3D printing technology remains relatively new technology. But thanks to a team of scientists at MIT and 3D printer Stratasys (NASDAQ:SSYS), the field is improving rapidly. 3D printing has been valuable because of the ability to quickly print objects and tweak designs as needed. Yet 3D printed objects themselves are rigid and unable to be personalized after the printing process is complete.
The newest advancement in printing, known as 4D printing, is set to add a level of customization to the printing industry not yet seen, and will likely increase the industry's value immensely.
Printing on another dimension
While 4D printing isn't exactly printing something into another dimension, it adds crucial value to an industry that is falling short of expectations. For years, people have been waiting for the 3D printing takeover that hasn't come. Instead, the industry has been printing fidget spinners and figurines, waiting to build on the momentum it had a decade ago. The key word here is waiting. This has been an issue of time.
Which is where 4D printing comes in. Instead of launching printing into another dimension, 4D printing saves its users time. Skylar Tibbits, founder and Co-Director of the Self-Assembly Lab at MIT, coined the phrase 4D printing in 2013. "Ultimately the future of this is flexibility and adaptation. Adaptable materials that can transform to the body, transform to the environment and change function on demand," Tibbits noted in a recent explainer.
4D printed objects can change their shape over time when they are exposed to external stimuli like temperature or light. Today, the main method of 4D printing is what's called rapid liquid printing (RLP). In RLP, objects are drawn in a 3D space using a hydrogel or memory polymer which can remember its shape. This technique solves the biggest problems in 3D printing, like printing speed, scalability, and use of industrial grade materials, and the possible applications are endless.
4D printing applications include:
- Flexible car interiors, which can contour to passengers' unique shapes
- Self-assembling furniture
- Adaptive infrastructure that can expand and contract as needed
- Objects moving between 3D and 2D (i.e. boxes flattening for storage)
4D printing takes the principles of its 3D printing predecessors and makes it custom. While a 3D printer can print a reasonably comfortable lounge chair, a 4D printer can print a comparable chair which contours to the user's body and exponentially reduces in size for storage when not in use.
Who is taking the leap?
Stratasys (NASDAQ:SSYS) was working to develop new programmable printing materials when it partnered with the MIT Self-Assembly Lab all in 2014. Together, the two are creating new printing methods which allow objects to be as flexible and as agile as possible. Such objects can be shaped individually, creating customization for anything printed using 4D material. Such flexibility can, say, allow a pipe to expand and contract as needed with the flow of water, drastically increasing efficiency and saving energy consumption in the process.
Some companies are pumping funding into research and development for 4D printing from the product side. In an initial trial, British interior design company Steelcase (NYSE:SCS) created customizable furniture that is flexible and assembles itself. The company sees this as the perfect way to provide a better experience to workers through personalized office furniture which promotes a sense of authenticity and self-expression.
BMW (OTC:BMWYY)has also gotten in on the action, working to develop 4D printing solutions for the construction of vehicle interiors. The printing innovation helps the car company improve rider experience, for instance, providing more precise back support needed for each passenger based on the amount of pressure their body puts on the headrest and seat. It would also create airbags that contour to a passenger on impact, making the technology safer and more effective. And BMW plans to dive even deeper into 4D printing with its VISION NEXT 100. This concept car could have its outer shell change in response to air flow if produced using 4D printing technology. In the crowded landscape of luxury vehicles, 4D printing could give BMW a leg up on its competition.
Both self-assembling furniture and improved car interiors provide a significant upgrade for consumers. This means no more struggling to build an IKEA desk or dealing with lower back pain after a long road trip. Even if this technology increases costs, and therefore retail prices, many consumers will likely shell out the extra cash for these improvements.
Stratasys is winning the printing battle
As for the current 3D printing companies, Stratasys had already been beating out its opponents in the market, and 4D printing could provide them even more of a boost to their bottom-line. In the first quarter of 2019, the company reported a slight increase of 1% in revenue and doubled its EPS to $0.10 compared to the same period a year prior. What is perhaps most interesting is the $367.8 million in cash the company has on its books, which provides it with significant resources to invest in research and development on 4D printing technology via its already existing partnerships with MIT.
Seeing as 4D printing can be completed using similar technology to 3D Polyjet printers, it's likely that other 3D printing companies will attempt to catch Stratasys in the next evolution of printing. This makes Proto Labs and 3D Systems potential threats to Stratasys in the market.
However, Proto Labs has had a tough start to the year, with double-digit percent declines in year over year GAAP operating income and GAAP EPS. Additionally, only $15.3 million of the company's revenue (accounting for 13.2% of total revenue) was generated by 3D printing on the quarter, compared to the $155.3 million that Stratasys generated in Q1 from the 3D printing products and services. While Proto Labs ended the second quarter with $150.7 million in cash, it has much less incentive to invest in 4D as Stratasys, and has other areas of business in which to invest its resources. Meanwhile, 3D Systems is struggling to stay afloat after its EPS loss widened to $0.09 per share and net income continues to fall deeper into the red. With such profitability concerns, and a stock price that fell 24% in May alone, the company has a lot to rectify before it can fully invest itself in experimenting with new printing products.
It's clear that 4D printing will have some form of impact on the future. The level of customization for any printed object is limitless, at least in theory. Imagine this technology getting into the hands of Nike or Adidas, who could produce form-fitting shoes that contour perfectly to their owner's feet. Or Tempur Sealy International, Inc. creating beds that offer the exact amount of support needed for each sleeper. Such customization will open new doors for product designers and manufacturers spanning across many industries.
BMW and Steelcase remain 4D printing first movers on the product side, but are unlikely to see any significant change in stock price because of it, at least for now. Don't weigh 4D technology too much into your price valuation of these companies today. On the other hand, Stratasys is determined to be an industry leader in the advancement of printing technology. With such a wide range of applications across industries I have Stratasys as a buy and hold for the coming decade, as the company is building on its investment on 4D printing, and stands to benefit immensely when 4D printed objects become a part of daily life.