EOS
We were only a quarter of the way through 2025 when RAPID + TCT came around, but it had already turned out to be a landmark year for EOS.
In January, the company announced it had installed its 5,000th 3D printing system, after a M 400-4 system was brought online at Keselowski Advanced Manufacturing, and commenced assembly of its M 290 metal 3D printers to its Texas facility in Q1.
And with EOS North America President Glynn Fletcher [GF] made available for press briefings at the event, we caught up with him to get his reaction on the installation milestone, understand more about the company's capacity to scale up machine production, and discuss the significance of bringing machine assembly back to the United States.
TCT: Glynn, thanks for taking the time. Let's start with the 5,000th installation of an EOS additive manufacturing system earlier this year. What is your reaction to that landmark?
GF: It's a very significant milestone, obviously. But just to put it into perspective, we've been in business now for over 35 years, 36 years this year, and I can't remember the ratios exactly, but it took us maybe 10 years to sell the first 100 machines, and it took us another 15 years to get to 1,000 and then it's been exponential. It's been growing fast since then. I always like to describe EOS as a an overnight success 36 years in the making. But frankly, it's been the last 10 years when we've seen the most growth. There was that famous Economist front cover in 2011 that said 'Print me a Stradivarius, and I always put that as the trigger point for how things started to really go fast. And, of course, everybody expects things to be a perfect linear vector in a straight line upwards, life's not like that, and the business is not like that. So, we've had some ups and downs, but at the moment, I think we're at an inflection point, and it's a definite up. Our business is great at the moment, particularly in North America.
TCT: You mentioned that growth isn't always linear, and obviously EOS is selling both polymer and metal systems, so how does the growth in sales of your metal machines compare to polymers in recent years?
GF: Metal has accelerated faster than polymer. In Polymer, there is not the same level of dominant design that there is in metal. Metal DMLS, powder bed fusion, is the dominant design. In Polymer, you've got extrusion deposition, you've got stereolithography, you've got a lot of variations on the theme. And we specialise only in powder bed fusion, which is a much narrower niche. But it's still quite successful. We do okay, it's just growing at the same level. And the other thing about the contrast between the two, polymer still remains entrenched in rapid prototyping. There are fewer scaled and industrialised applications in polymer than there are in metal.
TCT: Jumping from around 1,000 installations to 5,000 in around ten years says a lot about the demand for EOS products, but how challenging is scaling your infrastructure to meet that accelerating demand?
GF: Well, it's an interesting question, because we have an enormous amount of capacity. If we take that five year period up until, let's say, 2017, that was where all of these so-called experts [talked about] a compound annual growth of 25%. It's always really nice to write, but somebody's got to do it. At the same time you have the inward investment thing and there were founders of organisations who were [saying], 'We're going to start this company with zero today, and in five years time, we're going to be a billion dollars,' and this SPAC money was coming in. So, we were caught up in that hype, and we invested a lot of money in infrastructure to get us from where we were then - maybe 250 million - to where we were projecting 500 million. And we, organised our organisation to have the capacity to do that. But then, of course, things started to flatten off, and then came COVID.
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So, we found ourselves with an over capacity issue, which was a bit of a struggle for a while, because it costs money. We have to cover the operating expenses for that. However, we're a family owned company, so we don't have shareholders other than the family to take care of. We stuck it out. We continue. We slow the investment down. We have a factory in Germany that has the potential to churn out 1,000 machines a year if we were at full three shift capacity. Right now, we're not, so we've got plenty of spare capacity. We've got an SAP ERP system that is probably a bit too big and a bit too sophisticated for a small company, but we have it, and we've figured out how to use it over the last few years, where a lot of companies who have tried to deploy something like SAP, struggle to do that. We've got a very sophisticated CRM, so we made all of those investments, and they started to get a bit scary because of the cost associated with them, but now they're paying off because we've got the capacity that we need, and we've got the systems and processes that that are required for an organisation to scale.
TCT: With that infrastructure in place, which are the industries and applications that will scale that installation figure further?
GF: Well, let's just concentrate a little bit on the United States. We have, here in the United States, at least 12 companies that have over 25 of our systems. We have one company that's got close to 50 of our systems. And when I say our systems, I'm talking about big systems, so a million and a half dollar systems. We're really deeply embedded in a lot of very regulated industries. So, the space industry, for instance, the defence industry, the aerospace industry, the medical industry. That's a huge advantage for us, because we have that market share. We've been able to establish that because what that has also done is led us to a place where we are quite sophisticated in the way that we can support those industrial scale companies now. That's what we have, and that continues to grow. That's a gift that keeps on giving, because we're embedded. And as they increase capacity, they buy more of our systems. We're in Sintavia, Incodema, i3d, Beehive, ADDMAN, Blue Origin, SpaceX, quite a long list, and we do really well.
I was in San Jose a couple weeks ago, at Nvidia's GTC User Conference, and I listened to [Nvidia CEO] Jensen Huang keynote, he took over the San Jose Sharks' hockey stadium, 17,000 people, the one thing that was clear, and the one thing that endorsed some of the thinking that we have is data acquisition and management, if you think of that as a core of a value stream that goes from the production of the semiconductor, through to the creation of the silicon wafer into the server, into the data centre, through to the increased power consumption that that requires, there's a ton of additive manufacturing opportunities along that value stream. And we're seeing a lot of opportunity there. And what Huang was saying was that he expected that the capital investment in data centres would be over a trillion dollars in the next three years. You only need 1% of a trillion dollars, and you're not doing too bad. That's our job now, is to find that. They have to find innovative ways to generate power and transmit power and additive is finding its way into a lot of those places.
TCT: Another recent development at EOS is the transition of M290 assembly to its Texas facility. What was the motivation here?
GF: Well, first, a bit of context. Because it coincided with the tariff situation, everybody thinks that we foresaw that. No, we made the decision a year ago to do this, and we made the decision to do it in a very progressive way. And the driving force behind the decision was that we are now doing more and more business with government agencies and regulated industries in the United States that don't insist on American-made but tend to favour those people who are demonstrating some commitment to manufacturing in the United States. So, we thought we would do that, and we decided that it would be the M290 first because it's the easiest. We've been doing a variation on that machine for 12 years. So, it's really well established. You don't have to have a lot of expertise to do it. All of the bills of material, all of the work instructions, are well prepared. It's easy to train the people. So we thought, let's start with that, and then when we start with that and prove to ourselves that we've got it under control, we can start to bring in other products, which is what we are now going to do. We're going to increase our production capability in Texas and we're going to expand the range as well. So, we'll go from M290 to M400 to, probably, the new product, M4 NEXT, and then maybe even some AMCM products later on as well.
TCT: So, EOS didn't foresee the tariff situation, but has the Trump Administration's policy around tariffs emphasised the importance of this move?
GF: Well, the difference between success and failure is positioning, in my opinion. You've got to position yourself to take the opportunity when it presents itself. And that's what we did. We said a year ago, what we sense is that we're doing more and more business with government agencies. Those government agencies tend to favour organisations that are committed to the United States. Maybe we can get to the full 'Made in America' criteria, but symbolically, it also shows that this market is very important to us, and we're prepared to invest in it, not just take from it. And, so we did that, and it is paying dividends to the extent that now, because we've figured it out over the last six months, we've got ourselves into a position where we're now really comfortable to start to expand that and to increase our footprint. Luck is where preparation meets opportunity. So, we were prepared for it.
TCT: The reason EOS assembled the M290 outside of its domestic markets previously was presumably for cost reasons, right? So, how do you bring the assembly of these machines to the US and remain cost competitive?
GF: It costs us money. But our position is that we're prepared to sacrifice the margin to be able to demonstrate that we're committed to this working. And the gamble is that it is offset by the fact that we sell a whole lot more of everything else as a consequence.
