This article first appeared on GuruFocus .
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Revenue:Reported revenue was $203.9 million, up 3% on a reported basis and 6% at constant currency to $211.5 million.
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Gross Profit Margin:Gross profit margin was 76.9%, moderating by 1.3 points; at constant currency, it was 77.6%.
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Operating Expenses:Operating expenses were $141.4 million, up 2% on a reported basis and 4% at constant currency.
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EBIT:Reported EBIT was $16 million, or $21.6 million at constant currency, up 21% year-over-year.
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Trophon-Only EBIT:Reported EBIT was $50.6 million, or $56.5 million at constant currency, up 16%.
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Capital Revenue:Grew 4% to $54.7 million, or 8% at constant currency.
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Annuity Revenue:Grew 4% on a reported basis to $141.8 million, or 8% at constant currency.
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North America Revenue:Reported revenue was $186.4 million, up 3% or 8% at constant currency; annuity revenue reached $126.8 million, up 4% or 9% at constant currency.
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EMEA Revenue:Total revenue grew 1% to $12.3 million; annuity revenue rose 7%.
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APAC Revenue:Reported revenue was $5.1 million, down 14%; annuity revenue was $4.2 million, down 14%; capital revenue was $0.9 million, down 18%.
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Cash and Cash Equivalents:Ended FY26 with $155.2 million.
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Business Cash Flow:$13.6 million, excluding funds spent on share buyback.
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Share Buyback:Completed a $20 million buyback in FY26; announced a further buyback of up to $40 million for FY27.
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FY27 Guidance:Revenue expected between $220 million and $228 million at constant currency, representing growth of 8% to 12%; gross profit margin expected between 74% and 76%; operating expenses expected between $156 million and $163 million.
Release Date: August 25, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Nanosonics Ltd ( NNCSF ) delivered solid FY26 results with constant currency revenue up 6% and EBIT up 21%, demonstrating strong operational performance.
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The trophon-only business achieved its strongest placement performance in three years, with over 4,200 units placed and a record upgrade activity in North America, expanding the installed base to over 39,000 devices.
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The successful launch of next-generation technologies, trophon3 and trophon2 Plus, is driving improved average selling prices and adoption, particularly in the second half of the year.
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CORIS is on track with key regulatory approvals achieved, including FDA 510(k) clearance, and the commercial launch is planned for the first half of FY27, positioning the company for a second growth platform.
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The company maintains a strong financial position with a debt-free balance sheet, $155.2 million in cash, and a new $40 million share buyback, reflecting confidence in future growth and disciplined capital allocation.
Negative Points
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Reported revenue growth was only 3% due to unfavorable currency movements, with constant currency growth of 6% masking the impact of a stronger Australian dollar.
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Gross profit margin moderated by 1.3 points to 76.9%, impacted by product mix from record capital placements and currency headwinds.
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Q3 FY26 experienced softness in consumables due to severe weather events in the Northeast US, which temporarily reduced hospital traffic and shipments, impacting overall revenue.
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EMEA and APAC regions showed softer performance, with EMEA capital revenue moderating due to a shift to managed equipment service models and APAC revenue declining 14% due to placement mix in Japan.
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FY27 guidance includes higher tariffs (12.5%) and increased freight costs, which are expected to pressure gross profit margins down to 74%-76%.
Q & A Highlights
Q: Can you provide more specific details about what the additional OpEx investment in CORIS will fund this year, and should we expect this new OpEx base to remain stable into FY28 and FY29? A: Michael Kavanagh (CEO): The majority of the incremental OpEx will be deployed in the regions to support the CORIS launch, including specialist salespeople, project management and installation support (which is more complex than trophon due to infrastructure requirements), clinical applications and education resources, and increased marketing spend. We expect FY27 to be the major investment year, and FY27 will form the baseline for FY28 without significant step-up changes in CORIS investment.
Q: Can you clarify the CORIS consumable pricing in USD terms and how it compares to the trophon business? A: Michael Kavanagh (CEO) and Jason Burriss (CFO): The cost to clean a device today ranges from USD10 to USD37. The expected price of the CORIS consumable is towards the lower end of that range, which is still a significant increase (four to six times) compared to trophon's price per cycle. CORIS is expected to run approximately 10 cycles per day on average, which is three to four times that of trophon.
Q: Regarding the consumables softness in Q3, can you quantify the impact of the severe weather events in the Northeast US and confirm that Q4 recovered to first-half levels? A: Michael Kavanagh (CEO): The softness in Q3 was temporary and reversed in Q4. We estimate the weather-related disruptions in the Northeast US impacted consumables by approximately $2 million in Q3. The recovery in Q4 gives us confidence entering FY27 on the consumables front.
Q: Is the trophon ASP pricing back to expected levels, and should we expect trophon3 to be the dominant device for new install base sales going forward? A: Jason Burriss (CFO): Second-half pricing was encouraging and returned to previous years' levels, driven by the transition towards trophon3. We still sold more trophon2 in the second half than expected due to longer sales cycles on larger deals, but as the mix improves in FY27, we expect further pricing improvement.
Q: How should we think about the go-to-market model for CORISwill it be capital sales, rentals, or managed equipment service (MES) modelsand what has been the initial feedback from trial clients? A: Michael Kavanagh (CEO): We expect a mix of models. The strength of our balance sheet provides flexibility, and the most important thing is getting units installed since the consumables gross margins for CORIS will be similar to trophon. We may see more MES-type models in the UK and more capital sales in the US, with a potential 50/50 split between capital placements and rentals.
Q: Was there any stocking up activity in the first half that diluted consumables growth in the second half, particularly related to US tariff price increases? A: Jason Burriss (CFO): There was no particular restocking or pricing-related activity. The bounce-back in Q4 volumes gave us comfort entering FY27. Data from large US hospital results showed slower foot traffic in Q3, which we associate with the weather-related softness.
Q: Do you believe the discontinuation of trophon EPR or changes in the competitive dynamic have impacted the consumables business? A: Michael Kavanagh (CEO): We achieved record placements in the US over the last three years and haven't seen significant attrition to competition. In large deals where we were evaluated against competitors, we didn't lose any. While there may be some low-volume users switching to competitors like Tristel, we've also seen some Tristel customers return to trophon. The consumables softness was primarily traffic-related.
Q: What is the conviction behind the CORIS capital pricing strategy (three to five times trophon), and what will the revenue mix look like in FY27capital or consumables? A: Michael Kavanagh (CEO): Our conviction is backed by pricing research and customer feedback on the value proposition. Compared to what hospitals pay for AERs (automated endoscope reprocessors), CORIS is still less expensive but offers more sophisticated technology. For FY27, it's early to say on the mix, but we expect a variety of modelspotentially 50/50 between capital placements and rentals.
Q: Can you provide more color on the lower utilization patterns seen in EMEA, and is this related to NHS pressures? A: Michael Kavanagh (CEO): Within the NHS, there is extreme pressure in sonography with a significant shortage of sonographers compared to demand. This likely impacted procedural volumes in EMEA. We would have liked to see more growth from Europe, but with the trophon3 launch and improved forecasts, we expect higher performance going into FY27.
Q: Regarding the CORIS OpEx step-up, should we expect only incremental cost growth beyond FY28, with no major step-ups? A: Michael Kavanagh (CEO): Correct. We are not expecting double-digit step-up increases in OpEx for CORIS beyond this year. The launch year is the big investment year from a commercialization perspective, and FY27 will serve as the baseline for future years.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
