Accuray Incorporated (ARAY - Free Report) reported first-quarter fiscal 2020 adjusted loss of 11 cents per share, wider than the Zacks Consensus Estimate of a loss of 10 cents. The company had reported a loss of 11 cents in the year-ago quarter.
Net revenues of this Zacks Rank #3 (Hold) company totaled $89.6 million, missing the Zacks Consensus Estimate by 4.03%. On a year-over-year basis, revenues dropped 6.5%.
Fiscal Q1 Details
Product Revenues: Product revenues fell 9.4% year over year to $37.6 million in the reported quarter.
Service Revenues: Service revenues totaled $52 million, down 4.3% from the year-ago quarter.
Gross Order Update: Gross orders in the fiscal first quarter totaled $78.5 million, up 27.8% year over year. The upside was driven by strong demand for Radixact, CyberKnife and TomoTherapy platforms. Radixact accounted for more than 60% of the gross orders. Both EMEA and China made significant contributions to gross orders in the quarter.
Gross profit in the fiscal first quarter totaled $32.9 million, down 13% on a year-over-year basis. Gross margin was 36.8%, highlighting a contraction of 270 basis points (bps) year over year.
Research and development expenses contracted 3.9% year over year to $13.3 million. Selling and marketing expenses declined 1.8% to $13.3 million. General and administrative expenses contracted 32% to $10.6 million.
First-quarter operating loss was $4.3 million compared with a loss of $4.7 million in the year-ago quarter.
The company exited first-quarter fiscal 2020 with total cash, cash equivalents, and short-term restricted cash of $86.7 million, compared with $87 million at the end of Jun 30, 2019.
For fiscal 2020, Accuray continues to expect revenues within $410-$420 million. The Zacks Consensus Estimate for the same is pegged at $435.4 million, above the guided range.
However, management expects revenue decline of 5-6% on a year-over-year basis in the first half of fiscal 2020 and solid revenue growth in the second half of fiscal 2020.
Adjusted EBITDA for fiscal 2020 is expected within $19-$24 million.
Accuray exited the fiscal first quarter on a weak note despite solid demand for the Radixact, CyberKnife and TomoTherapy platforms. We are also upbeat to note that this was the company’s fifth consecutive quarter of double-digit growth in gross orders, which was driven by continued strength in China and EMEA. Accuray retained its fiscal 2020 guidance.
On the flip side, year-over-year decline in the top line is concerning. In fact, Accuray’s segmental revenues were soft in the quarter. Gross margin contracted significantly. Accuray also expects a year-over-year revenue decline in the first half of fiscal 2020.
Earnings of Other MedTech Majors at a Glance
Some better-ranked companies, which posted solid results this earnings season, are Edwards Lifesciences (EW - Free Report) , Thermo Fisher Scientific Inc. (TMO - Free Report) and ResMed Inc. (RMD - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Edwards Lifesciences delivered third-quarter 2019 adjusted earnings per share (EPS) of $1.41, outpacing the Zacks Consensus Estimate by 15.6%. Net sales of $1.09 billion surpassed the Zacks Consensus Estimate by 5.5%.
Thermo Fisher delivered third-quarter 2019 adjusted EPS of $2.94, which surpassed the Zacks Consensus Estimate by 2.1%. Revenues of $6.27 billion outpaced the Zacks Consensus Estimate by 1.3%.
ResMed reported fiscal first-quarter 2020 adjusted EPS of 93 cents, which beat the Zacks Consensus Estimate of 87 cents by 6.9%. Revenues were $681.1 million, surpassing the Zacks Consensus Estimate by 3.6%.
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