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IPG Photonics Reports Another Record Quarter

OXFORD, Mass., Oct. 31, 2012 — Fiber laser maker IPG Photonics reported Wednesday another quarter of double-digit profit and revenue growth for the third quarter of 2012, which ended Sept. 30. The company said it also expects to report strong year-over-year growth in the fourth quarter.

Profit increased to $42.4 million, up 29 percent from 2011's $32.9 million. Revenue increased 21 percent year over year, from $129 million to $156 million. Once again, the increase was attributed to growth in high-power and pulsed laser sales for materials processing applications.

"Strength in the US and Europe for cutting and welding applications in automotive and general manufacturing, as well as marking and engraving in consumer electronics, were the primary drivers of our record revenue performance," said IPG CEO Dr. Valentin Gapontsev. "In addition, advanced applications revenue benefited from sales of several high-power and brightness lasers."

Our growth in Europe was partially offset by lower demand in Russia, he said, adding, "In Asia, we continued to expand our business in Turkey, while Japan and China both showed moderate growth.”

Gapontsev said the company used a portion of the $38 million in cash it generated in the third quarter from operations to acquire JP Sercel Associates Inc. (See: IPG Photonics Acquires JPSA). IPG ended the quarter with $372 million in cash.

"Materials processing sales increased by 21 percent, driven primarily by high-power laser sales for automotive and general manufacturing applications," Gapontsev said. "High-power laser sales increased 16 percent, while pulsed laser sales grew by 51 percent, driven by increased demand for consumer electronics applications."

Demand for thin metal cutting and welding in microprocessing applications boosted medium-power laser sales by 11 percent, he said.

Looking ahead, the company said it expects revenue of between $140 million and $150 million for the fourth quarter, with earnings per share in the range of 65 cents to 75 cents.

"At the same time, we will face challenges in the fourth quarter, including historical seasonality in some markets and macro-economic pressures in a few key geographies. As a result of these factors, our book-to-bill ratio was less than one in Q3," Gapontsev said.

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