Varex Imaging swings to Q3 profit, agrees to $1.1B Teledyne buyout at $18.90 a share
VREX has more than doubled off its 52-week low of $8.42 on elevated volume (21× avg).
Summary
Varex Imaging's Q3 FY26 10-Q reports a profit of $15.7 million and discloses a definitive agreement to be acquired by Teledyne Technologies for $18.90 per share in cash, a $1.1 billion deal.
Key Events · M&A and Partnerships · VREX
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Teledyne Buyout at $18.90/Share
On August 10, 2026, Varex entered into a definitive merger agreement with Teledyne Technologies, which will acquire all outstanding shares for $18.90 per share in cash, valuing the company at approximately $1.1 billion. The deal is expected to close in early 2027, subject to regulatory approvals and shareholder vote.
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Q3 Return to Profitability
For the quarter ended July 3, 2026, Varex reported net income of $15.7 million, or $0.37 per diluted share, compared to a net loss of $89.1 million in the prior-year quarter. Revenues increased 3.7% to $210.5 million, with Industrial segment revenue up 25.6%.
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IEEPA Tariff Refunds Boost Margins
The company received $17.0 million in IEEPA tariff refunds during the quarter, which reduced cost of revenues by $16.7 million and increased gross profit by approximately $10.1 million. Excluding these refunds, gross margin would have been approximately 31%, down from 33.3% a year ago.
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Debt Refinancing Completed
Varex refinanced its debt during the quarter, entering into a new $350 million Term Loan Facility and a $100 million Revolving Credit Facility. It used proceeds to redeem $368 million of 7.875% Senior Secured Notes, incurring a $9.2 million loss on extinguishment. As of July 3, 2026, total debt outstanding was $347.1 million.
Analysis · VREX · Manufacturing
Filed concurrently with the announcement of its acquisition by Teledyne Technologies, Varex Imaging's 10-Q for the quarter ended July 3, 2026, marks a return to profitability with net income of $15.7 million, or $0.37 per share, buoyed by $17 million in IEEPA tariff refunds. The filing also unveils the definitive merger agreement under which Teledyne will acquire Varex for $18.90 per share in cash—a $1.1 billion deal that represents a premium to the stock's recent trading range and will take the company private. The combination of improved quarterly results and a transformative M&A event makes this a critical disclosure for investors.
At the time of this filing, VREX was trading at $18.47 on NASDAQ in the Manufacturing sector, with a market capitalization of approximately $777.2M. The 52-week trading range was $8.42 to $18.49. This filing was assessed with positive market sentiment and an importance score of 9 out of 10.