NEWS RELEASE

STRATASYS RELEASES SECOND QUARTER 2019 FINANCIAL RESULTS

Second Quarter Revenue of $163.2 million

Second Quarter GAAP net income of $1.2 million, or $0.02 per diluted share, and non-GAAP
net income of $8.5 million, or $0.16 per diluted share

Minneapolis & Rehovot, Israel, July 31, 2019 — Stratasys Ltd. (NASDAQ: SSYS) announced financial results for the second quarter of 2019.

Q2 2019 Financial Results Summary:

Revenue for the second quarter of 2019 was $163.2 million, compared to $170.2 million for the same period last year.

●	GAAP gross margin was 49.7% for the quarter, compared to 49.1% for the same period last year.
●	Non-GAAP gross margin was 52.5% for the quarter, with no change compared to the same period last year.
●	GAAP operating income for the quarter was $0.8 million, compared to an operating loss of $1.9 million for the same period last year.
●	Non-GAAP operating income for the quarter was $9.1 million, compared to non-GAAP operating income of $10.6 million for the same period last year.
●	GAAP net income for the quarter was $1.2 million, or $0.02 per diluted share, compared to a net loss of $3.6 million, or ($0.08) per diluted share, for the same period last year.
●	Non-GAAP net income for the quarter was $8.5 million, or $0.16 per diluted share, compared to non-GAAP net income of $8.1 million, or $0.15 per diluted share, for the same period last year.
●	The Company used $3.8 million of cash from operations during the second quarter and ended the period with $366.3 million of cash and cash equivalents.

“Our second quarter results reflect continued strong performance in the Americas, where we saw revenue growth across systems, consumables, and services, which was offset mainly by significant economic weakness in Europe that we believe is impacting capital investments and general spending in the automotive and industrial machinery markets in that region, as well as by the adverse impact of foreign exchange rates in Europe and Asia Pacific,” said Elchanan (Elan) Jaglom, Interim Chief Executive Officer of Stratasys. “We believe that we are well positioned to return to growth in Europe when macro conditions improve, and our new products and platforms are launched and adopted in the market. Additionally, despite relatively flat revenue growth after excluding divestments, we are pleased that our emphasis on operational efficiency delivered earnings and profitability while we continue to invest in new products and strengthen our R&D efforts to expand our addressable markets.”

Financial Guidance:

Stratasys today issued the following information regarding the Company’s guidance for the fiscal year ending December 31, 2019:

●	Revenue guidance of $670 to $700 million.
●	GAAP net loss of $17 to $3 million, or ($0.31) to ($0.05) per diluted share, compared to previous guidance of a GAAP net loss of $22 to $12 million, or ($0.40) to ($0.22) per diluted share.
●	Non-GAAP net income of $30 to $38 million, or $0.55 to $0.70 per diluted share.
●	Non-GAAP operating margins of 5.5% to 6.5%.
●	Capital expenditures are projected at $30 to $45 compared to previous guidance of $45 to $60 million.

Given the expected ongoing negative impact of not recording a tax benefit on U.S. tax losses on the Company’s non-GAAP net income, the Company believes that the rate of growth in its non-GAAP operating income is the best measure of its performance.

Non-GAAP earnings guidance excludes $23 to $24 million of projected amortization of intangible assets; $22 to $24 million of share-based compensation expense; reorganization expenses and other of ($1) to $1 million; and includes tax adjustments of ($2) to ($3) million on the above non-GAAP items.

“We are excited about the market response to the new products that we have recently launched, and about the several additional product announcements we intend to make later this year and in 2020,” continued Jaglom. “We believe we are well positioned to continue expanding in manufacturing, rapid prototyping, and photo-realism design as well as in our target verticals of aerospace, automotive, healthcare, and dental. Our focus on innovation and select partnerships over the last several years is opening new, incremental opportunities that along with our healthy balance sheet will support our accelerated growth plan beginning in 2020.”

Stratasys Ltd. Q2 2019 Conference Call Details

The Company plans to hold the conference call to discuss its second quarter financial results on Wednesday, July 31, 2019 at 8:30 a.m. (ET).

The investor conference call will be available via live webcast on the Stratasys Web site at investors.stratasys.com; or directly at the following web address: https://edge.media-server.com/mmc/p/o8gp8wcb.

To participate by telephone, the domestic dial-in number is (866) 394-5776 and the international dial-in is (409) 350-3596. The access code is 9771494.

Investors are advised to dial into the call at least ten minutes prior to the call to register. The webcast will be available for 90 days at investors.stratasys.com, or by accessing the provided web address.

Stratasys is a global leader in additive manufacturing or 3D printing technology, and is the manufacturer of FDM^®and PolyJet™ 3D Printers. The Company’s technologies are used to create prototypes, manufacturing tools, and production parts for industries, including aerospace, automotive, healthcare, consumer products and education. For 30 years, Stratasys products have helped manufacturers reduce product-development time, cost, and time-to-market, as well as reduce or eliminate tooling costs and improve product quality. The Stratasys 3D printing ecosystem of solutions and expertise includes: 3D printers, materials, software, expert services, and on-demand parts production. Online at: www.stratasys.com, http://blog.stratasys.com and LinkedIn.

Stratasys is a registered trademark and the Stratasys signet is a trademark of Stratasys Ltd. and/or its subsidiaries or affiliates. All other trademarks are the property of their respective owners.

Cautionary Statement Regarding Forward-Looking Statements

The statements in this press release regarding Stratasys' strategy, and the statements regarding its projected future financial performance, including the financial guidance concerning its expected results for 2019, are forward-looking statements reflecting management's current expectations and beliefs. These forward-looking statements are based on current information that is, by its nature, subject to rapid and even abrupt change. Due to risks and uncertainties associated with Stratasys' business, actual results could differ materially from those projected or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to: the degree of market acceptance of our 3D printers, high-performance systems and consumables, and the software and technology included in those systems; potential declines in the demand for, or the prices of, our products and services, or volume of our sales, due to decreased demand either for them specifically or in the 3D printing market generally; potential shifts in our overall strategy, including as related to any reorganization activities and our capital expenditures; potential shifts in our product mix to lower-margin products or in our revenues mix towards our AM services business; the impact of competition and new technologies; potential further charges against earnings that we could be required to take due to impairment of additional goodwill or other intangible assets; potential failure to successfully consummate acquisitions or investments in new businesses, technologies, products or services; risks related to our relationships with our suppliers, resellers and independent sales agents, and our operations at our manufacturing sites; risks related to the international scope of our operations and regulatory compliance (including reporting, environmental, anti-corruption and other regulatory compliance) related to that scope of operations; risks related to the security of our information systems (including risks related to potential cyber-attacks); changes in the overall global economic environment or in political and economic conditions in the countries in which we operate; changes in our strategy; costs and potential liability relating to litigation and regulatory proceedings; and those additional factors referred to in Item 3.D “Key Information - Risk Factors”, Item 4, “Information on the Company”, Item 5, “Operating and Financial Review and Prospects,” and all other parts of our Annual Report on Form 20-F for the year ended December 31, 2018 (the “2018 Annual Report”), filed with the Securities and Exchange Commission (the “SEC”) on March 7^th, 2019. Readers are urged to carefully review and consider the various disclosures made throughout our 2018 Annual Report and the Report of Foreign Private Issuer on Form 6-K that attaches Stratasys’ unaudited, condensed consolidated financial statements as of, and for the quarter and six months ended, June 30, 2019, and its review of its results of operations and financial condition for that period, which has been furnished to the SEC on or about the date hereof, and our other reports filed with or furnished to the SEC, which are designed to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations and prospects. Any guidance provided, and other forward-looking statements made, in this press release are made as of the date hereof, and Stratasys undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Use of non-GAAP financial measures

The non-GAAP data included herein, which excludes certain items as described below, are non-GAAP financial measures. Our management believes that these non-GAAP financial measures are useful information for investors and shareholders of our Company in gauging our results of operations (x) on an ongoing basis after excluding mergers, acquisitions and divestments related expense or gains and reorganization-related charges or gains, and (y) excluding non-cash items such as stock-based compensation expenses, acquired intangible assets amortization, including intangible assets amortization related to equity method investments, impairment of long-lived assets, and the corresponding tax effect of those items. These non-GAAP adjustments either do not reflect actual cash outlays that impact our liquidity and our financial condition or have a non-recurring impact on the statement of operations, as assessed by management. These non-GAAP financial measures are presented to permit investors to more fully understand how management assesses our performance for internal planning and forecasting purposes. The limitations of using these non-GAAP financial measures as performance measures are that they provide a view of our results of operations without including all items indicated above during a period, which may not provide a comparable view of our performance to other companies in our industry. Investors and other readers should consider non-GAAP measures only as supplements to, not as substitutes for or as superior measures to, the measures of financial performance prepared in accordance with GAAP. Reconciliation between results on a GAAP and non-GAAP basis is provided in a table below.

Stratasys Investor Relations
Yonah Lloyd
Vice President - Investor Relations
Yonah.Lloyd@stratasys.com

Stratasys Ltd.

Consolidated Balance Sheets

(Unaudited)
(in thousands, except share data)
	June 30,			December 31,
	2019			2018
ASSETS

Current assets
Cash and cash equivalents	$	366,327		$	393,167
Accounts receivable, net		131,546			138,146
Inventories		147,799			123,524
Prepaid expenses		8,117			6,398
Other current assets		29,686			22,936

Total current assets		683,475			684,171

Non-current assets
Property, plant and equipment, net		189,794			188,150
Goodwill		385,803			385,849
Other intangible assets, net		96,001			107,274
Operating lease right-of-use assets		23,399			-
Other non-current assets		18,891			22,810

Total non-current assets		713,888			704,083

Total assets	$	1,397,363		$	1,388,254

LIABILITIES AND EQUITY

Current liabilities
Accounts payable	$	54,662		$	45,855
Current portion of long term-debt		-			5,143
Accrued expenses and other current liabilities		29,942			39,115
Accrued compensation and related benefits		29,572			31,703
Deferred revenues		54,298			53,965
Operating lease liabilities - short term		9,106			-

Total current liabilities		177,580			175,781

Non-current liabilities
Long-term debt		-			22,000
Deferred revenues - long-term		16,652			18,422
Operating lease liabilities - long term		14,702			-
Other non-current liabilities		31,409			29,084

Total non-current liabilities		62,763			69,506

Total liabilities		240,343			245,287

Redeemable non-controlling interests		742			852

Equity
Ordinary shares, NIS 0.01 nominal value, authorized 180,000 thousands shares; 54,344 thousands shares and 53,881 thousands shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively		147			146
Additional paid-in capital		2,695,622			2,681,048
Accumulated other comprehensive loss		(7,047	)		(7,753	)
Accumulated deficit		(1,532,444	)		(1,531,326	)
Total equity		1,156,278			1,142,115

Total liabilities and equity	$	1,397,363		$	1,388,254

Stratasys Ltd.

Consolidated Statements of Operations

(in thousands, except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Net sales
Products	$	110,341		$	118,403		$	215,432		$	222,320
Services		52,822			51,833			103,031			101,749
		163,163			170,236			318,463			324,069

Cost of sales
Products		47,095			53,262			91,264			98,480
Services		34,901			33,327			69,575			66,292
		81,996			86,589			160,839			164,772

Gross profit		81,167			83,647			157,624			159,297

Operating expenses
Research and development, net		24,040			23,689			46,614			48,799
Selling, general and administrative		56,322			61,887			113,476			118,892
		80,362			85,576			160,090			167,691

Operating profit (loss)		805			(1,929	)		(2,466	)		(8,394	)

Financial income (expense), net		1,755			(83	)		2,508			(75	)

Income (loss) before income taxes		2,560			(2,012	)		42			(8,469	)

Income tax expenses		1,280			205			2,498			806

Share in profits (losses) of associated companies		(195	)		(1,360	)		1,228			(7,433	)

Net income (loss)		1,085			(3,577	)		(1,228	)		(16,708	)

Net loss attributable to non-controlling interests		(67	)		(26	)		(110	)		(116	)

Net income (loss) attributable to Stratasys Ltd.	$	1,152		$	(3,551	)	$	(1,118	)	$	(16,592	)

Net income (loss) per ordinary share attributable to Stratasys Ltd.
Basic	$	0.02		$	(0.08	)	$	(0.02	)	$	(0.33	)
Diluted	$	0.02		$	(0.08	)	$	(0.02	)	$	(0.33	)

Basic		54,231			53,722			54,102			53,689
Diluted		54,687			53,722			54,102			53,689

Stratasys Ltd.

Reconciliation of GAAP to Non-GAAP Results of Operations

		Three Months Ended June 30,
		2019		Non-GAAP			2019		2018			Non-GAAP			2018
		GAAP		Adjustments			Non-GAAP		GAAP			Adjustments			Non-GAAP
		U.S. dollars and shares in thousands (except per share amounts)
	Gross profit (1)	$	81,167	$	4,441		$	85,608	$	83,647		$	5,708		$	89,355
	Operating income (loss) (1,2)		805		8,246			9,051		(1,929	)		12,548			10,619
	Net income (loss) attributable to Stratasys Ltd. (1,2,3)		1,152		7,372			8,524		(3,551	)		11,643			8,092
	Net income (loss) per diluted share attributable to Stratasys Ltd. (4)	$	0.02	$	0.14		$	0.16	$	(0.08	)	$	0.23		$	0.15

(1)	Acquired intangible assets amortization expense				3,900								5,220
	Non-cash stock-based compensation expense				541								442
	Reorganization and other related costs				-								46
					4,441								5,708

(2)	Acquired intangible assets amortization expense				1,783								2,539
	Non-cash stock-based compensation expense				5,552								3,836
	Reorganization expenses and other				(3,530	)							465
					3,805								6,840
					8,246								12,548

(3)	Corresponding tax effect				(874	)							(1,119	)

	Amortization of acquired intangibles assets related to equity method investments				-								214
				$	7,372							$	11,643

(4)	Weighted average number of ordinary shares outstanding- Diluted		54,687					54,687		53,722						53,745

Stratasys Ltd.

Reconciliation of GAAP to Non-GAAP Results of Operations

		Six Months Ended June 30,
		2019			Non-GAAP			2019		2018			Non-GAAP			2018
		GAAP			Adjustments			Non-GAAP		GAAP			Adjustments			Non-GAAP
		U.S. dollars and shares in thousands (except per share amounts)
	Gross profit (1)	$	157,624		$	8,693		$	166,317	$	159,297		$	11,307		$	170,604
	Operating income (loss) (1,2)		(2,466	)		18,321			15,855		(8,394	)		23,935			15,541
	Net income (loss) attributable to Stratasys Ltd. (1,2,3)		(1,118	)		15,299			14,181		(16,592	)		27,406			10,814
	Net income (loss) per diluted share attributable to Stratasys Ltd. (4)	$	(0.02	)	$	0.28		$	0.26	$	(0.33	)	$	0.53		$	0.20

(1)	Acquired intangible assets amortization expense					7,798								10,424
	Non-cash stock-based compensation expense					895								829
	Reorganization and other related costs					-								54
						8,693								11,307

(2)	Acquired intangible assets amortization expense					3,672								5,097
	Non-cash stock-based compensation expense					9,427								6,864
	Reorganization expenses and other					(3,471	)							2,230
	Gain from sale of plant and property					-								(1,563	)
						9,628								12,628
						18,321								23,935

(3)	Corresponding tax effect					(1,418	)							(1,911	)

	Gain from equity method divestment, related write-offs and amortization					(1,604	)							5,382
					$	15,299							$	27,406

(4)	Weighted average number of ordinary shares outstanding- Diluted		54,102						54,585		53,689						53,732

Stratasys Ltd.

Reconciliation of GAAP to Non-GAAP Forward Looking Guidance

Fiscal Year 2019

(in millions, except per share data)
GAAP net loss		($17) to ($3)

Adjustments
Stock-based compensation expense		$22 to $24
Intangible assets amortization expense		$23 to $24
Reorganization and other related costs		($1) to $1
Tax expense related to Non-GAAP adjustments		($2) to ($3)

Non-GAAP net income		$30 to $38

GAAP loss per share		($0.31) to ($0.05)

Non-GAAP diluted earnings per share		$0.55 to $0.70

Good day, ladies and gentlemen. Welcome to today’s conference call to discuss Stratasys’ second quarter 2019 financial results.

My name is [INSERT], and I’m your operator for today’s call. [INSERT RELEVANT INSTRUCTIONS].

And now, I’d like to hand the call over to Yonah Lloyd, Vice President of Investor Relations for Stratasys. Mr. Lloyd, please go ahead.

Good morning, everyone, and thank you for joining us to discuss our 2019 second quarter financial results. On the call with us today are Elan Jaglom, Interim CEO, David Reis, Vice-Chairman and member of our Board’s Oversight Committee, and Lilach Payorski, CFO.

I remind you that access to today's call, including the prepared slide presentation, is available online at the web address provided in our press release.

In addition, a replay of today's call, including access to the slide presentation, will also be available, and can be accessed through the investor relations section of our website.

Please note that some of the information you will hear during our discussion today will consist of forward-looking statements, including, without limitation, those regarding our expectations as to our future revenue, gross margin, operating expenses, taxes and other future financial performance, and our expectations for our business outlook. All statements that speak to future performance, events, expectations or results are forward-looking statements. Actual results or trends could differ materially from our forecast. For risks that could cause actual results to be materially different from those set forth in forward-looking statements, please refer to the risk factors discussed in Stratasys' annual report on Form 20-F for the 2018 year, as well as our report on Form 6-K and the related press release concerning our earnings for the second quarter of 2019, the latter two of which we are furnishing to the SEC today. Stratasys assumes no obligation to update any forward-looking statements or information which speak as of their respective dates.

As in previous quarters, today's call will include GAAP and non-GAAP financial measures. The non-GAAP financial measures should be read in combination with our GAAP metrics to evaluate our performance. Certain non-GAAP to GAAP reconciliations are provided in the table contained in our slide presentation and in today’s press release.

Our second quarter results reflect continued strong performance in the Americas, our largest market, where we saw revenue growth across systems, consumables, and services.

In-line with our long-term strategy, we continue to invest in developing new products that we believe will expand our addressable markets and generate accelerated growth beginning in 2020.

Over the coming two years, we anticipate multiple major product introductions of new systems, platforms and technologies, subject to R&D timelines.

Our focus on operational efficiency has allowed us to continue generating earnings and profitability even as overall revenue growth remains relatively flat, after excluding divestments.

We believe we are well positioned to continue expanding in manufacturing, rapid prototyping, and photo-realism design as well as in our target verticals of aerospace, automotive, healthcare, and dental.

Additionally, our emphasis on innovation and select partnerships over the last several years is opening new, incremental opportunities that, along with our healthy balance sheet, will support our accelerated growth plan beginning in 2020.

We are excited about the market response to the new products that we have recently launched, and about several additional announcements we plan to make later this year and in 2020.

Our positive Americas top-line results in the second quarter were offset by our disappointing performance in EMEA. We believe that our sales are being affected primarily by the significant economic weakness in Europe that is impacting capital investments and general spending in the European automotive and industrial machinery markets. Our results were also unfavorably impacted by foreign exchange rates in Europe and Asia Pacific.

Despite the revenue weakness we are experiencing in Europe, we continue to see high levels of customer engagement and are encouraged by the interest in deploying our solutions there. We believe that we are well positioned to return to growth in that region once conditions improve.

I will return later in the call to provide an update on our search for a new CEO, and David will provide more details regarding the quarter and other items, but first I will turn the call over to our CFO, Lilach Payorski, who will review the details of our financial results.

Total revenue in the second quarter was $163.2 million compared to $170.2 million for the same period last year.

After adjusting for the sale of our divested entities during 2018, total revenue decreased 2% for the quarter and decreased 1% after also adjusting for constant currency.

GAAP operating income for the second quarter was $0.8 million, compared to a loss of $1.9 million for the same period last year.

Non-GAAP operating income for the quarter was $9.1 million, compared to non-GAAP operating income of $10.6 million for the same period last year.

GAAP net income for the quarter was $1.2 million, or $0.02 per diluted share, compared to a net loss of $3.6 million, or ($0.08) per diluted share, for the same period last year.

Non-GAAP net income for the quarter was $8.5 million, or $0.16 per diluted share, compared to non-GAAP net income of $8.1 million, or $0.15 per diluted share, for the same period last year.

Product revenue in the second quarter was $110.3 million, a decrease of 7% compared to the same period last year. Excluding the divested entities and on a constant currency basis, product revenue decreased by 3%.

Within product revenue, system revenue for the quarter decreased 10%, and decreased by 6% after adjusting for the divested entities and on a constant currency basis, compared to the same period last year.

Consumables revenue for the quarter decreased by 4% compared to the same period last year and decreased by 1% after excluding the divested entities and on a constant currency basis.

Services revenue in the second quarter was $52.8 million, an increase of 2% compared to the same period last year, and an increase of 3% after excluding divested entities and on a constant currency basis.

Within services revenue, customer support revenue increased by 2% compared to the same period last year, and by 4% after excluding divested entities and on a constant currency basis.

GAAP gross margin was 49.7% for the quarter, compared to 49.1% for the same period last year.

Non-GAAP gross margin was 52.5% for the quarter, with no change compared to the same period last year.

GAAP operating expenses decreased by 6% to $80.4 million for the second quarter, as compared to the same period last year, primarily due to the impact of divestments.

Non-GAAP operating expenses decreased by 3% to $76.6 million for the second quarter as compared to the same period last year, driven by a continued focus on administrative cost controls and the impact of divestments.

SLIDE 11: BALANCE SHEET SUMMARY & CASH FLOW FROM OPERATIONS

The Company used $3.8 million of cash from operations during the second quarter, as compared to $13.0 million of cash generated in the second quarter last year, primarily due to proactive steps to increase inventory levels in order to improve fulfillment time and support product demand.

We ended the second quarter with $366.3 million in cash and cash equivalents, compared to $367.8 million at the end of the first quarter of 2019.

Our search for a new CEO is moving ahead and we continue to meet with excellent candidates around the world, from various industries and backgrounds. These candidates have the requisite experience as public company leaders with strong track records of growing their businesses and delivering shareholder value, and we are being duly deliberate in our decision-making process.

As a reminder, our current Oversight Committee consisting of our board members, David Reis, Dov Ofer, and Scott Crump, continues to work closely with me and with our management team. I look forward to bringing this process to its conclusion and advising you of our decision at that time.

I would now like to ask David to provide more detailed information regarding the results of the quarter, David?

Our second quarter results reflect a continuation of the trends we observed in the last several quarters, with systems, consumables and services growth in the Americas, our largest market, where we continue to observe increased adoption in our target verticals of aerospace, automotive, healthcare, and dental.

For example, in our North American aerospace segment, we are seeing strong sales of our production-focused 3D printers and materials, as well as encouraging early adoption of our recently launched Aircraft Interiors Solution.

We believe that our ability to meet the strict requirements of the aerospace industry is clearly demonstrated by our NCAMP qualification from NIAR which we discussed on our last call.

As the aerospace industry in general increases its investments into additive manufacturing, we believe that Stratasys is uniquely positioned to provide the OEM’s and their entire supply chain with our solutions.

In addition to large deals with several top aerospace OEMs in Q2, we are seeing increased adoption by Tier 1 and Tier 2 suppliers, specifically for jigs, fixtures, and tooling applications.

We made several announcements at the Paris Airshow further demonstrating our focus and traction in the aerospace segment.

After two years of rapid adoption for both RP and tooling applications, we extended the Boom Supersonic partnership by seven years to span well into their development program, and also showcased tooling and end-use part applications that Marshall Aerospace and Defense is addressing with our FDM technology.

Additionally, at the Aircraft Interiors Expo in April, Diehl Aviation highlighted their adoption of Stratasys FDM technology, specifically showing a printed curtain header for the Airbus A350 XWB, which is reportedly the largest 3D printed part to be made for a passenger aircraft.

As we noted at the beginning of the year, we are focused on bringing to market innovative new systems, materials, software, and application-specific solutions that leverage our deep knowledge of additive manufacturing and customer requirements to create new, incremental revenue opportunities.

The new systems being developed include major developments across our existing technology portfolio of FDM and PolyJet, our upcoming Layered Powder Metallurgy metal platform, or LPM, as well as new offerings that will broaden the range of solutions we bring to the market. As a brief update, we have shipped two Early Bird LPM systems, one to a large metal-focused service bureau and the other to a world leading automotive OEM.

We are pleased with the early market interest in the new products we introduced this year, including the F120 and V650, and expect to see the impact ramping in H2 2019.

Additionally, in the back half of 2019 and into 2020 we intend to make several additional announcements, including more details on the LPM metal platform, progress on the High-Speed Sintering platform developed in partnership with Xaar, as well as exciting new advancements in both FDM and PolyJet.

We continue to expect that beginning in fiscal year 2020, on the strength of our R&D and sales and marketing efforts we will begin seeing accelerated revenue growth.

I would now like to turn the call over to our VP of Investor Relations, Yonah Lloyd, who will provide greater details on our 2019 financial guidance. Yonah?

Non-GAAP earnings guidance excludes $23 to $24 million of projected amortization of intangible assets; $22 to $24 million of share-based compensation expense; reorganization expenses and other of $1 to ($1) million; and includes tax adjustments of ($2) to ($3) million on the above non-GAAP items.

The estimated non-GAAP tax rate for 2019 is impacted by the ongoing non-cash valuation allowance on deferred tax assets that we expect to record throughout the year on U.S. losses.

Given the expected ongoing negative impact of not recording a tax benefit on U.S. tax losses on our net income, as well as significant quarter to quarter variability in our non-GAAP tax rate, the Company believes non-GAAP operating income is the best measure of our performance.

Appropriate reconciliations between GAAP and non-GAAP financial measures are provided in a table at the end of our press release and slide presentation, with itemized detail concerning the non-GAAP financial measures.

Thank you for joining today’s call. We look forward to speaking with all of you again next quarter.

c/o Stratasys, Inc.		1 Holtzman Street, Science Park
7665 Commerce Way		P.O. Box 2496
Eden Prairie, Minnesota 55344		Rehovot, Israel 76124
(Addresses of principal executive offices)

	STRATASYS LTD.

Dated: July 31, 2019	By:	/s/ Lilach Payorski
	Name:	Lilach Payorski
	Title:	Chief Financial Officer

Exhibit		Description
99.1		Press release dated July 31, 2019, announcing the financial results of Stratasys Ltd. for the quarter ended June 30, 2019

99.2		Script for conference call of Stratasys Ltd. discussing quarterly financial results, held on July 31, 2019

99.3		PowerPoint presentation with additional information for the foregoing conference call

	1.	We are pleased with year-over-year growth in Americas systems, consumables, and services revenues, which were offset primarily by the impact of economic conditions in EMEA.
	2.	Our results reflect a continuation of strong non-GAAP earnings, demonstrating the success of our ongoing effort to maintain operational discipline and expense management as we continue to improve profitability.
	3.	We continue to enjoy a healthy balance sheet and are well positioned to take advantage of opportunities moving forward.