Novanta Inc. (NOVT), a leading supplier of photonic and motion control components, saw its stock surge 5.85% in pre-market trading on Tuesday after reporting better-than-expected fourth quarter results driven by robust demand for its Medical Solutions segment.

The company reported adjusted earnings per share of $0.76, beating analysts' estimates of $0.71. However, revenue of $238.1 million fell slightly short of expectations at $240.3 million, primarily due to weakness in its Automation Enabling Technologies segment.

Novanta's Medical Solutions segment, which caters to the medical technology market, emerged as the standout performer, with revenue soaring 16.8% year-over-year to $110.3 million. This growth was fueled by strong customer demand for Novanta's innovative products used in hospital operating rooms and surgical equipment.

According to Matthijs Glastra, Chair and Chief Executive Officer of Novanta, the company's robust performance in the medical sector stems from its strategic investments in generative AI and autonomous driving technologies. These investments have positioned Novanta to capitalize on the growing demand for advanced medical solutions.

"We remain confident in our strategy, our portfolio, our exposure to diversified end-markets, and our ability to generate strong operating cash flows to compound our growth through our targeted acquisition strategy," Glastra stated.