Anticipating Intuitive Surgical’s Q1 Earnings Performance

Intuitive Surgical

Intuitive Surgical, Inc. (NASDAQ:ISRG) is set to unveil its first-quarter 2024 results on Apr 18, after the closing bell. Year to date, the company’s shares have surged by 11.9%, outpacing the industry’s growth of 4.8%. In comparison, the S&P 500 Index has seen a 7.7% increase during the same period.

In the previous quarter, ISRG pleasantly surprised investors with an earnings beat of 8.84%. Impressively, the company has consistently surpassed earnings estimates over the past four quarters, with an average surprise of 5.83%.

Q1 Estimates

Analysts estimate ISRG’s revenues for the first quarter to reach $1.86 billion, reflecting a notable 9.9% improvement from the year-ago quarter’s reported figure. Earnings per share are forecasted at $1.40, marking a 13.8% year-over-year increase.

Key Considerations

The Instruments & Accessories segment is poised to deliver robust first-quarter results, primarily fueled by an increase in da Vinci procedure volume observed over recent quarters. However, adverse currency movements are expected to partially offset gains from the rebound in procedure demand. On a positive note, the rise in recurring revenues bodes well for ISRG.

Furthermore, the recovery in China, driven by robust procedure growth following COVID-related setbacks in the past year, is likely to have bolstered sales in the upcoming quarter.

While ISRG reported a 17% year-over-year increase in sales to $1.93 billion in the fourth quarter, driven by a 21% growth in da Vinci procedures worldwide, supply-chain challenges may have limited da Vinci capital placements in the first quarter. These challenges, coupled with hospitals facing capital spending pressures amid inflationary trends, could have impacted capital placements.

The FDA’s recent approval for the use of its next-generation da Vinci 5 robotic system may not significantly affect first-quarter results, but ISRG may provide updates on its launch plans. In the previous quarter, the company placed 415 systems, marking a 12% year-over-year growth, with potential benefits from rising demand outside the U.S. market.

The single port platform’s growth is expected to have been driven by additional clinical indications and clearances in international markets. Additionally, the availability of Ion catheters in Europe may have contributed to increased revenues during the first quarter.

ISRG’s digital products, such as the Intuitive Hub and Case Insights, are likely experiencing rising adoption. However, government policy changes in China, increased logistics costs due to supply-chain challenges, and rising inflationary pressures may have posed challenges during the quarter.

As ISRG gears up to announce its Q1 earnings, investors eagerly await insights into the company’s performance and outlook amidst these various factors.

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