At a Glance
- Growth in the 3D printing segment slowed as expected in Q4 2022, but the total year-end results showed that the market is growing and heading toward a reservedly positive Q1.
- There seems to be no stopping 3D scanners’ success. The companies are reporting record quarterly and year-end results and steady demand is set to continue in 2023.
- However, demanding market conditions are not likely to give up, and some firms may see a dip in Q1 results — if only because they surpassed all expectations in 2022.
Market Overview
If there’s one word I would use to describe the additive manufacturing market’s developments in Q4 2022, it would be “predictable.” Every segment of the market, from 3D printers to scanners and desktop manufacturing, performed largely along the lines foreseen in Q3.
In fact, the most surprising thing to me was how few surprises we saw. The largest shocker was the unexpectedly good performance many companies saw in 2022, despite the difficult economic and market conditions that are likely to continue even in 2023.
Here are my thoughts and highlights of the additive manufacturing market’s Q4 2022 and year-end performance.
3D Printing Market
In the 3D printing segment, the expectations set in Q3 2022 proved correct. Market growth — which had already dipped in Q3 — slowed even further. Thus, Q4 witnessed the lowest year-on-year quarterly growth in 2022.
But that’s not the whole story. Despite the slowdown, Q4 2022 saw revenues climb by 16% to £2.8 billion ($3.5 billion) compared to Q4 2021, according to SmarTech. The growth is there — the line is just heading upward at a less steep angle.
Also, taken as a whole, 2022 was a strong year for the global 3D printing industry. The market grew by 23%, reaching a total worth of £10.9 billion ($13.5 billion).
3D printing software was the segment’s growth leader, reaching a value of £977 million ($1.2 billion). Polymer 3D printers and materials had the highest total market share at £5.9 billion ($7.3 billion), which represented 20% growth year-on-year. Revenues in metal 3D printers and materials grew by 25% to £3.9 billion ($4.9 billion). Finally, additive manufacturing services reached a market value of £4.8 billion ($6 billion).
“Additive isn’t entirely immune from the global economic and geopolitical problems, but if there’s anything we’ve learned over the last three years, it’s that instability is generally a driver in adoption of flexible advanced manufacturing innovations,” said SmarTech’s executive vice president of research, Scott Dunham.
Some large players in the 3D printing market witnessed the mentioned instability. 3D Systems, for example, reported a 12% y-o-y revenue decrease in Q4. Yet again, this isn’t the whole truth. The company’s stock rose 17% following the year-end report as investors were happy with the lower-than-expected decrease.
Similar stories played out at other companies as well. For example, Stratasys (which merged with Ultimaker in Q3 2022) saw annual revenue rise 7.3%, even though Q4 ended 4.6% lower y-o-y. Yet, still others — like Markforged and Desktop Metal — reported good to excellent growth for both Q4 and full year 2022.
Heading into 2023, the waters in the market are expected to calm down. Across the board, companies are expecting moderate to strong growth in the oncoming year. That said, Q1 2023 may see some falling revenues — simply because 2022 was unexpectedly great for many companies.
The global economic hindrances impacting the market in Q4 will persist into 2023. However, 3D printing companies have by now learned to deal with them. As such, the industry is hoping for a good year, driven by new product applications and restructuring in the global supply chain to reduce risk from geopolitical factors.
“There are mixed outlooks all over different sectors of the additive market for 2023, but as usual, when taken as a whole, the expectation is that the growth will certainly still be there. There are many things to be excited about in the additive industry,” said Dunham.
One thing to be excited about was the January launch of the UltiMaker S7 3D printer. It will be interesting to see how this new machine performs in the upcoming Q1 2023.
3D Scanning Market
If 3D printers fulfilled their expectations for Q4 2022, so did 3D scanners. Only, there were no signs of a slowdown in this segment. 3D scanning continued its strong trajectory this quarter and is set to do so as we move into 2023.
High-precision applications, such as automotive and aerospace, kept up strong demand for innovative 3D scanner solutions in Q4. Revenues grew across the board, resulting in record years at some companies.
One of them was Ametek, which owns the Peel 3D and Creaform scanner brands. According to Ametek chairman and CEO David A. Zapico, the company completed a “record year with an outstanding Q4.”
“Our results in the quarter were ahead of expectations driven by continued broad-based sales growth and exceptional operating performance,” he said.
Sales with Ametek’s Electronic Instruments Group (EIG), which includes its 3D scanners, were up 10% y-o-y in Q4 2022. According to Mr. Zapico, this was partially due to strategic acquisitions, such as that of New York-based Navitar, which produces optical imaging systems, cameras, and related components and software.
In total, Ametek reported an 11% increase in sales over 2021.
Things looked great also at Hexagon, which owns Leica 3D scanners. Year-on-year net sales increased by 8% in both Q4 2022 and the year as a whole.
“While component supply constraints continued, the negative impact in the quarter was small, and we consider the situation largely resolved moving forward,” said Paolo Guglielmini, Hexagon president and CEO.
In fact, Hexagon’s industrial enterprise solutions segment — which includes its 3D scanners — outpaced the company as a whole. In this area, quarterly net sales were up 12% y-o-y, and the year-end results showed a 9% increase over 2021.
The 3D scanning segment has strong momentum as it moves into Q1 2023. Although there are foreseeable bumps in the road, such as ongoing geopolitical challenges and supply strain constraints, manufacturers are well placed to overcome them. Strong demand and advancing technologies are projected to keep driving 3D scanners to an even stronger 2023.
Desktop Manufacturing Market
As I mentioned in my commentary on Q3 2022, the desktop manufacturing market is more challenging to observe than 3D printing or 3D scanning. Many of the companies active in this segment are private, so they have no need to report their annual performance.
That said, we can nonetheless look at developments along general lines. The market for desktop laser cutters is projected to grow at a significant rate. This is thanks to the introduction of more advanced technologies that reduce cutting errors and decrease machine development costs and time. The consumer goods market, in particular, is seen as a driving force in desktop laser cutters due to its reliance on versatile and cost-effective technologies.
The desktop CNC machine segment also grew in the past year and the momentum is expected to continue in 2023. The driving force in this market is manufacturers’ increasing dependence on intelligent automation to improve factory efficiency in the face of labour shortages. Automotive manufacturers, in particular, are projected to acquire more desktop CNC machines as consumer tastes move toward customized products.
Desktop printed circuit board (PCB) machines are benefiting from the current geopolitical instability. Electronics manufacturers experience significant supply chain disruptions and desktop PCB printers are well-placed to resolve their problems. Biodegradable PCB materials are projected to see particular growth due to electronics manufacturers’ desire to cut waste.
On the topic of PCB printers, Voltera named a new CEO in Q4 2022. The manufacturer of one of the world’s first desktop PCB printers is now headed by Jesus Zozaya, one of Voltera’s co-founders. He replaced the previous CEO, Alroy Almeida, in November 2022.
Having been with Voltera since the very beginning — when we were just four university students with an idea — it has been an honour to work alongside my friends and watch this company exceed expectations. It has been exhilarating to see the overwhelmingly positive response to our new product, Nova. I am excited to be at the helm as Voltera continues on this trajectory and I’d like to thank our team for trusting me with Voltera’s next chapter,” said Mr. Zozaya.
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