Core Insights - Intuitive Surgical, Inc. reported $2.44 billion in revenue for the quarter ended June 2025, marking a year-over-year increase of 21.4% and an EPS of $2.19 compared to $1.78 a year ago, exceeding Zacks Consensus Estimate of $2.35 billion by +3.93% [1] - The company delivered an EPS surprise of +14.06%, with the consensus EPS estimate being $1.92 [1] Financial Performance Metrics - The installed base of the Da Vinci Surgical System reached 10,488, surpassing the four-analyst average estimate of 10,427 [4] - Revenue from products (instruments, accessories, and systems) was $2.05 billion, exceeding the $1.96 billion average estimate based on seven analysts, representing a +21% year-over-year change [4] - Revenue from services was $391.2 million, compared to the estimated $368.86 million, reflecting a +23.3% change year-over-year [4] - Revenue from systems was $574.7 million, exceeding the estimated $516.21 million, with a +28.2% year-over-year change [4] - Revenue from instruments and accessories was $1.47 billion, slightly above the estimated $1.44 billion, representing an +18.5% year-over-year change [4] Stock Performance - Shares of Intuitive Surgical have returned +0.2% over the past month, while the Zacks S&P 500 composite has changed by +5.9% [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential outperformance against the broader market in the near term [3]

Core Insights - Intuitive Surgical, Inc. (ISRG) reported quarterly earnings of $2.19 per share, exceeding the Zacks Consensus Estimate of $1.92 per share, and showing an increase from $1.78 per share a year ago, resulting in an earnings surprise of +14.06% [1][2] - The company generated revenues of $2.44 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 3.93%, and up from $2.01 billion year-over-year [2] - Intuitive Surgical has consistently outperformed consensus EPS estimates over the last four quarters, achieving this four times [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1.96 on revenues of $2.39 billion, and for the current fiscal year, it is $7.84 on revenues of $9.65 billion [7] - The estimate revisions trend for Intuitive Surgical was favorable ahead of the earnings release, leading to a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] Market Performance - Intuitive Surgical shares have underperformed the market, losing about 1.1% since the beginning of the year, while the S&P 500 has gained 7.2% [3] - The outlook for the industry, particularly the Medical - Instruments sector, is currently in the bottom 35% of Zacks industries, which may impact stock performance [8]

Image source: The Motley Fool.Tuesday, July 22, 2025 at 4:30 p.m. ETCALL PARTICIPANTSChief Executive Officer — Dave RosaChief Financial Officer — Jamie SamathChief Medical Officer — Dan ConnallyNeed a quote from one of our analysts? Email [email protected] RISKSJamie Samath stated, "pro forma gross margin was 67.9% in Q2 2025, down from 70% in Q2 2024." attributing the decline to "higher facilities costs," "a greater mix of lower-margin ION and da Vinci five revenue," and "higher service costs related to da ...

Financial Data and Key Metrics Changes - Revenue for the quarter was $2,440 million, representing a 21% growth year over year [27] - Pro forma operating margin was 39%, and pro forma earnings per share increased by 23% to $2.19 [20][36] - Pro forma net income for the second quarter was $798 million compared to $641 million last year [36] Business Line Data and Key Metrics Changes - da Vinci procedure growth was 17%, with a notable increase in benign general surgery in the US [9][21] - SP procedures grew 88%, driven by strong growth in Korea and Europe [29] - ION procedures increased by 52%, with approximately 35,000 procedures performed in the quarter [30] Market Data and Key Metrics Changes - In the US, da Vinci procedures grew 14%, while outside the US, they grew 23%, with strong contributions from India and Korea [22][23] - Capital placements in the US increased by 45%, while placements in Japan decreased by 26 systems year over year [63] - Total systems placed in the quarter were 395, a 16% increase from the previous year [24] Company Strategy and Development Direction - The company is focused on the full launch of da Vinci V and increasing adoption of focused procedures through training and market access efforts [18] - There is a commitment to innovation and expanding the digital ecosystem to enhance clinician training and patient care [12][17] - The company aims to improve operational efficiency and product quality while navigating macroeconomic challenges [8][16] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing macro challenges in international markets but expressed confidence in the company's operational and financial positioning [19] - The updated financial guidance for 2025 includes a forecast for da Vinci procedure growth of 15-17% [44] - Management highlighted the importance of adapting to changes in Medicaid coverage and its potential impact on hospital capital budgets [22][62] Other Important Information - The company opened a new manufacturing facility in Bulgaria to support its growth strategy [34] - The average selling price for systems increased to $1,500,000, reflecting a higher mix of da Vinci V systems [28] - The company repurchased 350,000 shares at an average price of $518 per share during the quarter [37] Q&A Session Summary Question: Margin sustainability and drivers - Management noted strong revenue growth and a favorable purchase mix contributed to the margin upside, but cautioned against characterizing it as the new normal [50][51] Question: Reprocessing and extending useful life of instruments - Management emphasized the importance of high-quality instruments and ongoing innovation to maintain competitive advantage [54][55] Question: Capital spending and Medicaid coverage impacts - Management acknowledged potential challenges from Medicaid coverage loss but highlighted opportunities to demonstrate the value of da Vinci systems [62] Question: System placements outside the US - Management indicated a measured rollout for da Vinci V in Europe and Japan, with expectations for increased trade-ins as customers upgrade [88][90] Question: Future opportunities in outpatient environments - Management expressed optimism about expanding robotic surgery into outpatient settings and ASCs, leveraging existing technology [94] Question: Future features and capabilities of da Vinci V - Management confirmed ongoing enhancements to the da Vinci V platform, with expectations for improved outcomes and efficiency [96][99]

Financial Data and Key Metrics Changes - Revenue for the quarter was $2,440 million, representing a 21% growth over the prior year, with systems revenue increasing by 28% [27][36] - Pro forma operating margin was 39%, and pro forma earnings per share increased by 23% to $2.19 [20][36] - Pro forma net income for the second quarter was $798 million compared to $641 million last year [36] Business Line Data and Key Metrics Changes - da Vinci procedures grew by 17%, with a total procedure growth of 18% when including ION procedures [21][10] - SP procedures grew by 88%, driven by 112% growth in Korea [29] - ION procedures increased by 52%, with approximately 35,000 procedures performed in the quarter [30] Market Data and Key Metrics Changes - In the US, da Vinci procedures grew by 14%, with notable growth in benign general surgery [21] - Outside the US, da Vinci procedures grew by 23%, with strong contributions from India, Korea, and distributor markets [22] - Capital placements in the US increased by 45%, while placements in Japan decreased by 26 systems year over year [64] Company Strategy and Development Direction - The company is focused on the full launch of da Vinci V, regional clearances, and follow-on feature releases [18] - There is an emphasis on increasing adoption for focused procedures through training and commercial activities [18] - The company aims to enhance its digital tools and manufacturing optimization to support long-term growth [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing macro challenges in certain international markets but expressed confidence in the company's operational and financial positioning [6][19] - The company updated its 2025 da Vinci procedure growth guidance to a range of 15-17% [44] - Management highlighted the potential impacts of fiscal policy on Medicaid recipients and the importance of demonstrating clinical and economic advantages [22] Other Important Information - The company opened a new 187,000 square foot manufacturing facility in Bulgaria to support its portfolio of mature endoscope products [33] - The average selling price for systems was $1,500,000, reflecting an increasing mix of da Vinci V systems [28] Q&A Session Summary Question: Margin performance and sustainability - Management noted strong revenue growth and a favorable purchase mix contributed to the margin upside, but it should not be characterized as the new normal [50][51] Question: Reprocessing and protecting the business - Management emphasized the importance of high-quality instruments and operational support in maintaining customer value amidst competition from remanufactured instruments [54][56] Question: Capital spending and Medicaid impacts - Management acknowledged potential challenges for hospitals due to lower admissions from Medicaid coverage loss but highlighted opportunities for Intuitive to demonstrate value [62][63] Question: System placements outside the US - Management indicated a measured rollout for da Vinci V in Europe and Japan, with expectations for increased trade-ins as customers upgrade [88][89] Question: Future opportunities in robotics - Management expressed interest in expanding robotic utilization in outpatient environments and ASCs, leveraging existing technology [93][94]

Exhibit 99.1 Contact: Investor Relations (408) 523-2161 INTUITIVE ANNOUNCES SECOND QUARTER EARNINGS SUNNYVALE, CALIF. July 22, 2025 – Intuitive (the "Company") (Nasdaq: ISRG), a global technology leader in minimally invasive care and the pioneer of robotic-assisted surgery, today announced financial results for the quarter ended June 30, 2025. Q2 Highlights Q2 Financial Summary Gross profit, income from operations, net income attributable to Intuitive Surgical, Inc., and net income per diluted share attribu ...

Core Viewpoint - Intuitive Surgical, Inc. (ISRG) is expected to report second-quarter 2025 earnings with sales estimated at $2.35 billion and earnings per share (EPS) at $1.92, driven by a projected 15-17% increase in da Vinci procedures in 2025 [2][8]. Financial Performance - ISRG delivered an earnings surprise of 5.85% in the last reported quarter, with an average surprise of 14.64% over the past four quarters [3][4]. - The company has stable EPS estimates of $7.84 for 2025 and $9.05 for 2026 [2]. Market Trends - The Instruments & Accessories segment is anticipated to show strong results due to robust da Vinci procedure growth, particularly in U.S. general surgery and cancer procedures outside the U.S. [6][7]. - Procedure growth in China has improved, primarily driven by urologic procedures, although tariff-related challenges may impact sales [9]. Product Adoption - Strong adoption of the newly launched da Vinci 5 surgical system is expected to contribute positively to the second-quarter results, with 147 systems placed in the first quarter [10]. - The Services segment is likely to reflect strong adoption of digital products and services, including Intuitive App and Intuitive Hub [11]. Valuation and Performance - ISRG shares have declined 0.7% year-to-date, underperforming the S&P 500 Index's gain of 6.5% but outperforming the Zacks Medical sector's decrease of 6.4% [13]. - The company is currently trading at a forward 12-month P/E of 60.92X, significantly higher than the industry average of 27.90X, indicating a premium valuation [16][17]. Future Outlook - Continued growth in da Vinci procedure volume and strong Ion procedure growth are expected to drive ISRG's performance for the remainder of 2025 [20]. - The launch of da Vinci SP in Europe and da Vinci 5 in the U.S. is anticipated to further enhance system placements [21]. - Rising trade tensions and tariff implications may introduce uncertainty, but the company's U.S. and Mexico manufacturing facilities should mitigate some risks [22].

Core Viewpoint - The article suggests that three industry leaders with strong catalysts and competitive advantages could outperform current AI leaders Nvidia and Palantir over the next decade. Group 1: Nvidia and Palantir - Nvidia has gained over $3.8 trillion in market value since the start of 2023, while Palantir's stock has surged approximately 2,250% during the same period [2] - Nvidia's GPUs, particularly the Hopper and Blackwell models, dominate AI-accelerated data centers, allowing the company to charge a significant premium due to ongoing AI-GPU scarcity [4] - Palantir's platforms, Gotham and Foundry, are essential for federal governments and businesses, driving sales growth and recurring profitability [5] - Both companies may be in a bubble, as historical trends suggest that major innovations often experience bubble-bursting events [6] - Palantir's price-to-sales (P/S) ratio is nearing 121, while Nvidia's is approaching 29, significantly higher than peers [7] Group 2: Potential Competitors - Alibaba Group, with a current market cap of $276 billion, is positioned to potentially surpass Nvidia and Palantir, benefiting from its e-commerce dominance and cloud infrastructure services [10][11] - Alibaba's Taobao and Tmall platforms accounted for an estimated 41% of China's online retail market in 2024, supported by a growing middle class [11] - Alibaba Cloud captured one-third of all cloud infrastructure spending in mainland China, with generative AI solutions expected to drive double-digit sales growth [12] - PayPal Holdings, with a market cap of $71 billion, is also a strong contender, as the global fintech market is projected to grow significantly [14][15] - PayPal's total payment volume increased from $936 billion to an annual run rate of $1.67 trillion, indicating strong engagement from active accounts [16] - Intuitive Surgical, valued at $184 billion, has a stronghold in the robotic-assisted surgical market, with a growing revenue stream from high-margin instruments and services [19][21][22] - The company is expanding its surgical systems' applications, which could sustain double-digit growth for the next decade [23]

Company Overview - Intuitive Surgical (ISRG) received FDA clearance for its Vessel Sealer Curved, a multifunctional instrument for da Vinci surgical systems, enhancing procedural efficiency in minimally invasive surgeries [2][5] - The Vessel Sealer Curved integrates advanced bipolar energy technology with refined mechanical design, improving performance and precision in robotic-assisted surgeries [3][9] - The new instrument can grasp, dissect, coagulate, and transect tissue, increasing procedural efficiency and broadening the appeal of robotic-assisted surgery across specialties [5][10] Financial Performance - ISRG has a market capitalization of $183.59 billion and an earnings yield of 1.45%, which is higher than the industry's negative 2.88% [6] - In the last reported quarter, ISRG delivered an earnings surprise of 5.85% [6] Stock Performance - Following the FDA clearance announcement, ISRG shares traded flat, with a year-to-date loss of 1.8%, compared to the industry's 11.5% decline and the S&P 500's gain of 5.6% [4] Industry Prospects - The global surgical robots market is projected to grow from $4.31 billion in 2024 to $7.42 billion by 2030, with a CAGR of 9.42% from 2025 to 2030, driven by technological innovation and increasing investments [13]

Core Insights - Intuitive Surgical, Inc. (ISRG) is expected to report quarterly earnings of $1.92 per share, a 7.9% increase year-over-year, with revenues projected at $2.35 billion, reflecting a 16.8% year-over-year growth [1] Earnings Estimates - The consensus EPS estimate has been revised upward by 0.1% in the last 30 days, indicating analysts' reassessment of their initial estimates [2] - Changes in earnings estimates are crucial for predicting investor reactions, as empirical research shows a strong correlation between earnings estimate revisions and short-term stock performance [3] Revenue Forecasts - Analysts forecast 'Revenue- Product (Instruments and accessories and Systems)' to reach $1.96 billion, a 15.7% increase from the previous year [5] - The consensus estimate for 'Revenue- Services' is $368.86 million, suggesting a 16.3% year-over-year change [5] - 'Revenue- Systems' is expected to reach $516.21 million, indicating a 15.2% increase year-over-year [5] Unit and Procedure Estimates - The average prediction for 'Revenue- Instruments and accessories' is $1.44 billion, reflecting a 15.9% increase from the prior year [6] - Analysts estimate 'Total System Units Placed - Total Company' at 395, up from 341 in the same quarter last year [6] - The estimated 'Total Number of Procedures' is 771,122, compared to 661,000 a year ago [7] - The 'Da Vinci Surgical System Installed Base' is projected to be 10,427, up from 9,203 year-over-year [7] - 'Total System Units Placed - Outside of the United States' is expected to reach 184, down from 192 year-over-year [7] - 'Total System Units Placed - United States' is estimated at 211, compared to 149 in the same quarter last year [8] Profit and Cost Estimates - The consensus for 'Gross profit- Service' is $245.26 million, up from $219.50 million in the same quarter last year [8] - Analysts project 'Cost of revenue- Service' to reach $118.34 million [8] Stock Performance - Over the past month, shares of Intuitive Surgical have returned +0.6%, while the Zacks S&P 500 composite has changed +4.2% [9] - ISRG currently holds a Zacks Rank 2 (Buy), indicating potential outperformance in the near future [9]