ISRG
HealthcareIntuitive Surgical
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XBRL · SEC EDGAR2008–2025(18yr)| Metric | FY 2008 | FY 2009 | FY 2010 | FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $874.9M | $1.1B | $1.4B | $1.8B | $2.2B | $2.3B | $2.1B | $2.4B | $2.7B | $3.1B | $3.7B | $4.5B | $4.4B | $5.7B | $6.2B | $7.1B | $8.4B | $10.1B | +20.5% |
| Gross Profit | $620.8M | $751.1M | $1.0B | $1.3B | $1.6B | $1.6B | $1.4B | $1.6B | $1.9B | $2.2B | $2.6B | $3.1B | $2.9B | $4.0B | $4.2B | $4.7B | $5.6B | $6.6B | +17.9% |
| Gross Margin | 71.0% | 71.4% | 72.9% | 72.5% | 72.1% | 70.4% | 66.3% | 66.2% | 69.8% | 69.9% | 69.9% | 69.4% | 65.6% | 69.3% | 67.4% | 66.4% | 67.5% | 66.0% | -1.5pp |
| Operating Income | $310.8M | $377.4M | $555.2M | $694.8M | $878.1M | $852.5M | $544.8M | $740.0M | $945.2M | $1.1B | $1.2B | $1.4B | $1.0B | $1.8B | $1.6B | $1.8B | $2.3B | $2.9B | +25.4% |
| Operating Margin | 35.5% | 35.9% | 39.3% | 39.5% | 40.3% | 37.6% | 25.6% | 31.0% | 34.9% | 33.6% | 32.2% | 30.7% | 24.1% | 31.9% | 25.3% | 24.8% | 28.1% | 29.3% | +1.1pp |
| Net Income | $204.3M | $232.6M | $381.8M | $495.1M | $656.6M | $671.0M | $418.8M | $588.8M | $735.9M | $660.0M | $1.1B | $1.4B | $1.1B | $1.7B | $1.3B | $1.8B | $2.3B | $2.9B | +23.0% |
| Net Margin | 23.4% | 22.1% | 27.0% | 28.2% | 30.1% | 29.6% | 19.6% | 24.7% | 27.2% | 21.0% | 30.3% | 30.8% | 24.3% | 29.9% | 21.3% | 25.2% | 27.8% | 28.4% | +0.6pp |
| Free Cash Flow | $172.3M | $331.6M | $432.0M | $594.7M | $672.4M | $775.4M | $559.5M | $690.9M | $989.0M | $953.2M | $982.2M | $1.2B | $1.1B | $1.7B | $958.4M | $749.6M | $1.3B | $2.5B | +91.0% |
| FCF Margin | 19.7% | 31.5% | 30.6% | 33.8% | 30.9% | 34.2% | 26.2% | 29.0% | 36.5% | 30.4% | 26.4% | 26.2% | 26.2% | 30.4% | 15.4% | 10.5% | 15.6% | 24.7% | +9.1pp |
| EPS (Diluted) | $5.12 | $5.93 | $9.47 | $12.32 | $15.98 | $16.73 | $11.11 | $15.54 | $18.73 | $5.67 | $9.49 | $11.54 | $8.82 | $4.66 | $3.65 | $5.03 | $6.42 | $7.87 | +22.6% |
1. THE BIG PICTURE
Intuitive Surgical has evolved from a hardware vendor into a dominant "razor-and-blade" ecosystem that captures nearly 30 cents of profit from every dollar of revenue. By integrating advanced robotics with a digital "Insights Engine," Intuitive Surgical has made its technology indispensable to hospital workflows, allowing it to grow at 20.5%—more than triple the rate of its largest peer, Johnson & Johnson (XBRL).
2. WHERE THE RISKS HIT HARDEST
The "Technological Ecosystem" that Intuitive Surgical cites as its primary advantage is increasingly threatened by a shift in how hospitals pay for it. The move toward usage-based leasing models (RISKS) creates unpredictable cash flows that could undermine Intuitive Surgical’s peer-leading 24% FCFFCFFree Cash Flow — cash left after paying for operations and capital investments; what the company can actually spend, save, or return to shareholders margin if procedure volumes fluctuate. Furthermore, the 32% of revenue derived from international markets is highly vulnerable to Chinese anti-corruption campaigns and export controls on rare earth elements (RISKS). These geopolitical factors directly threaten the "expanded access" pillar of Intuitive Surgical's "Quintuple Aim" by delaying system placements and disrupting the supply chain for the new da Vinci 5 (10-K Item 1).
3. WHAT THE NUMBERS SAY TOGETHER
The financial data reveals a company operating with extreme efficiency: Intuitive Surgical’s 28.8% operating margin is more than double that of Stryker (12.3%) or Becton Dickinson (11.5%) (XBRL). While management guides for 13% to 15% procedure growth in 2026, the most recent quarterly revenue growth of 19% suggests that higher average selling prices for the da Vinci 5 are currently compensating for any volume stabilization (8-K). This growth is supported by a fortress balance sheet containing $5.8 billion in net cash, which provides a buffer against the "resource constraints" and staffing shortages currently stressing global healthcare systems (10-K Item 1). With short interest at a low 1.9% of the float, market sentiment remains overwhelmingly positive despite the premium entry price (Yahoo Finance).
4. IS IT WORTH IT AT THIS PRICE?
At 42.6x Forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations, Intuitive Surgical trades at a 120% premium to the peer median of 19.4x (XBRL). The market is currently pricing in approximately 11.4% long-term growth (CAPM analysis). While the current TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter revenue growth of 20.5% easily justifies this, the valuation is highly sensitive to any hiccups in the da Vinci 5 rollout. If long-term growth were to slow to 9.5%, the justified multiple would fall to 23.6x—representing a nearly 45% decline from current levels (CAPM analysis). The current price is only "right" if Intuitive Surgical continues to convert its 24% FCFFCFFree Cash Flow — cash left after paying for operations and capital investments; what the company can actually spend, save, or return to shareholders margin into aggressive share buybacks (currently at a 1.2% yield) and maintains its technological lead over Medtronic and Johnson & Johnson.
5. WHAT WOULD CHANGE THIS VIEW?
- Cautious if 2026 procedure growth falls below the 13% guidance floor or if gross margins drop below 67% as Intuitive Surgical struggles to "mature" its manufacturing processes for the da Vinci 5 (10-Q).
- Constructive if the Ion endoluminal system maintains its 44% procedure growth rate (8-K) or if Intuitive Surgical successfully navigates Chinese regulatory hurdles to increase its 32% international revenue share.
6. BOTTOM LINE
Structural Advantage: High switching costs created by a "progressive learning journey" for surgeons and a proprietary digital ecosystem that integrates pre-operative 3D modeling with real-time robotic precision. Bottom Line: Intuitive Surgical is a best-in-class operator priced for perfection; it remains the gold standard in med-tech so long as its technological lead keeps competitors at bay.
1. Top 5 Material Risks
- Competitive Landscape: Intuitive Surgical faces competition from established treatment options like open surgery and laparoscopy, as well as numerous robotic-assisted system developers including Medtronic, Johnson & Johnson, and various Chinese manufacturers. This competition, combined with the potential for weight-loss drugs to reduce bariatric procedure volumes, threatens to reduce revenue and pricing power.
- International Operations: With 32% of revenue derived from OUS markets in 2025, Intuitive Surgical is exposed to risks including trade barriers, tariffs on goods manufactured in Mexico, and political instability. Specifically, Intuitive Surgical’s growth in China is threatened by anti-corruption campaigns that have already caused delays in system placements.
- Usage-Based Business Model: The increasing shift toward usage-based arrangements exposes Intuitive Surgical to revenue losses if procedure volumes fall short of expectations. These arrangements also create unpredictable cash flows and potential gross profit margin fluctuations if utilization rates do not align with forecasts.
- Supply Chain Constraints: Reliance on sole- or single-sourced suppliers for critical components makes Intuitive Surgical vulnerable to disruptions. Evolving trade requirements, such as Chinese export controls on rare earth elements, could prevent Intuitive Surgical from meeting product demand, leading to lost revenue and damaged brand reputation.
- Regulatory Compliance: Intuitive Surgical is subject to stringent FDA and international quality management system requirements (such as the new QMSR and EU MDR). Failure to maintain compliance or obtain necessary clearances for new products can result in enforcement actions, including import bans or the inability to market products, which would materially impact financial results.
2. Company-Specific Risks
- Product Liability and Litigation: Intuitive Surgical is subject to ongoing product liability and patent litigation. Because Intuitive Surgical self-insures these risks, significant adverse judgments or settlements could directly impact its financial condition.
- Cybersecurity and AI Integration: The integration of AI into products and operations introduces risks related to algorithmic bias, data privacy, and potential cyberattacks. A breach could lead to product recalls, regulatory fines, and loss of customer trust.
- Contracting Cycles and Seasonality: The lengthy capital sales cycle for da Vinci systems, combined with historical seasonality (heavier fourth-quarter placements), creates quarterly fluctuations that may cause financial results to fall below analyst expectations.
- Third-Party Remanufacturing: The sale of unauthorized or remanufactured instruments by third parties threatens a significant portion of Intuitive Surgical’s revenue, which is generated through the sale of instruments and accessories.
3. Regulatory/Legal Risks
- FDA Enforcement: Intuitive Surgical is subject to FDA inspections and potential Warning Letters. Non-compliance can lead to the seizure of products, bans on exports, or the inability to obtain Certificates to Foreign Government (CFGs) required for international registration.
- EU MDR Transition: The transition to the EU Medical Device Regulation (MDR) requires conformity assessments by notified bodies. Delays in these assessments or the inability to maintain CE marks would prevent the sale of products in the EU and EEA.
- Data Privacy Laws: Intuitive Surgical must comply with global data protection regimes, including the GDPR in Europe and the PIPL in China. Failure to adhere to these laws can result in fines of up to 7% of worldwide annual turnover under the EU AI Act.
- Chinese Healthcare Policy: Provincial limits on hospital charges for robotic surgeries in China have directly impacted the number of procedures performed and the pricing of instruments and accessories.
4. Financial Impact Map
- Competitive Pressure → Revenue → Potential reduction in market share and average selling prices.
- International Trade/Tariffs → Gross Margin → Increased costs for components and finished goods manufactured in Mexico and China.
- Usage-Based Leasing → Cash Flows/Revenue → Reduced cash inflows at lease commencement and increased variability in quarterly revenue.
- Supply Chain Disruptions → Revenue → Inability to meet product demand leading to deferred or canceled procedures.
- Product Liability/Litigation → Operating Expenses → Potential for significant monetary damages, legal fees, and settlement costs.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 10-K | Feb 2026 | Dec 2025 |
| 8-K | Jan 2026 | — |
| 10-Q | Oct 2025 | Sep 2025 |
| 14A | Mar 2025 | — |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
Intuitive Surgical Q4 Preliminary Results Show Growth Risks From Medicaid Funding Cuts
- ▸Q3 revenue $2.51B, beat estimates of $2.40B
- ▸Q3 adjusted EPS $2.40, beat estimates of $1.98
- ▸Stock closed 2.7% lower on January 14 following preliminary Q4 update
- ▸Management cited Medicaid funding cuts as potential growth headwind
- ▸Increased competition from rival robotic surgical systems noted as risk factor
Intuitive Surgical acquires Southern Europe da Vinci and Ion distribution business
- ▸Acquired Southern Europe distribution business for da Vinci and Ion platforms
- ▸Transitioning to direct control of sales and service in the region
- ▸Aims to improve customer support and system availability for hospitals
- ▸ISRG shares trading at $471.91, down 16% year-to-date
- ▸Integration of distribution operations presents new operational execution risk
Intuitive Machines Q4 revenue falls 18% to $44.8M, misses EPS estimates
- ▸Q4 revenue $44.8M, down 18% YoY
- ▸Full-year 2025 loss $106.8M or $0.59 per share
- ▸FY25 free cash flow negative $56M
- ▸2026 revenue guidance $900M–$1B vs $907M consensus
- ▸Annual revenue $210M, down 8% YoY
Intuitive Surgical acquires Southern Europe distribution business, expands direct operations in region
- ▸Acquired da Vinci and Ion distribution business from ab medica and affiliates
- ▸Operations expanded in Italy, Spain, Portugal, Malta, and San Marino
- ▸Integration adds 250 employees to Intuitive Surgical workforce
- ▸Combined installed base of 470+ da Vinci systems in acquired territories
- ▸Q4 2025 revenue $2.87B, +19% YoY; EPS $2.53 beat estimates by $0.28
Intuitive Surgical acquires Southern Europe distribution business to expand da Vinci, Ion footprint
- ▸Acquired da Vinci and Ion distribution business from ab medica, Abex, and Excelencia Robótica
- ▸Expansion covers Italy, Spain, Portugal, Malta, and San Marino
- ▸Over 470 da Vinci surgical systems installed in Southern Europe as of Dec 31, 2025
- ▸FDA approved da Vinci 5 system for specific cardiac procedures including mitral valve replacement
- ▸Consensus analyst price target of $620 implies 26.49% upside
Intuitive Surgical Reports Phishing-Related Data Breach; Core Robotic Platforms Remain Fully Operational
- ▸Unauthorized third party accessed internal IT business applications via phishing
- ▸Limited customer and employee data exposed in cybersecurity incident
- ▸da Vinci and Ion robotic platforms remain fully operational
- ▸FDA recently cleared da Vinci 5 system for cardiac procedures
- ▸Projected 2028 revenue $13.4B with $3.7B in earnings
Intuitive Surgical upgraded to Buy at Citi; Stryker placed on 90-day catalyst watch
- ▸Intuitive Surgical upgraded to Buy from Neutral by Citi
- ▸Stryker placed on 90-day catalyst watch; Buy rating maintained
- ▸Abbott Laboratories price target trimmed by $4; Buy rating maintained
- ▸Intuitive Surgical Q4 2025 revenue $2.87B, +18.76% YoY
- ▸Stryker 2025 full-year revenue $25.12B, +11.16% YoY
Intuitive Surgical 2025 revenue $10.1B +21%, 2026 EPS estimates raised 7.4%
- ▸2025 revenue $10.1B, up 21% YoY
- ▸Total procedure volume increased 19% YoY
- ▸Ion lung biopsy platform procedures surged 51% in 2025
- ▸SP platform procedure growth reached 87% in 2025
- ▸2026 EPS estimates increased 7.4% to $10.06 per share