This morning, 3D Systems (NYSE: DDD) reported its first-quarter earnings. These fell in line with the company's preliminary results, which warned investors that the upcoming quarter would fall significantly below management's initial expectations.

In the preliminary release, management attributed the anticipated shortfall to a variety of factors, including continued strength of the U.S. dollar, the aftermath of low oil prices, a softening capital spending environment, and performance issues with some of its nylon and metal 3D printers.

The final results showed that 3D Systems' revenue grew by 9% year over year, or 17% on a constant currency basis, to $160.7 million, translating to a net loss of $0.12 per share, or an adjusted profit of $0.05 per share. 3D Systems' preliminary results anticipated it would generate between $158 million and $160 million in revenue, and earn between $0.02 and $0.04 per share on an adjusted basis.

All told, there were some good, bad, and ugly aspects to 3D Systems' earnings.

The good
In the first quarter, several areas of 3D Systems' business showed signs of underlying strength. On a year-over-year basis, the company's consumer revenues experienced growth of 65% and unit growth of 169%, its direct metal 3D printing revenues grew 38% thanks to a 46% increase in units sold, its healthcare revenues increased 38% despite some underlying softness in the segment, and its 3D-printed related services revenues increased by 31%.

Additionally, 3D Systems' Americas reporting segment saw its revenues grow by 27% year over year. Its gross profit margin increased by 120 basis points sequentially to 49.1%, but fell 200 basis points year over year, due to an unfavorable shift in printer and material sales toward products that carry lower profit margins.

The bad
During the first quarter, currency headwinds brought on by a strengthening U.S. dollar reduce 3D Systems' revenue by $12 million, and largely was to blame for the company's Europe, Middle East, and Africa revenue only increasing by 2% year over year, down significantly from the impressive 46% growth the region experienced during the fourth quarter.

3D Systems' design and manufacturing revenue, which includes products, services and materials, made up more than 90% of the company's revenue during the quarter, but only increased by 5% year over year. According to management, the company's design and manufacturing revenue bared the brunt of the capital spending weakness it experienced from customers delaying purchases.

By segment, 3D Systems' products revenue increased by 3% year over year and its material revenue declined by 8%. The latter suggests there could be some underlying weakness in 3D Systems' customer utilization rates, which doesn't bode well for the company's "razor and blade" business model, whereby long-term streams of recurring revenue are generated from the sale of materials during its printers' life cycles.

The ugly
3D Systems' Asia-Pacific operating performance experienced a revenue decline of 20% year over year, due to a combination of weakened demand in Japan and currency headwinds.

In terms of organic growth, which measures annual revenue growth excluding acquisitions made in the last year, 3D Systems reported a negative organic growth rate of 7%. In other words, 3D Systems' total revenue growth for the quarter would've declined on a year-over-year basis without the help of acquisitions.

The bigger picture
3D Systems ended the quarter with nearly $200 million in cash, giving it plenty of flexibility to continue funding future growth initiatives and to weather any potential business- or industry-related headwinds. In light of what appear to be ongoing challenges facing 3D Systems' business, management has decided to withdraw its 2015 full-year guidance until it gets a better handle on the macroeconomic environment for 3D printing.

At the end of the day, 3D Systems' first-quarter earnings gave investors a very mixed picture about the health of its underlying business, and it appears to be a developing situation to monitor.