Robotic Surgery Giant Crushes Expectations, Stock Soars
Surging Sales and System Placements Drive Growth
Intuitive Surgical, a leader in robotic surgery, has shattered Wall Street’s expectations with its preliminary fourth-quarter report. The company’s sales surged 25% to $2.41 billion, far exceeding forecasts of $2.2 billion. This impressive performance was largely driven by system placements, with 493 da Vinci robotic surgery systems installed in the fourth quarter, beating expectations by 19%.
New Products and Expanding Market Fuel Growth Story
Analysts are optimistic about Intuitive Surgical’s future prospects, citing the company’s increasingly vocal plans for new products, such as software for enhanced imaging, and an expanding total addressable market. William Blair analyst Brandon Vazquez notes that this remains a growth story with durable tailwinds, likely to deliver above investor expectations.
Procedure Volume and Instrument Sales Boost Revenue
The number of procedures using Intuitive Surgical’s systems climbed 18%, above calls for 16.9%. This led to higher sales of single-use instruments and accessories, which jumped 23% to $1.41 billion, topping projections for $1.35 billion.
Guidance and Outlook
While the company expects procedure growth to slow to 13% to 16% in 2025, this is in line with expectations and historical growth rates. Vazquez believes that Intuitive Surgical has an achievable pathway to deliver upside to these estimates, driven by the ramping-up launch of da Vinci 5 and new software launches in 2025.
Total Addressable Market Expands
Intuitive Surgical now sees a total addressable market of 8 million cases, 1 million above its prior forecast. This suggests the company is just 34% penetrated into this market exiting 2024 and still has room to more than double its total addressable market to 22 million procedures over time.
Stock Soars on Strong Earnings
Intuitive Surgical stock rocketed 7.7% to 580.11, topping a flat-base buy point at 556.23 on the weekly chart. Vazquez rates Intuitive Surgical stock a buy, citing its growth potential and achievable guidance.
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