10-KPeriod: FY2016

INTUITIVE SURGICAL INC Annual Report, Year Ended Dec 31, 2016

Filed February 6, 2017For Securities:ISRG

Summary

Intuitive Surgical, Inc. (ISRG) reported strong performance for the fiscal year ending December 31, 2016, with total revenue reaching $2.7 billion, a 13% increase year-over-year. This growth was driven by a 15% increase in procedures performed globally and a 10% increase in systems revenue. Recurring revenue, comprising instruments, accessories, and services, continued to be a significant driver, making up 71% of total revenue and growing 15% to $1.9 billion, reflecting the expanding installed base of da Vinci Surgical Systems. The company shipped 537 da Vinci Surgical Systems in 2016, an increase from 492 in the prior year, bringing the total installed base to 3,919 systems globally. The company highlighted growth in general surgery procedures in the U.S. and continued strong performance in urology procedures internationally, particularly da Vinci Prostatectomy (dVP). Research and development spending increased by 21% to $239.6 million, underscoring the company's commitment to innovation and expanding its product portfolio. ISRG ended the year with a robust cash position of $4.8 billion, providing significant financial flexibility for future growth and investments.

Financial Highlights

49 data points
Beta

Revenue

$2.70B

70.0% Gross Margin

Net Income

$738.30M

27.3% Net Margin

EPS (Diluted)

$2.09

Total Assets

$6.49B

Cash & Equivalents

$1.04B

Free Cash Flow

$1.09B

Financial Statements
Beta
Revenue$2.70B
Cost of Revenue$814.30M
Gross Profit$1.89B
R&D Expenses$239.60M
SG&A Expenses$703.60M
Operating Expenses$943.20M
Operating Income$949.70M
Net Income$738.30M
EPS (Basic)$2.14
EPS (Diluted)$2.09
Shares Outstanding (Basic)344.70M
Shares Outstanding (Diluted)353.70M

Key Highlights

  • 1Total revenue grew 13% to $2.7 billion in 2016, driven by a 15% increase in procedures and a 10% rise in systems revenue.
  • 2Recurring revenue, primarily from instruments, accessories, and services, increased 15% to $1.9 billion, representing 71% of total revenue.
  • 3The installed base of da Vinci Surgical Systems grew 9% to 3,919 units worldwide.
  • 4537 da Vinci Surgical Systems were shipped in 2016, up from 492 in 2015.
  • 5U.S. general surgery procedures showed strong growth, up 33% year-over-year, while international urology procedures also performed well.
  • 6Research and development expenses increased 21% to $239.6 million, signaling continued investment in innovation.
  • 7The company maintained a strong balance sheet with $4.8 billion in cash, cash equivalents, and investments at year-end 2016.

Frequently Asked Questions

Intuitive Surgical's total revenue grew by 13% to $2.7 billion in 2016. This growth was primarily driven by a 15% increase in global da Vinci procedures performed and a 10% increase in systems revenue. Recurring revenue, which includes instruments, accessories, and services, also saw significant growth, increasing by 15% and contributing 71% of the total revenue.

The installed base of da Vinci Surgical Systems increased by approximately 9% to 3,919 units globally as of December 31, 2016. The company shipped 537 systems in 2016, up from 492 in 2015, indicating continued market penetration and adoption of their robotic surgical technology.

The company noted strong growth in U.S. general surgery procedures, which increased by 33% year-over-year, particularly in hernia repair and colorectal procedures. Internationally, urology procedures, especially da Vinci Prostatectomy (dVP), continued to perform well, showing robust growth.

Intuitive Surgical is heavily investing in future growth through research and development, with R&D expenses increasing by 21% to $239.6 million in 2016. This investment supports the development of new da Vinci Xi platform products, the da Vinci Single Port Surgical System, robotic-assisted catheter-based medical devices, and next-generation robotics.