Intuitive Surgical achieved impressive revenue growth in the first quarter of 2025, although it continues to face challenges in margin development. Despite mixed signals, the company demonstrates strong financial performance.
Financial Performance
- Revenue: Revenue rose by 19% year-over-year to $2.25 billion, surpassing analysts’ forecasts.
- Earnings Per Share (EPS): Adjusted EPS climbed to $1.81, above expectations of $1.74.
- Pro-forma Net Income: Pro-forma net income was a strong $662 million.
Growth and Expansion
- Procedure Volumes: There was a 17% increase in procedure volumes, supported by robust growth in international markets.
- System Installations: 367 new systems were installed, increasing the operational stock by 15% to over 10,000 units.
- Procedure Growth Forecast: Intuitive Surgical raised its growth forecasts for the current year to 15-17%.
Challenges
- Trade Tariffs and Margins: Gross margins suffered from trade tariffs but were only slightly below expectations.
- Capital Expenditures: The company plans significant investments to support growth, which could continue to put pressure on margins.
Market Reaction
- Stock Price: Despite the challenges, the stock price rose by 5.8%.
- Analyst Ratings: BTIG lowered the price target but maintained the buy recommendation.
Overall, Intuitive Surgical is considered a company with strong growth potential, but it needs to address the challenges posed by trade tariffs.