Varex Imaging Corporation Q1 FY2026 earnings call

Sunny Sanyal announced first quarter revenue of $210 million, up 5% year-over-year, driven by Industrial segment's cargo systems and Medical segment's stability. Non-GAAP gross margin was 34% at the high end of guidance. Discussed RSNA event, showcasing new technologies and modality-based approach. Sam Maheshwari noted regional performance: Americas up 17%, EMEA up 7%, APAC down 7%. Highlighted change in non-GAAP policy to exclude gains/losses from equity method investments.

Medical segment: Revenue was $145 million, accounting for 69% of total revenues. Performance was stable year-over-year with strength in CT and growing engagement in next-generation system designs. Industrial segment: Revenue was $65 million, 31% of total revenues. Up 17% year-over-year driven by strength in the cargo systems business.

Second quarter revenues expected between $210 million and $225 million. Non-GAAP EPS expected between $0.15 and $0.25. Based on non-GAAP gross margin 33%-34%, operating expenses approximately $52 million, interest and other expense in the range of $7 million to $8 million, tax rate of about 23% for the second quarter, and non-GAAP diluted share count of about 42 million shares.

Q: Larry Solow asked about current environment, India operations, and guidance.

A: Sunny and Sam discussed Medical's stability, India factory progress, and guidance range.

Q: Young Li asked about Industrial segment cargo orders and growth.

A: Shubham Maheshwari talked about cargo business traction and potential for double-digit growth.

Q: Suraj Kalia asked about Medical segment gross margins and China/photon counting.

A: Sunny and Sam discussed Medical segment margins, China's role, and photon counting progress.

Q: James Sidoti asked about inventory and refinancing.

A: Shubham Maheshwari discussed inventory increase due to cargo systems and refinancing plans.