OSI Systems Receives Order for $32 Million for Cargo and Vehicle Inspection Systems

Rhea-AI Summary

OSI Systems (NASDAQ: OSIS) announced that its Security division has secured an international order worth $32 million for Eagle® M60 high-energy mobile inspection systems. The contract includes providing service and training support for the deployment and operations of these systems, which will be used for border security applications.

According to CEO Ajay Mehra, the Eagle M60 systems play a important role in enhancing security frameworks at critical border entry points globally.

Positive

• Secured significant $32 million international order
• Contract includes additional revenue from service and training support

Negative

• None.

Insights

Security Technology Analyst

The $32 million contract for Eagle® M60 mobile inspection systems represents a strategic win in the border security technology sector. The M60's high-energy X-ray technology enables comprehensive scanning of vehicles and cargo containers, detecting contraband, weapons and other security threats with exceptional accuracy. Operating at speeds up to 60 vehicles per hour, these systems significantly enhance border checkpoint efficiency.

The inclusion of service and training components indicates a comprehensive deployment strategy that will ensure optimal system performance and operator proficiency. This type of full-package deal typically yields higher profit margins compared to hardware-only sales. The order's size suggests a major border security infrastructure upgrade, likely covering multiple checkpoints or extensive border sections.

For context, this single order represents approximately 4.8% of OSI's annual revenue, making it a material contribution to the Security division's performance. The international nature of the order also demonstrates continued global market penetration and validates OSI's competitive position in the high-end security scanning market.

Financial Analyst

This order materially impacts OSI Systems' financial outlook, adding $32 million to the backlog. Based on typical project execution timelines, revenue recognition will likely occur over 12-18 months, providing predictable cash flow and revenue visibility. The Security division, which historically maintains operating margins between 10-12%, should see margin expansion due to the included service and training components.

The timing of this order, early in calendar 2025, positions OSI well for meeting fiscal year targets. International orders of this magnitude often lead to follow-on opportunities and recurring maintenance revenues. The contract's value represents approximately 1.2% of OSI's market capitalization, making it a meaningful win that could positively influence investor sentiment and valuation metrics.

HAWTHORNE, Calif.--(BUSINESS WIRE)-- OSI Systems, Inc. (the “Company” or “OSI Systems”) (NASDAQ: OSIS) today announced that its Security division has received an international order for approximately $32 million to provide Eagle^® M60 high-energy mobile inspection systems for border security applications. As a part of this award, the Company expects to provide service and training to support the deployment and operations of these systems.

OSI Systems’ President and CEO, Ajay Mehra, stated, “Our Eagle M60 systems are vital components in the global effort to enhance security frameworks at critical border entry points. We are committed to delivering solutions that not only meet but exceed the evolving standards of global security.”

About OSI Systems

OSI Systems is a vertically integrated designer and manufacturer of specialized electronic systems and components for critical applications in the homeland security, healthcare, defense, and aerospace industries. The Company combines more than 40 years of electronics engineering and manufacturing experience with offices and production facilities in more than a dozen countries to implement a strategy of expansion into selective end product markets. For more information on OSI Systems or any of its subsidiary companies, visit www.osi-systems.com. News Filter: OSIS-G

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements relate to OSI Systems’ current expectations, beliefs, and projections concerning matters that are not historical facts. Forward-looking statements are not guarantees of future performance and involve uncertainties, risks, assumptions, and contingencies, many of which are outside OSI Systems’ control and which may cause actual results to differ materially from those described in or implied by any forward-looking statements. Undue reliance should not be placed on forward-looking statements, which are based on currently available information and speak only as of the date on which they are made. OSI Systems assumes no obligation to update any forward-looking statement made in this press release that becomes untrue because of subsequent events, new information, or otherwise, except to the extent it is required to do so in connection with its ongoing requirements under Federal securities laws. For a further discussion of factors that could cause OSI Systems’ future results to differ materially from any forward-looking statements, see the section entitled "Risk Factors" in OSI Systems’ most recently filed Annual Report on Form 10-K and other risks described therein and in documents subsequently filed by OSI Systems from time to time with the Securities and Exchange Commission.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250116576252/en/

OSI Systems, Inc.

Ajay Vashishat

Vice President, Business Development

310-349-2237

avashishat@osi-systems.com

Source: OSI Systems, Inc.

FAQ

What is the value of OSI Systems' latest border security contract in 2024?

OSI Systems (OSIS) received an international order valued at $32 million for Eagle® M60 high-energy mobile inspection systems for border security applications.

What type of systems did OSIS receive orders for in their recent border security contract?

OSIS received orders for Eagle® M60 high-energy mobile inspection systems, which are used for border security applications.

Does the $32 million OSIS border security contract include additional services?

Yes, the contract includes service and training support for the deployment and operations of the Eagle M60 systems.

What is the purpose of OSI Systems' Eagle M60 inspection systems?

The Eagle M60 systems are designed to enhance security frameworks at critical border entry points for border security applications.