Accuray (ARAY) Q2 2025 earnings summary

Executive summary

• Achieved strong Q2 FY25 results with net revenue up 8% year-over-year to $116.2 million, driven by innovation, operational efficiencies, and expansion in China and Asia Pacific, despite declines in the Americas and EIMEA.

• Product revenue grew 19% year-over-year to $61.2 million, with standout performance in China, APAC, and Japan; service revenue declined 1%.

• Net income for Q2 was $2.5 million, reversing a $9.6 million loss last year; adjusted EBITDA rose to $9.6 million from $2.0 million.

• Gross margin improved to 36.1% from 33.5% year-over-year, aided by China JV margin release and favorable product mix.

• Operating expenses decreased 7% year-over-year, mainly from lower R&D and G&A costs following restructuring.

Financial highlights

• Q2 net revenue was $116.2 million, up 8% year-over-year; product revenue $61.2 million (up 19%), service revenue $55.0 million (down 1%).

• Adjusted EBITDA was $9.6 million, up from $2.0 million in the prior year.

• Operating income was $4.7 million, compared to a $4.0 million loss last year.

• Gross margin improved to 36.1% from 33.5% year-over-year.

• Book-to-bill ratio was 1.3, with order backlog at quarter-end of $463.1 million.

Outlook and guidance

• Full-year FY25 revenue guidance raised to $463 million–$475 million; adjusted EBITDA guidance increased to $28.5 million–$31 million.

• Guidance assumes minimal tariff impact and a recovering U.S. market in the second half of FY25.

• Management expects continued headwinds from inflation, supply chain, and logistics costs impacting margins and net income through FY25.

• The company believes it has sufficient liquidity for at least the next 12 months but is monitoring debt covenant compliance.