates for ABBNY, Alamo Group and Enersys are currently pegged at 17.25%, 16% and 15%, respectively.
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This article originally published on Zacks Investment Research (zacks.com).