Stratasys, Ltd. · NASDAQ:SSYS
Stratasys — Q2 2020 Earnings Presentation
26 slides from Stratasys's earnings presentation, Aug 5, 2020
Slide 1: Q2 2020 Financial Results Conference Call
Stratasys Q2 2020 Financial Results Conference Call August 5, 2020 & stratasys
Slide 2: Conference call & webcast details
Q2 2020 Conference call & webcast details Speakers * Yoav Zeif -CEO « Lilach Payorski - CFO * Yonah Lloyd — VP Investor Relations Live webcast and replay: https://78449 themediaframe.com/dataconf/productusers/s EE a ea aw Sot aV ee ee ee Live dial-in information US Toll-Free dial-in: 1-877-407-0619
Slide 3: Forward-looking statements
Stratasys Forward-looking statements The statements in this presentation regarding Stratasys’ strategy, and the statements regarding its projected future financial performance, including the financial guidance (or withdrawal of guidance) concerning its expected results for 2020, are forward-looking
Slide 4: Use of non-GAAP financial information
Stratasys Use of non-GAAP financial information The non-GAAP data that appears below, which excludes certain items as described below, constitutes non-GAAP financial measures. Our management believes that these non-GAAP financial measures are useful information for investors and shareholders of our
Slide 5: Opening Remarks: Corporate strategy review
Opening Remarks: Corporate strategy review yields strong plan for industry leadership and long-term growth i Make it Better. Yoav Zeif Ne Hania faye
Slide 6: COVID-19 weak macro and cost mitigation continues
Stratasys COVID-19 weak macro and cost mitigation continues * Global 4-day work week « Additional 5% salary reduction for top executives « Accelerated 10% workforce reduction as part of new operating model « Work from home where possible and subject to regulatory restrictions
Slide 7: Helping our world through the pandemic and beyond
Helping our world through the pandemic and beyond Responding to critical needs Demonstrating the possibilities and benefits of 3D printing Make it with Stratasys.
Slide 8: 3D Printing penetrating deeper into manufacturing
Stratasys 3D Printing penetrating deeper into manufacturing Manufacturers reassessing supply chains post-COVID-19 3D printing “top choice” for . : investment in SME survey,
Slide 9: New commitments to additive manufacturing from government, aerospace and automotive customers
New commitments to additive manufacturing from government, aerospace and automotive customers 8 £ a
Slide 10: Successful J55 launch and initial shipments to customers
Successful J55 launch and initial shipments to customers
Slide 11: Strong cash position, healthy balance sheet, resilient business model
Strong Healthy Resilient cash — balance i business position sheet model
Slide 12: Our Goal: 1st Choice in the growing Polymer 3D Printing market
Our Goal: 4st Choice in the growing Polymer. 3D Printing mar
Slide 13: Growth focus: Polymers for manufacturing
13 Stratasys Growth focus: Polymers for manufacturing Polymers is the largest value pool in our industry and is growing steadily Manufacturing is the fastest- growing area within Polymers Long runway of opportunity with new technologies
Slide 14: Polymer leadership via the most comprehensive solutions
Polymer leadership via the most comprehensive solutions across applications and geographies $5 billion global market in 2019 (not including parts sales) Source: Stratasys market analysis drawing from CONTEXT AM3DP Printer Shinmen
Slide 15: Expand our technologies to serve growing polymer 3D printing applications
» Expand our technologies to serve the growing applications for Polymer 3D Printing 100% > 90% PBF - Metal 80% Directed Energy Deposition Binder Jetting Vat Photopoly - SLA Vat Photopoly - Non-SLA 70% 60% 50% 40% PBF - Non Metal 30% Material Jetting 20% 10% Material Extrusion g 0% g 2015 2016 2017 2
Slide 16: Total Addressable Market — 2019
16 Stratasys Total Addressable Market — 2019 Hardware / Materials / Software / Services Manufacturing Stratasys serves approximately mnufacts one third of 3D Printing F om % hardware addressable market Production applications growing faster than prototyping Prototyping FDM in aerospace shows what’s
Slide 17: Total Addressable Market — 2025
7 Stratasys Total Addressable Market — 2025 Hardware / Materials / Software / Services To win, invest in the maniractning 3 growth engines driving a the future additive t manufacturing market @ Leverage Global Core Competencies 4% Comprehensive solutions Prototyping & Go-to-market and service infras
Slide 18: Financial Update
Financial Update Staying operationally efficient during COVID-19 Strong balance sheet / No debt Make it Better. .
Slide 19: Financial Results
19 Stratasys Financial Results GAAP Q2-20 Change Y/Y Non-GAAP Q2-20 Change Y/Y Total Revenue Gross Profit % Margin Operating Income (Loss) % Margin Net Income (Loss) attributed to SSYS Ltd. % Margin Diluted EPS Diluted Shares $ in millions unless noted otherwise All numbers and percentages are round
Slide 20: Financial Results: Revenue quarterly trend
20 Financial Results Revenue Quarterly trend 163.2 157.5 160.2 51.1 106.3 Q2"19 Q3'19 Q4'19 mService Product tratasys $ in millions unless noted otherwise St 132.9 49.7 Qt'20 117.6 Q2' 20 Revenue Growth — Q2 ’20 Revenue YY Product -33.0% System -35.6% Consumables -30.6% Service -17.2% Customer Suppo
Slide 21: Financial Results: Gross margin trends
21 Financial Results Gross margin trends GAAP 87.3% iar ad 57.0% 52.8% 49.7% 49.2% 49.1% o@—2 —0_ 45.0% 45.9% 37.2% 33.9% 32.3% 32.1% 30.1% 5% Q2"19 Q3 19 Q419 Q1'20 Q2'20 itasys: Non-GAAP e11% 23% 61.6% 57.9% 52.5% 52.4% 52.4% 52.9% 48.4% 45.4% 34.5% ~ 31.7% 32.9% 32.4% 32.7% Q2"19 Q3 19 Q419 Q1'20
Slide 22: Financial Results: Operating expenses and operating margin trends
Financial Results Operating expenses and operating margin trends 9.2% 5.5% 5A% 6.3% Q2"19 Q2'20 GAAP Operating Expenses -19.8% Q2"19 Q3 19 Q419 Q1'20 Q2°20 —@®— GAAP Operating Margin —®=— Non-GAAP Operating Margin Q2"19 Q2'20 Non-GAAP Operating Expenses @ E $ in millions unless noted otherwise
Slide 23: Balance sheet summary and cash flow from operations
23 Stratasys Financial Results Balance sheet summary and cash flow from operations Q2-19 Q1-20 Q2-20 Cash and Cash Equivalents and Short term deposits 366.3 325.5 313.0 Accounts Receivable 131.5 115.1 102.2 Inventories 1478 172.5 164.6 Net Working Capital 505.9 4807 465.7 $ in millions unless noted
Slide 24: Stratasys has all the ingredients for leadership in Polymer additive manufacturing
Stratasys has all the ingredients for leadership in Polymer additive manufacturing ¢ Reboot growth in short-medium term ¢ Earn greater customer share of wallet ¢ Accelerate future topline growth Comprehensive Solutions
Slide 25: Full Polymer solution suite from one source
Manufacturin: Z 2 ef a Fa / , y of ow f e — lq d a all of. Full Polymer solution suite from one source — Stratasys Systems + Materials + Software * Service Engineering
Slide 26: GAAP to Non-GAAP Reconciliation
26 Stratasys GAAP to Non-GAAP Reconciliation Stratasys Ltd Three Months Ended June 30, 2020 Results of operations (Gross Profit (1) $53,348 Three Months Ended June 30, 2019 (Operating income (Loss) (1,2) (29,278) 21,228 (8,050) 805 8.246 9,051 ‘Net income (Loss) attributable to Stratasys Ltd. (1,2,3