Abstract

OSI Systems Inc will announce fiscal Q2 2026 results on October 29, 2026 Pre-Market; this preview consolidates recent performance, segment trends, and consensus expectations for revenue, margins, net profit, and adjusted EPS with year-over-year dynamics.

Market Forecast

Based on the latest forecast dataset, OSI Systems Inc’s current quarter projections indicate revenue of $449.51 million, an adjusted EPS estimate of $2.52 (year-over-year growth of 8.20%), and EBIT of $62.82 million (year-over-year growth of 10.12%); year-over-year revenue growth is projected at 10.72%. Forecast highlights point to continued momentum in core screening and detection systems, with stable margins supported by operating efficiency. The most promising segment is the Security division, expected to maintain leadership with revenue scale of $254.25 million last quarter and a constructive year-over-year trajectory in new contract wins and backlog execution.

Last Quarter Review

OSI Systems Inc’s prior quarter delivered revenue of $384.62 million, a gross profit margin of 32.03%, GAAP net profit attributable to the parent company of $20.56 million, a net profit margin of 5.34%, and adjusted EPS of $1.42, with year-over-year adjusted EPS growth of 13.60%. A key highlight was outperformance versus consensus on revenue and EPS, signaling resilient demand and execution across major programs. Main business contributions were led by the Security division at $254.25 million, followed by Optoelectronics and Manufacturing at $109.46 million and Healthcare at $40.74 million, with corporate eliminations of -$19.83 million; the Security division was the largest growth driver in the quarter.

Current Quarter Outlook

Security Screening and Detection Systems

Security solutions remain the nucleus of OSI Systems Inc’s quarterly narrative. Backlog conversion in airport checkpoint, cargo, and border security solutions is central to sustaining revenue growth near the double-digit range indicated by forecasts. Pricing discipline and product mix—particularly higher-value computed tomography (CT) checkpoint systems and large-scale cargo scanning—can anchor gross margin stability. Execution on government procurement cycles, fulfillment timing, and service contract expansions will be pivotal to meeting the implied EBIT growth of 10.12% and supporting adjusted EPS of $2.52. Management’s track record in global deployments and lifecycle service revenues provides a buffer against periodic slippage in project start dates, although any government budget delays could shift revenue recognition.

Optoelectronics and Manufacturing

The Optoelectronics and Manufacturing segment represents a complementary earnings stream tied to industrial, medical, and defense end-markets. With last quarter revenue of $109.46 million, this segment’s margin profile is influenced by mix between higher-complexity components and broader-volume assemblies. Supply chain normalization versus prior periods should aid throughput and delivery schedules, while design wins in sensor components can support incremental growth. The segment’s contribution to EBIT depends on maintaining utilization levels and managing input costs, which, if well controlled, may offer slight margin improvement on a sequential basis. Any softening in discretionary industrial demand could cap upside, but defense-related orders help maintain a steadier baseline.

Healthcare

Healthcare posted $40.74 million last quarter, comprising patient monitoring and diagnostic systems alongside service and accessories. Growth in this segment often hinges on adoption cycles in hospitals and capital spending environments, which vary by geography. For this quarter, incremental growth could be driven by installed-base refreshes and software-enabled features that lift attachment rates. Given the smaller scale, Healthcare’s margin impact is modest at the consolidated level, yet disciplined pricing and cost containment can keep contribution positive and reduce variability in consolidated operating results.

Key Factors Impacting the Stock Price

Earnings day dynamics will revolve around whether OSI Systems Inc delivers on the $449.51 million revenue projection and the $2.52 adjusted EPS estimate, alongside visibility on backlog and order intake. Commentary on gross profit margin relative to last quarter’s 32.03% will help investors gauge cost control and pricing power. All eyes are on the Security division’s project timelines and international contract flow; any commentary on new awards or expanded service contracts can influence sentiment. Investors will also monitor guidance updates for fiscal Q3 and the remainder of fiscal year 2026, particularly year-over-year outlook for revenue and EPS, and potential impacts from currency, procurement timing, or input costs.

Analyst Opinions

The balance of institutional commentary compiled over the recent period tilts constructive, with a majority indicating expectations of revenue growth near the 10.72% mark and improved profitability as higher-margin systems mix supports EBIT expansion toward $62.82 million. Positive previews emphasize demand resilience in the Security segment and consistent backlog execution, with stable to slightly improving adjusted EPS. These views reflect confidence in OSI Systems Inc’s fundamentals, including diversified segment exposure and recurring service revenues, suggesting that achieving or modestly exceeding consensus could support favorable stock reaction if guidance remains intact or edges higher.