Is Google Developing a 3-D Printer? Should 3D Systems and Stratasys Be Concerned?

It's being reported that Google is planning on entering the 3-D printing market. Is this within the realm of possibilities? How would it affect the existing players?

May 18, 2014 at 1:01PM

If you're following 3D Systems (NYSE:DDD), Stratasys (NASDAQ:SSYS), or other 3-D printing companies, you know that this space has been ripe with speculation. Within the last week, speculation that would be the mother lode of happenings, if it turns out to be true, hit the wires: Trip Chowdhry of Global Equities Research started releasing notes claiming that both Google (NASDAQ:GOOG) (NASDAQ:GOOGL) and Apple are developing "all-in-one" 3-D printers, according to a Barron's article.

I haven't put much stock in the rumor-mongering that's gone on in the 3-D printing realm. However, based on the information in the Barron's piece and my knowledge of Google, it seems possible that there could be something to this buzz. Additionally, Chowdhry's background, at least on the surface, does add some credibility to this story. Prior to starting his firm, he worked in information technology for quite some time, including a stint at Microsoft.

While I don't usually like to write about something where I have such little information, I decided an article was warranted. That's because I'd want to know about the possibility of tech titan Google entering the 3-D printing space if I were a 3D Systems or Stratasys shareholder. Besides, even if the Google rumor proves to be unfounded, we can use this opportunity to look at how competition in the consumer market might affect 3D Systems and Stratasys.

The buzz
According to Barron's, Chowdhry wrote that Google is "secretly working on building the next generation of 3D All-in-One printer ecosystem based on --  Google Project Tango, integrating several Robotic technologies and Google Cloud; developers are speculating that Apple is also probably working on similar 3D All-in-One printer ecosystem centered around PrimeSense Technology, but information available on Apple is currently very scarce."

Barron's went on to say that Chowdhry believes that Google may show off something on this topic at its Google I/O conference, which is June 25 and June 26, and that he wrote that "Incumbents 3D systems, Stratasys and others may probably need to reinvent themselves for the consumer market."

The Barron's writer didn't know what Chowdhry was referring to by the term "3D All-in-One printer." While I can't be certain of how someone else is using a word, the term often refers to a 3-D scanner/3-D printer combination.

Let's examine the plausibility
Google entering the 3-D printing market seems plausible for a couple of reasons. First, the 3-D printing industry has been growing like gangbusters; according to the recently released Wohlers' Report 2014, the industry grew 34.9% in 2013, and is projected to grow more than 20% annually through 2021. This is a very attractive space, and it wouldn't likely be that difficult for a deep-pocketed and deep-tech-brained giant like Google to enter. Google is so big that it needs to keep entering new fast-growing spaces if it wants to keep growing its revenue at a solid pace. 

Additionally, 3-D printing would seem to be a fit with Google's existing initiatives and apparent strategies. Google's acquisition earlier this year of Nest, which makes "smart" thermostats and smoke detectors, was considered by most to be the company's initial step in the battle to win the "smart house." This is likely one battle on Google's march toward its apparent goal of being a major player in the "Internet of Things," where various objects will be seamlessly connected, providing users with instant feedback. Anything that one can currently control wirelessly -- or potentially control wirelessly -- in the home is likely fair game for Google. A 3-D scanner/3-D printer falls into this category.

It seems conceivable that Google's Project Tango could somehow be involved in a 3-D printer initiative. Project Tango has created a prototype Android smartphone-like device that tracks the 3-D motion of the device, and creates a 3-D model of the environment around it.

How would 3D Systems and Stratasys be affected by the big G's entrance?
3D Systems and Stratasys are the only publicly traded companies that make 3-D printers for the consumer market.

Ssys Replicator

Source: Stratasys

3D Systems' consumer segment accounted for 6.6% of the company's total revenue in the first quarter of this year. Meanwhile, Stratasys' MakerBot unit, which it acquired in 2013, brought in 13.6% of the company's revenue in the same quarter. These percentages should increase, as these segments are growing much faster than each company's overall business. 3D Systems' total revenue grew 45% in the quarter, while revenue in its consumer business rocketed 150%; Stratasys' revenue jumped 54%, while MakerBot sales soared 75%.

At first glance, it would appear that Stratasys has potentially more to lose if Google or other companies successfully enter the consumer 3-D printing market. However, this isn't necessarily the case. MakerBot's products aren't only used by consumers and "prosumers" (professional consumers who use them in their small businesses), but also by companies. Ford, for instance, made news in late 2012 when it announced that it planned to put a MakerBot Replicator on every engineer's desk. We don't know how MakerBot's sales breakdown by customer type: consumers vs. businesses. If the breakdown is roughly 50-50, than Stratasys has about the same exposure to the consumer market as does 3D Systems.

Foolish final thoughts
It seems within reason that Google could enter the consumer 3-D printing space. Even if Google doesn't enter this market, there's little doubt that other large companies eventually will.

The margins in 3D Systems' consumer segment and Stratasys' MakerBot unit are lower than the companies' overall margins. When competition further heats up, these margins will shrink. Both companies, however, generate the lion's share of revenue -- and an even larger portion of profit share -- from their commercial and industrial offerings. While Google's entrance into the consumer 3-D printing business would likely hurt both companies, it wouldn't be catastrophic. 

Profit from the next big megatrend: the $14.4 trillion "Internet of Things"
Every investor wants to get in on revolutionary ideas before they hit it big. Like buying PC-maker Dell in the late 1980s, before the consumer computing boom. Or purchasing stock in e-commerce pioneer in the late 1990s, when it was nothing more than an upstart online bookstore. Most investors, however, don't understand the key to investing in hyper-growth markets. The real trick is to find a small-cap "pure-play," and then watch as it grows in EXPLOSIVE lockstep with its industry. Our expert team of equity analysts has identified one stock that's poised to rocket with the next $14.4 TRILLION industry. Click here to get the full story in this eye-opening report.

Beth McKenna has no position in any stocks mentioned. The Motley Fool recommends 3D Systems, Apple, Google (A shares), Google (C shares), and Stratasys. The Motley Fool owns shares of 3D Systems, Apple, Google (A shares), Google (C shares), Microsoft, and Stratasys. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.

Compare Brokers