01—Abstract
Summary
Summary of the 10-K filed February 6, 2017. Cited figures are marked; the original filing is the authoritative source.
Intuitive Surgical, Inc. (ISRG) reported strong performance for the fiscal year ending December 31, 2016, with total revenue reaching $2.7 billiona, 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 billionb, 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 millionc, 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.
02—Key points
Key Highlights
- Total revenue grew 13% to $2.7 billion in 2016, driven by a 15% increase in procedures and a 10% rise in systems revenue.
- Recurring revenue, primarily from instruments, accessories, and services, increased 15% to $1.9 billion, representing 71% of total revenue.
- The installed base of da Vinci Surgical Systems grew 9% to 3,919 units worldwide.
- 537 da Vinci Surgical Systems were shipped in 2016, up from 492 in 2015.
- U.S. general surgery procedures showed strong growth, up 33% year-over-year, while international urology procedures also performed well.
- Research and development expenses increased 21% to $239.6 million, signaling continued investment in innovation.
- The company maintained a strong balance sheet with $4.8 billion in cash, cash equivalents, and investments at year-end 2016.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2016, Intuitive Surgical kept $0.27.
- Revenue$2.70B100.0%
- Cost of revenue−$811.5M30.0%
- Gross profit$1.89B70.0%
- Operating costs−$943.2M34.9%
- Operating income$949.7M35.1%
- Interest, other & tax−$211.4M7.8%
- Net income$738.3M27.3%
Where FY2016 revenue went
$2.70B- Cost of revenue: $814.3M, 30% of revenue
- Net income: $738.3M, 27% of revenue
- SG&A: $703.6M, 26% of revenue
- R&D: $239.6M, 8.9% of revenue
- Interest, other & tax: $211.4M, 7.8% of revenue
Kept 27% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2016filed February 6, 2017Financial Statements
FY2016 against FY2015
| Line item | FY2016FY2015 | Change |
|---|---|---|
| Revenue | $2.70B$2.38B | +13.4% |
| Cost of Revenue | $814.30M$806.50M | +1.0% |
| Gross Profit | $1.89B$1.58B | +20.0% |
| R&D Expenses | $239.60M$197.40M | +21.4% |
| SG&A Expenses | $703.60M$640.50M | +9.9% |
| Operating Expenses | $943.20M$837.90M | +12.6% |
| Operating Income | $949.70M$740.00M | +28.3% |
| Net Income | $738.30M$588.80M | +25.4% |
| EPS (Basic) | $2.14$1.76 | +21.6% |
| EPS (Diluted) | $2.09$1.73 | +20.8% |
| Shares Outstanding (Basic) | 344.70M333.90M | +3.2% |
| Shares Outstanding (Diluted) | 353.70M341.10M | +3.7% |
05—Questions
Frequently Asked Questions
What was the company's revenue growth in 2016 and what were the key drivers?
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.
How is the company's installed base of da Vinci Surgical Systems performing?
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.
What are the company's key areas of procedural growth?
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.
How is Intuitive Surgical investing in future 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.
06—Continue