RSLBF (RSLBF) Q2 2026 Earnings Report, Transcript and Summary

Welcome to RaySearch presentation of the second quarter of 2026. My name is Carolina Stromlid, and I'm Head of Investor Relations. Today, our CEO and Founder, Johan Lof; and our CFO, Nina Gronberg, will take you through the key highlights and financial results for the quarter. After the presentation, we will open up for questions. Simply raise your hand in Teams if you would like to ask a question. And with that short introduction, I'll hand over to you, Johan. Johan Löf: Thank you, Carolina, and welcome again, everyone. This is a summary of RaySearch as of today. We have 4 different software platforms: RayStation, which is a treatment planning system; RayCare, which is an oncology information system; RayIntelligence, an analytics platform; and RayCommand, which is a treatment control system; and they're all dedicated to improving cancer treatments. We have 472 employees of 41 different nationalities. We collaborate with 26 industrial partners, and we have over 1,200 customers in 51 countries. But most importantly, our software has been used to treat over 11 million cancer patients. So this is the revenue development over a very long period of time. And the message here is that RaySearch has grown every year since 2008, except for the 2 pandemic years. Even though, as you can see in this diagram, the fluctuations between quarters can be quite significant. And if you look at the last 2 quarters, we have had 2 quite weak quarters. But nevertheless, we expect this growth journey to continue. So a few words about Q2. So the weaker development in net sales and operating profit during the quarter was, of course, disappointing. It was primarily due to poor performance in the U.S., where several deals were postponed compared to our expectations. Net sales decreased by 11% to SEK 272 million, while organic growth was a negative 8%. Recurring support revenue continued to provide stability, amounting to SEK 133 million or 49% of total revenue. Operating profit was SEK 28 million, corresponding to an operating margin of 10%. If we look beyond the individual quarter, the last 12 months show a bit more consistent performance. Net sales amounted to SEK 1.27 billion with organic growth of 9%. Recurring support revenue provided a solid base, accounting for 41% of total revenue. Operating profit was SEK 277 million with an EBIT margin of 22% over the last 12 months. So while the second quarter was disappointing, the last 12 months figures show a more stable view of our underlying performance. Despite a weaker quarter, demand remained stable across our markets and order intake increased by 23%. Several expected deals in the U.S. were postponed during the quarter, but a number of those were received in early Q3. In total, we secured 9 RayStation orders worth approximately USD 5 million in July. These came from well-established cancer centers, for example, University of Florida Health Proton Therapy Institute, the University of North Carolina School of Medicine, the Lexington VA Healthcare System, and the Emory Proton Therapy Center. We made progress in several other important markets. We received our first RayStation order in Vietnam and Yonsei Cancer Center in Seoul, South Korea, expanded its RayStation installation with additional licenses for carbon ion therapy. In Germany, the upcoming end of life of Pinnacle contributed to 5 new RayStation orders. Overall, we continue to see solid demand with several important opportunities across our markets. Another important customer win during the quarter was Dana-Farber Cancer Institute in Boston, which selected both RayStation and RayCare for its proton therapy program. The order value was SEK 29 million, and we expect approximately 1/3 of that to be recognized as revenue in Q3. And this also means that another leading cancer center, one of the top 15 clinics in the world join our growing customer base. The solution combines RayStation and RayCare to enable efficient, adaptive, and data-driven workflows together with Mevion's S250-FIT proton therapy system and Leo Cancer Care's Marie chair and CT. And the combined system is supported in RayStation version 2025. The first treatment was done in June this year and that treatment happened at Stanford. Some other key highlights from the quarter. In mid-May, Iridium Netwerk in Belgium performed the first online adaptive treatments using RayStation and RayCare on the Varian TrueBeam linear accelerator. This opens up for advanced adaptive radiation therapy to many clinics and patients around the world using equipment that they already had. We also further strengthened our proton expertise through the recruitment of Antony Lomax, who is one of the world's most highly regarded experts in proton therapy. During the quarter, we participated in the ESTRO Congress here in Stockholm, which was a great opportunity to connect with the global oncology community. On the product side, we launched new versions of RayStation, RayCare, and RayIntelligence during the quarter. Together, these releases expand our capabilities within adaptive treatments, more efficient workflows and more precise personalized cancer treatments. Finally, we introduced a long-term incentive program to attract and retain talent. To secure shares for the program participants, we acquired treasury shares. We also carried out additional repurchases to reduce the number of outstanding shares. So in total, share repurchases amounted to SEK 200 million. I will now hand over to Nina to go through the financial development in more detail. Nina Grönberg: Thank you, Johan. It is obvious that our second quarter didn't turn out the way we expected, and the demand that we see in the market wasn't reflected in order intake nor in our net sales. Order intake was up 23%, and it did include orders of strategic importance, and that is good. But the growth was in relation to a rather low comparison quarter and order intake on licenses was down 14%. As you know by now, our business model involves fluctuations, and the underlying fundamentals in our market and research position have not changed. We continue our growth. The book-to-bill ratio was 1.1 and order backlog end of June amounted to SEK 1.691 billion, of which SEK 670 million is expected to turn into net sales in the next 12 months. The overview of net sales and EBIT margin development gives the view of the disappointment in the second quarter with a drop of 11% from SEK 305 million in 2025 to the SEK 272 million in 2026. License sales decreased 18% in the quarter and hardware sales were down 38%. Support sales did increase with 1%. There are still some headwinds from the stronger Swedish krona, and organic growth was minus 8%. The low net sales led to an EBIT of SEK 28 million and an EBIT margin of 10%, and both of them are lower than last year's SEK 36 million and 12%. And we were not able to keep up the margin in the same way as we were in the first quarter of this year. Currency gain from revaluation of working capital gave us a positive SEK 4 million [indiscernible] effect in the second quarter. Splitting the revenue into licenses, support, hardware, and training. The support revenue stood for 49% of the total revenue in the quarter, where our normal number is usually around 40%, and that higher 49% was related to the lower license sales in the quarter. Taking away currency effects from support numbers, the growth would have been 4%. We still have some periodization effects in support sales that moves revenue into later periods. Moving to the next slide with the quarterly and last 12-month development of free cash flow. Free cash flow in the second quarter was SEK 50 million, and that is including positive effects from an increase in advances from customers and temporary increases in accounts payable. And as you can see, it is an improvement compared to last year. Cash flow is always in focus, and it will be so also going forward. But as I have mentioned before, we have contract situations, for example, larger, very profitable contracts, frame agreements and so on, where we do accept longer payment terms. And we do see it as a strength that we are able to have this flexibility. We have very, very low bad debt. And for the end of the quarter, we also had SEK 390 million in advances from customers. Cash balance end of the quarter amounted to SEK 213 million. It was affected by a dividend payment that we did in May of SEK 137 million. And during the second quarter, we also did share buyback of SEK 142 million. In July, we have acquired own shares for an additional SEK 58 million. And that gives us in total share buybacks of SEK 200 million, and that means that we have acquired 995,558 shares at this point, and that stands for 2.9% of the total registered shares. As Johan also mentioned, there are 2 purposes with those share buybacks. One is to keep treasury shares in order to secure our long-term incentive program. And the other one is repurchases to reduce the number of outstanding shares and to transfer value to our shareholders. In order to keep a high level of flexibility and preparedness for possible investment opportunities coming up, we have signed during the second quarter a new credit facility. It is a so-called rolling credit facility that we use when we want to, and it is in the amount of SEK 225 million. And that was all from me. So I hand over to you again, Johan. Johan Löf: Thank you very much, Nina. Okay. So let me summarize and share our outlook. While we're not satisfied with our performance during the first half of the year, our long-term growth prospects remain unchanged. Demand for advanced radiotherapy software continues to be strong. We're already seeing robust order momentum in the U.S. in early Q3, which supports a strong second half of the year. We are a leading player in the global proton therapy market, which continues to grow and offers a large number of business opportunities. The clinical milestone achieved with RayStation and RayCare on TrueBeam is very important. Online adaptive treatments on the most widely installed treatment machine in the market support a broader adoption of both RayCare and RayStation. Finally, we believe in strong performance during the second half of the year, and our operating margin target of at least 25% for 2026 is unchanged. So now it's time to open up for questions, and I will hand over to Carolina.

[Operator Instructions] The first question comes from Kristofer Liljeberg at DNB Carnegie.

A few questions from me. Okay. Good. So the first question is you received quite a number of orders here in early third quarter. So is it possible to say how much of the miss in the second quarter has now been recovered in early third quarter? That's my first question. And then -- yes, maybe we could start with that. Johan Löf: We can answer them one by one, I think. Yes, it's -- there's a big part, but it's not -- I wouldn't say it's everything. But yes, that's my answer. It's not 100% slipped orders.

Okay. But do you expect to recover all of it in the third quarter? Or could it be further delayed? Johan Löf: No, those particular -- the expected orders for Q2, I think I'm quite confident that we will recover all of those during Q3.

Okay. And do you see a risk for additional delays instead come in in the third quarter and fourth quarter? Johan Löf: It's a fair question because now we have had 2 quarters with delays, although it was more elaborate or more clear in the second quarter, in particular related to the United States. But we -- there are other ways of looking at this. And we -- given the pipeline that we have now, we are confident that we will deliver on the promise for the entire year. And that requires a very strong comeback in both Q3 and Q4.

And that's actually my second question. So when you say deliver on what you have promised for the year, then you refer to the margin? Or would you be willing to give any sort of indication what type of sales growth you could expect for the full year? Johan Löf: We didn't set a sales growth target. So I'm referring to the EBIT margin target.

Yes. Okay. But given that sales is down FX-adjusted here first half of the year, do you think it's fair to assume that you could be back at double-digit sales growth for this year? Johan Löf: That's definitely our aim. Given that we can't change the cost base drastically because that's mostly related to our staff, and that we can only change that in a slow fashion, so with that assumption, then to be able to deliver the EBIT margin target, it requires a significant growth.

Okay. Just one more question on R&D amortization, which were down here in the first half of the year. Is this the level we should assume now going forward? Or as you continue to capitalize, will R&D amortization pick up anytime soon? Nina Grönberg: Yes, I'll take that question. I mean, the main reason for the amortization to be lower this quarter is that we have a later release of RayStation. Previous year, we did that release already in April and this year, it was in June. So that is the effect that you see in the depreciation. When it comes to the capitalization rate, it was low, I would say, in the comparison quarter. So -- and it was -- it has been on 70% last year, the total of last year. And now in the quarter 2 2026, we are approximately on those 70% again.

With the release amortization, we should expect it to go up again in third quarter? Nina Grönberg: Yes, I would say so. Yes.

We will now move over to Mattias Vadsten for the next question. Mattias, please. Sorry, Mattias Vadsten at SEB.

Perfect. First one, just a clarification made on the press release on 10th of August and the comments you made today around $5 million in orders from the U.S. So basically, is that all U.S. revenue you have received in July? Or is it referring to those specific orders that slipped from the second quarter? Johan Löf: It's referring to the ones that slipped. But I -- right now, I don't know if there is additional -- I can't answer that question if there is some additional orders on top of that. At any rate, it's no big ones, but it could be a few smaller ones.

Perfect. And then I was keen to hear a little bit about on APAC and Europe. Would you say that those regions are performing more or less in line with your initial expectations so far this year or in general terms? Johan Löf: Yes. Yes, I would. Especially in Europe, they have been performing very well so far. APAC is a little bit behind, but they also have a very strong H2 projected.

And then I have a question. Before you have given the Pinnacle conversion as a percent of license revenues. I don't know if you're willing to give that for either Q2 or first half or anything. Johan Löf: I'm sorry, I don't think we have it at this moment. Nina Grönberg: Sorry, can you please repeat?

Pinnacle replacements. Nina Grönberg: No, we haven't.

Okay. That's fine. Last one was on the cost side. Selling expenses in Q2 looked quite high. And at the same time, admin was lower. So I was just keen to hear if there are any reclassifications in cost items or anything like that, that's disturbing the comparison figures. Nina Grönberg: Sorry, Mattias, I was focused on your previous question, trying to look that up, the Pinnacle replacement. So I'm sorry, but can you repeat it again?

Yes, of course. No worries. It's the selling expenses that looked high at the same time as I think admin looked quite low. So if there are any reclassification or anything going on? Nina Grönberg: Yes. I mean, admin is related to last year. We had a couple of items that were affecting comparison last year, if you remember. So that's the main reason for the lower admin costs. And when it comes to selling costs, I would say -- I mean, we have increased the staff there. So that increase is mainly related to that.

Okay. Then I will squeeze in one last question. The 1,227 customers you presented in the beginning... Nina Grönberg: Yes. Sorry, Mattias, ESTRO was also a big thing that added some costs in this quarter 2 related to last year since it was in Stockholm this year. Johan Löf: There was an extra [indiscernible] as well. Nina Grönberg: So we have some extra activities. And we also have a minor effect that we have moved our patent costs from admin to sales. So that is also part of it. But I would say the main thing is that we have increased the staff.

Okay. I will squeeze in one last question now. So the 1,227 customers you presented, is that as of Q2? I mean, as of June then or is it today? Nina Grönberg: Yes. End of. No. Okay. That is the number you presented. Customers that is [indiscernible], yes.

Our next question comes from Carlos Moreno.

I've got -- well, I've got 2 questions. They're sort of related. I'll come out with them. If I would have gone back 12, 18 months ago, I would have thought that this year, which, by the way, looks like for the quarterly volatility is going to be a decent year for revenue growth. But I would have thought it would have been like a banner year because of the Pinnacle roll-off. And it makes me slightly worried about what's going to happen post-Pinnacle because you do have a bit of a tailwind at the moment. It's an okay year with this tailwind. And as you say yourself, RayCare is a very long-cycle sale. And connected to that, I wanted to ask, I'll just lay it out and then we can answer the 2 bits. I want to know if there's any change in your customers when it comes to thinking about paying for your software monthly rather than upfront with maintenance because if you think about back to Pinnacle, they've got the machines. They know they're doing a software swap out. Surely, these customers don't think of it as CapEx. They think of it as OpEx, and they would be very happy to do a SaaS sale. So I want to talk about Pinnacle and what happens post-Pinnacle in this tailwind period. And I want to talk about the move to SaaS, which to me seems sooner or later, it's going to happen. And I just want to know what your customers are saying to you. Johan Löf: Okay. Thank you. So first of all, the Pinnacle, as you say, tailwind, and it wears off in certain -- it's already gone in certain regions. For example, Japan and U.K. are good examples. It's been gone for a while. And then we sell -- we replace in other systems like Monaco and Eclipse. So -- and then that will happen in the other markets as well. So we see a transition from grabbing the, well, low-hanging fruit that still exists. Regarding Pinnacle, as it goes away, then there are other systems to replace, and the RayCare sales are slowly but surely picking up, and there's a lot of interest. There's a big pipeline now. We have had okay, not so many, but 4 sales so far this year. It was 4 sales in total last year. And now I think we'll add a good number of additional RayCare sales during the second half of this year. So I see -- I'm not too worried about the -- well, a loss of Pinnacle tailwind, if you will. And then when we come to -- I don't think you mean SaaS, you mean subscription.

Yes. Johan Löf: And so we do offer subscription, and we have some subscription customers, not that many. The overwhelming buying behavior of our customers is still to have -- to not view this as OpEx, but to view this as a CapEx investment. And it makes some sense because it's a very long-term investment. I will add some details to this, some nuance, but I think it makes sense that if you -- most of our customers, they buy RayStation, and they stick with RayStation forever as far as we are concerned so far. And that doesn't feel like a subscription situation because really buy something for a very long period of time. And then I think the customers view it more as an investment type of purchase. That being said, we want to -- it's really in our interest to -- at least not to avoid these quarterly fluctuations to have more of a recurring revenue-heavy model. And I believe there are ways where the customers can invest in the RayStation or RayCare framework. And then functionality on top of that can be subscription-based. For example, treatment techniques in some way, they come and go. To go back 25 years, then all the treatments were called 3DCRT with uniform beams. And then for a long time after 2000, it was another treatment technique, IMRT, and then yet another one came VMAT, and I'm sure we'll have other treatment techniques. So that type of thing, I think it lends itself nicely to subscription where you can -- things that can change over time that I think is very well suited for subscription. So we're going to investigate and move into that field, because right now, we just offer full RayStation or full RayCare in a subscription fashion, then -- and I think we'll see some sort of hybrid model going forward.

Okay. But by the sound of it, it's going to be slow. Basically, your customers aren't that interested in it, and it's not particularly changing? Yes.

Next, we have Oscar Bergman from Redeye.

It seems that we are experiencing more delays in this industry as of late, specifically in the U.S. So I'm just wondering if you can give some background as to why that might be. And I'm speaking in general terms for the industry. Johan Löf: Of course. Yes, we have some theories and some data points. You know the reimbursement levels have gone down in the U.S. during this year. And what we hear from some customers is that the administration around procurement, and the part of the hospital that handles procurement, has become much more cautious. And so they slowed down the process. And some people say that it's because they really want to make sure that whatever the hospital buys is really, really needed. So I think that's part of the explanation that -- but of course, in our cases, the hospitals have -- they do need the software, and nothing has been canceled so far. So I guess in the end, it turns out that the hospital or the purchasing departments decide that, okay, this software is needed, but the whole process is slower because they want to sort of minimize unnecessary purchases. That's the main explanation. And these delays, we don't see them in other regions. It's -- this is U.S.-specific.

Okay. Great. And at ESTRO, Johan, you showed a very interesting slide during your presentation. One slide illustrated the 6 machines that you have RayCare interoperability agreements with today. And then on the second slide, you showed an additional 18 machines that you expect to have interoperability agreements with in the next 12 months. So I just want to make sure that I understood the time line correctly. Johan Löf: Yes, 18 sounds a bit much. I think I know which slide you referred to. It's not -- I'm not sure it's 18. But it's -- it's a significant number. It's around 10 new machines. And you have understood it perfectly right. So we are adding interoperability to RayCare to a large number of machines right now.

Okay. Great. And just a follow-up on that. The customer pipeline in respect to those expected interoperability agreements, I suspect that you have pretty far-going discussions already with those potential customers that this would entail for you? Johan Löf: Yes, in some cases. I think Dana-Farber is a good example because they purchased Mevion FIT. The interoperability is not there technically yet, but it's very close. We have teamed up with both Mevion and Leo Cancer Care, and there will be interoperability between RayCare and that machine. But Dana-Farber has -- they have already purchased it because they know that the interoperability will come. And that's one example of that.

Okay. And just a final question from me. I recently spoke with someone who's very, very familiar with Pinnacle. And he told me that a part of the Pinnacle users today actually will continue using Pinnacle after end of life because there are some third-party service providers that are still going to service this TPS. I'm just wondering if you have noticed this any significant degree or if you expect that this is a very small part that over time is likely anyway to convert as well. Johan Löf: Yes, I don't think that's a long-term solution. It's still a very old system. That's why they abandon the system. It has been very robust. It survived many, many more years than anyone expected. And for a medical device as treatment planning system is, you don't want to have it supported by a third-party organization for any longer period of time. So I think that's going to be a short term -- at least in the Western world. But I think it's probably true in, for example, China, there will be Pinnacles ongoing even beyond end of life. But the majority of the Pinnacles in North America and Europe will be replaced.

We will move over to [ Daniel Kaarsa ] for the next question.

So regarding the North American market, I think a lot of investors have seen sort of a dual trend with large health systems consolidating while care simultaneously somehow shifts towards smaller outpatient clinics and satellite centers. And I was just going to ask how RaySearch positions itself to product offering, I mean, particularly RayStation, and RayCare to capture this shift? And how does it affect your sales strategy in the U.S.? Johan Löf: Currently, we work on both fronts. We work both with small and medium-sized clinics, and we work with the bigger networks. So it's not really -- we don't distinguish. I mean, of course, we distinguish, but we don't prioritize one over the other.

But with the consolidation, wouldn't bigger hospitals, bigger hospital parks, a lot more diversifications in the machines, could that be some kind of tailwind for you guys giving you guys moat with your software? Johan Löf: I mean, if you look historically, the biggest most renowned -- we just announced Dana-Farber, and that means that we have 11 out of the top 15 and largest clinics in the world, and they represent what you are describing. So yes, on paper, that should be in our favor. But I also think it's important for RaySearch to go after because the bulk of the market in the U.S. is still all these smaller clinics. So we have to -- the bigger clinics, we -- I mean, check, we have -- those are -- they come to us eventually. The smaller clinics, we have to work harder to break into the 1, 2, 3 linac centers.

Okay. And just one more question regarding China. So I mean, looking at China, China has for the years, there has been a sort of strong regulatory push for hospitals to source domestic medical equipment. They came a new law about procurement also. I was going to ask how is RaySearch navigating these buy local requirements? And do you see these regulatory shifts creating long-term hurdles for your sales in the region? Or is it also some kind of tailwind? Johan Löf: Yes. Regulatory-wise, it's a hell of a headwind, I would say, so far, it's a very heavy regulatory process. But I mean, it's clear that China aims to purchase more and more domestic in the health care sector. One way that we address this is to work closely with a number of new machine vendors that are Chinese. And we have really good, very strong partnerships with several new machine vendors. We have worked for a long time with Shinva. We work with IntelliRay. We work with OWL and several others. So it's -- that's a good approach for us to bundle with the Chinese machine.

Now we have a follow-up question from Kristofer Liljeberg at DNB Carnegie.

Just wonder if you could disclose the number of proton therapy deals you signed in the second quarter and in the first half in total? Johan Löf: Okay. I don't have that number on top of my head. Do you have that, Nina? Nina Grönberg: No, not exactly how many. We have to get back on that one.

Okay. That's fine. Johan Löf: We can come back on that. It's easy to find out. We just don't have it right now.

Yes. We have received a few written questions, but most have been covered already. But I have one here regarding the Ortega project. RayStation for the first 2 clinics was recognized in Q1. When do you expect RayCare for those 2 clinics to be delivered and recognized as revenue? And when do you currently expect RayStation and RayCare to be delivered to the third clinic? Johan Löf: Yes, we have delivered 2 clinics. There will be at least 2 more deliveries this year. And we're up to 4 in total. And then we have another 5 to go. Nina Grönberg: Yes. That's correct. Johan Löf: And they will probably be delivered within 2027, 2028. And I can't say exactly when the revenue for RayCare will be recognized. But I would guess almost all of it should be recognized before end of 2028. Nina Grönberg: Yes. So I can add there we have recognized revenue for RayCare for the 2 first sites now in quarter 2. And as Johan said, when we deliver to the 2 additional sites in 2026, that will also be with RayCare. Johan Löf: So 4 RayCare installations this year to Ortega? Nina Grönberg: Yes, or deliveries, at least. Johan Löf: Deliveries. Nina Grönberg: Yes.

Good. That concludes our Q&A. Thank you all for joining us today and for your questions. If you have any follow-up questions, please don't hesitate to reach out to us. We look forward to seeing you again on November the 3rd for our Q3 results. Have a great day. Thank you. Johan Löf: Thank you.