Materialise Q2 2026 Earnings Report

Materialise EPS Results

• Actual EPS: $0.07
• Consensus EPS: $0.05
• Beat/Miss: Beat by +$0.02
• One Year Ago EPS: N/A

Materialise Revenue Results

• Actual Revenue: $79.97 million
• Expected Revenue: $78.23 million
• Beat/Miss: Beat by +$1.74 million
• YoY Revenue Growth: N/A

Materialise Announcement Details

• Quarter: Q2 2026
• Date: 8/26/2026
• Time: Before Market Opens
• Conference Call Date: Thursday, August 27, 2026
• Conference Call Time: 8:30AM ET

Materialise (NASDAQ:MTLS) is a Belgium-based company specializing in 3D printing software and additive manufacturing services. Through its dual focus on software and printing, the company addresses a wide range of industries, including automotive, aerospace, consumer goods, and healthcare. Materialise’s offerings span from design and simulation tools to end-to-end production, delivering both standardized and highly customized parts across polymer and metal platforms.

On the software side, Materialise develops a suite of proprietary applications—such as Magics for data preparation, Mimics for medical image processing and patient-specific modeling, and Streamics for production workflow management. These tools support customers in optimizing part designs, ensuring manufacturability, and streamlining the entire 3D printing process. Meanwhile, its manufacturing services leverage technologies like selective laser sintering (SLS), stereolithography (SLA), fused deposition modeling (FDM) and selective laser melting (SLM) to produce prototypes, tooling, and end-use parts.

Founded in 1990 by Wilfried Vancraen and headquartered in Leuven, Belgium, Materialise has expanded its footprint with facilities and sales offices across Europe, North America and Asia. The company’s medical division collaborates with healthcare providers to develop patient-specific implants, surgical guides and anatomical models, supporting treatment planning and improving clinical outcomes. Materialise went public on the NASDAQ in 2014 and is led by its founder, who serves as president and CEO, supported by an executive team experienced in engineering, software development and global operations.

Materialise Q2 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Q2 revenue grew 8% year over year to €70.1 million, led by Medical growth of more than 12% and Manufacturing growth of nearly 7%. Adjusted EBIT increased to €3.9 million, with the margin expanding to 5.5%.
• Positive Sentiment: Management reaffirmed full-year 2026 revenue guidance of €273 million–€283 million and raised adjusted EBIT guidance to €12 million–€14 million, citing cost discipline and stronger execution.
• Negative Sentiment: Software revenue declined 3% in Q2 to €9.6 million as industrial customers remained cautious and sales cycles lengthened; Medical software was also pressured by reduced U.S. research grants and reimbursement-related caution in orthopedics.
• Positive Sentiment: Materialise reported a stronger financial position, with €74.2 million in net cash, €11.4 million of first-half free cash flow, and €5.2 million invested in share buybacks. Manufacturing profitability also improved substantially, with quarterly adjusted EBITDA loss narrowing to €0.3 million from €4.8 million.
• Neutral Sentiment: The company launched CO-AM Pro ahead of schedule and began early-adopter programs for CO-AM NPI and Enterprise, which management views as future software growth drivers, particularly as aerospace and defense customers scale additive manufacturing.

Presentation

[Operator]

Good day, and welcome to the second quarter and half year 2026 Materialise NV financial results conference call. At this time, all participants are in listen only mode. After the speakers' presentation, there will be a question and answer session. To ask a question, you will need to press star one one on your touchtone telephone. Please note, this call may be recorded. I would like to turn the call over to Jody Burfening, Alliance Advisors Investor Relations. Please go ahead.

[Jody Burfening, Managing Director at Alliance Advisors]

Thank you, Michelle, and thank you everyone for joining us today for Materialise's quarterly conference call. With us on the call are Brigitte de Vet, Chief Executive Officer, and Koen Berges, Chief Financial Officer. Today's call and webcast are being accompanied by a slide presentation that reviews Materialise's strategic, financial, and operational performance for the second quarter and first half of 2026. To access the slides, if you have not already done so, please go to the investor relations section of the company's website at www.materialise.com. The earnings press release that was issued earlier today can also be found on that page.

[Jody Burfening, Managing Director at Alliance Advisors]

These forward-looking statements are subject to known and unknown uncertainties and risks that could cause actual results to differ materially from the expectations expressed, including competitive dynamics and industry change. Any forward-looking statements, including those related to the company's future results and activities, represent management's estimates as of today and should not be relied upon as representing their estimates as of any subsequent day. Management disclaims any duty to update or revise any forward-looking statements to reflect future events or changes in expectations.

[Jody Burfening, Managing Director at Alliance Advisors]

A more detailed description of the risks and uncertainties and other factors that may impact the company's future business or financial results can be found in the company's most recent report on Form 20-F filed with the SEC. Finally, management will discuss certain non-IFRS measures on today's conference call. A reconciliation table is contained in the earnings release and at the end of the slide presentation. With that, I would now like to turn the call over to Brigitte. Good morning, Brigitte.

[Brigitte de Vet, CEO at Materialise]

Good morning and good afternoon. Thank you everyone for joining us today. You can find the agenda for our call on slide 3. First, I will summarize the business highlights for the second quarter of 2026. Then I will pass the floor to Koen, who will take you through the second quarter and half year financials. Finally, I will come back and explain what we expect the remaining months of 2026 to bring. When we have completed our prepared remarks, we will be happy to respond to questions. Moving to slide 4 for the highlights of the second quarter 2026. I would like to open by drawing your attention to our first half year report, now available on our investor relations website. This report reflects our compliance with the European reporting requirements.

[Brigitte de Vet, CEO at Materialise]

Requirements that, as announced in our first quarter earnings call, led us to deliberately schedule this second quarter earnings release later in the quarter. I am also pleased to announce some changes in our executive committee taking place as of early September. Those changes will further strengthen our leadership team and strategy execution. Annelies Smits-Ottens will join us as Chief Human Resource Officer to further strengthen our human resource agenda. Annelies brings more than 30 years of international HR leadership experience with a strong record in shaping people and organization strategies that support business growth, transformation, and employee engagement. Throughout her career, she has worked primarily in the life science sector, as well as in telecom and fast-moving consumer goods in both Belgian and international environments.

[Brigitte de Vet, CEO at Materialise]

Most recently, Annelies served as CHRO of Galapagos, now Lakefront Biotherapeutics, where she acted as strategic advisor to the CEO and executive committee and led the HR function across all disciplines in an international setting. She played an important role in supporting the company through periods of growth, transformation, and organizational change, while also strengthening HR as a strategic partner to the business. She brings a wealth of experience, strong energy, and a people-centered leadership style that will help us further our people agenda across the organization. Second, Philippe Verlinden will join us in the newly created role as Chief Digital and Information Officer. This new role reflects the strategic importance of digital capabilities to simplify, scale, and execute more effectively. Philippe brings more than 35 years of experience in technology, digital, and transformation leadership.

[Brigitte de Vet, CEO at Materialise]

He spent 26 years at Philips, and most recently, he served as the Chief Digital and Information Officer at Barco, where he led IT and software across a global footprint. Throughout his career, he led large-scale technology, product, and digital transformation initiatives across engineering, consumer electronics, and healthcare technology. He brings deep experience in cloud and connected platform capabilities, as well as AI, to further drive our digital agenda across our units and markets. We are also making a leadership change in Medical. Our Medical unit is delivering strong results as evidenced by the strong growth this quarter. In addition, we see significant opportunities ahead. To fully capitalize on these opportunities, we have decided to look for a new leader for the Medical segment, and Koen Peters will leave the company in September.

[Brigitte de Vet, CEO at Materialise]

The second quarter also marked the 30th anniversary of Materialise in the U.S., a market that has been central to our growth strategy from the beginning. Over the years, we made several strategic acquisitions in the U.S., including OrthoView, the market leader in orthopedic digital pre-operative planning software, Link3D, an additive workflow and digital manufacturing software company, and Identify3D, a company that developed software to encrypt, distribute, and trace the flow of digital parts across complex supply chains. Today, we are one of the leading players globally, and our U.S. office and team have been very instrumental in our global success. Looking now further at our business segment highlights at the second quarter on slide 5, starting with Medical.

[Brigitte de Vet, CEO at Materialise]

In the second quarter, we saw further evidence of the growing maturity of personalized care and 3D printing during the eighth edition of our 3D Planning and Printing in Hospitals Forum in Leuven, where we welcomed around 200 surgeons, radiologists, clinical engineers from hospitals across Europe and beyond to discuss the use of 3D printing in the hospital. What stood out in this year's discussion was the clear shift from what is the value of personalized 3D solutions to how can we scale this in clinical practice. The continued rise of in-house hospital 3D labs is evidence that 3D printing is becoming more established and operational. The discussions also confirmed that Materialise is at the center of this trend, not only as a software and service provider, but as a long-term partner, helping hospitals integrate personalized care more broadly into daily practice.

[Brigitte de Vet, CEO at Materialise]

In the second quarter, we also announced an investment in Replasia, a Belgian medtech startup developing personalized 3D printed solutions and anatomical analysis software for hip preservation. Our goal is more personalized, less invasive orthopedic treatments that help patients maintain their natural anatomy and their quality of life for as long as possible. Our current hip portfolio is focused on replacements. Strategically, the investment in Replasia strengthens our position across the full spectrum of personalized hip care and complements our existing portfolio to hip preservation solutions. Preservation will play an important role as the market shifts towards less invasive approaches. A similar shift to less invasive approaches is happening in markets outside of orthopedics. One example in CMF, craniomaxillofacial, is minimally invasive orthognathic surgery, or MIOS, a technique that allows surgeons to perform jaw surgery through smaller incisions. Smaller incisions mean that more patients will opt for surgery.

[Brigitte de Vet, CEO at Materialise]

At the same time, smaller incisions require a high level of precision during the surgery, and that is an area where Materialise is well-positioned with our software and device portfolio. The strong proof point of our position was the International MIOS meeting in Brazil in June, which brought together more than 200 maxillofacial experts from 13 countries, and where we trained surgeons in hands-on cadaver labs to perform the surgeries in a safe and effective way. Turning now to Software. In the second quarter, we officially released CO-AM Pro to the market on May 15th, one month ahead of schedule. CO-AM Pro is our cloud-based solution integrated with Magics that brings AM data management and build preparation together in one workflow, making it easier for teams to collaborate, standardize processes, and automate recurring tasks. It centralizes AM data, giving users one source of the truth of the data across teams.

[Brigitte de Vet, CEO at Materialise]

We also formally released the CO-AM Bricks offering, our automation platform that helps users reduce manual work, for example, in the new product introduction process, and helps embed AM knowhow more easily into their daily operations. Early customer onboarding since launch gives us encouraging initial validation of the offering. In addition, we have started the early adopter program of CO-AM NPI and CO-AM Enterprise. Together, these steps mark the structured expansion of our Magics installed base into a connected platform that grows with customers over time. Turning to manufacturing now. Following the agreements we announced at the end of the first quarter, we completed the transfer of our RapidFit business to its management team on April 30th and the transfer of our Eyewear business on July 1st.

[Brigitte de Vet, CEO at Materialise]

With these closings, both businesses now continue independently under their existing leadership with greater focus and flexibility to pursue their next phase of growth. For Materialise, these completed transactions are an important step in sharpening our portfolio and concentrating capital, resources, and leadership attention on the business lines with the strongest long-term scaling potential. In the case of Eyewear, we retain a 20% minority stake, reflecting our continued confidence in the business. Looking at the second quarter results in manufacturing, Aerospace remains a strong growth area for us, with 40% revenue growth realized in the second quarter. This reflects our strong position in this space. A good example of our capabilities is a recent project with Lufthansa Technik. The project involved a small part in an aircraft cabin component that repeatedly failed in service and could not be sourced individually, meaning the entire assembly had to be replaced each time.

[Brigitte de Vet, CEO at Materialise]

By redesigning that part for additive manufacturing and producing it as a certified standalone component, Lufthansa Technik was able to turn a costly recurring replacement into a faster and significantly more cost-effective repair. Following this project, Materialise was named an official workbench for Lufthansa Technik metal parts, an important proof point of the trust we have built in certified aerospace production. Also, in the second quarter, we continued to build momentum in the defense market. Additive manufacturing can provide real value in defense by enabling spare parts and critical components to be produced closer to where they are needed, reducing dependence on vulnerable supply chains. With our combination of software and manufacturing capabilities, Materialise is well-positioned to support that shift. In the second quarter, the Belgian Cyber Force and the Royal Higher Institute for Defence selected Materialise to lead a research consortium with Sirris and Innocon called Strike-IT.

[Brigitte de Vet, CEO at Materialise]

The project focuses on secure and reliable digital manufacturing of spare parts, ensuring that digital files remain protected throughout the production process. Our Identify3D and CO-AM technology will be instrumental in this project to build trust in additive manufacturing for mission-critical environments like defense and help make digital supply chains more resilient. Turning over to Koen now, who will present the financial results.

[Koen Berges, CFO at Materialise]

Thank you, Brigitte. Good morning or good afternoon to all of you on this call. I will begin with a brief overview of our key financial results for Q2 2026, shown on slide 6. In the second quarter, we delivered broad-based growth across the business, with consolidated revenue growing by more than 8% year-on-year to EUR 70.1 million. Gross profit increased to EUR 39.8 million, resulting in a gross margin of 56.8%. Importantly, profitability continued to scale faster than revenue, with adjusted EBIT reaching now EUR 3.9 million and our adjusted EBIT margin expanding to 5.5%, reflecting stronger operating leverage across our business. Net profit for the quarter amounted to EUR 3.3 million or EUR 0.06 per share. Our balance sheet and cash generation remain key strategic strengths, giving us the flexibility to invest for future growth.

[Koen Berges, CFO at Materialise]

Supported by strong operating cash flow and continued debt reduction, we increased our net cash position to EUR 74.2 million, up EUR 3.4 million compared to the start of the year. We also continued our share buyback program, investing EUR 5.2 million during the first half of 2026. I will now walk you through these results in more detail. As a reminder, all comparisons are versus the second quarter and the first 6 months of 2025. Slide 7 provides an overview of our consolidated revenue.

[Koen Berges, CFO at Materialise]

In Q2 2026, our consolidated revenue reached EUR 70.1 million, up by 8% compared to the same period of last year. Growth continued to be led by Medical, with revenue increasing by more than 12% in another quarter of double-digit expansion, reinforcing its position as our primary growth engine. Also, Manufacturing grew by nearly 7% year-over-year, reflecting the benefits of our strategic repositioning towards higher-value series manufacturing.

[Koen Berges, CFO at Materialise]

Software, on the other hand, declined by 3%, reflecting cautious customer spending and extended sales cycles in the current industrial environments. Although the high level of recurring revenue continues to support the resilience of our business model. As shown on the right-hand side, Medical represented 53% of total revenue in Q2, with Manufacturing at 34% and Software at 14%. For the half year 2026, our revenue totaled EUR 136.3 million, up by nearly 4% compared to the same period last year. Our deferred revenue balance for software maintenance and license fees coming from both Medical and Software decreased in Q2 to EUR 46.5 million. But in line with normal seasonal renewal patterns. The total deferred revenue reported on our balance sheet stood at EUR 63 million at the end of the second quarter. Turning now to slide 8. I'd like to highlight the progress we continue to make on profitability.

[Koen Berges, CFO at Materialise]

In the second quarter, adjusted EBITDA reached EUR 9.6 million, an increase of almost 16% year-on-year, resulting in an adjusted EBITDA margin of 13.7%. Adjusted EBIT improved to EUR 3.9 million, compared to EUR 3.1 million in the prior year quarter, resulting in a 5.5% adjusted EBIT margin. For the half year, adjusted EBITDA rose to EUR 17.6 million, representing a margin of 12.9%. While adjusted EBIT increased sharply to EUR 6.4 million, representing a margin of 4.7%. This clear margin expansion reflects revenue growth, disciplined cost management, operational efficiencies, and a sharper focus on our core growth segments as we execute our strategy across our various business units. These results once more demonstrate the resilience of our business model and our ability to improve profitability despite the still challenging macroeconomic environment. Let me now turn to our business segments, starting with Materialise Medical as shown on slide 9.

[Koen Berges, CFO at Materialise]

Medical revenue increased by more than 12% year-on-year. That growth was primarily driven by medical devices, which grew 19% across our partner and direct sales channels, partly offset by a -4% realized in our Materialise Medical software segments. Adjusted EBITDA increased to EUR 11.6 million, representing a strong 31% EBITDA margin, while we continued to increase targeted R&D investments to support future growth opportunities. For the half year, Materialise Medical segment revenue increased by nearly 10% to EUR 70 million, with adjusted EBITDA reaching EUR 20.8 million at a consistent margin of 30%. Slide 10 summarizes the results of our Materialise Software segments. in Q2 2026, software revenue decreased as said by 3% to EUR 9.6 million, reflecting the cautious customer spending and extended sales cycles we continue to see in the current industrial environments.

[Koen Berges, CFO at Materialise]

During the quarter, 86% of our software revenue can now be considered to be recurring while we are approaching the final stages of our transition from perpetual licenses to recurring subscription model. Adjusted EBITDA in Q2 showed a decline to EUR 1 million, reflecting the impact of lower revenue combined with ongoing investments in our new product functionality. As already mentioned by Brigitte, in Q2 we fully launched CO-AM Professional ahead of plan, and this release marks an important strategic milestone for our future growth. For the half year, software segment revenue totaled EUR 19.2 million, 2% below 2025. Despite softer revenue, profitability improved with adjusted EBITDA for the first half reaching EUR 2.1 million, representing a margin of 10.9%. Turning now to slide 11. This slide covers our manufacturing segments. Manufacturing revenue increased nearly 7% to EUR 23.6 million, despite the unfavorable revenue impact of the RapidFit divestment.

[Koen Berges, CFO at Materialise]

The return to growth reflects continued traction in our strategic focus segments, particularly aerospace and defense. This growth in series manufacturing was still partly offset by continued weakness in prototyping demand in Q2. Alongside top-line growth, disciplined cost control drove an improved adjusted EBITDA, landing now at -EUR 0.3 million compared to -EUR 4.8 million in the prior year periods. This improvement demonstrates that our cost actions and portfolio optimization efforts are beginning to translate into improved operating performance. For the half year, the manufacturing revenue remains fairly stable, climbing only slightly to EUR 47.1 million with an adjusted EBITDA improving to break even. During the quarter, we successfully completed the divestment of RapidFit and announced also the sale of our Eyewear business, which in the meantime was successfully closed on July 1.

[Koen Berges, CFO at Materialise]

The latter was recorded as an asset held for sale in our consolidated Q2 financials with EUR 0.7 million of asset impairments impacting that we adjusted for. These actions sharpen the strategic focus of our manufacturing segment and allow us to allocate our capital and resources towards core growth priorities. With the segment results now covered, slide 12 outlines our consolidated income statement showing the drivers behind our improved profitability. Gross profit increased to EUR 39.8 million, with the gross margin remaining fairly stable at 56.8%. Operating expenses in the quarter increased by 3.9%, reflecting targeted growth investments while maintaining our overall cost discipline. We continued to invest in innovation with total R&D spending exceeding EUR 12 million for the quarter, which reflects an increase of 11% year-on-year.

[Koen Berges, CFO at Materialise]

For the half year, total operating expenses increased by only 2% compared to the prior year periods, with the increase again driven by higher R&D investments while G&A and S&M remained stable. Other operating income decreased in the quarter to EUR 0.8 million compared to EUR 1.3 million last year. The Q2 2026 figure includes non-recurring charges of EUR 0.7 million related to an asset impairment on the transfer of Eyewear. As a result of all this, operating profit reached EUR 2.8 million for the quarter. For the half year, this figure stood at EUR 4.9 million versus EUR 3.3 million in the first half of 2025. This improvement reflects the combined impact of revenue growth, stronger operational execution, and disciplined cost management. The net financial income for the quarter was limited to EUR 0.2 million, driven by interest income on cash balances and interest expense on debt.

[Koen Berges, CFO at Materialise]

The impact from currency fluctuations remained limited in Q2 of this year. Income tax benefit amounted to EUR 0.3 million. Overall, this resulted in an increased net profit of EUR 3.3 million or EUR 0.06 per share. For the half year, net profit totals EUR 5.1 million or EUR 0.09 per share. Finally, let's review now our balance sheet and cash flow position, which remains a key strength for Materialise on slide 13. Our cash reserve at the end of the quarter amounted to EUR 133.7 million, while our gross debt was further reduced to EUR 59.5 million. Our resulting net cash position increased to EUR 74.2 million, up by more than EUR 3.4 million compared to the beginning of this year, primarily driven by strong operating cash flow generation.

[Koen Berges, CFO at Materialise]

At the same time, we invested EUR 5.2 million over the first six months of this year through our share buyback program on Nasdaq, acquiring close to 1.1 million ADSs, representing 1.8% of our total share base by June 30, 2026. Compared to the balance sheet at year-end 2025, net working capital components increased by EUR 3.9 million, driven by higher inventory levels of finished products and work in progress, higher receivables, and lower outstanding payables. Deferred income increased to EUR 62.6 million, including EUR 46.5 million related to software licenses and maintenance. As you can see from the graph on the right side of the page, the operating cash flow in the second quarter amounted to more than EUR 8 million. Capital expenditures totaled EUR 2 million, almost all of which is recurring.

[Koen Berges, CFO at Materialise]

Even with continued investments in growth initiatives, we again delivered solid free cash flow generation in this quarter, with cash flow after investing activities amounting to EUR 5.6 million. For the half year, operational cash flow was EUR 50 million, significantly up from the same period in 2025. Combined with lower CapEx, this resulted in a free cash flow of more than EUR 11.4 million, almost double of last year. For the first half of 2026, CapEx totaled EUR 3.4 million and remained well below prior year levels. Recurring CapEx of EUR 2.7 million was primarily focused on machinery, while non-recurring CapEx fell to EUR 0.8 million, primarily reflecting investments in our internal digital transformation programs. With that, I'd like to hand the call back to Brigitte.

[Brigitte de Vet, CEO at Materialise]

Thank you, Koen. Let's now turn to page 14. I will close my remarks with a discussion of our full year 2026 guidance. Our solid first half year performance reinforces our confidence in delivering on our financial guidance. The strategic actions we are taking to sharpen our portfolio and to focus on strategic growth segments, combined with the targeted investments we are making across our three segments, are enhancing operational performance and positioning Materialise for profitable growth.

[Brigitte de Vet, CEO at Materialise]

Accordingly, we are reaffirming our full year 2026 revenue guidance of EUR 273 million to EUR 283 million, fully absorbing the expected unfavorable revenue impact of the RapidFit and Eyewear divestments. At the same time, we are increasing our full year adjusted EBIT guidance to EUR 12 million to EUR 14 million from the earlier communicated range of EUR 10 million to EUR 12 million, reflecting the strength of our execution and our continued discipline in managing costs and capital. This concludes our prepared remarks. Operator, we are now ready to open the call to questions.

[Operator]

Thank you. As a reminder, if you would like to ask a question, please press star 1 1. If your question has been answered and you would like to remove yourself from the queue, please press star 1 1 again. Our first question comes from Alexander Craeymeersch with Kepler Cheuvreux. Your line is open.

[Alexander Craeymeersch, Analyst at Kepler Cheuvreux]

Hey, good afternoon. Thank you for taking my question. The first one would be on Medical. We saw a re-acceleration to 12% year-on-year growth in Q2, and that came after that softer Q1. I am wondering what changed sequentially, and can we hold up this double-digit growth? I know that is the target, but can we expect it to be sustained in H2 and also in 2027 perhaps? Then maybe a related question on this would be if I look at the underlying drivers, we see Materialise Medical Software down 5% and then devices and services increasing 19%. The question on this is how do we need to look at this? Is this basically less customers trying to make the design themselves and opting to outsource the design service to you, and hence there is less need for software? That is the question on Medical.

[Alexander Craeymeersch, Analyst at Kepler Cheuvreux]

Then the second question I have, it would be on basically 2026 EBIT guidance. You guide for EUR 12 million to EUR 14 million in EBIT. Of course, you already delivered EUR 6.4 million in the first half. In the past, the budget cycles always gave you a stronger Q4, especially in software. Is it safe to assume that you do not expect that same budget cycle to happen this year, given your guidance? I will stick to these two. Thanks.

[Brigitte de Vet, CEO at Materialise]

Good afternoon, Alexander. Thanks for your questions. I will kick us off with the question on Medical. I have previously always said that the structural growth rate for Medical is double digits, but low double digits. Reasonably, a sustainable growth number that I would expect for Medical is around 10%, which is essentially what you see for the first half of this year. That is absolutely sustainable. Of course, there can be quarter for quarter differences, which again, is basically what you see in Q1 and Q2 numbers, and actually has to do with a couple of timing impacts. Now your question on the underlying drivers. We do indeed see softer software revenue and stronger device and service revenue. There is a couple of elements that explain that. One of the primary elements is on the software side.

[Brigitte de Vet, CEO at Materialise]

We have an academic segment that we serve, and in particular, in the U.S. Those are academic centers that use our software to train their students, but also to do research based on our current product. In the U.S. in particular, research grants have been reduced for the last year, and we see the impact of that in our software sales. So that is a segment that we serve with our software portfolio, but not with our device and service portfolio. So that is a structural difference between those two segments. The second aspect that we need to take into account is the domains in which we are playing and in which our software is used, which are slightly different from the market segments in which the device and services are positioned and are used.

[Brigitte de Vet, CEO at Materialise]

Of course, these different market segments, and then I talk about them and some of the areas, they are subject to different trends in reimbursement, hence also affordability. Our software products, historically, have been positioned a little more, very strongly on the orthopedic side which is, again, particularly in the U.S., a segment where reimbursement changes have led to a bit more cautiousness from our customers' side, and that is what we feel in our software revenue. So those are the underlying drivers that differentiate our software segment from our device and services segment. I will hand it over for Koen to tackle your second question on the 2026 EBIT guidance. The fact that you mentioned that we already delivered EUR 6.4 million in the first half of the year.

[Koen Berges, CFO at Materialise]

Alexander, good afternoon. To answer that question, I think what we've been able to demonstrate the first half of this year, I think that we have been able to improve our profitability expressed as EBIT or EBITDA percentage. We believe that is also largely driven by the fact that we have been able to reduce our cost structure. We have the feeling that is also structural cost savings that we're doing there. We are counting to continue them as well going forward. If you, of course, do an extrapolation of the current realized EBIT in the first half of the year, you would end somewhere in the middle of the guidance range that we put forward now. There is, of course, some seasonality in the quarters. The fourth quarter is typically a stronger quarter. We hope to have that as well this year, of course.

[Koen Berges, CFO at Materialise]

On the other hand, the summer quarter and third quarter typically is then maybe a bit of a softer quarter, typically, if you look over the trend over the past years. So probably those will compensate each other to a certain extent, and that's why we see for ourselves us landing in a range between EUR 12 million to EUR 14 million of EBIT over the full year.

[Brigitte de Vet, CEO at Materialise]

Does that answer your question, Alexander?

[Alexander Craeymeersch, Analyst at Kepler Cheuvreux]

Yes. I'll leave it at that. Thank you both for answering my questions and talk soon. Thanks.

[Brigitte de Vet, CEO at Materialise]

Thank you.

[Operator]

Thank you. Our next question comes from Guy Sips with KBC Securities. Your line is open.

[Guy Sips, Analyst at KBC Securities]

Yes. First of all, congratulations with the very good results. You highlighted encouraging early adoption of CO-AM Professional and launched early adopter programs for CO-AM NPI and Enterprise and expanded your partnership with HP. Could you share how you see these initiatives contributing to software growth and recurring revenues over the next few years? Thank you.

[Brigitte de Vet, CEO at Materialise]

Yes. Thank you for your question, Keith. It is a very valid question because the whole CO-AM program is a strategic move, as you know, that we made a couple of years ago, and that we are driving as we speak with those three offerings, the CO-AM Pro, CO-AM NPI, and CO-AM Enterprise offering. The way you need to look at this program and the shift that we are making is really on the basis of our installed base of Magics. We bring additional capabilities to the market that are packaged in those three offerings, Pro, NPI, and Enterprise. In particular, NPI and Enterprise, for us, will be growth drivers. Why? Because we position us in those segments where companies have understood the value of additive manufacturing and are now in a need for capabilities to help them scale.

[Brigitte de Vet, CEO at Materialise]

That is exactly what NPI and Enterprise are trying to do. As an example, in the aerospace or defense segment, where the value of additive is well-established, users already have a base of additive manufacturing. They now want to get to the next level, scale, do more and more parts with it. That is where the NPI and the Enterprise capabilities come in. Those will be driving our growth going forward. The Pro offering is a step into the CO-AM offering, is a first step, which is a critical one because we want to get customers onto our cloud platform, but the major growth drivers will come from NPI and Enterprise. Does that answer your question?

[Guy Sips, Analyst at KBC Securities]

Yes. Thank you. Yep. Thank you.

[Operator]

Thank you. I am showing no further questions. I would like to turn the call back over to Brigitte de Vet for closing remarks.

[Brigitte de Vet, CEO at Materialise]

Thanks again for joining us today. We look forward to continuing our dialogue with you through investor conference or in one-on-one virtual meetings and calls. In the meantime, please reach out if you have any questions. Thank you and goodbye for now.

[Operator]

Thank you for your participation. You may now disconnect. Good day.

Participants

Executives

• Brigitte de Vet, CEO
• Koen Berges, CFO

Analysts

• Jody Burfening, Managing Director at Alliance Advisors
• Alexander Craeymeersch, Analyst at Kepler Cheuvreux
• Guy Sips, Analyst at KBC Securities