Accuray(ARAY) - 2025 Q4 - Annual Results

Executive Summary & Highlights Accuray's fiscal Q4 and full-year 2025 results show mixed revenue performance but improved profitability and strategic advancements Key Fiscal Fourth Quarter Highlights Accuray reported a decrease in total net revenue for Q4 FY25, primarily due to a decline in product revenue, while service revenue saw an increase. Net income and Adjusted EBITDA also decreased compared to the prior year, with a book-to-bill ratio of 1.2 | Metric | Q4 FY25 (Millions) | Q4 FY24 (Millions) | Change (%) | | :------------------- | :----------------- | :----------------- | :--------- | | Total Net Revenue | $127.5 | $134.3 | -5% | | Product Revenue | $70.7 | $79.7 | -11% | | Service Revenue | $56.8 | $54.6 | +4% | | Net Income | $1.1 | $3.4 | -67.6% | | Adjusted EBITDA | $9.4 | $10.1 | -6.9% | | Order Book-to-Bill | 1.2 | N/A | N/A | Key Fiscal Year 2025 Highlights For the full fiscal year 2025, Accuray achieved an increase in total net revenue driven by growth in both product and service revenues. The company significantly reduced its net loss and improved Adjusted EBITDA compared to the prior fiscal year, maintaining a book-to-bill ratio of 1.2 | Metric | FY25 (Millions) | FY24 (Millions) | Change (%) | | :------------------- | :-------------- | :-------------- | :--------- | | Total Net Revenue | $458.5 | $446.6 | +3% | | Product Revenue | $237.6 | $234.2 | +1% | | Service Revenue | $220.9 | $212.4 | +4% | | Net Loss | $1.6 | $15.5 | -89.7% | | Adjusted EBITDA | $28.3 | $19.7 | +43.6% | | Order Book-to-Bill | 1.2 | N/A | N/A | Management Commentary Management highlighted the company's strategic advancements in innovation, access, and service growth, successfully navigating a challenging environment. They emphasized annual revenue growth, strong service performance, adjusted EBITDA margin expansion, and the successful completion of debt refinancing - CEO Suzanne Winter noted the advancement of the company's strategy of innovation, access, and service growth, along with annual revenue growth, strong service performance, adjusted EBITDA margin expansion, and successful debt refinancing[4] - CFO Ali Pervaiz highlighted the team's resilience despite macroeconomic challenges and tariff uncertainty, steady operational progress, customer adoption through product portfolio expansion, and the announcement of refinancing plans[14] Fiscal Fourth Quarter 2025 Financial Results Accuray's Q4 FY25 financial results detail revenue, profitability, and cash position, showing mixed performance Revenue Performance (Q4 FY25) Total net revenue for the fourth quarter of fiscal 2025 decreased by 5% year-over-year, primarily driven by an 11% decline in product revenue, while service revenue experienced a 4% increase | Revenue Type | Q4 FY25 (Millions) | Q4 FY24 (Millions) | Change (%) | | :------------- | :----------------- | :----------------- | :--------- | | Total Net Revenue | $127.5 | $134.3 | -5% | | Product Revenue | $70.7 | $79.7 | -11% | | Service Revenue | $56.8 | $54.6 | +4% | Profitability and Expenses (Q4 FY25) Gross profit increased slightly in Q4 FY25, improving as a percentage of net revenue. However, operating expenses rose by 10%, leading to a decrease in net income and Adjusted EBITDA compared to the prior year's fourth quarter | Metric | Q4 FY25 (Millions) | Q4 FY24 (Millions) | Change (%) | | :------------------- | :----------------- | :----------------- | :--------- | | Total Gross Profit | $39.0 | $38.5 | +1.3% | | Gross Profit Margin | 30.6% | 28.6% | +2.0 ppts | | Operating Expenses | $34.7 | $31.6 | +10% | | Net Income | $1.1 | $3.4 | -67.6% | | Net Income Per Share | $0.01 | $0.03 | -66.7% | | Adjusted EBITDA | $9.4 | $10.1 | -6.9% | Order Backlog and Cash Position (Q4 FY25) Accuray's ending order backlog decreased both quarter-over-quarter and year-over-year. The company's cash, cash equivalents, and short-term restricted cash also saw a sequential decline | Metric | As of June 30, 2025 (Millions) | As of March 31, 2025 (Millions) | As of June 30, 2024 (Millions) | Change QoQ (%) | Change YoY (%) | | :---------------------------------- | :----------------------------- | :------------------------------ | :----------------------------- | :------------- | :------------- | | Ending Order Backlog | $427.0 | N/A | $487.3 | -5.6% | -12.4% | | Cash, Cash Equivalents, Restricted Cash | $58.0 | $78.8 | N/A | -26.4% | N/A | Fiscal Year 2025 Financial Results Accuray's full fiscal year 2025 financial results detail overall revenue and profitability performance Revenue Performance (FY25) For fiscal year 2025, Accuray reported a 3% increase in total net revenue, driven by modest growth in both product and service revenues compared to the prior fiscal year | Revenue Type | FY25 (Millions) | FY24 (Millions) | Change (%) | | :------------- | :-------------- | :-------------- | :--------- | | Total Net Revenue | $458.5 | $446.6 | +3% | | Product Revenue | $237.6 | $234.2 | +1% | | Service Revenue | $220.9 | $212.4 | +4% | Profitability and Expenses (FY25) Accuray improved its gross profit and gross profit margin for fiscal year 2025, while operating expenses decreased. This led to a significant reduction in GAAP net loss and a substantial increase in Adjusted EBITDA compared to the previous fiscal year | Metric | FY25 (Millions) | FY24 (Millions) | Change (%) | | :------------------- | :-------------- | :-------------- | :--------- | | Total Gross Profit | $147.0 | $142.9 | +2.9% | | Gross Profit Margin | 32.1% | 32.0% | +0.1 ppts | | Operating Expenses | $139.1 | $142.4 | -2% | | GAAP Net Loss | $1.6 | $15.5 | -89.7% | | GAAP Net Loss Per Share | $0.02 | $0.16 | -87.5% | | Adjusted EBITDA | $28.3 | $19.7 | +43.6% | Fiscal Year 2026 Financial Guidance Accuray's FY26 guidance projects increased total net revenue and Adjusted EBITDA, based on current expectations and market conditions | Metric | FY26 Guidance (Millions) | | :------------------- | :----------------------- | | Total Net Revenue | $471 to $485 | | Adjusted EBITDA | $31 to $35 | Conference Call Information Accuray hosted a conference call on August 13, 2025, to discuss Q4 and FY25 results, with webcast and replay details provided - Accuray hosted a conference call on August 13, 2025, at 1:30 p.m. PT/4:30 p.m. ET to discuss Q4 FY25 results and corporate developments[16] - Live access was available via the Investor Relations section of Accuray's website (www.accuray.com), with a slide presentation also accessible[16] - A taped replay of the conference call was available for seven days, with specific dial-in numbers for USA and International callers, and an archived webcast on the company's website[17][18][19] Use of Non-GAAP Financial Measures Accuray supplements GAAP with non-GAAP measures like Adjusted EBITDA, excluding specific items, for performance comparison, acknowledging their limitations - Accuray uses non-GAAP financial measures, such as Adjusted EBITDA, to supplement its GAAP financial results[20] - Adjusted EBITDA excludes depreciation and amortization, stock-based compensation expense, interest expense, provision for income taxes, changes to the fair value of warrant liability, ERP and ERP related expenditures, restructuring charges, and certain non-recurring items[21] - Management believes non-GAAP measures provide useful supplemental information for investors and facilitate meaningful comparisons, but acknowledges their limitations as they are not GAAP-compliant and should not be considered in isolation[21][22] About Accuray Accuray Incorporated advances radiation therapy with unique oncology and neuro-radiosurgery solutions, headquartered in Madison, Wisconsin - Accuray Incorporated (Nasdaq: ARAY) is committed to expanding the potential of radiation therapy to improve lives[23] - The company invents unique, market-changing solutions for radiation treatments in oncology, neuro-radiosurgery, and beyond, addressing the full spectrum of patient needs[23] - Accuray is headquartered in Madison, Wisconsin, with facilities worldwide[23] Safe Harbor Statement Forward-looking statements on future results, guidance, and strategies are subject to risks like macroeconomic factors, supply chain, and tariffs, with no obligation to update - Statements in the press release that are not historical facts are forward-looking and subject to the 'safe harbor' provisions of the Private Securities Litigation Reform Act of 1995[24] - Forward-looking statements relate to future results, guidance (total net revenue, adjusted EBITDA), strategy execution, impact of tariffs, debt refinancing, supply chain, macroeconomic challenges, China joint venture, strategic partnerships, new product introductions, and service growth[24] - Risks and uncertainties include the global macroeconomic environment, supply chain disruptions, market acceptance of products, outstanding indebtedness, international tariffs, benefits of the China joint venture, gross margins, regulatory approvals, credit facility covenants, and backlog conversion[24][25] - The company assumes no obligation to update forward-looking statements to reflect actual performance or changes in assumptions, except as required by applicable securities laws[26] Financial Tables This section presents detailed financial statements, including operations, balance sheets, order data, and non-GAAP reconciliations Condensed Consolidated Statements of Operations This table provides a detailed breakdown of Accuray's revenues, costs, gross profit, operating expenses, and net income (loss) for the three and twelve months ended June 30, 2025, and 2024, highlighting changes in profitability metrics | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Twelve Months Ended June 30, 2025 | Twelve Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | Net revenue: | | | | | | Products | $70,702 | $79,673 | $237,580 | $234,164 | | Services | $56,841 | $54,616 | $220,925 | $212,387 | | Total net revenue | $127,543 | $134,289 | $458,505 | $446,551 | | Gross profit | $38,979 | $38,452 | $146,967 | $142,921 | | Total operating expenses | $34,745 | $31,635 | $139,128 | $142,417 | | Income from operations | $4,234 | $6,817 | $7,839 | $504 | | Net income (loss) | $1,123 | $3,387 | $(1,591) | $(15,545) | | Net income (loss) per share - basic | $0.01 | $0.03 | $(0.02) | $(0.16) | Condensed Consolidated Balance Sheets This table presents Accuray's financial position as of June 30, 2025, and June 30, 2024, detailing assets, liabilities, and stockholders' equity. Notable changes include a decrease in cash and accounts receivable, an increase in inventories, and a significant increase in total stockholders' equity | Metric (in thousands) | June 30, 2025 | June 30, 2024 | | :-------------------- | :------------ | :------------ | | Assets: | | | | Cash and cash equivalents | $57,416 | $68,570 | | Accounts receivable, net | $83,192 | $92,001 | | Inventories | $141,020 | $138,324 | | Total current assets | $317,465 | $323,236 | | Total assets | $470,239 | $468,627 | | Liabilities: | | | | Accounts payable | $34,033 | $50,020 | | Deferred revenue (current) | $82,306 | $71,649 | | Short-term debt, net | $15,583 | $7,756 | | Total current liabilities | $195,428 | $195,267 | | Long-term debt, net | $120,937 | $164,400 | | Total liabilities | $389,070 | $423,543 | | Stockholders' Equity: | | | | Total stockholders' equity | $81,169 | $45,084 | Summary of Orders and Backlog This table provides a summary of Accuray's gross orders, net orders, and order backlog for the three and twelve months ended June 30, 2025, and 2024, along with the book-to-bill ratio | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Twelve Months Ended June 30, 2025 | Twelve Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | Gross orders | $84,741 | $95,472 | $288,035 | $342,148 | | Net orders | $45,282 | $63,773 | $177,233 | $210,914 | | Order backlog | $426,972 | $487,319 | $426,972 | $487,319 | | Book to bill ratio (a) | 1.2 | N/A | 1.2 | 1.5 | Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA This table reconciles GAAP net income (loss) to Adjusted EBITDA for the three and twelve months ended June 30, 2025, and 2024, by adding back non-cash and non-operating expenses such as depreciation, stock-based compensation, interest, and other specific adjustments | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Twelve Months Ended June 30, 2025 | Twelve Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | GAAP net income (loss) | $1,123 | $3,387 | $(1,591) | $(15,545) | | Depreciation and amortization | $1,598 | $1,507 | $6,150 | $5,905 | | Stock-based compensation | $2,818 | $2,042 | $10,201 | $9,483 | | Interest expense, net | $3,937 | $2,686 | $11,762 | $10,676 | | Provision for income taxes | $948 | $471 | $2,725 | $3,725 | | Adjusted EBITDA | $9,448 | $10,093 | $28,271 | $19,692 | Forward-Looking Guidance Reconciliation This table provides a reconciliation of projected GAAP net loss to projected Adjusted EBITDA for the fiscal year ending June 30, 2026, outlining the adjustments for non-GAAP items | Metric (in thousands) | Twelve Months Ending June 30, 2026 (From) | Twelve Months Ending June 30, 2026 (To) | | :-------------------- | :---------------------------------------- | :-------------------------------------- | | GAAP net loss | $(12,000) | $(8,000) |\ | Depreciation and amortization | $6,000 | $6,000 |\ | Stock-based compensation | $10,500 | $10,500 |\ | Interest expense, net | $23,500 | $23,500 |\ | Provision for income taxes | $3,000 | $3,000 |\ | Adjusted EBITDA | $31,000 | $35,000 |