3D Systems Corporation

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3D Systems Corporation

• Conference Call Webcast
• First-Quarter 2006 Results
• May 4, 2006

NASDAQ TDSC www.3dsystems.com
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Participants

• Chanda HughesCoordinator, Investor Relations
• Abe N. ReichentalPresident Chief Executive
  Officer
• Fred R. JonesVice President Chief Financial
  Officer
• Robert M. Grace, Jr.Vice President, General
  Counsel Secretary

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Forward-Looking Statements

• Certain statements made in this release that are
  not statements of historical or current facts are
  forward-looking statements within the meaning of
  the Private Securities Litigation Reform Act of
  1995. Forward-looking statements may involve
  known and unknown risks, uncertainties and other
  factors that may cause the actual results,
  performance or achievements of the company to be
  materially different from historical results or
  from any future results expressed or implied by
  such forward-looking statements. In addition to
  statements which explicitly describe such risks
  and uncertainties, readers are urged to consider
  statements in the future tenses or that include
  the terms believes, belief, expects,
  intends, anticipates or plans to be
  uncertain and forward-looking. Forward-looking
  statements may include comments as to the
  companys beliefs and expectations as to future
  events and trends affecting its business.
  Forward-looking statements are based upon
  managements current expectations concerning
  future events and trends and are necessarily
  subject to uncertainties, many of which are
  outside the control of the company. The factors
  stated under the heading Forward-Looking
  Statements and Cautionary Statements and Risk
  Factors in managements discussion and analysis
  of results of operations and financial condition,
  which appear in the companys periodic filings
  with the Securities and Exchange Commission, as
  well as other factors, could cause actual results
  to differ materially from those reflected or
  predicted in forward-looking statements.

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Operating Highlights
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Operating Highlights

• Record revenue of 33.5 Million--up 10
• In constant U.S. dollars up 14.5
• System revenue up 21
• Material revenue up 18
• Service revenue down 9
• FX accounted for half the service decline
• Planned reductions of legacy upgrade packages
• Foregone TM service revenue
• Component reliability resulting in lower volume
  of replacements
• Gross profit up 8
• Gross margin down one percentage point
• Growth pains from increased system placements
• Duplicate overhead costs
• Grand Junction and Valencia closure
• Marly, Switzerland start-up
• Rock Hill start up

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Operating Highlights

• Operating expenses
• Restructuring and relocation 1.6 MM
• Other strategic initiatives
• European shared service center
• Outsourcing of logistics to UPS
• Oracle-based ERP implementation
• FAS 123R effect 0.2 MM
• Volume-related selling expenses up 0.4 MM
• RD investments up 0.6 MM
• Growth pains from increased systems volume
• Bottom line
• Strategic and special initiatives negatively
  affected profitability

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Financial Review
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Quarterly Revenue Trends( Millions)

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Q1 Revenue Component Changes( Millions)
40
35
30
25
20
15
10
5
Volume Core Products
Q1 2005
Price/Mix
Volume New Products
FX Effects
Q1 2006
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New Product Revenue 2003 2006( millions)
2003
2004
2005
2006
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Q1 2006 Global Revenue( Millions)
By Region
By Product Class
33.5
33.5

30.4
30.4
12
28
17
Asia Pacific
Services
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33
35
37
Europe
Materials
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Systems Other
37
55
U.S.
47
33
13
Q1 Gross Profit Margin ( Millions)

• Products
• Responses to growth challenges
• Benefits of material promotional efforts in prior
  periods
• Services
• Component reliability up lower volume of
  replacements
• Absence of upgrades on older, legacy models
• Responses to growth challenges--revenue costs

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1Q06 Operating Costs
Millions
As of Revenue
6.9
8.3
34.2
29.1
Severance Restructuring
R D
SG A
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Operating Income( Millions)
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Net Income (Loss) ( Millions, except per share
amounts)
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Influence of Special Items on Net Income (Loss)
Available to Common Stockholders ( 000's)
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Cash Flow( Millions)
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Cash Provided by Operating Activities(
millions)
( millions)
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Business Highlights
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3-D Printing Update

• Grew resale channel to 85 locations
• Introduced 14,900 desk-top 3-D Printer
• Launched InVision Dental Pro
• Introduced new LD colors
• Planning to launch additional desktop 3-D Printers

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Rapid Manufacturing Update

• Over 60 of systems shipped
• Expanding tooling and casting applications
• New materials fueling growth
• New capabilities open new doors

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Rapid Manufacturing Larger Parts
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Rapid Manufacturing Accurate Parts
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Rapid Manufacturing Higher Throughput
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Rapid ManufacturingMore Materials, Better
Utilization
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Rapid Manufacturing Accura 60 Simulate
polycarbonate A clear, tough plastic

• Produce parts that mimic polycarbonate
• Durable, stiff and tough parts
• High clarity allows view of internal features
• Faster build speed
• Increased system utilization
• Easy cleaning and finishing
• Low viscosity
• Ideal for complex casting applications
• Dive mask faceplate design is patented courtesy
  of Kirby Morgan Dive Systems Scicon Technologies

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Rapid Manufacturing New Software Tools

• Viper Pro
• 3DView
• 3DManage
• 3DPrint
• Viper HA
• ShellWizard
• - Hearing Aid Automation Software

3DPrint
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Rapid Manufacturing SLS Automation Tools

• Smart Start (new) starts purging and heating at
  same time to start build faster. Maximum benefit
  with 3D nitrogen generator.
• Other software features
• Self-learning build-time estimator
• Smart Feed
• Advanced .STL file cutting
• Opti-Scale software
• RealMonitor module
• SinterScan module

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Rapid ManufacturingSymyx Collaboration

• Steady stream of new manufacturing-capable
  materials
• Breakthrough discoveries and commercial successes
  for broad range of next-generation materials
• Drive new technology development to meet customer
  needs and further differentiate ourselves from
  competition
• Lead to significant industry transformation
• 3D Systems has research exclusivity and IP rights
  to program inventions
• 3D Systems funds research and pays royalties upon
  commercial success

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Business Highlights Relocation

• Interim Rock Hill, South Carolina, facility in
  full operation
• Departmental transition ahead of plan
• Customer service
• Call center
• Supply chain
• Finance
• HR
• IT
• Engineering
• Marketing
• Signed lease
• Commenced construction
• Working on disposition of CO and CA facilities
• Listed CO and CA facilities
• Closed CO facility April 28
• InVision material production moved to Marly,
  Switzerland
• Outsourcing all spare parts and material
  logistics to UPS
• Lowered 06 cost estimates down to 6.4-8.1 MM
  from 7.0-8.7 MM
• Plan to open new facility September 2006

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Business Highlights ERP Implementation

• Project Scope
• Oracle-based ERP system
• 4 million investment
• Successful U.S. go-live May 1, 2006
• Planned Europe/Asia-Pacific go-live June 1, 2006
• Expected Benefits
• Focused on customer service and daily success
• Enhanced automation
• Effective controls
• Better financial reports and analysis

Powered By
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Business Highlights Supply Chain

• Same-day service until 1100PM (Eastern Time)
• Spare parts
• Materials
• 3-D Printers
• Depot service
• Louisville now
• Köln June 1st

Synchronized By
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Outlook
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Key Initiatives

• Completing planned HQ consolidation
• Correcting growth pains resource constraints
• Completing planned UPS transition in Europe
• Restructuring European and Japanese sales
  organization
• Commercializing additional desktop 3-D Printers
• Growing 3-D Printer reseller channel globally
• Enhancing service productivity and profitability
• Completing Oracle-based ERP system
  implementation
• Pruning portfolio and retiring older legacy
  systems
• Improving operations and customer experience

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Bottom Line

• Leading industry position and technology
• Energized, experienced management team
• Clear priorities demonstrated execution
• Stronger financial base and flexibility
• Favorable results from recent strategic
  initiatives
• Outsourcing of assembly activities
• Reshaping and expanding sales organization
• Introducing significant new products
• Healthy pipeline of opportunities
• Improving operating results and cash flow
• Significant growth programs
• 3-D Printing
• Rapid Manufacturing
• Measurable value, customers and stockholders

Transitioning from Restructuring to Growth
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Question Answer Session
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participants, please ask one question and then
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questions.All questions must be directed
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Thank youfor participating

• Replay of this webcast is available from the
  Investor Relations section of 3D Systems
  website www.3DSystems.com

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3D Systems Celebrates 20th Anniversary
SLA 1
Spring 2006 Marks 20th Anniversary of 3D
Systems 3D Systems Pioneered Stereolithography
Technology and Launched the Entire Rapid
Prototyping Industry 3D Systems rich history
began in 1986 when Chuck Hull, founder and first
inventor, discovered that certain acrylate and
epoxy resins cured and hardened when exposed to
UV light and could be imaged in layers and
stacked on top of each other to form solid
objects. After several attempts, many
discoveries and additional inventions, the first
solid imaging machine, the SLA 1 system, was
launched. 20 years and numerous machines later,
Stereolithography has advanced to what it is
today with latest introductions of the SLA
5000/7000 and Viper series.
Viper Pro
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Relocation Progression
3D Systems Breaks Ground February 27, 2006 on New
Global Headquarters Facility in Rock Hill, South
Carolina - Facility Opening Scheduled for
September 2006 -
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3D Systems Holds Users Group Meeting

• 3D Systems Holds Annual Users Group Conference
  April 30 - May 4, 2006 in Tucson, Arizona
• Users Gather at the Hilton, El Conquistador to
  learn about 3D Systems Rapid Manufacturing
  Solutions

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Royal College of Art Project
Royal College of Art Project - Students use 3D
Systems Rapid Prototyping and Manufacturing
Technology to Create Concepts, Design in 3D and
Produce Final Products -
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3D Systems Chuck Hull Receives Honorary Ph.D.
Chuck Hull, 3D Systems Vice-President and Chief
Technology Officer, Receives Honorary Ph.D.
Loughborough University Awards Chuck Hull for his
Pioneering Engineering Research, in particular
the Development of the Stereolithography Process
-