Sales increased 17% to $1.55 billion, just ahead of ISRG stock analysts' projections for . - building a financial model and investor presentation for fundraising . It flows from respect for and understanding of patients and care teams, their needs, and their environment. And with that, I'd like to turn it over to Jamie. In addition, COVID delayed some R&D work, resulting in underspend on prototypes. Thanks. I'm just curious what the net effect there is from the savings and expense perspective and R&D, whether this is maybe the beginning of you starting to see some leverage off of the 10% you've been at for the last couple of years. Non-GAAP net income attributable to Intuitive Surgical, Inc. and EPS. We anticipate iterating our approach as we learn and the year progresses. (1) Selling, general and administrative includes the effect of the following item: (2) Income from operations includes the effect of the following items: (3) Interest and other income, net includes the effect of the following item: (4) Income tax expense includes the effect of the following item: Excess tax benefits related to share-based compensation arrangements, (5) Diluted net income per share attributable to, Amortization of intangible assets, net of tax, Gains (losses) on strategic investments, net of tax. Yes. There are a number of limitations related to the use of non-GAAP measures versus measures calculated in accordance with GAAP. We don't actually know how much backlog was resolved in the quarter, how much backlog is left or the timing of the recovery of that might be. And we've seen both good clinical outcomes, but also high surgeon satisfaction and better ergonomics. And we think that the extended use instruments lowers barriers for purchases of systems. These forward-looking statements are necessarily estimates reflecting the best judgment of the our management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. To supplement its consolidated financial statements, which are prepared and presented in accordance with accounting principles generally accepted in the United States (GAAP), the Company uses the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income attributable to Intuitive Surgical, Inc., non-GAAP net income per diluted share attributable to Intuitive Surgical, Inc. (EPS), and non-GAAP diluted shares outstanding. So I think those are the key kind of procedure highlights. The Motley Fool recommends the following options: long January 2022 $580 calls on Intuitive Surgical and short January 2022 $600 calls on Intuitive Surgical. To change your e-mail options at The charge associated with the deferred-tax asset and a higher mix of U.S. income drove the 25% current quarter pro forma rate. Capital placements for the first six months of 2021 were in line with procedure and utilization growth. A couple of things I'd say. In closing, we continue to believe there is a substantial and durable opportunity to fundamentally improve surgery and acute interventions. Listen to Webcast. COVID has impacted global supplies of semiconductors and other materials used in our products, while we carry safety stocks of critical components and are otherwise working to secure supply necessary to ensure fulfillment of customer demand, global shortages could result in higher production costs and production development and regulatory delays. The next page will display a menu of options. All of that, to me, indicates that the business feels in balance. Leasing represented 33% of current quarter placements, compared with 29% last year and 43% last quarter. Having said that, it's a difficult procedure for surgeons to perform. Of those patients, 43% were in the da Vinci robotic cohort, 35% in the laparoscopic cohort, and 22% in the open cohort. The authors concluded, "The results revealed that robotic-assisted thoracic surgery is a feasible and safe technique compared with VATs in terms of short-term and long-term outcomes." Unrealized gain (loss) - net of tax expense (recovery) effect of $347 and $37 for the three months ended December 31, 2022 and 2021, respectively; ($859) and $(354) for the six months ended . The Company's da Vinci Surgical System offers surgeons superior visualization, enhanced dexterity, greater precision and ergonomic comfort for the optimal performance of MIS. The rise in earnings was driven by higher . Jamie Samath Senior Vice President Finance. To make the world smarter, happier, and richer. I think we're going to have to let it play for another few quarters to see. So bariatric obviously has been highly laparoscopically penetrated historically. Higherfourthquarter revenue was driven by growth in da Vinci procedure volume and system placements. Investors are cautioned not to place undue reliance on such forward-looking statements. I guess first question on guidance. We ended the quarter with cash and investments of $7.7 billion, compared with $7.2 billion last quarter. Examining procedure trends more deeply. Intuitive advances minimally invasive care by innovating at the point of possibility. Our SEC filings can be found through our website or at the SEC's website. I think that would be a mistake. In terms of penetration or adoption, we're in the early to mid-innings kind of range is what I'd say in the U.S. market. You're developing, trying to increase efficiency, decrease costs, that kind of thing. During 2021, COVID-19 resurgences continued to impact da Vinci procedure volumes. I hear your question is asking us how much is left, how much of the catch-up is left. Shifting to the extended use program, you know, you've been out for around six months, smaller rollout in Europe in the fourth quarter. Rick Wise -- Stifel Financial Corp. -- Analyst. Plan to attend GIANT 2022. Annualized U.S. procedure growth rates are returning to historical levels for procedures with longer diagnostic pipelines as patients have started returning to screening and diagnostic testing. That's great. In the U.S., procedures that are dependent on diagnostic pipelines also grew, albeit at lower rates as compared to benign procedures. That means that utilization will go up kind of naturally, that that mix moves toward a higher utilization mix. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Richard Wolf GmbH 10.6 . And I guess why won't that continue? In addition, the components of the costs that the Company excludes in its calculation of non-GAAP net income attributable to Intuitive Surgical, Inc. and non-GAAP EPS may differ from the components that its peer companies exclude when they report their results of operations. Our total Ion clinical experience is approximately 4,000 cases to date. From the low-end perspective, the 27% reflected there is greater summer seasonality that reflects the possibility of an impact due to pent-up demand for vacation, especially for healthcare workers that have worked extensively during this period with COVID. Without excluding these tax effects, investors would only see the gross effect that these non-GAAP adjustments had on the Companys operating results. Investor's Business Daily . In terms of our underlying numbers, we're growing at a little faster rate in the revision section, sleeves and bypass grow about the same rate. 2021 Intuitive Sustainability Report 7.8 MB. Just so really speaking backward-looking, so far, so good. Bob Hopkins -- Bank of America Merrill Lynch -- Analyst. Yeah. There were nearly 1,500 Ion procedures completed in the second quarter. The compound annual growth rate between the fourth quarter of 2019 and the fourth quarter of 2021 was 10%. Corporate Governance Guidelines 384.4 KB. All Rights Reserved. Our fully integrated advanced instruments portfolio has been a strong addition to our multiport ecosystem, allowing for high-quality tissue interaction controlled from the surgeon's console while optimizing workflow. Submit. The increase in cash in the second quarter primarily reflected cash from operations and stock exercises. That's right -- theythink these 10stocks are even better buys. Or any color you can provide on that? Maybe just at the beginning of your comments, I was struck that you emphasized that da Vinci utilization rates are, if I understood you correctly, at the high end of historical averages. Gary, just with you, just thinking through the My Intuitive and what you're doing at the surgeon level. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. These non-GAAP financial measures also facilitate managements internal comparisons to its historical performance. Feb 2021 - Jun 2021 5 months Advised and supported life science entrepreneurs through market validation, regulatory, reimbursement, intellectual property, investor narrative, and talent . And I'd just be curious to -- since you all are calling it out repeatedly as an important incremental growth driver, where are we now, in your view, in that, I'm sure, multiyear, long-term adoption process? Ladies and gentlemen, thank you for standing by and welcome to the Intuitive Q4 2021 Earnings Release Call. Both gynecology and urology procedure annualized growth strengthened in the quarter, as pandemic pressures eased in the U.S. Second-quarter OUS procedure volume grew approximately 51%, compared with a 7% decline for the second quarter of 2020 and 23% growth last quarter. Gross profit, income from operations, net income attributable to Intuitive Surgical, Inc., net income per diluted share attributable to Intuitive Surgical, Inc., and diluted shares are reported on a GAAP and non-GAAP* basis. Our focus is in clinical capability and productivity of the installed base we have. The increase compared to prior year reflects costs associated with higher headcount, increased variable compensation, and increased spending in areas impacted by COVID. SUNNYVALE, Calif., Jan. 20, 2022 (GLOBE NEWSWIRE) -- Intuitive (the "Company") (Nasdaq: ISRG), a global technology leader in minimally invasive care and the pioneer of robotic-assisted surgery, today announced financial results for the quarter ended December 31, 2021.Reported revenue and procedure results are consistent with the Company's press release issued on January 12, 2022. Intuitive 360 is an annual conference for executive, clinical, and operational leadership focusing on robotic service line development and the surgical care team. Consistent with the last quarter's forecast, we expect our noncash stock compensation expense to range between $450 million and $470 million in 2021. The compound annual growth rate between the fourth quarter of 2019 and the fourth quarter of 2021 was 6%. (4) Income tax expense includes the effect of the following items: One-time tax benefit from re-measurement of certain deferred tax assets, Discrete tax expense arising from the conclusion of a tax matter, Accounts payable and other accrued liabilities, Total liabilities and stockholders equity, Adjustments attributable to noncontrolling interest in joint venture. The Company defines non-GAAP net income as net income attributable to Intuitive Surgical, Inc., excluding intangible asset charges, non-cash impairment charges and recoveries, certain acquisition-related items for the re-measurement of contingent consideration, SBC and long-term incentive plan expenses, litigation charges and recoveries, gains (losses) on strategic investments, adjustments attributable to noncontrolling interest in joint venture, net of the related tax effects, and tax adjustments, including the excess tax benefits or deficiencies associated with SBC arrangements, a one-time tax benefit from re-measurement of certain deferred tax assets, and the net tax effects related to intra-entity transfers of non-inventory assets. I mean, how do you know there was catch-up from the backlog in Q2? Submit. Yeah, sure. You may automatically receive Intuitive Surgical financial information by e-mail. Good afternoon. Long-term incentive plan expense relates to phantom share awards granted in China by the Companys Intuitive-Fosun joint venture to its employees that vest over four years and can remain outstanding for seven to ten years. Today's press release and supplementary financial data tables have been posted to our website. Procedures recovered nicely in Q2. Key business metrics for the second quarter were as follows. The next page will display a menu of options. COVID-19 has had, and may continue to have, an adverse impact on the Companys procedure volumes. I'll now turn the time over to Marshall to take you through our financial performance in greater detail. System placements came in above plan, and system ASP and I&A revenue per procedure tracked slightly above our expectations, together driving revenue of $1.46 billion in Q2. European procedure growth was generally healthy, though varied by country. Third, we are launching and refining our flexible diagnostic platform, Ion, by working with early customers to help establish high-performing sites and by improving our technology and supply chain capabilities. Jamie Samath Senior Vice President of Finance Thank you. The decrease relative to these prior periods reflects geographic mix and volume discounts provided to customers purchasing multiple systems. From a market perspective, about 60%-ish or so are sleeves, about 15% are revisions. And that has implications for the kind of imaging we do, it has implications for task analysis and training, and we're doing those things, and those can be aggregated across a surgical platform. During the quarter, a group from the Shenzhen Hospital Naval Medical University in China, published a meta-analysis in BMC cancer comparing robotic-assisted thoracic surgery versus video-assisted thoracic surgery, or VATs, for lung lobectomy or segmentectomy in patients with nonsmall cell lung cancer. I'll caution that what the next couple of quarters or next four quarters looks like in terms of hospital access to capital and their decision-making, capital is always lumpy. We think we stand up pretty well to those comparisons, and we're ready to help them pursue their aims as the year proceeds. Now turning to the clinical side of our business. The call will be webcast by Nasdaq OMX and can be accessed on Intuitives website at www.intuitive.com or by dialing (844) 867-6169 using the access code 525958. The Company calculates constant currency revenue by translating current period revenue using prior period exchange rates. I don't know how much of an update you can give us, but just something on what's happening at that level in terms of software tools and services? For more information, please visit the Companys website at www.intuitive.com. The constant currency revenue percentage change is calculated by determining the increase in the current period constant currency revenue over the prior period revenue. As I conclude, for the balance of the year, we're focused on the following: first, agile and flexible support for our customers globally as they need it, often addressing the return of surgical patients to treatment. Forward-looking statements relate to expectations concerning matters that are not historical facts. These system-controlled staplers, vessel sealers, and energy instruments support a range of procedures from bariatrics to colorectal procedures, to thoracic and gynecologic applications. Even then, it's not enough. Growth in Japan was solid but was impacted by a relatively slow rollout of vaccines and the impact of localized lockdowns as a result of ongoing efforts to prevent resurgences of COVID-19. On the capital side, new system placements continue to be healthy, with the United States, China, Germany, France, and Japan, notable in the quarter. 10/08/22 - 11:00 AM EDT. Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. Fourth quarter 2022 GAAP income from operations also included litigation charges of $21million. And sequential growth in what they can do with the system remains our focus on SP for now. And then on a two-year compounded basis, you're kind of where you thought you might be pre pandemic. The tax effects of the non-GAAP items are determined by applying a calculated non-GAAP effective tax rate, which is commonly referred to as the with-and-without method. Please go ahead, sir. In the quarter, we completed a number of placements with larger IDNs that prefer to purchase rather than lease product. 2021 Proxy Statement - Special Meeting 224.6 KB. Intuitive Surgical, Inc.Which belongs to the Zacks Medical - Instruments industry, posted revenues of $1.29 billion for the quarter ended March 2021, surpassing the Zacks Consensus Estimate by 16. . Pagination. The increase in instruments and accessories revenue was primarily driven by approximately 18% growth in da Vinci procedure volume, partially offset by customer buying patterns and foreign currency impacts. We think about digital as enabling and accelerating a lot of different parts of the ecosystem. Submit. Turning to our single-port system. To choose J.P. Morgan Healthcare Conference 2023 Presentation 4.2 MB. I will also summarize our GAAP performance later in my prepared remarks. I just wondered, are you suggesting or should we be thinking that we could be in the front of a new wave of capital acquisition, with again, capital released because of the need to add additional systems to accommodate the expanding number of procedures? We think there is an opportunity to accelerate learning and to drive increased insight for a surgeon into their own progress. The non-GAAP* measures are described below and are reconciled to the corresponding GAAP measures at the end of this release. Based in Sunnyvale, California. Calvin Darling -- Senior Director of Finance, Investor Relations. I'm just curious from what you see out there, is this broadly reflective of what you think is going on in the marketplace for surgical procedures? Intuitive Surgical Investor Relations. Well, I'll add one bit of color to that. Fourth quarter 2021 GAAP income from operations included share-based compensation expense of $120 million, compared with $104 million in the fourth quarter of 2020. Buy These 2 Stocks in 2023 and Hold for the Next Decade, 2 Growth Stocks to Buy Before the Big Bull Rally, Join Over Half a Million Premium Members And Get More In-Depth Stock Guidance and Research, Copyright, Trademark and Patent Information. General surgery growth in the U.S. was strong, and in addition to the positive impact from patient backlogs, reflected increasing access for surgeons to our fourth-generation technology. And just, you know, on competition, it does seem like the noise is increasing. Statements using words such as estimates, projects, believes, anticipates, plans, expects, intends, may, will, could, should, would, targeted, and similar words and expressions are intended to identify forward-looking statements. The Company uses these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. So short answer there is just kind of a reminder of what we're trying to do. The Company undertakes no obligation to publicly update or release any revisions to these forward-looking statements, except as required by law. Listen to Webcast. So I'd encourage those folks on the call, it's likely to be a comparison of ecosystems in delivering the Quad Aim over time. Fourth quarter 2022 GAAP income from operations decreased to $373 million, compared with $450 million in the fourth quarter of 2021. I would just add, Bob, as you saw the COVID hospitalization rates in the U.S. come down in March and into Q2, that frees hospital resources to increase the level of surgery that we do. The Company defines non-GAAP net income as net income attributable to Intuitive Surgical, Inc., excluding amortization of intangible assets, SBC and long-term incentive plan expenses, litigation charges and recoveries, a gain on the sale of a business, gains (losses) on strategic investments, adjustments attributable to noncontrolling interest in joint venture, net of the related tax effects, and tax adjustments, including the excess tax benefits or deficiencies associated with SBC arrangements and the net tax effects related to intra-entity transfers of non-inventory assets. It's a short period, but we believe that there is elasticity, and we've seen elasticity in markets where reimbursements are very low. (USD millions), considering 2021 as the base year . Intuitive Surgical (ticker: ISRG ) reported an adjusted fourth-quarter profit of $1.30 a share, beating forecasts for $1.28 a share, on sales of $1.55 billion, which topped expectations for $1.52 . Our teams continue to work closely with hospitals, physicians, and care teams in pursuit of what our customers have termed the Quadruple Aim: Better, more predictable patient outcomes, better experiences for patients, better experiences for their care teams, and ultimately, a lower total cost to treat. Each quarter on these calls, we highlight certain recently published studies that we deem to be notable. PROCEPT BioRobotics is a surgical robotics company enabling better patient care by developing transformative solutions in urology. Can you talk about kind of next steps to the program here, particular geographies you're targeting? Extended use instruments were introduced into the U.S. and Europe in the fourth quarter, in most other markets in the first six months of this year, except China due to regulatory timelines. And basically, still underpenetrated, big opportunity. In Q2, U.S. procedures grew 77% year over year, which equates to 16% on a two-year . Intuitive(Nasdaq: ISRG), headquartered in Sunnyvale, California, is a global technology leader in minimally invasive care and the pioneer of robotic-assisted surgery. Looking forward, we see the following capital revenue dynamics. 3.5 Leading Players of Laparoscopy Surgical Robotic System and Consumables by Type in 2021 3.6 Conclusion of Segment by . This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The webcast replay of the call will be made available on our website at www.intuitive.com within 24 hours after the end of the live teleconference and will be accessible for at least 30 days.