Intuitive Surgical Reports Q2 Performance

Intuitive Surgical, Inc.

The Q2 earnings results for Intuitive Surgical, Inc. (NASDAQ:ISRG) show underlying business performance despite environmental and other obstacles.

For example, despite pressure from COVID-driven lockdowns in China, the company’s second-largest market, procedures increased by 14% during the quarter compared to the same period previous year.

In addition, the number of capital placements has decreased from a year ago for a variety of reasons. Overall COVID lockdown pressure had little influence on procedures in the quarter, while Intuitive’s capital placements were more significantly impacted by lower trade-ins and supply chain time.

Procedure demand, a key metric of an organization’s health, is stable.

Here is additional information on the company’s most notable business segments:

Procedures –

Intuitive Surgical, Inc. (NASDAQ:ISRG) executives are encouraged by the quarter’s 14% increase, which reflects robust general surgery in the United States and strong growth outside of urology.

Bariatric surgery, cholecystectomy, and colorectal treatments saw the fastest growth in the United States, whereas hernia repair saw steady growth. Despite China’s COVID lockdown, procedures in OUS markets increased by 22% in the third quarter.

Intuitive Surgical is currently observing strength in urology outside of the United States, along with varied growth in other treatments.

For instance, general surgery, which includes rectal resection, experienced considerable development in Japan. Gynecology and general surgery saw rapid growth in the UK and Ireland.

Gynecology and general surgery also saw significant development in France. As method adoption diversifies, creating value for clients and for Intuitive, system utilization has been rising in various OUS countries in recent quarters.

This is the outcome of the investments the business made in important national marketplaces beginning a number of years ago.

Da Vinci Capital Placements –

Intuitive Surgical, Inc. (NASDAQ:ISRG), which placed 328 systems in Q2 2021, placed 279 systems this quarter.

The da Vinci business identified three reasons for the drop in placements from a year ago. For one, the installed base of third generation systems has decreased as consumers have switched to generation four da Vinci systems, which has decreased the trade-in population, especially in the US.

Next, supply chain disruption persisted throughout the quarter, affecting the timeline of system builds due to delays in semiconductor components, making it difficult for Intuitive to fulfill some client orders by quarter’s end.

Last but not least, over the past two quarters, the business has observed an increase in hospital capital spending pressure in its sector of the capital equipment market, encouraging customers to seek efficiency gains on existing capital before acquiring new capacity.

Operating teams are working hard to protect customers from the majority of these pressures, but component supply shortages still pose a risk.

Core demand for procedures and trade-in prospects are both factors in capital placements in more developed countries.

The demand for excellent robotic-assisted surgery is still strong. The customer’s incremental capital demand is a consequence of system use and procedure expansion.

System Utilization

The company’s compound annual growth rate in this market over the last three years has remained at historical levels of 5%.

As the increase rate of procedures over the previous year closely equaled the growth of the system installed base, system utilization in the U.S. during the preceding year was slightly lower.

On the other hand, as procedures diversify, system use has been increasing in many OUS markets. In general, Intuitive gives customers’ increased system utilization priority because it enhances the value of their investments and is consistent with the company’s long-term well-being.

Intuitive Surgical’s Innovation Engines and New Products and Services –

Forty-one Ion systems were placed by Intuitive Surgical, Inc. (NASDAQ:ISRG), up from 20 in Q2 of last year. With 204 systems in the ION clinical installed base as of right now, ION use is thriving and driving early capital replacements. For the company’s integration of ION with Siemens Cios Spin cone-beam CT, 510(k) clearance was granted.

Company customers appear to like this combination because it enhances registration and targeting accuracy for ION in the lung. Intuitive continues to be committed to improving customer satisfaction, operational excellence, and clinical outcomes in lung care.

Multiport Ecosystem –

An eight millimeter stapler made by Intuitive Surgical, Inc. (NASDAQ:ISRG) was launched in its initial phase in the United States. This stapler was created to fit in narrow anatomical gaps, such as those found in thoracic surgery. Initial client feedback has been positive.

The company is getting ready to introduce its newest endoscope, the Endoscope Plus, as well as its SureForm 45 and 60 millimeter staplers in China. All three will keep fostering the expansion of thoracic and general surgery operations.

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