OSI Systems, Inc. (OSIS): Business Model Canvas [Dec-2025 Updated]

You're digging into how a complex player like OSI Systems, Inc. actually makes its money, and honestly, their Business Model Canvas reveals a powerful, vertically-integrated machine that spans both critical security and healthcare technology. As someone who's spent two decades mapping these structures, I see a company that expertly blends high-margin, recurring service revenue with big-ticket government contracts, hitting a record $1.713 billion in revenue for fiscal 2025, all while sitting on a massive $1.8 billion backlog that secures the near future. It's a fascinating blueprint of how they manage everything from designing optoelectronic components to deploying massive airport screening systems. Dive into the nine blocks below to see the precise mechanics behind this dual-focus powerhouse.

OSI Systems, Inc. (OSIS) - Canvas Business Model: Key Partnerships

OSI Systems, Inc. builds its model on deep, long-term relationships across government, defense, and specialized manufacturing sectors. These partnerships are critical for securing large, multi-year revenue streams and embedding their technology into essential global infrastructure.

Strategic alliances for technology and market entry

OSI Systems, Inc. actively engages in strategic partnerships to enhance its technological capabilities and expand market presence across security and healthcare. The company's Optoelectronics and Manufacturing segment acts as a trusted global supplier of high-performance optoelectronic solutions and precision manufacturing services for leading Original Equipment Manufacturers (OEMs) in aerospace and communications. This segment manufactures specialized components, including sensors and optical devices, for these partners.

The shift toward service-based revenue highlights a key strategic alignment with customers' long-term operational needs. For instance, a service-based agreement secured in 2025 was valued at $47 million to maintain and enhance its installed base of Rapiscan inspection systems and CertScan software. This focus on recurring revenue is paying off; service and upgrade agreements contributed over 30% of the Security Division's revenue in 2024, up from 20% in 2020. The Security division's non-GAAP operating margin reached 20.4% in Q4 2025, partly due to these high-margin service contracts.

Government agencies and international ministries for large-scale security deployments

A significant portion of OSI Systems, Inc.'s revenue is derived from large-scale deployments with government entities globally. These contracts often involve complex, long-term integration of RF communication and inspection technologies. The company serves customers in over 170 countries, demonstrating a broad international footprint for its security solutions.

Key contract wins in 2025 illustrate the depth of these government and international ministry partnerships:

• Secured a $23 million order in January 2025 to deploy long-range RF critical communication systems for US government strategic capability.
• Awarded a $34 million contract in July 2025 by an international customer for Z Portal® and CarView™ inspection systems at ports and border crossings.
• Received a $20 million order in November 2025 from an international customer for a radiological threat detection solution.
• Secured a $26 million order in September 2025 for RF-based critical systems focused on public safety and infrastructure security.

The overall strength of these relationships is reflected in the year-end backlog for Fiscal 2025, which stood at > $1.8 Billion.

Here's a snapshot of notable 2025 contract activity:

Partnership Type/Customer	Contract/Order Value (USD)	Date Announced (2025)	System Focus
US Government (Security Division)	$23 million	January	Long-range RF Critical Communication Systems
International Customer (Security Division)	$34 million	July	Z Portal® and CarView™ Inspection Systems
International Customer (Security Division)	$20 million	November	Radiological Threat Detection Solution
Public Safety/Infrastructure Customer (Security Division)	$26 million	September	RF-based Critical Systems
Security Service/Upgrade Base (Recurring Revenue)	$47 million	Undisclosed (Service Contract)	Maintenance and Software Support

Global network of specialized distributors and resellers

OSI Systems, Inc. markets and sells its security and inspection products globally not only through a direct sales staff but also via an expansive global network of independent distributors. This network supports sales in North America, South America, Europe, the Middle East, Australia, and Asia. Similarly, healthcare solutions are sold through a global network of independent distributors, alongside direct sales teams in key regions.

The company's overall reach extends to serving customers in over 170 countries, which necessitates a robust, localized distribution and service infrastructure.

Defense electronics Original Equipment Manufacturers (OEMs) for component supply

The Optoelectronics and Manufacturing segment is integral to the defense supply chain, serving as a supplier to leading defense electronics OEMs. This partnership involves providing high-precision components for integration into advanced systems. While a specific 2025 OEM order wasn't detailed, a prior order in March 2024 for optical sensors to a leading defense OEM was valued at approximately $3 million for integration into sophisticated missile systems. This demonstrates the established nature of these component supply relationships.

Key suppliers for specialized optoelectronic components

OSI Systems, Inc.'s vertical integration strategy means it designs, manufactures, and customizes many of its own specialized components. However, for external supply, the Optoelectronics and Manufacturing segment focuses on providing high-performance optoelectronic solutions and precision manufacturing services to external OEMs. The company's ability to offer component design, subsystem concept design, and efficient manufacturing capabilities provides value to these external partners, positioning OSI Systems, Inc. as a comprehensive supplier rather than just a component buyer in some instances.

Finance: draft FY2026 cash flow forecast by end of next week.

OSI Systems, Inc. (OSIS) - Canvas Business Model: Key Activities

You're looking at the core engine of OSI Systems, Inc. (OSIS), the activities that drive their specialized business across security and healthcare. It's not just about selling boxes; it's about the entire lifecycle of complex, mission-critical systems.

Research and Development (R&D) for advanced security and medical imaging

OSI Systems, Inc. strategically positions its R&D capabilities worldwide to support its product lines. For the fiscal year ended June 30, 2025, R&D expenses amounted to $18.6 million, which represented 4.2% of that year's total revenues. This investment supports the development of advanced radiation monitoring portals and enhancements to patient monitoring and diagnostic cardiology devices under the Spacelabs name. The company's focus is on maintaining technological relevance in critical care and homeland security sectors.

Global manufacturing and supply chain management across multiple continents

The manufacturing footprint is intentionally broad, supporting the strategy of fast and efficient delivery across over 170 countries. You see this activity spread across numerous locations:

• Domestic security and inspection system manufacturing in California, Massachusetts, and Tennessee.
• International security and inspection system manufacturing in Germany, Malaysia and the United Kingdom.
• Healthcare systems manufacturing located in Washington state.
• Optoelectronic devices and electronics manufacturing services (EMS) spanning California, New Jersey, Canada, Mexico, India, Indonesia, Malaysia, and the United Kingdom.

This dispersed network is key to managing the supply chain for their diverse product offerings.

Execution of large, multi-year government and institutional contracts

A significant activity involves securing and executing large, long-term contracts, particularly with governmental bodies. For the fiscal year ended June 30, 2025, OSI Systems, Inc.'s Security division recorded direct sales to the U.S. Government totaling approximately $182.8 million. Furthermore, the company announced a contract award in June 2025 for approximately $11 million to deliver customized radiation monitoring portals and follow-on services to an international customer for border security applications. The company finished fiscal year 2025 with a year-end backlog of > $1.8 Billion, indicating substantial future execution work.

Providing high-margin, long-term maintenance and service support

Generating recurring revenue from the installed base is a core activity that drives profitability. The Security division's fourth quarter of fiscal 2025 performance was explicitly noted as being driven by strong growth in service revenues, which stems from the increasing installed base of their security products. This service component is critical for realizing the high-margin potential inherent in long-term customer relationships following system installation.

Vertical integration from component design to final system assembly

OSI Systems, Inc. actively engages in vertical integration, which the company states provides a competitive advantage, especially in the Optoelectronics and Manufacturing division. This activity spans from the design and fabrication of discrete optoelectronic devices and flexible circuit boards to providing full turnkey solutions, including supply chain management and box-build manufacturing services. This control over the component level helps ensure quality and supply chain reliability for their final security and healthcare systems.

Here's a quick look at the scale of operations based on recent reported figures:

Metric	Value (FY Ended June 30, 2025)	Value (Q1 FY2026)
Total Fiscal Year Revenue	$1.713 billion	N/A
Quarterly Revenue	N/A	$384.6 million ($384,623 thousand)
Fiscal Year-End Backlog	> $1.8 Billion	Record Q1 Backlog
R&D Expense as % of Revenue	4.2%	N/A
U.S. Government Direct Sales (Security)	$182.8 million	N/A

Finance: review the Q1 FY2026 service revenue percentage against the FY2025 run rate by next Tuesday.

OSI Systems, Inc. (OSIS) - Canvas Business Model: Key Resources

You're looking at the core assets that power OSI Systems, Inc. (OSIS) right now, late in 2025. These aren't just line items; they are the tangible and intangible engines driving the business.

Proprietary Technology and Manufacturing Scale

The foundation rests on the design and manufacture of specialized electronic systems. This includes the core technology underpinning the Security division's inspection systems and the Optoelectronics division's components.

• The company operates a vertically integrated structure, which is a key advantage in cost-effectiveness and agility.
• Fiscal Year 2025 revenues reached $1.713 billion, reflecting the scale of these operations.
• The Book to Bill Ratio for Fiscal Year 2025 was 1.1, showing strong order intake relative to revenue recognition.

OSI Systems, Inc. maintains a global manufacturing footprint to leverage competitive labor rates and enhance service delivery. The required locations are confirmed to be part of this network:

Region/Country	Confirmed Operational Presence
United States	Yes
United Kingdom	Yes
Malaysia	Yes
India	Yes
Other Confirmed Locations	Mexico, Canada, Indonesia, Singapore, Germany, UAE, Albania, Cyprus

Brand Equity and Revenue Visibility

The market recognizes two primary brand pillars. The brand equity is built on years of deployment and service contracts in critical sectors.

• Rapiscan Systems: Focuses on security and inspection equipment, including X-ray and cargo screening.
• Spacelabs Healthcare: Delivers patient monitoring, cardiology, and connected care systems.
• Spacelabs Healthcare even has a spotlight for designing technology used for NASA moon landings.

This brand strength translates directly into future revenue certainty. As of the Fiscal Year 2025 year-end (June 30, 2025), the year-end backlog stood at greater than $1.8 billion. Honestly, that backlog provides significant future revenue visibility, especially since Fiscal Year 2026 guidance is already set.

Specialized Human Capital

The ability to execute on those complex security and healthcare contracts relies on specialized people. You can see the scale of this resource in the total headcount.

As of June 30, 2025, OSI Systems, Inc. had a total of 7,337 employees. That number represented an increase of 656 employees, or 9.82%, over the prior year. Here's the quick math on productivity from that period:

Metric (FY2025)	Amount
Revenue Per Employee	$239,033
Profits Per Employee	$20,752

These specialized engineering and technical service personnel are the ones who design the IP and service the installed base that drives the Security division's service revenues.

Finance: draft 13-week cash view by Friday.

OSI Systems, Inc. (OSIS) - Canvas Business Model: Value Propositions

You're looking at the core value OSI Systems, Inc. (OSIS) delivers across its segments, grounded in the numbers from the latest reported periods.

The overall financial scale shows significant momentum leading into the current period. For the fiscal year ended June 30, 2025, OSI Systems, Inc. posted record revenues of $1.713 billion, marking an 11% year-over-year increase. The company finished that year with a backlog exceeding $1.8 Billion. For the first quarter of fiscal 2026 (ended September 30, 2025), revenues hit $385 Million, which was a 12% year-over-year jump, with Non-GAAP EPS reaching a record $1.42.

Metric	Fiscal Year 2025 (Ended 6/30/2025)	Q1 Fiscal 2026 (Ended 9/30/2025)
Total Revenue	$1.713 billion	$385 Million
Revenue YoY Growth	11%	12%
Non-GAAP EPS	$9.36	$1.42
Year-End Backlog / Record Q1 Backlog	> $1.8 Billion	Record Q1 Backlog

The value proposition of Comprehensive, vertically-integrated security screening solutions (Rapiscan) is evidenced by substantial contract wins focused on deployment and long-term support.

• Maintenance service contract for Rapiscan inspection systems: $47 million (May 29, 2025).
• Order for cargo and vehicle inspection systems (Z Portal): $24 million (April 15, 2025).
• Contract for mobile cargo inspection systems (Eagle M60, ZBV): $14 million (June 24, 2025).
• Order for airport screening solutions including Orion 920CT and Itemiser 5X: approximately $36 million (May 7, 2025).
• Recent order for radiation monitoring solutions: $20 million (November 24, 2025).

For High-performance, reliable patient monitoring and diagnostic cardiology systems (Spacelabs), the value is shown through ongoing system expansion with existing customers.

• Award to provide patient monitoring solutions and supplies to a U.S. hospital: approximately $4 million (April 2, 2025).

The value in Custom-designed optoelectronic devices and precision manufacturing services is demonstrated through component supply contracts.

• Order for critical electronic sub-assemblies for a healthcare OEM: approximately $15 million (as reported in April 2025 context).

The offering of Turnkey security solutions including financing, installation, and long-term operation is supported by the structure of recent large awards and corporate financial positioning.

• The $36 million airport contract included deployment and service.
• The $34 million contract included training, civil works management, and maintenance support.
• The company expanded its credit facility to a total borrowing capacity of $825 million, extended to July 2030.
• OSI Systems priced an upsized offering of $500 million aggregate principal amount of convertible senior notes due 2031, with an interest rate of 0.50%.

The value proposition tied to Enhanced national security and operational efficiency for critical infrastructure is quantified by the overall Security division performance and the backlog.

• Security division performance drove Fiscal Year 2025 revenues of $1.713 billion.
• The year-end backlog stood at > $1.8 Billion.
• The Z-Portal system scans up to 400 passenger vehicles per hour per lane.

Finance: draft 13-week cash view by Friday.

OSI Systems, Inc. (OSIS) - Canvas Business Model: Customer Relationships

Dedicated, high-touch relationship management is key for large government contracts, evidenced by the September 2025 award to S2 Global, Inc. for the U.S. Customs and Border Protection (CBP) Common Integration Platform (CIP) program, which has a total estimated potential value of approximately $54 million over its five-year term, with an initial award of about $1.5 million. Also, the Security division secured a $76 million order for explosive detection systems from a major international airport in Q3 Fiscal Year 2025, which was the largest airport award in the company's history.

Recurring revenue is built on long-term service agreements. The installed base growth directly fuels service revenue, as seen by the ~$56.1 million increase in Security division service revenues during Fiscal Year 2025. The Healthcare division also saw service revenue increase by $2.4 million in Fiscal Year 2025. The company serves customers across over 170 countries, requiring a globally positioned sales and service structure.

The direct sales force targets institutional and government customers. The Fiscal Year 2025 year-end backlog stood at > $1.8 Billion, demonstrating strong forward visibility driven by these large-scale engagements. The book-to-bill ratio exceeded 1.0 for the third quarter of Fiscal Year 2025, showing new bookings outpaced recognized revenue.

Technical support and maintenance are critical for the installed base. This relationship is monetized through service revenue, which contributed to the overall Fiscal Year 2025 consolidated revenue of $1.713 billion. The Security division's product revenue grew by approximately $97.0 million in Fiscal Year 2025, expanding the base requiring ongoing support.

The relationship with Optoelectronics OEM customers is standardized B2B. This segment saw revenue increase by $23.5 million year-over-year for the fiscal year ended June 30, 2025, driven mainly by the contract manufacturing business. The Healthcare division accounted for 10% of total consolidated revenues in Fiscal Year 2025.

Here's a look at some key figures underpinning these customer relationships as of late 2025:

Metric	Amount/Value	Context/Period
Total FY2025 Revenue	$1.713 billion	Fiscal Year Ended June 30, 2025
Year-End Backlog	> $1.8 Billion	As of June 30, 2025
Security Service Revenue Growth	~$56.1 million	Fiscal Year 2025 Increase
Optoelectronics Revenue Growth	$23.5 million	Fiscal Year 2025 Increase
CBP Contract Potential Value	$54 million	5-Year Term (Sept 2025 Award)
Largest Airport Order Value	$76 million	Q3 FY2025 Security Division
Healthcare Revenue Contribution	10%	Fiscal Year 2025 Share of Total Revenue
Global Operational Footprint	170 countries	Countries Served

The customer relationship structure supports significant future revenue visibility:

• Fiscal 2026 Revenue Guidance range is $1.805 billion - $1.850 billion.
• Security division secured a $50 million order for cargo inspection systems from a U.S. customer in Q3 FY2025.
• Healthcare division recorded a $4 million order for patient monitoring solutions in Q3 FY2025.
• The company's Q2 FY2025 SG&A expenses were $71 million, or 16.8% of sales, reflecting sales force and support costs.

Finance: review the contract milestone payment schedule for the $54 million CBP contract by next Tuesday.

OSI Systems, Inc. (OSIS) - Canvas Business Model: Channels

OSI Systems, Inc. utilizes a multi-faceted channel strategy across its Security, Healthcare, and Optoelectronics and Manufacturing segments to reach its diverse customer base across more than 170 countries.

Direct Sales and Service Teams to Government and Institutional End-Users

The Security division relies heavily on direct sales and service staff located across North America, South America, Europe, the Middle East, Australia, and Asia for marketing and selling its security and inspection products and turnkey screening solutions. For the fiscal year ended June 30, 2025, the Security division's direct sales to the U.S. Government were approximately $182.8 million. This direct sales organization is supported by a service organization in the same regions.

Global Network of Regional Sales Offices and Service Centers

OSI Systems maintains offices and production facilities in more than a dozen countries, which is viewed as a strategic advantage for strengthening sales, marketing, and the ability to service and repair systems by providing direct access to international markets and existing customers. The company operates in the Americas, Europe, the Middle East, and Asia-Pacific regions. The overall fiscal year 2025 revenue for OSI Systems, Inc. reached $1.713 billion.

Here is a look at the reported quarterly revenue performance during fiscal year 2025, which reflects the output of these various channels:

Reporting Period	Revenue Amount
Fiscal Year 2025 (Ended June 30, 2025)	$1,713,166 thousand
Q4 Fiscal Year 2025 (Ended June 30, 2025)	$504,985 thousand
Q3 Fiscal Year 2025 (Ended March 31, 2025)	$444.4 million
Q1 Fiscal Year 2025 (Ended September 30, 2024)	$344.0 million

Distributor and Reseller Network for Smaller International Markets and Products

For its Security products, OSI Systems supplements its direct sales staff with an expansive global network of independent distributors. The company's Optoelectronics and Manufacturing division also sells its components to third parties across various markets. The Optoelectronics and Manufacturing division reported 15% revenue growth in the third quarter of fiscal 2025.

Direct-to-Hospital Sales and Clinical Application Specialists for Spacelabs

The Healthcare division, primarily under the Spacelabs brand, sells its patient monitoring and related solutions directly to end customers. This includes sales to hospitals, physicians' offices, medical clinics, and ambulatory surgery centers. The division also utilizes indirect channels such as integrated delivery networks and group purchasing organizations in the U.S., the NHS Supplies Organization in the United Kingdom, UGAP in France, and NUPCO in Saudi Arabia, along with sales to government-funded hospitals in the Middle East and parts of Asia. In April 2025, Spacelabs Healthcare announced an agreement to provide approximately $4 million of patient monitoring solutions and related supplies to an existing U.S.-based hospital customer, facilitated in conjunction with a strategic partner.

The division's commitment to providing innovative care solutions is reinforced by its award-winning service and support teams, combined with comprehensive training and implementation.

Online and Direct Channels for Optoelectronics Component Sales

OSI Optoelectronics, Inc. and OSI Electronics, Inc. are key entities within the Optoelectronics and Manufacturing segment. These components are designed, developed, and manufactured for OEM and custom solutions. The products serve a broad range of customers across defense, aerospace, medical and life sciences, healthcare, telecommunications, homeland security, toll and traffic management, automotive, and industrial segments. The company's vertically-integrated structure supports this segment's sales.

• The year-end backlog across all segments as of June 30, 2025, was greater than $1.8 Billion.
• The company has a strong visibility into its opportunity pipeline heading into fiscal 2026.

OSI Systems, Inc. (OSIS) - Canvas Business Model: Customer Segments

You're looking at the core customer base for OSI Systems, Inc. as they closed out their fiscal year 2025. Honestly, the numbers show a heavy reliance on government and security-related entities, which drives a significant portion of their revenue stream.

For context on the scale of business, OSI Systems, Inc. reported record consolidated net revenue of $1.713 billion for the fiscal year ended June 30, 2025, which was an 11.3% increase year-over-year. Their year-end backlog stood at greater than $1.8 Billion.

Customer Segment Focus Area	FY2025 Revenue Contribution Context	Recent Contract Examples (Value/Type)
U.S. Government/Homeland Security	Over 70% of the Security division revenue comes from U.S. government clients.	Five-year contract from U.S. Customs and Border Protection (CBP) for NII Common Integration Platform (CIP) with a total estimated potential value of approximately $54 million. A $50 million contract for Cargo and Vehicle Non-Intrusive Inspection technology announced in April 2025.
International Governments/Security	Significant portion of Security division revenue from international sources, including major multi-year awards.	$20 million order for a radiological threat detection solution from an international customer (late 2025). $32 million international order for RF-based critical systems (February 2025). $24 million order for Z Portal® systems (April 2025).
Aviation & Transportation Authorities	Product revenue growth in FY2025 driven by cargo, vehicle inspection systems, and checkpoint screening sales.	$36 million contract to deploy and service airport screening solutions for a prominent international airport in the Middle East (May 2025).
Defense & Aerospace OEMs	Optoelectronics and Manufacturing division provides optoelectronic devices and electronics manufacturing services to OEM customers.	Optoelectronics and Manufacturing division revenues increased by $23.5 million year-over-year in FY2025. An order for $37 million for RF-based communication and surveillance was noted, with RF-based communication and surveillance solutions being a crucial component of military infrastructure.
Healthcare Providers	Healthcare division revenues decreased year-over-year in FY2025.	The division sells patient monitoring, cardiology, and remote monitoring systems globally to hospitals and medical centers. Cardiology sales decreased by $4.8 million in FY2025.

The Optoelectronics and Manufacturing division, which serves OEM customers, accounted for 20% of OSI Systems, Inc.'s total consolidated revenues for fiscal 2025.

The Healthcare division, which serves hospitals and medical centers, saw a year-over-year revenue decrease in fiscal 2025, primarily due to a reduction in cardiology sales of $4.8 million and patient monitoring sales of $1.8 million. Still, service revenue within Healthcare grew by $2.4 million.

You can see the direct link between the Security division's success and the government segment. The Security division's product and service revenues increased by approximately $97.0 million and $56.1 million, respectively, in fiscal 2025.

Here's a quick look at the specific customer-facing activities within the Security segment:

• Securing U.S. border and cargo checkpoints with Non-Intrusive Inspection (NII) systems.
• Providing advanced screening systems like Orion® 920CT and Orion 935DX for airport carry-on and air cargo.
• Deploying CertScan® platform to support U.S. Customs and Border Protection (CBP).
• Establishing radiation monitoring networks for international clients.
• Upgrading long-range secure communication systems for international military infrastructure.

Finance: draft 13-week cash view by Friday.

OSI Systems, Inc. (OSIS) - Canvas Business Model: Cost Structure

You're looking at the cost side of OSI Systems, Inc.'s business as of late 2025, and the numbers show a structure heavily weighted toward production and overhead to support its global operations. Honestly, when you see the scale of their revenue, the underlying costs are what you'd expect for a company with significant manufacturing and service footprints.

The Cost of Goods Sold (COGS), which they report as Cost of Revenue, represents a substantial portion of the total outlay. This directly reflects the expense of raw materials and components necessary for their Security and Optoelectronics and Manufacturing divisions. For the fiscal year ended June 30, 2025, the Cost of Revenue was $1,125,984 thousand. This cost base supported total revenues of $1,713,166 thousand for the same period.

The operating expenses structure shows the investment in both growth and necessary overhead. You'll see that operating expenses increased by $28.3 million in fiscal 2025, which partially offset the growth in gross profit. This increase is spread across the business, but we can see the major buckets for fixed and semi-fixed costs.

The investment in future products and maintaining the technical edge is evident in the Research and Development (R&D) spending. For fiscal 2025, R&D expense was $73,444 thousand. This is a key component that speaks to the high fixed cost associated with innovation, especially in the Security division. Also contributing to the overhead are the Selling, General and Administrative (SG&A) costs, which totaled $290,879 thousand in fiscal 2025. This line item helps cover the costs of maintaining the global service and support infrastructure you asked about, even if the specific service cost isn't broken out separately.

For capital deployment, the company continues to invest in its physical assets. Capital expenditures (CapEx) for the full fiscal year 2025 were $23,832 thousand. This spending supports the maintenance and expansion of the manufacturing facilities essential to their vertically-integrated structure. To give you a sense of the cadence, CapEx in the first quarter of fiscal 2025 was $7.7 million, and for the third quarter, it was $4.5 million.

Here's a quick look at the key cost and related profit metrics for the full fiscal year 2025, all in thousands of U.S. Dollars:

Cost/Expense Component	Fiscal Year 2025 Amount (in thousands)
Total Revenue	$1,713,166
Cost of Revenue (COGS)	$1,125,984
Gross Profit	$587,182
Research and Development Expense	$73,444
Sales, General and Admin Expense (SG&A)	$290,879
Total Capital Expenditures (CapEx)	$23,832
Operating Income (GAAP)	$217,524

The gross margin for fiscal 2025 was relatively comparable to the prior year, which suggests that while raw material and component costs are significant, OSI Systems, Inc. managed to pass along or absorb those costs effectively enough to maintain margin stability. The company's year-end backlog of over $1.8 billion suggests these cost drivers will remain central to their near-term planning.

• Operating Expenses increased by $28.3 million in fiscal 2025.
• Gross profit increased by approximately $56.7 million in fiscal 2025.
• R&D expense was $73,444 thousand for fiscal 2025.
• SG&A expense was $290,879 thousand for fiscal 2025.
• Total CapEx for fiscal 2025 was $23,832 thousand.

OSI Systems, Inc. (OSIS) - Canvas Business Model: Revenue Streams

You're looking at the hard numbers for how OSI Systems, Inc. (OSIS) actually brings in the money as of late 2025. It's a mix of hardware sales, ongoing support, and big, multi-year deals. Here's the quick math on their top-line performance for the last full fiscal year.

Total Fiscal Year 2025 Revenue reached a record $1.713 billion, which was an 11% increase year-over-year from the $1.539 billion seen in fiscal year 2024. This record performance was driven by strong execution across the board, especially in the Security division.

The revenue streams are clearly segmented between the physical goods they sell and the ongoing support they provide. Honestly, the service component is what analysts watch closely for that high-margin predictability.

Revenue Category	Fiscal Year 2025 Amount (in thousands)	Fiscal Year 2025 Amount (Approximate USD)
Product Sales	$1,323,291	$1.323 billion
Service Revenue	$389,875	$389.875 million
Total Net Revenues	$1,713,166	$1.713 billion

Service Revenue is key here; it includes high-margin, recurring maintenance, installation, and software contracts. The growth in this area for fiscal 2025 was approximately $56.1 million year-over-year, largely due to the expanding installed base of their security products.

The business model heavily relies on large, complex security deployments, which fall under project-specific contract revenue and service revenue. You see this clearly in the Security division's performance:

• Revenue from large international security contracts recognized in FY2025 totaled $231 million from three major contracts awarded in fiscal years 2023 and 2024.
• This compares to $404 million recognized in FY2024 from those same contracts.
• Further revenues are expected in fiscal year 2026, but at relatively lower amounts as the majority of equipment deliveries were fulfilled by the end of fiscal year 2025.

The Security division also generates revenue from turnkey project revenue, which OSI Systems, Inc. describes as delivering turnkey screening solutions. This is bundled within the product and service revenue lines, but the nature of these large-scale deployments is definitely a distinct revenue driver. For instance, the Security division saw product revenue increase by approximately $97.0 million in fiscal 2025, driven by cargo, vehicle inspection, and trace detection systems.

To be fair, the Optoelectronics and Manufacturing segment also contributes significantly through high-performance optoelectronic components and precision manufacturing services, though the Security segment is the primary focus for these large project revenues. Finance: draft 13-week cash view by Friday.