EX-99.2 3 exh_992.htm EXHIBIT 99.2

EXHIBIT 99.2

Fourth Quarter and Full Year 2016 Conference Call & Webcast February 28, 2017

Welcome and Participants • Vyomesh Joshi – President & Chief Executive Officer • John McMullen – Executive Vice President & Chief Financial Officer • Andy Johnson – Executive Vice President & Chief Legal Officer • Stacey Witten – Vice President, Investor Relations To participate via phone, please dial: US: 1 - 800 - 407 - 8291 Outside the US: 1 - 201 - 689 - 8345 2

Forward Looking Statements This presentation contains certain statements that are not statements of historical or current facts are forward - looking stateme nts within the meaning of the Private Securities Litigation Reform Act of 1995. Forward - looking statements include statements concerning plans, objectives, goals, strategies, expectations , intentions, projections, developments, future events, performance or products, underlying assumptions, and other statements which are other than statements of historical facts. I n s ome cases, you can identify forward - looking statements by terms such as “believes,” “beliefs,” ''may,'' ''will,'' ''should,'' expects,'' ''intends,'' ''plans,'' ''anticipates,'' ''est ima tes,'' ''predicts,'' ''projects,'' ''potential,'' ''continue,'' and other similar terminology or the negative of these terms. From time to time, we may publish or otherwise make available forward - looking statements of thi s nature. All such forward - looking statements, whether written or oral, and whether made by us or on our behalf, are expressly qualified by the cautionary statements described on t his message including those set forth below. Forward - looking statements are based upon management’s beliefs, assumptions and current expectations concerning future events and trends, usi ng information currently available, and are necessarily subject to uncertainties, many of which are outside our control. In addition, we undertake no obligation to u pda te or revise any forward - looking statements made by us or on our behalf, whether as a result of future developments, subsequent events or circumstances, or otherwise, or to reflect the o ccu rrence or likelihood of unanticipated events, and we disclaim any such obligation. Forward - looking statements are only predictions that relate to future events or our future performance and are subject to known and unknown r isk s, uncertainties, assumptions, and other factors, many of which are beyond our control, that may cause actual results, outcomes, levels of activity, performance, deve lop ments, or achievements to be materially different from any future results, outcomes, levels of activity, performance, developments, or achievements expressed, anticipated, or implied b y t hese forward - looking statements. Although we believe that the expectations reflected in the forward - looking statements are reasonable, forward - looking statements are not, and should not be relied upon as a guarantee of future performance or results, nor will they necessarily prove to be accurate indications of the times at or by which any such performance or resul ts will be achieved. 3D System’s actual results could differ materially from those stated or implied in forward - looking statements. Past performance is not necessarily indicative of future results. We do not undertake any obligation to and do not intend to update any forward - looking statements whether as a result of future developments, subsequent events or circumstances o r otherwise. Further , we encourage you to review “Risk Factors” in Part 1 of our Annual Report on Form 10 - K and Part II of our quarterly reports on Form 10 - Q filed with the SEC as well as other information about us in our filings with the SEC. These are available at www.SEC.gov. 3

Vyomesh Joshi (VJ) President & Chief Executive Officer

Overview and Highlights 5 • 3D printing is at an inflection point and is shifting from prototyping to production. • Use case by use case approach to key verticals, leveraging our core assets and domain expertise. • Executing an annuity based business model combining materials, services and software with structural improvements for profitable growth. • We are seeing clear progress in quality, reliability, supply chain and overall cost structure.

Financial Highlights 6 • Full year revenue decreased 5%, or 2% excluding the contribution of discontinued consumer products from 2015 • Improved GPM and reduced operating expenses • Non - GAAP earnings growth of 70% for the full year • Positive cash flow from operations each quarter for a total of $57 million of cash from operations in 2016

Outlook and 2017 Guidance 7 • Revenue growth between 2% and 8% – In the range of $643 million to $684 million • GAAP EPS improvement of 106% to 117% – In the range of $ 0.02 to $ 0.06 per share • Non - GAAP EPS increase of 10% to 20% – In the range of $0.51 to $0.55 per share • Continued positive cash flow from operations

John McMullen Executive Vice President & Chief Financial Officer

Operating Results GAAP 9 2016 2015 Y/Y Favorable (Unfavorable) 2016 2015 Y/Y Favorable (Unfavorable) $ 165.9 $ 183.4 (10%) $ 633.0 $ 666.2 (5%) $ 82.9 $ 60.2 38% $ 309.8 $ 291.8 6% 50.0% 32.8% 1720 bps 48.9% 43.8% 510 bps $ 78.8 $ 626.1 87% $ 348.2 $ 933.7 63% 47.5% 341.4% 55.0% 140.2% $4.1 ($565.9) 101% ($38.4) ($641.9) 94% 2.5% (308.6%) (6.1%) (96.4%) $5.2 ($596.4) 101% ($38.4) ($655.5) 94% 3.1% (325.2%) (6.1%) (98.4%) $0.05 ($5.32) 101% ($0.35) ($5.85) 94% Fourth Quarter Full Year ($ in millions, except per share) Income (Loss) Per Share % of Revenue Net Income (Loss) % of Revenue Revenue Gross Profit Operating Income (Loss) Gross Profit Margin Operating Expenses % of Revenue

Operating Results Non - GAAP 10 We use non - GAAP measures to supplement our financial statements presented on a GAAP basis because management believes non - GAAP f inancial measures are useful to investors in evaluating our operating performance and to facilitate a better understanding of the impact that strategic acqui sit ions, non - recurring charges and certain non - cash expenses had on our financial results. 2016 2015 Y/Y Favorable (Unfavorable) 2016 2015 Y/Y Favorable (Unfavorable) $ 165.9 $ 183.4 (10%) $ 633.0 $ 666.2 (5%) $ 83.0 $ 87.6 (5%) $ 320.8 $ 319.5 0% 50.0% 47.7% 230 bps 50.7% 48.0% 270 bps $ 66.2 $ 66.5 0% $ 270.2 $ 280.5 (4%) 39.9% 36.3% 42.7% 42.1% $16.8 $21.2 (21%) $50.6 $39.0 30% 10.1% 11.6% 8.0% 5.9% $16.7 $20.9 (20%) $50.8 $30.0 69% 10.1% 11.4% 8.0% 4.5% $0.15 $0.19 (21%) $0.46 $0.27 70% Fourth Quarter Full Year ($ in millions, except per share) Revenue % of Revenue Net Income % of Revenue Earnings Per Share Gross Profit Gross Profit Margin Operating Expenses % of Revenue Operating Income

Revenue Drivers • Healthcare solutions • Materials • Software • Printers • On - demand parts 5% Full Year 2016 Compared to 2015: 18% 4% 12% 11 21% $ in millions $666.2 $633.0

Gross Profit & Margin • GPM improved to 48.9% GAAP and 50.7% non - GAAP for the full year • Executing plans to reduce costs 12 $ in millions - Charges related to portfolio prioritization negatively impacted Q4 2015 and Q3 2016 GAAP GPM

Operating Expenses 13 • GAAP operating expenses decreased from lower amortization, stock based compensation and legal expenses, and from lower R&D expenses as investments were prioritized • Driving appropriate cost structure and reinvesting in infrastructure and innovation $ in millions

Cash and Balance Sheet • Generated $56.9 million of cash from operations in 2016 • Cash balance of $184.9 million at December 31, 2016, an increase of $29.3 million for the year • Inventory decreased sequentially to $103.3 million and days sales outstanding improved to 70 days 14

Outlook and 2017 Guidance 15 • Revenue growth between 2% and 8% – In the range of $643 million to $684 million • GAAP EPS improvement of 106% to 117% – In the range of $ 0.02 to $ 0.06 per share • Non - GAAP EPS increase of 10% to 20% – In the range of $0.51 to $0.55 per share • Continued positive cash flow from operations

Vyomesh Joshi (VJ) President & Chief Executive Officer

Transforming Digital Dentistry • Acquisition of NextDent establishes strategic foothold to transform digital dentistry workflow • Combination of Figure 4 and NextDent materials will allow us to deliver transformative production solutions from the dentist’s chair to the dental lab 17

Vertical Use - Case Approach • Leverage our platform across all key verticals • Comprehensive solutions provide complete digital manufacturing workflow • Focused innovation for production solutions 18

Q&A Session In the USA: 1 - 877 - 407 - 8291 Outside the USA: 1 - 201 - 689 - 8345

Thank You

Appendix

Reconciliation of GAAP to Non - GAAP – Q4 (a) Tax effect for the quarter ended March 31, 2016 and earlier periods was calculated quarterly, based on the Company’s overall ta x rate for each quarter. Tax effect for the quarters ended after March 31, 2016 was calculated based on the Company’s quarterly U.S. tax rate, which was 0% as a result of the val uat ion allowance that was recorded in the fourth quarter of 2015, in connection with GAAP net losses . The amount in the fourth quarter of 2016 also includes $1.2 million related to an adjustment for a prior period. 22 (in thousands, except per share amounts) GAAP Amortization, Stock-Based Compensation & Other Legal and Acquisition- Related Portfolio Restructuring Non-GAAP GAAP Amortization, Stock-Based Compensation & Other Legal and Acquisition- Related Portfolio Restructuring Non-GAAP Revenue $ 165,937 $ — $ — $ — $ 165,937 $ 183,363 $ — $ — $ — $ 183,363 Cost of sales 83,047 (85) — — 82,962 123,203 (71) — (27,390) 95,742 Gross profit 82,890 85 — — 82,975 60,160 71 — 27,390 87,621 Gross profit margin 50.0% 50.0% 32.8% 47.7% Operating expenses: Selling, general and administrative 57,767 (11,394) (1,249) — 45,124 66,542 (19,038) (3,409) — 44,095 Research and development 21,050 — — — 21,050 22,360 — — — 22,360 Impairment of goodwill and other intangible assets — — — — — 537,179 (537,179) — Total operating expenses 78,817 (11,394) (1,249) — 66,174 626,081 (19,038) (540,588) — 66,455 Income (loss) from operations 4,073 11,479 1,249 — 16,801 (565,921) 19,109 540,588 27,390 21,166 Interest and other expense, net 102 — — — 102 9,000 — — — 9,000 Income (loss) before income taxes 3,971 11,479 1,249 — 16,699 (574,921) 19,109 540,588 27,390 12,166 Provision (benefit) for income taxes (a) (1,212) 1,245 — — 33 29,535 (982) (27,771) (1,408) (626) Net income (loss) 5,183 10,234 1,249 — 16,666 (604,456) 20,091 568,359 28,798 12,792 Less: net income (loss) attributable to noncontrolling interests (47) — — — (47) (8,090) — — — (8,090) Net income (loss) attributable to 3D Systems Corporation $ 5,230 $ 10,234 $ 1,249 $ — $ 16,713 $ (596,366) $ 20,091 $ 568,359 $ 28,798 $ 20,882 Net income (loss) per share available to 3D Systems Corporation common stockholders — basic and diluted $ 0.05 $ 0.15 $ (5.32) $ 0.19 Quarter Ended December 31, 2016 Quarter Ended December 31, 2015

Reconciliation of GAAP to Non - GAAP – Full Year (a) Tax effect for the quarter ended March 31, 2016 and earlier periods was calculated quarterly, based on the Company’s overall ta x rate for each quarter. Tax effect for the quarters ended after March 31, 2016 was calculated based on the Company’s quarterly U.S. tax rate, which was 0% as a result of the val uat ion allowance that was recorded in the fourth quarter of 2015, in connection with GAAP net losses. The amount in the fourth quarter of 2016 also includes $1.2 million related to a n a djustment for a prior period. 23 (in thousands, except per share amounts) GAAP Amortization, Stock-Based Compensation & Other Legal and Acquisition- Related Portfolio Restructuring Non-GAAP GAAP Amortization, Stock-Based Compensation & Other Legal and Acquisition- Related Portfolio Restructuring Non-GAAP Revenue $ 632,965 $ — $ — $ — $ 632,965 $ 666,163 $ — $ — $ — $ 666,163 Cost of sales 323,214 (332) — (10,723) 312,159 374,354 (303) — (27,390) 346,661 Gross profit 309,751 332 — 10,723 320,806 291,809 303 — 27,390 319,502 Gross profit margin 48.9% 50.7% 43.8% 48.0% Operating expenses: Selling, general and administrative 259,776 (66,087) (5,741) (34) 187,914 303,784 (95,496) (20,556) — 187,732 Research and development 88,395 — — (6,072) 82,323 92,770 — — — 92,770 Impairment of goodwill and other intangible assets — — — — — 537,179 — (537,179) — — Total operating expenses 348,171 (66,087) (5,741) (6,106) 270,237 933,733 (95,496) (557,735) — 280,502 Income (loss) from operations (38,420) 66,419 5,741 16,829 50,569 (641,924) 95,799 557,735 27,390 39,000 Interest and other expense, net 1,392 — — — 1,392 13,029 — — — 13,029 Income (loss) before income taxes (39,812) 66,419 5,741 16,829 49,177 (654,953) 95,799 557,735 27,390 25,971 Provision (benefit) for income taxes (a) (547) (207) (67) — (821) 8,972 21,493 (24,663) (1,408) 4,394 Net income (loss) (39,265) 66,626 5,808 16,829 49,998 (663,925) 74,306 582,398 28,798 21,577 Less: net income (loss) attributable to noncontrolling interests (846) — — — (846) (8,433) — — — (8,433) Net income (loss) attributable to 3D Systems Corporation $ (38,419) $ 66,626 $ 5,808 $ 16,829 $ 50,844 $ (655,492) $ 74,306 $ 582,398 $ 28,798 $ 30,010 Net income (loss) per share available to 3D Systems Corporation common stockholders — basic and diluted $ (0.35) $ 0.46 $ (5.85) $ 0.27 Full Year Ended December 31, 2016 Full Year Ended December 31, 2015

Reconciliation of GAAP to Non - GAAP 2017 Guidance Tax effect for non - GAAP adjustments is based on the company

’s U.S. tax rate. As a result of the valuation allowance that was recorded in the fourth quarter of 2015, in connection with GAAP net losses, tax effect is expected to be 0% in 2017. 24 (in millions, except per share amounts) Low High Revenue $ 643 $ 684 GAAP Earnings per Share $ 0.02 $ 0.06 Estimated adjustments to arrive at non-GAAP EPS: Amortization 0.30 0.30 Stock Based Compensation 0.14 0.14 Acquisition, severance and settlements 0.05 0.05 Total Adjustments $ 0.49 $ 0.49 Non-GAAP Earnings per Share $ 0.51 $ 0.55 Full Year Ended December 31, 2017