Download PDF

1. Company Snapshot

1.a. Company Description

Accuray Incorporated designs, develops, manufactures, and sells radiosurgery and radiation therapy systems for the treatment of tumors in the United States, Canada, Latin America, Australia, New Zealand, Europe, the Middle East, India, Africa, Japan, China, and rest of the Asia Pacific region.It offers the CyberKnife System, a robotic stereotactic radiosurgery and stereotactic body radiation therapy system used for the treatment of primary and metastatic tumors outside the brain, including tumors on or near the spine and in the breast, kidney, liver, lung, pancreas, and prostate.The company also provides the TomoTherapy System, including the Radixact System, which allows for integrated radiation treatment planning, delivery, and data management, enabling clinicians to deliver ultra-precise treatments to approximately 50 patients per day; iDMS data management system, a fully integrated treatment planning and data management systems; and Accuray precision treatment planning system, a treatment planning and data management systems.


In addition, it offers post-contract customer support, installation, training, and other professional services.The company primarily markets its products directly to customers, including hospitals and stand-alone treatment facilities through its sales organization, as well as to customers through sales agents and group purchasing organizations in the United States; and to customers directly and through distributors and sales agents internationally.Accuray Incorporated was incorporated in 1990 and is headquartered in Madison, Wisconsin.

Show Full description

1.b. Last Insights on ARAY

Negative drivers behind Accuray Incorporated's recent performance include the lack of significant updates on its product pipeline, despite the company's strong fiscal second-quarter results. The recent announcement of new studies showcasing the benefits of the CyberKnife platform in central nervous system tumors, while positive for the long-term, may not have a significant short-term impact on the company's performance. Additionally, the absence of any major updates on the company's sales or revenue growth in the recent earnings release may have contributed to the negative sentiment.

1.c. Company Highlights

2. Accuray's Q1 FY2026 Earnings: A Mixed Bag

Accuray reported net revenue of $94 million for the first quarter of fiscal 2026, a 7% decline from the prior year. The company's product revenue was $37 million, down 23% year-over-year, primarily due to slower performance in EIMEA and China. However, service revenue was a highlight, with $57 million in revenue, up 7% from the prior year. The gross margin was 28.3%, down from 33.9% in the prior year, due to sales mix, tariffs, and a one-time obsolescence charge. The company's adjusted EBITDA was a loss of $4.1 million, compared to an income of $3.1 million in the prior year. The actual EPS came out at -$0.18, relative to estimates at -$0.01.

Publication Date: Nov -29

📋 Highlights
  • Revenue Decline:: Q1 FY2026 net revenue fell 7% to $94M, driven by 23% YoY product revenue drop to $37M, while service revenue rose 7% to $57M.
  • Gross Margin Contraction:: Margins declined to 28.3% from 33.9% YoY, impacted by sales mix, tariffs, and a one-time obsolescence charge.
  • Adjusted EBITDA Loss:: Loss of $4.1M vs. prior-year income of $3.1M, despite maintained FY2026 guidance ($471M–$485M revenue; $31M–$35M adjusted EBITDA).
  • Margin Expansion Focus:: Strategy to boost profitability via service pricing, cost reduction, and tariff mitigation via duty drawback and foreign trade zones.
  • Revenue Timing Shift:: First-half revenue will account for ~40% of full-year guidance, with stronger product demand expected in the second half (60%).

Guidance and Outlook

Accuray reiterated its fiscal year 2026 guidance, with revenue expected to be between $471 million and $485 million, and adjusted EBITDA between $31 million and $35 million. CEO Steve LaNeve expects to have a better understanding of the organization and market dynamics in the next 90 days and will assess revenue and adjusted EBITDA guidance at that time. The company expects first-half revenue to be around 40% of full-year guidance, with the second half making up around 60%, due to product demand shifting to the second half.

Margin Expansion and Cost Mitigation

The company is focused on margin expansion, particularly in the service business, driven by higher pricing and reducing costs. Accuray is also working to mitigate the impact of tariffs, exploring options such as duty drawback programs and foreign trade zones. As Ali Pervaiz stated, the product and geography mix impacting product gross margins would likely continue into the fiscal second quarter and then possibly improve in the second half, due to more deals in emerging markets in Q1 and Q2, which will be followed by executions on the backlog with a better margin profile from developed markets.

Valuation and Growth Prospects

With a P/S Ratio of 0.27 and an EV/EBITDA of 10.55, the market seems to be pricing in a moderate growth outlook for Accuray. Analysts estimate next year's revenue growth at 2.6%. Given the company's current valuation multiples and growth prospects, it remains to be seen whether Accuray can meet its transformation plan goals and drive sustainable growth. The service business showed a 7% growth in service and 10% growth in contract revenue, and the company feels positive about its positioning and future.

3. NewsRoom

Card image cap

Financial Review: Accuray (NASDAQ:ARAY) & Mesa Laboratories (NASDAQ:MLAB)

Nov -30

Source: defenseworld.net

Card image cap

Accuray's Latest Transformation Attempt Could Be Too Little Too Late

Nov -06

Source: seekingalpha.com

Card image cap

Accuray Incorporated (ARAY) Q1 2026 Earnings Call Transcript

Nov -05

Source: seekingalpha.com

Card image cap

Accuray Reports Fiscal 2026 First Quarter Financial Results

Nov -05

Source: prnewswire.com

Card image cap

Accuray Incorporated Reports Inducement Award Under NASDAQ Listing Rules

Oct -31

Source: prnewswire.com

Card image cap

Accuray to Report First Quarter Fiscal 2026 Financial Results on November 5, 2025

Oct -28

Source: prnewswire.com

Card image cap

Accuray Accelerates Transformation Efforts with Appointment of Experienced Executive Leaders to Drive Performance and Growth

Oct -20

Source: prnewswire.com

Card image cap

Accuray Announces Milestone for Cancer Patients in Melbourne, Australia with First SBRT Treatments Using the CyberKnife® System

Oct -08

Source: prnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.02%)

6. Segments

Oncology Systems Products

Expected Growth: 3.5%

Accuray's Oncology Systems Products growth is driven by increasing cancer incidence, adoption of stereotactic body radiation therapy (SBRT), and rising demand for non-invasive treatments. Expanding global presence, strategic partnerships, and innovative product offerings, such as the CyberKnife and Radixact systems, also contribute to the 3.5% growth.

Oncology Systems Services

Expected Growth: 2.5%

Accuray's Oncology Systems Services growth is driven by increasing adoption of radiation therapy, rising cancer incidence, and growing demand for precise and non-invasive treatments. Expanding global presence, strategic partnerships, and innovative product offerings, such as the CyberKnife System, also contribute to the 2.5% growth.

7. Detailed Products

CyberKnife System

A robotic stereotactic radiosurgery system that delivers precise, high-dose radiation to tumors and lesions throughout the body.

Tomotherapy System

A radiation therapy system that uses a unique, spiral-scan approach to deliver precise, 3D image-guided radiation therapy.

Radixact System

A next-generation radiation therapy system that combines the benefits of Tomotherapy with advanced imaging and treatment capabilities.

Accuray Treatment Planning System

A comprehensive treatment planning software that enables clinicians to create personalized treatment plans for patients.

8. Accuray Incorporated's Porter Forces

Forces Ranking

Threat Of Substitutes

Accuray Incorporated's products are highly specialized and there are limited substitutes available in the market, reducing the threat of substitutes.

Bargaining Power Of Customers

Accuray Incorporated's customers are largely hospitals and healthcare providers, who have limited bargaining power due to the specialized nature of the company's products.

Bargaining Power Of Suppliers

Accuray Incorporated relies on a few key suppliers for critical components, giving them some bargaining power, but the company's strong relationships and diversified supply chain mitigate this risk.

Threat Of New Entrants

The radiation oncology market has high barriers to entry, including significant capital expenditures and regulatory hurdles, making it difficult for new entrants to compete with Accuray Incorporated.

Intensity Of Rivalry

The radiation oncology market is highly competitive, with several established players competing for market share, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 79.26%
Debt Cost 3.95%
Equity Weight 20.74%
Equity Cost 11.40%
WACC 5.49%
Leverage 382.11%

11. Quality Control: Accuray Incorporated passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
NeueHealth

A-Score: 4.8/10

Value: 9.8

Growth: 3.6

Quality: 4.6

Yield: 0.0

Momentum: 7.5

Volatility: 3.7

1-Year Total Return ->

View Full Report
Stock-Card
Dianthus Therapeutics

A-Score: 4.6/10

Value: 6.4

Growth: 6.0

Quality: 5.0

Yield: 0.0

Momentum: 8.5

Volatility: 1.7

1-Year Total Return ->

View Full Report
Stock-Card
Alignment Healthcare

A-Score: 4.4/10

Value: 3.4

Growth: 6.8

Quality: 3.3

Yield: 0.0

Momentum: 9.0

Volatility: 3.7

1-Year Total Return ->

View Full Report
Stock-Card
Delcath Systems

A-Score: 3.9/10

Value: 1.2

Growth: 5.8

Quality: 6.5

Yield: 0.0

Momentum: 8.0

Volatility: 2.0

1-Year Total Return ->

View Full Report
Stock-Card
Kymera Therapeutics

A-Score: 3.8/10

Value: 6.4

Growth: 3.1

Quality: 4.9

Yield: 0.0

Momentum: 6.5

Volatility: 2.0

1-Year Total Return ->

View Full Report
Stock-Card
Accuray

A-Score: 3.6/10

Value: 7.8

Growth: 5.0

Quality: 2.2

Yield: 0.0

Momentum: 4.0

Volatility: 2.7

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

1.0$

Current Price

1$

Potential

-0.00%

Expected Cash-Flows