Core Viewpoint - Intuitive Surgical reported strong quarterly earnings with a double beat on both revenue and earnings per share, but mixed guidance due to tariff uncertainties affecting future growth prospects [3][4][5]. Financial Performance - The company achieved earnings per share (EPS) of $1.81, exceeding estimates by $0.10 and reflecting a 20% year-over-year increase [3]. - Revenue for the quarter was $2.25 billion, surpassing estimates by 3.27% and showing a 19% year-over-year growth [3]. Guidance and Growth Expectations - Intuitive Surgical anticipates a procedure volume growth of 15% to 17%, an increase from the previous guidance of 13% to 16% [4]. - Despite the positive growth outlook, the company faces challenges from tariffs, which could offset this growth [5]. Tariff Impact - The company manufactures 98% of its Da Vinci systems in the U.S., but 70% of endoscopes and 80% of instruments and accessories are sourced from Europe and Mexico, respectively [6]. - Intuitive Surgical expects a non-GAAP gross margin of 65% to 66.5%, a decline of about 5% year-over-year, factoring in an estimated revenue impact of 1.7% due to tariffs [7]. Stock Performance and Analyst Ratings - The current stock price is $508.13, with a 12-month price target of $598.95, indicating a potential upside of 17.87% [8]. - The stock is trading at a forward P/E ratio of 75.8, which is considered expensive compared to the broader market but aligns with its five-year average [8]. - Analysts suggest a cautious approach, recommending waiting for the stock to break above the 50-day simple moving average before taking a long position [10]. Tariff Outlook - The company faces potential tariffs of 125% and 145% for imports and exports to China, 10% for European components, and 25% for certain products from Mexico [12].

Core Insights - Intuitive Surgical (ISRG) reported Q1 earnings for 2025 with mixed results compared to expectations [1] - Revenue for the quarter was $2.3 billion, exceeding analyst expectations by 3% and representing a year-over-year growth of 19% [1] - Earnings per share (EPS) for the quarter surpassed expectations by 5% [1]

Surgical Systems and Regulatory Approvals - As of March 31, 2025, the installed base of da Vinci SP surgical systems is 291, with FDA clearance for multiple procedures[110]. - The da Vinci 5 surgical system has an installed base of 509 as of March 31, 2025, and received FDA clearance for all surgical specialties except cardiac and pediatric[112]. - The company has commercialized various da Vinci surgical systems since 1999, with the latest being the da Vinci 5 surgical system launched in 2024[109]. - The Ion endoluminal system, launched in 2019, has received FDA clearance and various OUS regulatory approvals, expanding the company's offerings into diagnostic procedures[115]. - The company aims to expand the regulatory approvals for the da Vinci SP surgical system in international markets over time[111]. - The company plans to seek additional clearances and approvals for its Ion endoluminal system in OUS markets over time[115]. - The company obtained FDA clearance for the SP SureForm 45 stapler in March 2025, which is useful in thoracic and colorectal surgical procedures[149]. - The company received regulatory clearance for the da Vinci 5 surgical system in March 2024, which is expected to extend over several quarters for a phased launch[153]. - The Japanese Ministry of Health granted reimbursement for five additional da Vinci procedures in April 2024, including lobectomy for benign conditions[155]. - The company anticipates extended timelines for the introduction of new products due to increasingly stringent regulations[148]. - The company has obtained regulatory clearances for various products, including the E-200 generator and redesigned staplers, enhancing its product offerings[153]. Financial Performance and Revenue - Recurring revenue increased to $7.04 billion, representing 84% of total revenue in 2024, up from $5.94 billion (83%) in 2023 and $4.92 billion (79%) in 2022[129]. - Instruments and accessories revenue grew to $5.08 billion in 2024, compared to $4.28 billion in 2023 and $3.52 billion in 2022, reflecting continued procedure adoption[130]. - Service revenue reached $1.31 billion in 2024, an increase from $1.17 billion in 2023 and $1.02 billion in 2022, driven by a 15% growth in the installed base of da Vinci surgical systems[131]. - Systems revenue increased by 17% to $1.97 billion in 2024, following a flat performance of $1.68 billion in 2023[141]. - Total revenue for the three months ended March 31, 2025, increased by 19% to $2.25 billion compared to $1.89 billion for the same period in 2024[184]. - Product revenue rose by 20% to $1.89 billion for the three months ended March 31, 2025, compared to $1.58 billion for the same period in 2024[190]. - Service revenue increased by 16% to $363 million for the three months ended March 31, 2025, compared to $314 million for the same period in 2024[199]. - Operating income for Q1 2025 increased by 23% to $578 million compared to $469 million in Q1 2024[184]. - Net income attributable to Intuitive Surgical, Inc. was $698.4 million for the three months ended March 31, 2025, compared to $544.9 million for the same period in 2024, reflecting a 28% increase[185]. - The U.S. accounted for 68% of total revenue in the three months ended March 31, 2025, up from 66% in the same period in 2024[188]. Installed Base and Procedure Volume - The installed base of da Vinci surgical systems grew to approximately 9,902 as of December 31, 2024, compared to 8,606 in 2023 and 7,544 in 2022, indicating strong market adoption[131]. - The installed base of da Vinci surgical systems reached approximately 10,189 systems as of March 31, 2025, a 15% increase from 8,887 systems in Q1 2024[184]. - In 2024, approximately 2,683,000 surgical procedures were performed with da Vinci surgical systems, a 17% increase from 2023's 2,286,000 procedures[163]. - U.S. da Vinci procedures grew to approximately 1,757,000 in 2024, up 15% from 2023's 1,532,000 procedures, with general surgery being the largest specialty[164]. - OUS da Vinci procedures increased to approximately 926,000 in 2024, a 23% rise from 2023's 754,000 procedures, driven by urology and general surgery[165]. - Approximately 732,000 da Vinci procedures were performed in Q1 2025, a 17% increase from approximately 627,000 procedures in Q1 2024[184]. Tariffs and Trade Impact - The U.S. imposed a 25% tariff on imports from Mexico and Canada on February 1, 2025, but the impact on the company was not material due to USMCA certifications[117]. - A 10% universal tariff on imports not subject to USMCA was announced on April 2, 2025, affecting some raw materials and finished goods[118]. - The U.S. imposed tariffs up to 145% on imports from China on April 7, 2025, which may significantly impact the cost of da Vinci Xi surgical systems in China[119]. Operating Leases and Customer Trends - Total da Vinci system placements under operating lease arrangements increased to 864 in 2024, up from 704 in 2023 and 591 in 2022, with 51% of total placements under operating leases[135]. - Revenue from customer buyouts of leased systems was $109 million in 2024, up from $74 million in 2023 and $72 million in 2022, reflecting customer interest in ownership[140]. - Operating lease revenue was $654 million in 2024, compared to $501 million in 2023 and $377 million in 2022, indicating a growing trend in lease arrangements[135]. - Operating lease revenue was $195 million for the three months ended March 31, 2025, compared to $148 million for the same period in 2024[195]. Research and Development - The company anticipates continued substantial investments in research and development to support product development initiatives[211]. - Research and development expenses rose by 11% to $316.2 million in Q1 2025, compared to $284.5 million in Q1 2024[209]. Financial Reporting and Accounting - The financial statements are prepared in accordance with GAAP, requiring estimates and judgments that affect reported amounts of assets, liabilities, revenues, and expenses[229]. - There have been no new or material changes to the critical accounting estimates since the Annual Report on Form 10-K for the fiscal year ended December 31, 2024[229]. - Actual results may differ from estimates under different assumptions or conditions, highlighting the inherent uncertainty in financial reporting[229].

Core Insights - Intuitive Surgical Inc reported first-quarter 2025 revenue of $2.25 billion, exceeding analyst estimates of $2.19 billion, with a year-over-year increase of 19% [1] - The company placed 367 da Vinci surgical systems in the quarter, up from 313 in the same quarter of the previous year, leading to a total installed base of 10,189 systems, a 15% increase year-over-year [1] - Adjusted earnings for the first quarter were $1.81 per share, surpassing analyst expectations of $1.72 per share [2] Revenue and Growth - Worldwide da Vinci procedures increased by approximately 17% year-over-year, with guidance for a full-year increase of 15%-17% [1][2] - The company expects a gross profit margin of 65% to 66.5% in 2025, accounting for an estimated 1.7% impact from tariffs [3] Analyst Perspectives - Analysts believe the stock deserves a premium multiple due to elevated procedure growth and a new product cycle that could drive significant revenue and EPS growth [4] - Concerns about macro dynamics and potential Medicaid cuts may impact stock performance, but management noted that U.S. capital spending remains stable [4][5] - The company's leasing model is aiding hospitals in managing tight budgets, although potential Medicaid cuts could significantly affect hospital finances [5] Financial Position - The company has a strong cash position of $9.1 billion and zero debt, providing flexibility for share buybacks [6] - Stifel maintains a price target of $670 with a Buy rating, while Truist Securities has adjusted its price target from $605 to $590 but maintains a Buy rating [3][6] Stock Performance - ISRG stock increased by 2.47% to $490.58 [7]

Core Insights - Intuitive Surgical (ISRG) reported strong first-quarter 2025 results, with adjusted earnings per share (EPS) of $1.81, exceeding estimates by 5.9% and showing a year-over-year improvement of 20.7% [1] - Revenue for the quarter reached $2.25 billion, reflecting a 19.2% year-over-year increase and surpassing estimates by 3.3% [2] Revenue Details - The revenue growth was driven by an increase in installed systems and a rise in da Vinci procedure volume [2] - Revenue from the Instruments & Accessories segment was $1.37 billion, up 18% year over year, supported by a 17% increase in da Vinci procedure volume [3] - The Systems segment generated $523 million in revenue, a 25% increase year over year, due to higher system placements and average selling prices [4] - Service revenues amounted to $363 million, reflecting a 15.8% increase from the previous year [5] Margins and Expenses - Adjusted gross profit was $1.5 billion, a 17% year-over-year increase, with a gross margin of 66.4%, down 120 basis points from the prior year [6] - Selling, general, and administrative expenses rose to $563.4 million, up 14.6% year over year, while research and development expenses increased to $316.2 million, up 11.1% [6] Financial Position - The company ended the quarter with cash, cash equivalents, and investments totaling $9.1 billion, an increase from $8.83 billion in the previous quarter [8] - Total assets rose to $19.22 billion from $18.74 billion a year ago [8] Future Outlook - Intuitive Surgical expects gross margin to face a 170 basis points headwind in 2025 due to newly implemented global tariffs, particularly affecting components imported from China [11] - The company has lowered its pro forma gross margin guidance for the year to 65-66.5% from 67-68% [12] - Continued growth in da Vinci procedures and the launch of the da Vinci 5 system are anticipated to drive future revenues, although challenges in certain markets may slow adoption [14][16]

Financial Data and Key Metrics Changes - First quarter revenue was $2.25 billion, a 19% increase year-over-year, with constant currency growth at 20% [45][46] - Pro forma gross margin for Q1 was 66.4%, down from 67.6% in the previous year, primarily due to higher facility costs and a greater mix of lower-margin products [54] - Pro forma net income for Q1 was $662 million, or $1.81 per share, compared to $541 million, or $1.50 per share, in the same quarter last year [58][59] Business Line Data and Key Metrics Changes - Da Vinci procedure growth was 17%, with a 15% increase in the installed base of Da Vinci systems [38][39] - ION procedures grew 58% to approximately 31,000 in the quarter, with 49 ION systems placed [50][51] - SP procedure growth accelerated to 94%, driven by strong growth in the U.S. and international markets [28][52] Market Data and Key Metrics Changes - U.S. procedures grew 13%, with notable strength in benign general surgery, while OUS procedures grew 24%, driven by markets like India and Korea [40][41] - Capital placements included 367 systems, a 17% increase from the previous year, with 204 systems placed in the U.S. [42][43] - The U.S. capital environment remains strong, while OUS markets face constraints due to government budget limitations [72][74] Company Strategy and Development Direction - The company is focused on the full launch of Da Vinci 5 and increasing adoption of its products through training and market access efforts [29][30] - Plans to optimize production costs and adjust supply chain strategies in response to changing trade policies [10][11] - Continued investment in R&D and innovation to drive long-term growth and improve product quality [57] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term demand for minimally invasive care despite current trade policy uncertainties [11] - The company raised its full-year 2025 procedure growth forecast to a range of 15% to 17% [61] - Management acknowledged potential impacts from tariffs and government budget constraints on capital spending [63][64] Other Important Information - The company opened new manufacturing facilities in California to expand its U.S. manufacturing and R&D footprint [55] - Pro forma operating expenses increased by 12% compared to the previous year, driven by higher headcount and facility-related costs [57] Q&A Session Summary Question: Impact of tariffs on annualized basis - Management indicated that approximately half of the tariff impact is from U.S.-China trade, with the impact expected to increase each quarter [68][69] Question: Capital environment comparison to previous years - Management noted strong customer response to Da Vinci 5 and a relatively strong capital environment in the U.S., while OUS markets face budget constraints [71][72] Question: Inclusion of European reciprocal tariffs in estimates - Management confirmed that the 1.7% estimate includes anticipated European tariffs and emphasized a cautious approach to mitigating tariffs [79][80] Question: Confidence in raising procedure volume forecast - Management cited strong Q1 performance and positive customer feedback as reasons for the early forecast increase [86][87] Question: Drivers of robust OUS growth - Management highlighted strong growth in early-stage markets like India and Taiwan, as well as solid performance in the UK [100][101] Question: After-hours surgery and cardiac surgery growth - Management discussed the importance of after-hours surgery for patient access and the growing interest in cardiac surgery as a viable option for minimally invasive procedures [114][116] Question: Force feedback technology usage and clinical strategy - Management provided insights on the current use of force feedback instruments and the ongoing studies to validate this technology [120][124]

Core Insights - Intuitive Surgical, Inc. reported a revenue of $2.25 billion for the quarter ended March 2025, reflecting a year-over-year increase of 19.2% [1] - The earnings per share (EPS) for the quarter was $1.81, up from $1.50 in the same quarter last year, indicating a positive growth trend [1] - The reported revenue exceeded the Zacks Consensus Estimate of $2.18 billion by 3.27%, and the EPS also surpassed the consensus estimate of $1.71 by 5.85% [1] Financial Performance Metrics - The installed base of the Da Vinci Surgical System reached 10,189, slightly below the four-analyst average estimate of 10,194 [4] - Revenue from products (instruments, accessories, and systems) was $1.89 billion, exceeding the seven-analyst average estimate of $1.55 billion, with a year-over-year growth of 19.9% [4] - Revenue from services amounted to $363 million, surpassing the seven-analyst average estimate of $356.83 million, representing a year-over-year increase of 15.8% [4] - Revenue from systems was reported at $522.70 million, compared to the average estimate of $481.95 million, showing a year-over-year change of 25% [4] - Revenue from instruments and accessories reached $1.37 billion, slightly above the average estimate of $1.33 billion, with an 18% year-over-year increase [4] Stock Performance - Over the past month, shares of Intuitive Surgical have returned -7.9%, compared to a -8.9% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Financial Performance - Intuitive Surgical reported quarterly earnings of $1.81 per share, exceeding the Zacks Consensus Estimate of $1.71 per share, and up from $1.50 per share a year ago, representing an earnings surprise of 5.85% [1] - The company posted revenues of $2.25 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 3.27%, compared to $1.89 billion in the same quarter last year [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1.96 on revenues of $2.33 billion, and for the current fiscal year, it is $7.97 on revenues of $9.56 billion [7] - The estimate revisions trend for Intuitive Surgical is mixed, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Medical - Instruments industry, to which Intuitive Surgical belongs, is currently in the top 30% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Intuitive Surgical (ISRG) Q1 2025 Earnings Call April 22, 2025 04:30 PM ET Company Participants Dan Connally - VP - Head of Investor RelationsGary Guthart - CEODavid Rosa - President & DirectorJamie Samath - EVP, CFO & Enterprise Technology LeaderDaniel Oh - VP & Senior Medical OfficerTravis Steed - Managing Director - Equity ResearchRick Wise - Managing Director - Medical Technology & SuppliesDavid Roman - Managing Director Conference Call Participants Larry Biegelsen - AnalystRobert Marcus - AnalystAdam M ...

Intuitive Surgical, Inc. (ISRG) Q1 2025 Earnings Conference Call April 22, 2025 04:30 PM ET Company Participants Dan Connolly - Head of Investor RelationsConference Operator - ModeratorGary Goodhart - CEODave Rosa - PresidentJamie Samath - CFO Conference Call Participants Travis Steen - Analyst, Bank of America SecuritiesLarry Peterson - Analyst, Wells FargoRobbie Marcus - Analyst, JP MorganRick Wise - Analyst, StifelAdam Meter - Analyst, Piper SandlerRyan Zimmerman - Analyst, BTIGDavid Roman - Analyst, Gol ...