OSI SYSTEMS REPORTS FISCAL 2026 THIRD QUARTER FINANCIAL RESULTS

OSI SYSTEMS REPORTS FISCAL 2026 THIRD QUARTER FINANCIAL RESULTS · Record Q3 Revenues of $453 Million · Q3 Earnings per Diluted Share o GAAP EPS of $2.33 o Record Non-GAAP EPS of $2.60 · Record Q3 Backlog of $1.9 Billion · Q3 Book-to-Bill Ratio of 1.3x · Company Reiterates its Fiscal 2026 Guidance HAWTHORNE, Calif. — (BUSINESS WIRE) — May 4, 2026—OSI Systems, Inc. (the “Company” or “OSI Systems”) (NASDAQ: OSIS) today announced its financial results for the third quarter of fiscal 2026. Ajay Mehra, OSI Systems’ President and Chief Executive Officer, stated, “Our third quarter results demonstrate the strength and durability of our diversified portfolio highlighted by record Q3 non-GAAP earnings per share and strong bookings, reflecting sound execution in our Security and Optoelectronics and Manufacturing divisions. Our substantial backlog and a robust pipeline position us well as we capitalize on market opportunities and advance key strategic initiatives.” Financial Summary Three Months Ended March 31, Nine Months Ended March 31, (Dollars in thousands, except per-share amounts) 2025 2026 % Growth 2025 2026 % Growth Revenues $ 444,354 $ 453,246 2 % $ 1,208,181 1,301,926 8 % Diluted earnings per share - GAAP $ 2.40 $ 2.33 -3 % $ 5.67 $ 5.71 1 % Diluted earnings per share - non-GAAP $ 2.44 $ 2.60 7 % $ 6.11 $ 6.60 8 % Cash flow provided by operating activities $ 81,642 $ 14,457 $ 97,030 $ 93,794 Capital expenditures $ 4,518 $ 7,559 $ 17,713 $ 21,272 The Company’s backlog was approximately $1.9 billion as of March 31, 2026, compared to approximately $1.8 billion as of December 31, 2025 reflecting continued strong bookings momentum across the Security and Optoelectronics and Manufacturing divisions. Mr. Mehra added, “The Security division delivered another solid quarter supported by disciplined execution, strong bookings and operating margin expansion despite a challenging year-over-year comparison due to significant Mexico revenues in the third quarter of fiscal year 2025. Excluding these Mexico contracts, the Security division’s revenues increased by 25% year-over-year across the broader portfolio. In addition, we are pleased with recent notable awards and look forward to capturing other significant global opportunities.” Mr. Mehra continued, “The Optoelectronics and Manufacturing division also produced solid third quarter results, with 10% revenue growth and a strong book-to-bill ratio. These results continue to reinforce the advantages of our vertically integrated global operating model, which provides efficiency and flexibility to serve our diverse OEM customer base across aerospace, defense, healthcare and consumer technologies.” Fiscal Year 2026 Outlook The Company is reiterating its fiscal 2026 revenue guidance range of $1.825 billion to $1.867 billion and its non-GAAP diluted earnings per share guidance range of $10.30 to $10.55. Actual revenues and non-GAAP diluted earnings per share could vary from this guidance due to factors discussed under “Forward-Looking Statements” or other factors, including the impact on near-term bookings and revenues of the recent shutdown of the Department of Homeland Security and current conflicts in the Middle East. The Company’s fiscal 2026 diluted earnings per share guidance is provided on a non-GAAP basis only. The Company does not provide a reconciliation of guidance for non-GAAP diluted EPS to GAAP diluted EPS (the most directly comparable GAAP measure) on a forward-looking basis because the Company is unable to provide a meaningful or accurate compilation of reconciling items and certain information is not available. This is due to the inherent difficulty and complexity in accurately forecasting the timing and amounts of various items included in the calculation of GAAP diluted EPS but excluded in the calculation of non-GAAP diluted EPS, such as acquisition costs and other non-recurring items that have not yet occurred, are out of the Company’s control or cannot otherwise reasonably be predicted. For the same reasons, the Company is unable to address the significance of unavailable information which may be material and therefore could result in GAAP diluted EPS being materially different from projected non-GAAP diluted EPS. Conference Call Information The Company will host a conference call and simultaneous webcast beginning at 1:30 pm PT (4:30 pm ET) today to discuss its financial results for the 2026 third fiscal quarter. To listen, please visit the Investor Relations section of the OSI Systems website at http://investors.osi-systems.com/index.cfm and follow the link that will be posted on the front page. A replay of the webcast will be available beginning shortly after the conclusion of the conference call for approximately three months thereafter. The replay can be accessed through the Company’s website at www.osi-systems.com. About OSI Systems OSI Systems designs and manufactures specialized electronic systems and components for critical applications. The Company operates through three business segments: Security, Optoelectronics and Manufacturing, and Healthcare. Its Security division delivers advanced inspection systems, turnkey screening solutions, and comprehensive support services to protect people and infrastructure. The Optoelectronics and Manufacturing segment serves as a global supplier of high-performance optoelectronic solutions and precision manufacturing services for leading OEMs. The Healthcare segment focuses on patient monitoring, diagnostic cardiology, and related services with the goal of enhancing clinical care and patient outcomes. Serving customers in over 170 countries, OSI Systems strategically positions its sales, service, R&D, and manufacturing capabilities worldwide to provide fast and efficient delivery and support. For more information on OSI Systems or any of its subsidiary companies, visit www.osi-systems.com. News Filter: OSIS-E Presentation of Non-GAAP Financial Measures This earnings release includes a presentation of non-GAAP net income, non-GAAP diluted earnings per share, non-GAAP operating income (loss) by segment and non-GAAP operating margin, all of which are non-GAAP financial measures. The presentation of these non-GAAP figures is provided to allow for the comparison of the underlying performance of the Company, excluding the impact of impairment, restructuring and other charges (including certain legal costs), amortization of intangible assets acquired through business acquisitions, and associated tax effects, and discrete income tax items. Although we exclude amortization of acquired intangible assets from our non-GAAP figures, revenue generated from such intangibles is included in determining non-GAAP financial performance of the Company. Management believes that the non-GAAP financial measures presented in this earnings release provide (i) enhanced insight into the ongoing operations of the Company, (ii) meaningful information regarding the Company’s financial results (excluding amounts management does not view as reflective of ongoing operating results) for purposes of planning, forecasting and assessing the performance of the Company’s businesses, (iii) a meaningful comparison of financial results of the current period against results of past periods and (iv) financial results that are generally more comparable to financial results of peer companies than are GAAP figures. Non-GAAP financial measures should not be assessed in isolation or as a substitute for measures of financial performance prepared in accordance with GAAP. Our non-GAAP financial measures may not be the same as measures used by other companies due to possible differences in methods and in the items or events for which adjustments are made. Reconciliations of GAAP financial information to non-GAAP financial information are provided in the accompanying tables. The financial results calculated in accordance with GAAP and reconciliations from those financial results should be carefully evaluated. 2 Forward-Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements relate to the Company's current expectations, beliefs, and projections concerning matters that are not historical facts. Forward-looking statements are not guarantees of future performance and involve uncertainties, risks, assumptions, and contingencies, many of which are outside the Company's control and which may cause actual results to differ materially from those described in or implied by any forward-looking statement. Forward-looking statements include, but are not limited to, information provided regarding expected revenues, earnings, growth, cash flow generation, and operational performance in fiscal 2026 and beyond. The Company could be exposed to a variety of negative consequences as a result of delays related to the award of domestic and international contracts; failure to secure the renewal of key customer contracts; delays in customer programs; government shutdowns; delays in revenue recognition related to the timing of customer acceptance; the impact of potential information technology, cybersecurity or data security breaches; changes in domestic and foreign government spending and budgetary, procurement and trade policies adverse to the Company's businesses; the impact of the Russia-Ukraine conflict and conflicts in the Middle East, including the potential for broad economic disruption and increased global tensions; global economic uncertainty, including the impact of tariffs; material delays and cancellations of orders or deliveries thereon, supply chain and transportation networks disruptions, plant closures, or other adverse impacts on the Company’s ability to execute business plans; unfavorable currency exchange rate fluctuations; unfavorable interest rate fluctuations; effect of changes in tax legislation; market acceptance of the Company's new and existing technologies, products, and services; the Company's ability to win new business and convert orders received to sales within the current fiscal year; contract and regulatory compliance matters, and actions which, if brought, could result in judgments, settlements, fines, injunctions, debarment, or penalties; and other risks and uncertainties, including, but not limited to, those detailed herein and from time to time in the Company's Securities and Exchange Commission filings, which could have a material and adverse impact on the Company's business, financial condition, and results of operations. For additional information on these and other factors that could cause the Company's future results to differ materially from those in any forward-looking statements, see the section titled "Risk Factors" in the Company's most recently filed Annual Report on Form 10-K and other risks described therein and in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission. Undue reliance should not be placed on forward-looking statements, which are based on currently available information and speak only as of the date on which they are made. The Company assumes no obligation to update any forward-looking statement made in this press release that becomes untrue because of subsequent events, new information, or otherwise, except to the extent required to do so under federal securities laws. For Additional Information, Contact: OSI Systems, Inc. Ajay Vashishat Vice President Telephone: (310) 349-2237 avashishat@osi-systems.com 3 OSI SYSTEMS, INC. AND SUBSIDIARIES UNAUDITED CONDENSED Consolidated Statements of Operations (in thousands, except per share data) Three Months Ended March 31, Nine Months Ended March 31, 2025 2026 2025 2026 Revenues: Products $ 341,179 $ 344,921 $ 930,658 $ 971,493 Services 103,175 108,325 277,523 330,433 Total net revenues 444,354 453,246 1,208,181 1,301,926 Cost of goods sold: Products 236,667 242,574 631,176 693,641 Services 57,396 60,348 158,061 183,147 Total cost of goods sold 294,063 302,922 789,237 876,788 Gross profit 150,291 150,324 418,944 425,138 Operating expenses: Selling, general and administrative 73,249 71,487 216,194 208,643 Research and development 18,570 19,455 54,600 59,641 Impairment, restructuring and other charges, net 2,255 6,168 3,648 11,772 Total operating expenses 94,074 97,110 274,442 280,056 Income from operations 56,217 53,214 144,502 145,082 Interest and other expense, net (8,228 ) (3,995 ) (24,206 ) (22,106 ) Income before income taxes 47,989 49,219 120,296 122,976 Provision for income taxes (6,855 ) (9,003 ) (23,407 ) (23,505 ) Net income $ 41,134 $ 40,216 $ 96,889 $ 99,471 Diluted earnings per share $ 2.40 $ 2.33 $ 5.67 $ 5.71 Weighted average shares outstanding – diluted 17,159 17,291 17,089 17,414 4 OSI SYSTEMS, INC. AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) June 30, 2025 March 31, 2026 Assets Cash and cash equivalents $ 106,405 $ 345,236 Accounts receivable, net 837,743 870,450 Inventories 407,174 435,290 Prepaid expenses and other current assets 71,539 66,357 Total current assets 1,422,861 1,717,333 Property and equipment, net 126,747 125,765 Goodwill 387,393 385,075 Intangible assets, net 183,290 183,317 Other non-current assets 120,966 142,941 Total Assets $ 2,241,257 $ 2,554,431 Liabilities and Stockholders' Equity Bank lines of credit $ 178,000 $ - Current portion of long-term debt 8,130 3,791 Accounts payable 205,181 200,882 Accrued payroll and related expenses 49,535 51,003 Advances from customers 68,184 59,998 Deferred revenue 77,788 89,358 Other current liabilities 110,120 124,139 Total current liabilities 696,938 529,171 Long-term debt 463,504 998,748 Other long-term liabilities 129,731 132,197 Total liabilities 1,290,173 1,660,116 Total stockholders’ equity 951,084 894,315 Total Liabilities and Stockholders’ Equity $ 2,241,257 $ 2,554,431 5 NON-GAAP FINANCIAL MEASURES AND SEGMENT INFORMATION Three Months Ended March 31, 2025 2026 (Dollars in thousands, except per-share amounts) Operating % of Net Diluted Operating % of Net Diluted Revenues Income Revenues Income EPS Revenues Income Revenues Income EPS OSI Consolidated GAAP basis $ 444,354 $ 56,217 12.7 % $ 41,134 $ 2.40 $ 453,246 $ 53,214 11.7 % $ 40,216 $ 2.33 Impairment, restructuring and other charges, net 2,255 0.5 % 2,255 0.13 6,168 1.4 % 6,168 0.35 Amortization of acquired intangible assets 4,661 1.0 % 4,661 0.27 3,505 0.8 % 3,505 0.20 Tax effect of non-GAAP adjustments (1,643 ) (0.10 ) (2,292 ) (0.13 ) Discrete tax benefit (4,542 ) (0.26 ) (2,638 ) (0.15 ) Non-GAAP basis $ 63,133 14.2 % $ 41,865 $ 2.44 $ 62,887 13.9 % $ 44,959 $ 2.60 Operating % of Operating % of Revenues Income Revenues Revenues Income Revenues Revenue and Operating Income by Segment Security GAAP basis $ 314,908 $ 51,505 16.4 % $ 319,263 $ 53,971 16.9 % Impairment, restructuring and other charges, net 1,403 0.4 % 1,433 0.4 % Amortization of acquired intangible assets 4,000 1.3 % 2,883 1.0 % Non-GAAP basis 56,908 18.1 % 58,287 18.3 % Optoelectronics & Manufacturing GAAP basis 100,860 13,650 13.5 % 110,998 14,613 13.2 % Impairment, restructuring and other charges, net 72 0.1 % - 0.0 % Amortization of acquired intangible assets 365 0.4 % 351 0.3 % Non-GAAP basis 14,087 14.0 % 14,964 13.5 % Healthcare GAAP basis 43,722 1,308 3.0 % 40,701 (2,366 ) -5.8 % Impairment, restructuring and other charges, net 627 1.4 % 2,636 6.5 % Amortization of acquired intangible assets 296 0.7 % 271 0.6 % Non-GAAP basis 2,231 5.1 % 541 1.3 % Corporate/Elimination GAAP basis (15,136 ) (10,246 ) (17,716 ) (13,004 ) Impairment, restructuring and other charges, net 153 2,099 Non-GAAP basis (10,093 ) (10,905 ) OSI Consolidated GAAP basis $ 444,354 56,217 12.7 % $ 453,246 53,214 11.7 % Impairment, restructuring and other charges, net 2,255 0.5 % 6,168 1.4 % Amortization of acquired intangible assets 4,661 1.0 % 3,505 0.8 % Non-GAAP basis $ 63,133 14.2 % $ 62,887 13.9 % 6 NON-GAAP FINANCIAL MEASURES AND SEGMENT INFORMATION Nine Months Ended March 31, 2025 2026 (Dollars in thousands, except per-share amounts) Operating % of Net Operating % of Net Revenues Income Revenues Income EPS Revenues Income Revenues Income EPS OSI Consolidated GAAP basis $ 1,208,181 $ 144,502 12.0 % $ 96,889 $ 5.67 $ 1,301,926 $ 145,082 11.1 % $ 99,471 $ 5.71 Impairment, restructuring and other charges, net 3,648 0.3 % 3,648 0.22 11,772 0.9 % 11,772 0.68 Amortization of acquired intangible assets 13,226 1.1 % 13,226 0.77 10,958 0.9 % 10,958 0.63 Non-recurring retirement expense for former CEO - - 4,359 0.25 Tax effect of non-GAAP adjustments (4,033 ) (0.24 ) (6,350 ) (0.36 ) Discrete tax benefit (5,344 ) (0.31 ) (5,321 ) (0.31 ) Non-GAAP basis $ 161,376 13.4 % $ 104,386 $ 6.11 $ 167,812 12.9 % $ 114,889 $ 6.60 Operating % of Operating % of Revenues Income Revenues Revenues Income Revenues Revenue and Operating Income by Segment Security GAAP basis $ 829,209 $ 134,414 16.2 % $ 908,216 $ 138,041 15.2 % Impairment, restructuring and other charges, net 1,882 0.2 % 5,087 0.6 % Amortization of acquired intangible assets 10,708 1.3 % 9,142 1.0 % Non-GAAP basis 147,004 17.7 % 152,270 16.8 % Optoelectronics & Manufacturing GAAP basis 299,398 36,541 12.2 % 333,011 41,272 12.4 % Impairment, restructuring and other charges, net 619 0.2 % 261 0.1 % Amortization of acquired intangible assets 1,535 0.5 % 1,004 0.3 % Non-GAAP basis 38,695 12.9 % 42,537 12.8 % Healthcare GAAP basis 125,678 3,830 3.0 % 117,978 (1,617 ) -1.4 % Impairment, restructuring and other charges, net 779 0.6 % 4,325 3.7 % Amortization of acquired intangible assets 983 0.8 % 812 0.7 % Non-GAAP basis 5,592 4.4 % 3,520 3.0 % Corporate/Elimination GAAP basis (46,104 ) (30,283 ) (57,279 ) (32,614 ) Impairment, restructuring and other charges, net 368 2,099 Non-GAAP basis (29,915 ) (30,515 ) OSI Consolidated GAAP basis $ 1,208,181 144,502 12.0 % $ 1,301,926 145,082 11.1 % Impairment, restructuring and other charges, net 3,648 0.3 % 11,772 0.9 % Amortization of acquired intangible assets 13,226 1.1 % 10,958 0.9 % Non-GAAP basis $ 161,376 13.4 % $ 167,812 12.9 % 7