Accuray (NSDQ:ARAY) shares are down today after the company reported decreased sales and profits in the first quarter of fiscal 2020.
The Sunnyvale, Calif.-based radiotherapy device maker posted losses of -$9.4 million, or -11¢ per share, on sales of $89.6 million for the three months ended Sept. 30, for a bottom-line slide of -13% on a revenue decrease of -6.5%.
The loss of -11¢ per share fell short of Wall Street’s projection of -9¢ per share.
“Our first-quarter performance represented a solid start to our fiscal year with double digit gross order growth,” president & CEO Joshua Levine said in prepared remarks. “We are also very excited about Accuray systems named in 50 out of 58 Class A licenses recently awarded by the China National Health Commission which were announced on October 9, 2019. We need to remember that the process identified by the Ministry of Health requires a tender process following the license awards for all participating end user hospitals prior to being able to take receipt of a Type A device. This tender process has been put in place to define the transactional terms and conditions related to each hospital’s equipment order and is not a competitive bidding situation that would result in changes in the specific device that the hospital has received the Type A license for. We expect that based on the timelines required for this tendering process, we would not begin to see revenue impact related to the China Type A awards until sometime in our fiscal fourth quarter, and we remain excited about the China market opportunity as a significant growth catalyst for our business.”
Accuray said it now expects to put up an adjusted EBITDA of $19 million to $24 million this year, including $2 million of the company’s share of expected loss from joint venture operations in China. The company’s sales guidance is unchanged at between $410 million and $420 million.
Shares of ARAY were down -4.7% at $2.62 per share in mid-afternoon trading today.
