Accuray reported fourth-quarter fiscal 2025 results on August 13, 2025, with $128 million in revenue (down 5% year-over-year), service revenue of $56.9 million (up 4% year-over-year), and adjusted EBITDA of $9.4 million. Management completed a comprehensive debt refinancing in June, highlighted solid order momentum (book-to-bill 1.2), and issued guidance of $471 million to $485 million in revenue for fiscal year 2026 (ending June 30, 2026) and $31 million to $35 million in adjusted EBITDA for fiscal year 2026. The call focused on margin drivers, global supply chain shocks, and strategic product expansion in growth markets.
Debt refinancing boosts Accuray's flexibility
During the quarter, Accuray(ARAY -1.01%) exchanged approximately $82 million of 3.75% convertible notes due in 2026 for about 8.9 million shares and $68.6 million in cash, and entered a $190 million credit agreement with TCW, including a $150 million five-year term loan, $20 million delayed draw term loan, and $20 million revolver. This refinancing ended the company’s relationship with Silicon Valley Bank and resulted in a liquidity position of $62 million at quarter end.
"This refinancing extends our debt maturity by five years and adds meaningful liquidity to support high-return initiatives. Importantly, it consolidates our capital structure under a single counterparty, allowing us to focus on execution with greater clarity and confidence. We view this transaction as a critical milestone that enhances our ability to invest in innovation, drive margin improvement, and deliver long-term value to our shareholders."
-- Ali Pervaiz, Chief Financial Officer
The new capital structure eliminates near-term refinancing risk and provides the flexibility to invest in growth, research and development, and process efficiency over the next several years.
International growth drives Accuray's revenue mix
International markets accounted for 80% of total revenue for fiscal year 2025 (ending June 30, 2025), with product revenue up 20% year-over-year in China and more than 200% in the rest of Asia Pacific, even as EIMEA (Europe, India, Middle East, Africa) saw a 32% year-over-year decline and Japan revenue fell 19%. The Americas delivered 24% year-over-year revenue growth in the fourth quarter, while Asia Pacific grew 22% in the same period, despite tariffs and geopolitical unrest causing a 14% decline in China and a 34% contraction in EIMEA for the quarter.
"Growth in the emerging markets where we have introduced new products like the Helix and TomoC in China are seeing strong demand. These are among the highest growth markets in the world, which we are actively targeting and are an integral part of our growth plan in the next few years."
-- Suzanne Winter, President & Chief Executive Officer
Momentum in emerging and Asia Pacific markets positions the company for continued topline growth, while diversification reduces dependence on volatile developed market replacement cycles.
Service margin expansion signals operational leverage
Service gross margins improved by nine points, driven by lower parts consumption and successful price initiatives, alongside a service revenue increase of 4% year-over-year to $56.9 million. The installed base outside the U.S. grew, and service contract capture rates post-warranty improved across nearly all geographies for fiscal year 2025, with contract revenue now comprising 90% of total service revenue.
"I was encouraged to see service margins up nicely both year over year and sequentially. This will be a continued area of focus for us in the future, and we believe that we have laid out the foundation, including strategic pricing, development of high-value support and education offerings, and finally, driving efficiencies in our cost to service."
-- Suzanne Winter, President & Chief Executive Officer
Growth in the service business enhances earnings resilience, creates recurring revenue streams, and offers a pathway to sustainable margin expansion as the global installed base rises.
Looking Ahead
Management guided revenue to $471 million to $485 million for fiscal year 2026 (ending June 30, 2026) and adjusted EBITDA to $31 million to $35 million for fiscal year 2026, with 45% of revenue and 30% of EBITDA expected in the first half of the year. Back-end loaded contributions are expected from a growing installed base and new launches (Helix, TomoSeq, adaptive radiotherapy). Guidance assumes progress on foreign trade zone establishment and continued tariff mitigation, but acknowledges persistent macro and geopolitical risks.
