Varex Imaging Reports Q2 GAAP Net Loss, Reduced Cash, and Lower Non-GAAP EPS Year-Over-Year
VREX sits 63% above its 52-week low of $6.76 on elevated volume (1.8× avg).
Summary
Varex Imaging Corporation announced its second-quarter fiscal year 2026 results, reporting a GAAP net loss and cash outflows from operations, alongside a year-over-year decline in non-GAAP diluted EPS.
Key Events · Earnings and Guidance · VREX
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Q2 FY26 Financial Performance
Varex Imaging reported a GAAP net loss of $0.19 per diluted share and a non-GAAP net income of $0.21 per diluted share for Q2 FY26. Revenues increased 1% year-over-year to $216 million.
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Cash Flow and Balance Sheet Deterioration
The company experienced $2 million in cash outflows from operations during the quarter. Cash, cash equivalents, and marketable securities significantly decreased to $88 million from $155 million at the end of fiscal year 2025.
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Updated Fiscal Year 2026 Guidance
Varex expects full fiscal year 2026 revenue in the range of $860 million to $880 million and non-GAAP EPS between $0.80 and $1.00. Q3 FY26 revenue is projected between $210 million and $225 million, with non-GAAP EPS between $0.15 and $0.30.
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Non-GAAP Policy Change
The company modified its non-GAAP policy to exclude gains and losses from equity-method investments, applying this change retrospectively to improve comparability of ongoing operations.
Analysis · VREX · Manufacturing
The company's Q2 FY26 financial results indicate a significant deterioration in GAAP profitability, moving from a net income in the prior quarter to a net loss of $8.1 million. Despite a 1% year-over-year revenue increase, non-GAAP diluted EPS decreased to $0.21 from $0.31 in the prior year. Furthermore, Varex experienced $2 million in cash outflows from operations, contributing to a substantial reduction in its cash and marketable securities balance from $155 million at the end of FY25 to $88 million. While management noted solid demand and provided full-year guidance, the overall financial performance and cash burn present a concerning picture for investors. The updated non-GAAP policy to exclude equity-method investment gains/losses aims to improve comparability but should be noted.
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At the time of this filing, VREX was trading at $11.03 on NASDAQ in the Manufacturing sector, with a market capitalization of approximately $495.7M. The 52-week trading range was $6.76 to $14.57. This filing was assessed with negative market sentiment and an importance score of 7 out of 10.