Accuray announces debt restructuring and board appointment

MADISON, Wis. - Accuray Incorporated (NASDAQ: ARAY), a radiation therapy company with a market capitalization of $156.58 million and revenue growth of 8.06% in the last twelve months, has entered into agreements to exchange $82 million of its senior convertible notes for shares and cash, and secured a new financing arrangement with TCW Asset Management Company LLC. The transactions are part of a broader strategy to strengthen the company’s financial position and support its growth objectives. According to InvestingPro analysis, the company maintains a healthy current ratio of 1.64, indicating solid short-term liquidity.

The exchange of the senior convertible notes, due in 2026, will result in the issuance of approximately 8.88 million shares of common stock and a cash payment of about $68.6 million to note holders. This exchange is anticipated to close on June 11, 2025, subject to standard closing conditions. With a debt-to-equity ratio of 4.32, this restructuring could significantly impact the company’s capital structure. InvestingPro data reveals several additional insights about Accuray’s financial health, available in the comprehensive Pro Research Report.

Concurrently, Accuray has negotiated a new senior secured credit agreement providing $150 million in term loan facilities, a $20 million delayed draw term loan facility, and a $20 million revolving credit facility. The proceeds, alongside available cash, will be used to repay existing debt under a prior agreement with Silicon Valley Bank dated May 6, 2021. The new credit facilities offer various interest payment options and contain standard restrictions and covenants.

As part of the financing agreement, Accuray has agreed to appoint Steven F. Mayer, a senior advisor to TCW, to its Board of Directors. Mayer’s extensive experience in governance across various industries is expected to contribute to Accuray’s strategic priorities, including transforming radiation therapy care and enhancing shareholder value.

In addition, Accuray has issued warrants to certain lenders, allowing them to purchase additional shares of common stock in the future. These warrants come with anti-dilution protection and have not been registered under the Securities Act, meaning they cannot be sold without registration or an exemption.

The company’s CEO, Suzanne Winter, expressed confidence in the new financing agreement, stating it will provide Accuray with improved liquidity and operational flexibility to invest in key business areas and pursue long-term growth strategies.

This restructuring comes as Accuray continues to innovate in the radiation therapy sector, aiming to improve patient outcomes and streamline treatment processes. While the company generated $19.08 million in EBITDA over the last twelve months, InvestingPro analysts note that the company may face profitability challenges in the near term. Discover more detailed financial analysis and 6 additional ProTips about Accuray’s future prospects with an InvestingPro subscription.

The information for this article is based on a press release statement.

In other recent news, Accuray Incorporated reported a 12% increase in revenue for the third quarter of 2025, reaching $113 million. This growth was driven by strong performances in both product and service segments, with product revenue up 16% and service revenue up 9% year-over-year. The company also reported a significant improvement in adjusted EBITDA, which rose to $6 million from $1.1 million the previous year. Accuray’s order backlog increased to $452 million, indicating robust demand for its offerings. Despite these positive results, the gross margin slightly declined to 27.9% from 28.7% a year ago, reflecting cost pressures. The company is dealing with challenges related to tariffs, particularly concerning its operations in China, which could impact future revenues by $10 million to $15 million in the fourth quarter. Accuray is actively seeking tariff exemptions and exploring strategic initiatives to mitigate these impacts. Analyst firms like BTIG and Lake Street Capital Markets have shown interest in the company’s strategies to navigate these challenges.

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