Intuitive Announces Third Quarter Earnings
ISRG 10.17.2024
Q3Highlights
- Worldwide
da Vinci procedures grew approximately 18% compared with the third quarter of 2023. - The Company placed 379 da Vinci surgical systems, compared with 312 in the third quarter of 2023. The third quarter 2024 da Vinci surgical system placements included 110 da Vinci 5 systems.
- The Company grew its
da Vinci surgical system installed base to 9,539 systems as ofSeptember 30, 2024 , an increase of 15% compared with 8,285 as of the end of the third quarter of 2023. - Third quarter 2024 revenue of
$2.04 billion increased 17% compared with$1.74 billion in the third quarter of 2023. - Third quarter 2024 GAAP net income attributable to Intuitive was
$565 million , or$1.56 per diluted share, compared with$416 million , or$1.16 per diluted share, in the third quarter of 2023. - Third quarter 2024 non-GAAP* net income attributable to Intuitive was
$669 million , or$1.84 per diluted share, compared with$524 million , or$1.46 per diluted share, in the third quarter of 2023. - In
October 2024 , the Company obtained regulatory clearance inSouth Korea for the da Vinci 5 surgical system for use in urologic, general, gynecologic, thoracoscopic, thoracoscopically-assisted cardiotomy, and transoral otolaryngology surgical procedures.
Q3Financial Summary
Gross profit, income from operations, net income attributable to
Third quarter 2024 revenue was $2.04 billion, an increase of 17% compared with $1.74 billion in the third quarter of 2023. The higher third quarter revenue was driven by growth in
Third quarter 2024 instruments and accessories revenue increased by 18% to
Third quarter 2024 systems revenue was
Third quarter 2024 GAAP income from operations increased to
Third quarter 2024 GAAP net income attributable to
Third quarter 2024 non-GAAP* net income attributable to
The Company ended the third quarter of 2024 with
Impact of COVID-19 Pandemic
The first nine months of 2024 did not reflect any noticeable procedure volume disruptions from COVID-19. During the first quarter of 2023, in January, the Company saw COVID-19 resurgences impact
“Core measures of our business were healthy this quarter, and we are pleased by customer adoption of
Additional supplemental financial and procedure information has been posted to the Investor Relations section of the Intuitive website athttps://isrg.gcs-web.com/.
Webcast and Conference Call Information
Intuitive will hold a teleconference at
About Intuitive
Intuitive (Nasdaq: ISRG), headquartered in
Product and brand names/logos are trademarks or registered trademarks of Intuitive or their respective owner. Seewww.intuitive.com/trademarks.
For more information, please visit the Company’s website atwww.intuitive.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of 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 expectations concerning matters that are not historical facts. Statements using words such as “estimates,” “projects,” “believes,” “anticipates,” “plans,” “expects,” “intends,” “may,” “will,” “could,” “should,” “would,” “targeted,” and similar words and expressions are intended to identify forward-looking statements. These forward-looking statements are necessarily estimates reflecting the judgment of the Company’s management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. These forward-looking statements include, but are not limited to, statements related to future results of operations, future financial position, the adoption by customers of the Company’s products, and the goals it shares with its customers, including improving patient outcomes. These forward-looking statements should be considered in light of various important factors, including, but not limited to, the following: the overall macroeconomic environment, which may impact customer spending and the Company’s costs, including the levels of inflation and interest rates; the conflict in
*About Non-GAAP Financial Measures
To supplement its consolidated financial statements, which are prepared and presented in accordance with
The Company uses these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. The Company believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance by excluding items such as amortization of intangible assets, share-based compensation (“SBC”) and long-term incentive plan expenses, and other special items. Long-term incentive plan expense relates to phantom share awards granted in
Non-GAAP gross profit. The Company defines non-GAAP gross profit as gross profit, excluding SBC and long-term incentive plan expenses and amortization of intangible assets.
Non-GAAP income from operations. The Company defines non-GAAP income from operations as income from operations, excluding SBC and long-term incentive plan expenses, amortization of intangible assets, and litigation charges and recoveries.
Non-GAAP net income attributable to
There are a number of limitations related to the use of non-GAAP measures versus measures calculated in accordance with GAAP. Non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income attributable to
| Three Months Ended | |||||||||||
| Revenue: | |||||||||||
| Instruments and accessories | $ | 1,264.2 | $ | 1,244.4 | $ | 1,071.4 | |||||
| Systems | 445.0 | 448.2 | 379.4 | ||||||||
| Services | 328.9 | 317.3 | 292.9 | ||||||||
| Total revenue | 2,038.1 | 2,009.9 | 1,743.7 | ||||||||
| Cost of revenue: | |||||||||||
| Product | 555.4 | 539.4 | 489.5 | ||||||||
| Service | 108.8 | 97.8 | 87.0 | ||||||||
| Total cost of revenue | 664.2 | 637.2 | 576.5 | ||||||||
| Gross profit | 1,373.9 | 1,372.7 | 1,167.2 | ||||||||
| Operating expenses: | |||||||||||
| Selling, general and administrative | 510.6 | 525.3 | 452.0 | ||||||||
| Research and development | 286.0 | 280.1 | 249.4 | ||||||||
| Total operating expenses | 796.6 | 805.4 | 701.4 | ||||||||
| Income from operations (1) | 577.3 | 567.3 | 465.8 | ||||||||
| Interest and other income (expense), net | 93.7 | 87.2 | 56.2 | ||||||||
| Income before taxes | 671.0 | 654.5 | 522.0 | ||||||||
| Income tax expense (2) | 100.4 | 123.0 | 102.2 | ||||||||
| Net income | 570.6 | 531.5 | 419.8 | ||||||||
| Less: net income attributable to noncontrolling interest in joint venture | 5.5 | 4.6 | 4.1 | ||||||||
| Net income attributable to | $ | 565.1 | $ | 526.9 | $ | 415.7 | |||||
| Net income per share attributable to | |||||||||||
| Basic | $ | 1.59 | $ | 1.48 | $ | 1.18 | |||||
| Diluted (3) | $ | 1.56 | $ | 1.46 | $ | 1.16 | |||||
| Weighted average shares outstanding: | |||||||||||
| Basic | 355.8 | 355.0 | 351.7 | ||||||||
| Diluted | 362.7 | 361.0 | 358.2 | ||||||||
| (1) Income from operations includes the effect of the following items: | |||||||||||
| Amortization of intangible assets | $ | (3.5 | ) | $ | (5.0 | ) | $ | (5.1 | ) | ||
| Expensed IP charged to R&D | $ | — | $ | (0.2 | ) | $ | (7.5 | ) | |||
| (2) Income tax expense includes the effect of the following items: | |||||||||||
| Excess tax benefits related to share-based compensation arrangements | $ | (42.2 | ) | $ | (35.7 | ) | $ | (22.0 | ) | ||
| (3) Diluted net income per share attributable to | |||||||||||
| Amortization of intangible assets, net of tax | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.01 | ) | ||
| Expensed IP charged to R&D, net of tax | $ | — | $ | — | $ | (0.02 | ) | ||||
| Excess tax benefits related to share-based compensation arrangements | $ | 0.12 | $ | 0.10 | $ | 0.06 | |||||
| Nine Months Ended | |||||||
| 2024 | 2023 | ||||||
| Revenue: | |||||||
| Instruments and accessories | $ | 3,667.5 | $ | 3,132.9 | |||
| Systems | 1,311.4 | 1,199.5 | |||||
| Services | 959.7 | 863.4 | |||||
| Total revenue | 5,938.6 | 5,195.8 | |||||
| Cost of revenue: | |||||||
| Product | 1,649.2 | 1,480.5 | |||||
| Service | 297.4 | 263.2 | |||||
| Total cost of revenue | 1,946.6 | 1,743.7 | |||||
| Gross profit | 3,992.0 | 3,452.1 | |||||
| Operating expenses: | |||||||
| Selling, general and administrative | 1,527.4 | 1,396.8 | |||||
| Research and development | 850.6 | 738.7 | |||||
| Total operating expenses | 2,378.0 | 2,135.5 | |||||
| Income from operations (1) | 1,614.0 | 1,316.6 | |||||
| Interest and other income, net | 250.0 | 126.4 | |||||
| Income before taxes | 1,864.0 | 1,443.0 | |||||
| Income tax expense (2) | 214.5 | 236.4 | |||||
| Net income | 1,649.5 | 1,206.6 | |||||
| Less: net income attributable to noncontrolling interest in joint venture | 12.6 | 14.8 | |||||
| Net income attributable to | $ | 1,636.9 | $ | 1,191.8 | |||
| Net income per share attributable to | |||||||
| Basic | $ | 4.61 | $ | 3.40 | |||
| Diluted (3) | $ | 4.53 | $ | 3.34 | |||
| Weighted average shares outstanding: | |||||||
| Basic | 354.8 | 351.0 | |||||
| Diluted | 361.4 | 357.1 | |||||
| (1) Income from operations includes the effect of the following items: | |||||||
| Amortization of intangible assets | $ | (13.6 | ) | $ | (15.1 | ) | |
| Expensed IP charged to R&D | $ | (0.2 | ) | $ | (9.0 | ) | |
| (2) Income tax expense includes the effect of the following items: | |||||||
| Excess tax benefits related to share-based compensation arrangements | $ | (189.0 | ) | $ | (86.2 | ) | |
| (3) Diluted net income per share attributable to | |||||||
| Amortization of intangible assets, net of tax | $ | (0.03 | ) | $ | (0.03 | ) | |
| Expensed IP charged to R&D, net of tax | $ | — | $ | (0.02 | ) | ||
| Excess tax benefits related to share-based compensation arrangements | $ | 0.52 | $ | 0.24 | |||
| Cash, cash equivalents, and investments | $ | 8,311.5 | $ | 7,343.2 | |||
| Accounts receivable, net | 1,153.0 | 1,130.2 | |||||
| Inventory | 1,481.7 | 1,220.6 | |||||
| Property, plant, and equipment, net | 4,433.0 | 3,537.6 | |||||
| 348.3 | 348.7 | ||||||
| Deferred tax assets | 997.0 | 910.5 | |||||
| Other assets | 1,018.9 | 950.7 | |||||
| Total assets | $ | 17,743.4 | $ | 15,441.5 | |||
| Accounts payable and other liabilities | $ | 1,580.3 | $ | 1,552.5 | |||
| Deferred revenue | 485.6 | 491.7 | |||||
| Total liabilities | 2,065.9 | 2,044.2 | |||||
| Stockholders’ equity | 15,677.5 | 13,397.3 | |||||
| Total liabilities and stockholders’ equity | $ | 17,743.4 | $ | 15,441.5 | |||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||
| GAAP gross profit | $ | 1,373.9 | $ | 1,372.7 | $ | 1,167.2 | $ | 3,992.0 | $ | 3,452.1 | |||||||||
| Share-based compensation expense | 31.3 | 29.7 | 29.5 | 90.1 | 80.3 | ||||||||||||||
| Long-term incentive plan expense | 0.2 | 0.1 | 0.1 | 0.6 | 0.8 | ||||||||||||||
| Amortization of intangible assets | 2.4 | 3.7 | 3.7 | 9.9 | 10.6 | ||||||||||||||
| Non-GAAP gross profit | $ | 1,407.8 | $ | 1,406.2 | $ | 1,200.5 | $ | 4,092.6 | $ | 3,543.8 | |||||||||
| GAAP income from operations | $ | 577.3 | $ | 567.3 | $ | 465.8 | $ | 1,614.0 | $ | 1,316.6 | |||||||||
| Share-based compensation expense | 172.9 | 173.6 | 156.1 | 499.8 | 442.4 | ||||||||||||||
| Long-term incentive plan expense | 1.2 | 1.0 | 0.7 | 4.4 | 5.9 | ||||||||||||||
| Amortization of intangible assets | 3.5 | 5.0 | 5.1 | 13.6 | 15.1 | ||||||||||||||
| Litigation charges (recoveries) | — | 7.2 | (4.0 | ) | 7.2 | (4.0 | ) | ||||||||||||
| Non-GAAP income from operations | $ | 754.9 | $ | 754.1 | $ | 623.7 | $ | 2,139.0 | $ | 1,776.0 | |||||||||
| GAAP net income attributable to | $ | 565.1 | $ | 526.9 | $ | 415.7 | $ | 1,636.9 | $ | 1,191.8 | |||||||||
| Share-based compensation expense | 172.9 | 173.6 | 156.1 | 499.8 | 442.4 | ||||||||||||||
| Long-term incentive plan expense | 1.2 | 1.0 | 0.7 | 4.4 | 5.9 | ||||||||||||||
| Amortization of intangible assets | 3.5 | 5.0 | 5.1 | 13.6 | 15.1 | ||||||||||||||
| Litigation charges (recoveries) | — | 7.2 | (4.0 | ) | 7.2 | (4.0 | ) | ||||||||||||
| (Gains) losses on strategic investments | 0.9 | (7.8 | ) | 1.7 | (3.5 | ) | 7.9 | ||||||||||||
| Tax adjustments (1) | (74.0 | ) | (64.5 | ) | (51.0 | ) | (305.5 | ) | (189.6 | ) | |||||||||
| Adjustments attributable to noncontrolling interest in joint venture | (0.5 | ) | (0.4 | ) | (0.3 | ) | (1.7 | ) | (1.6 | ) | |||||||||
| Non-GAAP net income attributable to | $ | 669.1 | $ | 641.0 | $ | 524.0 | $ | 1,851.2 | $ | 1,467.9 | |||||||||
| GAAP net income per share attributable to | $ | 1.56 | $ | 1.46 | $ | 1.16 | $ | 4.53 | $ | 3.34 | |||||||||
| Share-based compensation expense | 0.48 | 0.48 | 0.44 | 1.38 | 1.24 | ||||||||||||||
| Long-term incentive plan expense | — | — | — | 0.01 | 0.02 | ||||||||||||||
| Amortization of intangible assets | 0.01 | 0.02 | 0.01 | 0.04 | 0.04 | ||||||||||||||
| Litigation charges (recoveries) | — | 0.02 | (0.01 | ) | 0.02 | (0.01 | ) | ||||||||||||
| (Gains) losses on strategic investments | — | (0.02 | ) | — | (0.01 | ) | 0.02 | ||||||||||||
| Tax adjustments (1) | (0.21 | ) | (0.18 | ) | (0.14 | ) | (0.85 | ) | (0.53 | ) | |||||||||
| Adjustments attributable to noncontrolling interest in joint venture | — | — | — | — | (0.01 | ) | |||||||||||||
| Non-GAAP net income per share attributable to | $ | 1.84 | $ | 1.78 | $ | 1.46 | $ | 5.12 | $ | 4.11 | |||||||||
| (1) For the three months ended | |||||||||||||||||||
| For the nine months ended | |||||||||||||||||||
Contact: Investor Relations(408) 523-2161
Source: Intuitive Surgical, Inc.