Varian Medical Systems (VAR) Reports In-Line Q2 EPS, Revenues Beat; Withdraws FY20 Guidance

Varian Medical Systems (NYSE: VAR) reported Q2 EPS of $0.85, in-line with the analyst estimate of $0.85. Revenue for the quarter came in at $794.5 million versus the consensus estimate of $769.98 million.

Second Quarter 2020 Summary

• Oncology Systems gross orders grew 1% in dollars or 2% in constant currency in the quarter; trailing twelve months gross orders grew 5% in dollars or 6% in constant currency
• 15 EthosTM orders received, including 11 in North America, 3 in Europe and 1 in Asia-Pacific
• Two Proton orders awarded in Asia-Pacific
• Total company revenues grew 2% in dollars, or 3% in constant currency, to $794 million; organic revenues declined 1%(1)
• GAAP operating earnings declined 50% at 6.9% of revenues; non-GAAP operating earnings declined 14% at 12.9% of revenues
• GAAP net earnings per diluted share of $0.47; non-GAAP net earnings per diluted share of $0.85
• The company is withdrawing fiscal year 2020 guidance due to uncertainty surrounding the severity and duration of COVID-19

"On behalf of everyone at Varian, I want to express our gratitude to all individuals on the frontlines dedicated to fighting this global pandemic. I also want to thank Varian employees worldwide who continue to focus on cancer patients receiving vital care during these turbulent times," said Dow Wilson, Chief Executive Officer of Varian. "While COVID-19 has created some unique challenges, our business has solid liquidity and is well-positioned strategically and organizationally to navigate through this challenging environment, continue to grow our market leadership, and deliver best-in-class solutions to cancer patients globally."

Guidance Withdrawn for Full Fiscal Year 2020

Since the previous update provided by the company on March 9, 2020, the severity of the COVID-19 pandemic has expanded globally and resulted in a shift in the macroeconomic environment. The uncertainty around the severity and duration of COVID-19 has impacted the company's ability to reliably estimate the financial impact of the pandemic for the balance of the fiscal year. As a result, the company is withdrawing its fiscal year 2020 guidance. Additionally, as a precautionary measure, the company has paused share buybacks to preserve liquidity.

For earnings history and earnings-related data on Varian Medical Systems (VAR) click here.

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