Accuray (ARAY) Q4 2024 earnings summary

Executive summary

• Achieved record Q4 revenue of $134.3M, up 14% year-over-year, driven by strong international demand and record system shipments, despite ongoing U.S. market weakness.

• International markets contributed over 80% of annual revenue, with significant growth in China, APAC, and EIMEA, offsetting a 26% decline in Americas revenue.

• Strategic milestones included regulatory approvals in China and Europe, new product launches, and expansion into emerging markets like India and Japan.

• Service contract revenue grew 4.5% year-over-year, reflecting a growing installed base and pricing actions.

• Entered FY 2025 with a $487M backlog, representing over two years of product revenue potential.

Financial highlights

• Q4 net revenue: $134.3M (+14% YoY); full-year revenue: $446.6M (flat YoY).

• Q4 product revenue: $79.7M (+28% YoY); 36 system shipments, a company record.

• Q4 service revenue: $54.6M (-2% YoY); full-year service revenue: $212.4M (-1% YoY).

• Q4 gross margin: 28.6% (down from 31.9% YoY), impacted by China margin deferral and supplier quality issue.

• Q4 operating income: $6.8M (vs. -$0.5M prior year); Q4 adjusted EBITDA: $10.1M (vs. $5.2M YoY); FY24 adjusted EBITDA: $19.7M (down from $23.9M YoY).

Outlook and guidance

• FY 2025 revenue guidance: $460M–$470M; adjusted EBITDA: $27.5M–$29.5M.

• Guidance assumes U.S. market recovery in H2 FY 2025 and China margin deferral release starting Q2.

• Expects 3–5% top-line growth and >40% EBITDA margin for FY 2025.

• Projected FY25 GAAP net loss: $3M–$5M.

• Monitoring U.S. and China market conditions, including anti-corruption and stimulus impacts.