INTUITIVE SURGICAL INC Quarterly Report for Q1 Ended Mar 31, 2011

Summary

Intuitive Surgical Inc. (ISRG) reported strong performance for the quarter ending March 31, 2011, demonstrating significant year-over-year growth in both revenue and net income. Total revenue increased by 18% to $388.1 million, driven by robust growth in product revenue, particularly from instruments and accessories, and a solid increase in service revenue. The company continues to expand its installed base of da Vinci Surgical Systems, selling 120 systems in the quarter, up from 104 in the prior year period. Profitability also improved, with net income rising 22% to $104.1 million. This growth was supported by expanding gross margins and effective management of operating expenses. The company's strong cash position was further bolstered by operating activities and financing, ending the quarter with $1.76 billion in cash, cash equivalents, and investments. Management remains optimistic about continued procedure adoption and future growth, despite some ongoing legal proceedings and the potential impact of global economic conditions and natural disasters.

Key Highlights

• 1Total revenue increased 18% year-over-year to $388.1 million.
• 2Net income grew 22% year-over-year to $104.1 million, with diluted EPS at $2.59.
• 3120 da Vinci Surgical Systems were sold in the quarter, an increase from 104 in the prior year period.
• 4Recurring revenue (instruments, accessories, and service) increased 28% to $221.0 million, representing 57% of total revenue.
• 5The installed base of da Vinci Surgical Systems grew to 1,840 units.
• 6Operating income increased 14% to $148.3 million.
• 7The company ended the quarter with a strong cash and investments balance of $1.76 billion.

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