Hewlett-Packard Co.’s (NYSE: HPQ) CEO Meg Whitman committed a boo-boo at last week’s annual meeting. Answering a shareholder question, Whitman said that HP would be entering the 3D printing business in June. Stocks of companies already in the 3D printing business promptly sagged.
It turns out what Whitman now wishes she had said was that the launch is likely to come in the fall. That is, in fact, what HP said in a blog over the weekend. And the shares of the 3D printer makers looked stronger.
3D Systems Corp. (NYSE: DDD) shares were up 2.4% to $59.36 on Tuesday, and up 4.5% since Friday. Stratasys Ltd. Shares (NASDAQ: SSYS) was up 0.5% to $107.58 on Tuesday, and 1.1% higher since Friday. ExOne Co. (NASDAQ: XONE) saw its shares rise nearly 1% to $35.55 on Tuesday — after falling nearly 20% over the prior three days.
The problem for HP is that its offerings in 3D printing are being held back by a number of big problems, starting with speed and quality.
There is another, bigger problem. Even if Hewlett-Packard launches a line of 3D printers, it is not clear how big a market there is for the products and what the business might mean to HP. Motley Fool analyst Steve Heller thinks the current market for 3D printers is about $3 billion in sales. It should grow to nearly $11 billion by 2021.
However, the consensus estimate is that HP will report $111 billion in revenue for the fiscal year that ends on Oct. 31. So don’t let your expectations get too high. For Hewlett-Packard, the 3D business will be tiny at first and will take years to evolve into something meaningful.
Even HP conceded the point. In a February interview, Martin Fink, the company’s chief technology officer and director of HP Labs, said, “We think consumers will first use print service providers — companies similar to FedEx Office — where people will send their 3D print jobs for high-quality fulfillment, and we’d be the ones to provide the equipment.”
Hewlett-Packard shares, meanwhile, were up 1.9% on Tuesday to $32.22, and they are up nearly 15% this year.
3D printing is a technology that is emerging, but it is still very new. While the expectations are high for the future, the future is a ways off and investors will need to be patient.