Varian Medical Systems (NYSE:VAR) was none too pleased with the market for its oncology systems, calling its Q2 revenues for that division "disappointing, particularly in the U.S."

Varian’s 2nd quarter 2013 oncology division revenues totaled $582 million, a 3% increase compared to the same period last year, but net orders were down 2%, much of that due to a 9% decline in U.S. orders.

"While revenues and operating income grew as expected during the 2nd quarter, net orders for the Oncology Systems business were disappointing, particularly in the U.S. where ongoing uncertainties regarding healthcare reform and reimbursement contributed to slow capital expenditures," CEO Dow Wilson said in prepared remarks. "Strong performance in emerging markets drove the orders growth outside of North America."

VAR shares dropped 7.4% in today’s trading, and were going for $63.31 apiece as of about 1:25 p.m.

Wilson related the softness in the U.S. oncology market to a shift in its customer base in preparation for operating in an Accountable Care Organization environment, which is driving partnerships across clinical specialties. Although the transition appears to be weighing down the market for the time being, it may prove beneficial in the future.

"For the long-term, we believe a transition to our ACO environment could lead to renewed investments in more advanced and cost-efficient clinical capability to support outcome-driven standards of care and pay-per-performance," Wilson said in a conference call with investors. "Radiotherapy and radiosurgery are among the least invasive and most cost-effective ways of treating cancer, and Varian’s technology and product portfolio fits this scenario to a T."

In the mean time Varian expects a "period of uncertainty and transition in the U.S.," marked by larger variations in quarter-to-quarter orders.

Overall Varian reported a 6.6% bump in sales and a 4.5% increase in profits during the 3 months ended March 29, 2013. The company’s 2nd quarter earnings came to $112.8 million, or $1.02 per diluted share, on sales of $768 million. That compared with profits of $107.8 million, or 94¢ per share, on sales of $720.3 million during the same period in 2012.

The medical device maker said it’s "on track for achieving its fiscal 2013 growth targets," expecting to increase overall revenues by as much as 8%, according to the report. Varian expects diluted per-share earnings in the range of $4.09-$4.14 for the year.