Varex Imaging (VREX) Q2 2026 earnings summary

Executive summary

• Q2 FY26 revenue reached $216 million, up 1–1.5% year-over-year, with Medical at $156 million and Industrial at $60 million, driven by strong CT, cargo, and photon counting demand.

• Non-GAAP EPS was $0.21; GAAP net loss was $8 million or $(0.19) per share.

• Gross margin (non-GAAP) was 34%, down from 36% year-over-year, mainly due to higher material costs in Medical.

• Debt refinancing completed, reducing leverage and expected to lower annual interest expense by over $7 million.

• Cash and equivalents declined to $85–$88 million, primarily due to debt refinancing and inventory buildup.

Financial highlights

• Q2 FY26 revenue: $216 million (up from $212.9 million in Q2 FY25); Medical revenue up 1.6%, Industrial up 1.2%.

• Non-GAAP gross margin: 33.9–34%; GAAP gross margin: 33.6–34%.

• Adjusted EBITDA: $26.6–$27 million (12–12.3% margin), down from $36.2 million in Q2 FY25.

• Operating expenses for Q2 FY26: $54–$58.2 million (25% of revenue), driven by higher legal and administrative costs.

• Net cash outflow from operations: $2 million for the quarter; cash and equivalents at quarter end: $85–$88 million.

Outlook and guidance

• Full-year FY26 revenue guidance: $860–$880 million; non-GAAP EPS: $0.80–$1.00.

• Q3 FY26 revenue guidance: $210–$225 million; non-GAAP EPS: $0.15–$0.30; non-GAAP gross margin: 33–34%.

• Second half FY26 revenue expected to increase ~3% year-over-year, driven by CT, industrial photon counting, and cargo systems.

• No IEEPA tariff refund assumed in guidance.