What happened?
shares of Intuitive Surgery (ISRG -14.34%) tumbled as much as 13.4% on Friday. At 11:16 a.m. ET, the stock was still down 12.42%.
The catalyst that sent the medical device maker lower weren’t better-than-expected financial results, but a cautious forecast that failed to inspire investors.
so what
Intuitive Surgical had revenue of $1.49 billion in the first quarter, up 15% year over year, which resulted in a 12% increase in gross profit. Unfortunately, higher costs weighed on operating income, which fell 2%. This resulted in adjusted earnings per share (EPS) of $1.13.
Image Credit: Intuitive Surgical.
To put these numbers in context, analyst consensus estimates are for sales of $1.4 billion and adjusted earnings per share of $1.08, putting the company ahead of expectations on both sales and earnings surpassed in profit.
Driving the solid growth was an increase in the number of global medical procedures using the da Vinci surgical robotic system, which rose 19% year over year. New system placement was subdued as Intuitive Surgical placed 311 da Vinci systems, a 4% increase. The total installed base of systems increased 13% to 6,920.
Systems revenue of $428 million increased 16% year over year, while instrument and accessory revenue of $810 million increased 15%.
What now
During the conference call to discuss the results, management acknowledged the ongoing challenges related to the pandemic, which have caused delays in orders and patients who continue to postpone medical procedures.
Management revised its guidance for process growth to a range of 12% to 16% for the full year, from its previous guidance range of 11% to 15%. However, the company also acknowledged that its guidance “continues to reflect uncertainty surrounding the trajectory of the pandemic” and that supply chain disruptions could exacerbate the situation further.
For those investing for the long term, this will only be a small blip on the radar. Patients who have postponed essential medical procedures will eventually have them, which bodes well for Intuitive Surgical and its investors.
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