HP Inc To Expand 3D Printing Footprint Across Asia Pacific

In a move to enhance the presence of its 3D Printing technologies globally, HP Inc. (NYSE:HPQ) recently made a series of announcements that will help in strengthening its foothold in the Asia-Pacific region.

The company is set to make the commercial availability of its award-winning HP Jet Fusion 3D Printing Solution in the Asia-Pacific region by expanding HP Partner First 3D Printing Specialization program to over a dozen new partners across the region. The new partners include names like Aurora, AM Korea, ECSS, evok3d, Eye2Eye, Infinite 3D Printing, FormX, Huxen, Hyunwoo Data, Shining 3D ePrint, Trustworthy, Wenpoo, and 3D Pro.

Initially, the program will serve Greater China, Japan, South Korea, Singapore, and Australia. With this partner expansion program, HP’s 3D printing technology reach will extend its reach beyond North America and Europe.

Apart from this, the company declared partnering with two Chinese 3D printing services providers which have agreed to build a significant number of facilities.

The major one is Shining 3D ePrint, which has agreed to deploy HP's 3D printing solutions in over 50 locations across China, including its Beijing, Chengdu, Guangzhou, Nanjing, and Shanghai facilities. Notably, Shining 3D ePrint has more than 10,000 customers in over 70 countries across Asia, the Americas, Europe, and the Middle East.

Infinite 3D Printing is another leading Chinese 3D printing services provider, which has agreed to deploy HP’s 3D printing solutions in locations like Suzhou and Qingdao.

HP also announced collaborating with China’s Sinopec Yanshan Petrochemical Company, which will develop polyolefin-based powders for the company’s Jet Fusion printing solution. Sinopec Yanshan Petrochemical will also join HP’s partner program.

In addition to the aforementioned announcements, HP also noted that it is planning to open several 3D Printing Reference and Experience Centers, in collaboration with its partners. These centers will be located in Beijing, Hangzhou, Qingdao, Shanghai, Suzhou, Taipei, Tokyo, Singapore, and Melbourne.

Why Asia Pacific?

HP’s latest announcement signifies that the company is taking big steps to fortify its presence in this manufacturing sector hub region. Per Stephen Nigro, President of 3D Printing, HP Inc., the Asia-Pacific manufacturing sector is of about $6 trillion, which provides a number of opportunities for the 3D printing solution providing companies.

Nigro said that, "We are excited to bring the industry's leading 3D printing technology, most robust partner community, and most innovative materials ecosystem to help this world-class manufacturing community accelerate their reinvention. Anchored by some of the most advanced companies in the world, the region's diverse and dynamic collection of global brands, large contract manufacturers, and materials leaders is primed to play a significant role in this global industry transformation."

Contract equipment manufacturer, Jabil Circuit Inc. (NYSE:JBL) , is among the early adopters of HP’s Multi Jet Fusion 3D printing technology. John Dulchinos, VP of Digital Manufacturing, Jabil, stated, “We are thrilled to see their [HP] expansion into Asia, home of some of the highest volume manufacturing".

Additionally, the 3D printing market presents remarkable long-term investment opportunities, as a large number of engineers, designers, architects and entrepreneurs are now turning to 3D solutions for primary designing and product modeling.

According to market research firm – CONTEXT – over half a million 3D printers have already been shipped across the globe between the 1980s and mid-2015, and the industry is currently on track to ship its millionth unit by 2017. Data from the Wohlers Report 2014 revealed that the worldwide 3D printing industry is anticipated to grow from $3.07 billion in 2013 to $12.8 billion by 2018, and will exceed $21 billion by 2020 at a CAGR of 34%.

Bottom Line

For the past several quarters, HP’s printing business has been facing challenges like sluggish demand and cut-throat competition in the space. In an effort to revamp its printer business, HP is looking at every aspect of growth, including product innovation and differentiation, and acquisition or expansion of 3D printing capabilities.

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Over the last few quarters, the company rolled out creative products like Sprocket and acquired Samsung (KS:005930) Electronics’ printer business to drive its printing segment.

Apart from this, the company is also trying to boost its 3D printing business capabilities, in an effort to revive tumbling sales. It should be noted that even though HP has been operating in this space for almost six years now, the company lags behind 3D Systems Corporation (NYSE:DDD) and Stratasys Ltd (NASDAQ:SSYS) .

Thus, in order to fortify its presence in this space, HP, last year, unveiled its Jet Fusion 3D Printing Solution with two models to choose from – 4200 and 3200. Unlike 3D Systems and Stratasys, which target all kinds of consumers, HP emphasizes only on industrial markets because of their ability to afford a premium range of 3D printing solutions.

In our opinion, HP’s efforts toward reviving its printing business have been commendable. Its strategy of focusing on product innovation and elevating 3D printing capabilities has helped in stabilizing declining revenues at its printer division as indicated by its last quarterly results where the segment witnessed 2% year-over-year growth.

Currently, HP carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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