Accuray Reports Fiscal 2025 Third Quarter Financial Results

Rhea-AI Summary

Accuray reported its fiscal 2025 third quarter results, showing notable improvements in financial performance. The company achieved total net revenue of $113.2 million, marking a 12% increase year-over-year. The quarter saw reduced losses, with net loss decreasing to $1.3 million compared to $6.3 million in the prior year.

Key financial highlights include:

• Product revenue increased 16% to $57.3 million
• Service revenue grew 9% to $55.9 million
• Adjusted EBITDA improved to $6.0 million from $1.1 million
• Cash position strengthened to $78.8 million

Despite facing tariff challenges, the company maintained resilient performance. However, order backlog decreased 10% to $452.4 million. For fiscal year 2025, Accuray reaffirmed its adjusted EBITDA guidance of $28.5-31.0 million but adjusted revenue guidance to $452-460 million due to tariff impacts on product volume.

Positive

• Revenue increased 12% YoY to $113.2M in Q3
• Net loss improved significantly to $1.3M from $6.3M YoY
• Adjusted EBITDA grew to $6.0M from $1.1M YoY
• Operating expenses decreased 9% to $30.6M
• Product revenue up 16% to $57.3M
• Service revenue grew 9% to $55.9M
• Cash position improved by $14.8M from December 2024

Negative

• Gross product orders decreased to $71.2M from $89.1M YoY
• Order backlog declined 10% YoY to $452.4M
• Book to bill ratio decreased to 1.2 from 1.8 YoY
• Gross profit margin declined to 27.9% from 28.7% YoY
• Company lowered revenue guidance due to tariff impact
• Cash decreased $9.8M from June 2024

Insights

Financial Analyst

Accuray reports improved Q3 with 12% revenue growth and narrowed losses, but lowers guidance amid tariff challenges.

Accuray's Q3 fiscal 2025 results show notable improvements in key metrics despite external pressures. Revenue increased 12% year-over-year to $113.2 million, with product revenue climbing 16% and service revenue up 9%. The company significantly narrowed its net loss to $1.3 million ($0.01 per share) from $6.3 million ($0.06 per share) in the prior year period.

The standout metric is Adjusted EBITDA, which jumped to $6.0 million from $1.1 million a year ago, highlighting improved operational efficiency. Operating expenses decreased 9%, demonstrating disciplined cost management. However, gross margin slightly contracted to 27.9% from 28.7%.

Forward-looking indicators present concerns. Gross product orders fell to $71.2 million from $89.1 million, and the book-to-bill ratio declined to 1.2 from 1.8. The $452.4 million order backlog is approximately 10% lower than the prior year period. While maintaining its adjusted EBITDA guidance, Accuray revised revenue guidance downward due to tariff impacts.

The cash position improved quarter-over-quarter by $14.8 million to $78.8 million, though it remains $9.8 million below the fiscal year start. This mixed financial picture shows operational improvements amid challenging market conditions.

Medical Technology Industry Expert

Accuray demonstrates resilience with revenue growth despite tariff headwinds, though declining orders signal potential industry challenges.

Accuray's Q3 performance reveals important dynamics in the medical technology capital equipment space. The company's ability to grow revenue by 12% while navigating tariff challenges demonstrates operational resilience. The 16% growth in product revenue is particularly impressive in the high-value radiation therapy equipment segment, where purchasing decisions typically have long sales cycles.

However, the tariff impact cited by CEO Winter represents a significant industry challenge. Medical device manufacturers with global supply chains are increasingly vulnerable to trade policy shifts. Accuray's specific mention of "actions to mitigate the impact of the tariffs" suggests the company is implementing supply chain adjustments or strategic pricing modifications.

The declining order metrics - particularly the 10% reduction in backlog and the decrease in book-to-bill ratio from 1.8 to 1.2 - signal potential market contraction. While still above 1.0 (indicating continued growth), this slowdown may reflect broader hesitancy among healthcare providers to commit to capital expenditures.

Despite these headwinds, Accuray's maintained EBITDA guidance while adjusting revenue targets suggests confidence in operational efficiency measures. This cautious yet determined stance aligns with industry trends where manufacturers are focusing on service revenue stability (which grew 9%) and cost optimization while navigating uncertain equipment sales environments.

MADISON, Wis., April 30, 2025 /PRNewswire/ -- Accuray Incorporated (NASDAQ: ARAY) today reported financial results for the third quarter ended March 31, 2025.

Key Fiscal Third Quarter Highlights:

• Total net revenue was $113.2 million, an increase of 12 percent year-over-year
• Net loss was $1.3 million compared to a net loss of $6.3 million in the prior year period
• Adjusted EBITDA was $6.0 million compared to $1.1 million in the prior year period

"We achieved a strong third quarter and I am proud of the resiliency of the entire team and their focus on driving actions to mitigate the impact of the tariffs. Despite evolving global dynamics, our team's disciplined execution, clear strategy and the growing underlying demand for our innovative, distinct technologies gives us confidence in our ability to deliver sustained performance," said Suzanne Winter, CEO of Accuray.

Fiscal Third Quarter Results

Total net revenue in the third quarter of fiscal 2025 increased to $113.2 million, an increase of 12 percent, from $101.1 million in the prior fiscal year third quarter. Product revenue in the third quarter of fiscal 2025 increased to $57.3 million, an increase of 16 percent, from $49.6 million in the prior fiscal year third quarter. Service revenue in the third quarter of fiscal 2025 increased to $55.9 million, an increase of 9 percent, from $51.5 million in the prior fiscal year third quarter.

Total gross profit in the third quarter of fiscal 2025 increased to $31.6 million, or 27.9 percent of total net revenue, compared to a total gross profit of $29.1 million, or 28.7 percent of total net revenue, in the prior fiscal year third quarter.

Operating expenses in the third quarter of fiscal 2025 decreased to $30.6 million, a decrease of 9 percent, from $33.6 million in the prior fiscal year third quarter.

Net loss in the third quarter of fiscal 2025 was $1.3 million, or $0.01 per share, compared to a net loss of $6.3 million, or $0.06 per share, in the prior fiscal year third quarter. Adjusted EBITDA in the third quarter of fiscal 2025 was $6.0 million, compared to $1.1 million in the prior fiscal year third quarter.

Gross product orders in the third quarter of fiscal 2025 decreased to $71.2 million from $89.1 million in the prior fiscal year third quarter. The book to bill ratio was 1.2 in the third quarter of fiscal 2025, compared to a book to bill ratio of 1.8 in the prior fiscal year third quarter. Order backlog as of March 31, 2025 was $452.4 million, which is approximately 10 percent lower than at the end of the prior fiscal year third quarter.

Cash, cash equivalents, and short-term restricted cash were $78.8 million as of March 31, 2025, an increase of $14.8 million from December 31, 2024 and a $9.8 million decrease from June 30, 2024.

Fiscal Nine Months Results

Total net revenue in the first nine months of fiscal 2025 increased to $331.0 million, an increase of 6 percent, from $312.3 million in the prior fiscal year period. Product revenue in the first nine months of fiscal 2025 increased to $166.9 million, an increase of 8 percent, from $154.5 million in the prior fiscal year period. Service revenue in the first nine months of fiscal 2025 increased to $164.1 million, an increase of 4 percent, from $157.8 million in the prior fiscal year period.

Total gross profit in the first nine months of fiscal 2025 increased to $108.0 million, or 32.6 percent of total net revenue, as compared to total gross profit of $104.5 million, or 33.5 percent of total net revenue, in the prior fiscal year period.

Operating expenses in the first nine months of fiscal 2025 decreased to $104.4 million, a decrease of 6 percent, from $110.8 million in the prior fiscal year period.

Net loss in the first nine months of fiscal 2025 was $2.7 million, or $0.03 per share, compared to a net loss of $18.9 million, or $0.19 per share, in the prior fiscal year period. Adjusted EBITDA in the first nine months of fiscal 2025 was $18.8 million, compared to $9.6 million in the prior fiscal year period.

Gross product orders in the first nine months of fiscal 2025 decreased to $203.3 million from $246.7 million in the prior fiscal year period. The book to bill ratio was 1.2 in the first nine months of fiscal 2025, compared to a book to bill ratio of 1.6 in the same period in the prior fiscal year period.

Fiscal Year 2025 Financial Guidance

The Company is reaffirming adjusted EBITDA guidance for fiscal year 2025 as follows:.

• Adjusted EBITDA is expected in the range of $28.5 million to $31.0 million.

Due to the recent tariff announcements and the estimated impact to product volume, the company is adjusting revenue guidance for the fiscal year 2025 as follows:

• Total revenue is expected in the range of $452 million to $460 million.

Guidance for non-GAAP financial measures excludes depreciation and amortization, stock-based compensation, interest expense, and provision for income taxes. For more information regarding the non-GAAP financial measures discussed in this press release, please see "Use of Non-GAAP Financial Measures" below.

Conference Call Information

Accuray will host a conference call beginning at 1:30 p.m. PT/4:30 p.m. ET today to discuss results for the third quarter of fiscal 2025 as well as recent corporate developments. Conference call dial-in information is as follows:

• U.S. callers: (833) 316-0563
• International callers: (412) 317-5747

Individuals interested in listening to the live conference call via the Internet may do so by logging on to the Investor Relations section of Accuray's website, www.accuray.com. There will be a slide presentation accompanying today's event which can also be accessed on the company's Investor Relations page at www.accuray.com.

In addition, a taped replay of the conference call will be available beginning approximately one hour after the call's conclusion and will be available for seven days. The replay number is (877) 344-7529 (USA), or (412) 317-0088 (International), Conference ID: 8141169. An archived webcast will also be available on Accuray's website until Accuray announces its results for the fourth quarter of fiscal 2025.

Use of Non-GAAP Financial Measures

Accuray reports its financial results in accordance with generally accepted accounting principles in the United States ("GAAP") and the rules of the SEC. To supplement its financial statements prepared and presented in accordance with GAAP, Accuray uses certain non-GAAP financial measures, such as adjusted EBITDA.

Accuray has supplemented its GAAP net income (loss) with a non-GAAP measure of adjusted earnings before interest, taxes, depreciation, amortization, stock-based compensation, restructuring charges and ERP and ERP related expenditures. ("adjusted EBITDA"). The calculation of adjusted EBITDA also excludes certain non-recurring, irregular and one-time items. Management believes that this non-GAAP financial measure provides useful supplemental information to management and investors regarding the performance of the company and facilitates a meaningful comparison of results for current periods with previous operating results. A reconciliation of GAAP net loss (the most directly comparable GAAP measure) to non-GAAP adjusted EBITDA is provided in the schedules below.

There are limitations in using these non-GAAP financial measures because they are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP financial measures. Investors and potential investors should consider non-GAAP financial measures only in conjunction with the company's consolidated financial statements prepared in accordance with GAAP.

About Accuray

Accuray Incorporated (Nasdaq: ARAY) is committed to expanding the powerful potential of radiation therapy to improve as many lives as possible. We invent unique, market-changing solutions that are designed to deliver radiation treatments for even the most complex cases—while making commonly treatable cases even easier—to meet the full spectrum of patient needs. We are dedicated to continuous innovation in radiation therapy for oncology, neuro-radiosurgery, and beyond, as we partner with clinicians and administrators, empowering them to help patients get back to their lives, faster. Accuray is headquartered in Madison, Wisconsin, with facilities worldwide.

Safe Harbor Statement

Statements made in this press release that are not statements of historical fact are forward-looking statements and are subject to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this press release relate, but are not limited, to the company's guidance and future results of operations, including expectations regarding: total revenue and adjusted EBITDA; the company's ability to deliver sustained performance and execute on its strategies;  expectations regarding the impact of tariffs as well as mitigation efforts by the company; the company's ability to navigate supply chain, logistics, macroeconomic, and foreign exchange challenges; the company's expectations regarding its capital structure and refinancing needs; the company's ability to achieve its longer-term goals; expectations regarding the company's China joint venture; expectations related to the amount and timing of realizing deferred margin from the company's China joint venture; expectations with respect to strategic partnerships and collaborations; expectations related to the markets and regions in which the company operates; expectations regarding new product introductions and innovations; expectations regarding service business growth and its ability to serve as a growth driver; and the company's ability to advance patient care and offer value to its customer. These forward-looking statements involve risks and uncertainties. If any of these risk or uncertainties materialize, or if any of the company's assumptions prove incorrect, actual results could differ materially from the results express or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, the effect of the global macroeconomic environment on the operations of the company and those of its customers and suppliers; disruptions to our supply chain, including increased logistics costs; the company's ability to achieve widespread market acceptance of its products; the company's ability to refinance its debt; the effect of enhanced international tariffs on the company; the company's ability to realize the expected benefits of the China joint venture and other partnerships; risks inherent in international operations; the company's ability to maintain or increase its gross margins on product sales and services; delays in regulatory approvals or the development or release of new offerings; the company's ability to meet the covenants under its credit facilities; the company's ability to convert backlog to revenue; and such other risks identified under the heading "Risk Factors" in the company's Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission (the "SEC") on February 5, 2025, and as updated periodically with the company's other filings with the SEC.

Forward-looking statements speak only as of the date the statements are made and are based on information available to the company at the time those statements are made and/or management's good faith belief as of that time with respect to future events. The company assumes no obligation to update forward-looking statements to reflect actual performance or results, changes in assumptions or changes in other factors affecting forward-looking information, except to the extent required by applicable securities laws. Accordingly, investors should not put undue reliance on any forward-looking statements.

Aman Patel, CFA	Beth Kaplan
Investor Relations, ICR-Westwicke	Public Relations Director, Accuray
+1 (443) 450-4191	+1 (408) 789-4426
aman.patel@westwicke.com	bkaplan@accuray.com

Financial Tables to Follow

 

Accuray Incorporated
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(Unaudited)
		Three Months Ended March 31,								Nine Months Ended March 31,
		2025				2024				2025				2024
Net revenue:
Products		$	57,320			$	49,603			$	166,878			$	154,491
Services			55,923				51,529				164,084				157,771
Total net revenue			113,243				101,132				330,962				312,262
Cost of revenue:
Cost of products			44,301				35,945				111,315				105,977
Cost of services			37,315				36,113				111,659				101,816
Total cost of revenue			81,616				72,058				222,974				207,793
Gross profit			31,627				29,074				107,988				104,469
Operating expenses:
Research and development			10,712				10,909				36,472				40,203
Selling and marketing			9,110				10,318				31,906				31,923
General and administrative			10,758				12,409				36,005				38,656
Total operating expenses			30,580				33,636				104,383				110,782
Income (loss) from operations			1,047				(4,562)				3,605				(6,313)
Income from equity method investment, net			2,297				1,024				3,829				1,028
Interest expense			(2,890)				(2,884)				(8,728)				(8,728)
Other income (expense), net			(1,294)				524				357				(1,665)
Loss before provision for income taxes			(840)				(5,898)				(937)				(15,678)
Provision for income taxes			457				444				1,777				3,254
Net loss		$	(1,297)			$	(6,342)			$	(2,714)			$	(18,932)
Net loss per share - basic and diluted		$	(0.01)			$	(0.06)			$	(0.03)			$	(0.19)
Weighted average common shares used in computing net loss per share:
Basic and diluted			102,825				99,197				101,462				97,838

 

Accuray Incorporated
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)
		March 31,				June 30,
		2025				2024
Assets
Current assets:
Cash and cash equivalents		$	77,824			$	68,570
Restricted cash			1,013				485
Accounts receivable, net			78,191				92,001
Inventories, net			146,445				138,324
Prepaid expenses and other current assets			29,203				23,006
Deferred cost of revenue			782				850
Total current assets			333,458				323,236
Property and equipment, net			27,081				24,774
Investment in joint venture			9,284				9,826
Operating lease right-of-use assets, net			34,023				33,773
Goodwill			57,720				57,672
Long-term restricted cash			1,407				1,337
Other assets			21,318				18,009
Total assets		$	484,291			$	468,627
Liabilities and stockholders' equity
Current liabilities:
Accounts payable		$	46,319			$	50,020
Accrued compensation			13,413				17,128
Operating lease liabilities, current			7,233				6,218
Other accrued liabilities			34,943				28,508
Customer advances			12,194				13,988
Deferred revenue			81,753				71,649
Short-term debt			7,574				7,756
Total current liabilities			203,429				195,267
Operating lease liabilities, non-current			33,352				32,373
Long-term other liabilities			6,127				7,389
Deferred revenue, non-current			25,591				24,114
Long-term debt			166,209				164,400
Total liabilities			434,708				423,543
Stockholders' equity:
Common stock			103				100
Additional paid-in capital			575,032				566,887
Accumulated other comprehensive loss			(5,157)				(4,222)
Accumulated deficit			(520,395)				(517,681)
Total stockholders' equity			49,583				45,084
Total liabilities and stockholders' equity		$	484,291			$	468,627

 

Accuray Incorporated
Summary of Orders and Backlog
(in thousands, except book to bill ratio)
(Unaudited)
		Three Months Ended March 31,								Nine Months Ended March 31,
		2025				2024				2025				2024
Gross orders		$	71,167			$	89,086			$	203,294			$	246,676
Net orders			46,656				60,795				131,951				147,141
Order backlog			452,392				503,220				452,392				503,220
Book to bill ratio (a)			1.2				1.8				1.2				1.6

(a) Book to bill ratio is defined as gross orders for the period divided by product revenue for the period.

 

Accuray Incorporated
Reconciliation of GAAP Net Loss to Adjusted EBITDA
(in thousands)
(Unaudited)
		Three Months Ended March 31,								Nine Months Ended March 31,
		2025				2024				2025				2024
GAAP net loss		$	(1,297)			$	(6,342)			$	(2,714)			$	(18,932)
Depreciation and amortization (a)			1,575				1,601				4,552				4,398
Stock-based compensation			2,745				2,735				7,383				7,441
Interest expense, net (b)			2,568				2,649				7,825				7,990
Provision for income taxes			457				444				1,777				3,254
Restructuring charges			—				—				—				2,633
ERP and ERP related expenditures			—				—				—				2,815
Adjusted EBITDA		$	6,048			$	1,087			$	18,823			$	9,599

(a) Consists of depreciation on property and equipment and amortization of intangibles.

(b) Consists of interest expense net of interest income.

 

Accuray Incorporated
Forward-Looking Guidance
Reconciliation of Projected GAAP Net Loss to Projected Adjusted EBITDA
(in thousands)
(Unaudited)
		Twelve Months Ending June 30, 2025
		From				To
GAAP net loss		$	(4,000)			$	(1,500)
Depreciation and amortization (a)			6,500				6,500
Stock-based compensation			10,000				10,000
Interest expense, net (b)			13,000				13,000
Provision for income taxes			3,000				3,000
Adjusted EBITDA		$	28,500			$	31,000

(a) Consists of depreciation on property and equipment and amortization of intangibles.

(b) Consists of interest expense net of interest income.

 

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/accuray-reports-fiscal-2025-third-quarter-financial-results-302443104.html

SOURCE Accuray Incorporated

FAQ

What were Accuray (ARAY) Q3 2025 revenue and earnings results?

Accuray reported Q3 2025 total revenue of $113.2M (up 12% YoY), with a net loss of $1.3M ($0.01 per share), improved from a $6.3M loss in Q3 2024. Product revenue was $57.3M and service revenue was $55.9M.

How much did Accuray (ARAY) improve its Adjusted EBITDA in Q3 2025?

Accuray's Adjusted EBITDA increased significantly to $6.0M in Q3 2025, compared to $1.1M in the prior year quarter, showing a more than 5x improvement.

What is Accuray's (ARAY) revenue guidance for fiscal year 2025?

Due to recent tariff impacts, Accuray adjusted its FY2025 revenue guidance to $452M-$460M, while maintaining Adjusted EBITDA guidance of $28.5M-$31.0M.

How strong is Accuray's (ARAY) order backlog as of March 2025?

Accuray's order backlog stood at $452.4M as of March 31, 2025, which is approximately 10% lower than the previous year's third quarter.

What was Accuray's (ARAY) cash position in Q3 2025?

As of March 31, 2025, Accuray held $78.8M in cash, cash equivalents, and short-term restricted cash, showing a $14.8M increase from December 2024 but a $9.8M decrease from June 2024.

How did Accuray's (ARAY) product orders perform in Q3 2025?

Accuray's gross product orders decreased to $71.2M from $89.1M year-over-year, with a book to bill ratio of 1.2 compared to 1.8 in the prior year quarter.