intuitive surgical investor presentation 2021

Calvin Darling -- Senior Director of Finance, Investor Relations. Next, we go over to Larry Beigelsen with Wells Fargo. Please go ahead, sir. For more information, please visit the Companys website at www.intuitive.com. Additionally, constant currency revenue growth is reported on a non-GAAP* basis. With me today, we have Gary Guthart, our CEO; Marshall Mohr, our CFO; and Jamie Samath, our senior vice president of finance. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. To change your e-mail options at 2 Healthcare Stocks You Can Buy and Hold for the Next Decade, Why Things Could Get Worse Before They Get Better for This Growth Stock, 2 Stocks to Buy No Matter What Happens This Year, Why Intuitive Surgical Stock Slumped in January. And then has the elasticity relative to the extended use program and the pricing adjustments played out relative to your expectations? [Operator Instructions] As a reminder, today's call is being recorded. To the extent that COVID impacts procedures, it will also impact capital purchases. With respect to operating expenses, on our last call, we forecast to grow full-year pro forma 2021 operating expenses between 18% and 22% above 2020 levels. Email: investor.relations@intusurg.com. Thoracic Surgery Market was valued at USD 3.1 Billion in 2021, and it is expected to reach a CAGR of 7.18 % . We are now slightly increasing our forecast and expect full-year gross profit margin to be between 70.5% and 71.5% of revenue. A couple of things. BSD Medical Corporation Medtronic Ethicon Endo-Surgery Olympus Corporation Siemens Healthcare Intuitive Surgical . Key business metrics for the second quarter were as follows. We placed four SP systems in the quarter, bringing the total installed base to 79. 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. The Company defines non-GAAP EPS as non-GAAP net income attributable to Intuitive Surgical, Inc. divided by non-GAAP diluted shares, which are calculated as GAAP weighted-average outstanding shares plus dilutive potential shares outstanding during the period. Today's press release and supplementary financial data tables have been posted to our website. [Operator instructions] And for our first question, we will go to Tycho Peterson. 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. Our focus is in clinical capability and productivity of the installed base we have. This article is a transcript of this conference call produced for The Motley Fool. Jamie will take you through procedure dynamics in more detail later in the call. And as we've said in the past, if we can bring the right system with the right instruments, the right imaging, and the right usability, the right ease of use, we think that surgeons will care. That low end also reflects some impact of a resurgence in the U.S. any time, re-enter your e-mail address and click Submit, then adjust your form entries. The Company believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance by excluding items such as amortization of intangible assets, share-based compensation (SBC) and long-term incentive plan expenses, and other special items. Marshall will provide a review of our financial results. Intuitive Surgical has been witnessing an upward estimate revision trend for 2021. Both gynecology and urology procedure annualized growth strengthened in the quarter, as pandemic pressures eased in the U.S. And as competition progresses in various markets, we will likely experience longer selling cycles and price pressures. Preliminary full year 2021 systems revenue increased by 44% to approximately $1.69 billion, compared with $1.18 billion in 2020. Listen to Webcast. Driven by steady sales of da Vinci and increasing surgical procedures, Intuitive Surgical recorded $5.71 billion in revenue for 2021, up 82% over the past five years despite COVID-19 slowdowns. In the quarter, strong trade-ins of older-generation systems for our fourth-generation products and strength in multi-system deals continue to support our thesis that customers that know us best continue to invest with us going forward. INTUITIVE SURGICAL, INC.-14.33%: 79 654: BOSTON . The compound annual revenue growth rate between the second quarters of 2019 and 2021 was 15%. Q4 2022 INTUITIVE Earnings Conference Call, INTUITIVE at J.P. Morgan Healthcare Conference, Q3 2022 INTUITIVE Earnings Conference Call, INTUITIVE at 2022 Wells Fargo Healthcare Conference, Q2 2022 INTUITIVE Earnings Conference Call, INTUITIVE at 43rd Annual Goldman Sachs Global Healthcare Conference, INTUITIVE at BofA Securities 2022 Healthcare Conference, Q1 2022 INTUITIVE Earnings Conference Call. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Turning to our single-port system. I mean, how do you know there was catch-up from the backlog in Q2? This presentation contains forward-looking statements. In the United States, procedure growth was strong in the quarter, driven by growth in bariatric surgery, hernia repair, and cholecystectomy. We are building tools and capabilities that allow hospital departments and departments of surgery to manage their program and look across programmatics for efficiency, for learning, for outcomes, and these things interlink. We are refining our estimate and expect our full-year pro forma operating expense growth to be between 17% and 21%. Follow Allison Gatlin on Twitter at @IBD_AGatlin . The Company shipped 385 da Vinci Surgical Systems, an increase of 18% compared with 326 in the fourth quarter of 2020. The compound annual growth rate between the full year of 2019 and the full year of 2021 was approximately 12%. We expect pro forma other income, which is comprised mostly of interest income, to total between $50 million and $55 million in 2021. INTUITIVE at 43rd Annual Goldman Sachs Global Healthcare Conference. And the capital to support that demand has not run ahead of the procedure demand. We placed 20 Ion systems in the quarter, bringing the installed base to 70 systems. An accomplished communicator seeking opportunities in Ottawa, with a proven ability to multitask under high-pressure situations to meet deadlines. . Gary, just with you, just thinking through the My Intuitive and what you're doing at the surgeon level. 20, 2021Corporate Participants: Philip Kim Head of Investor Relations. Intuitive Surgical, Inc. (NASDAQ:NASDAQ:ISRG) JPMorgan 40th Annual Healthcare Conference January 12, 2022 3:45 PM ETCompany ParticipantsGary Guthart - CEOJamie Samath - CFOBrian King -. We will now open the call to your questions. Women Techmakers Ambassador is responsible for driving diversity and inclusion through organizing local events within the tech community. 2021 Intuitive Sustainability Report 7.8 MB. The supply issues we called out in the first quarter did not impact Ion placements and procedures in this quarter. Fourth quarter 2022 revenue was$1.66 billion, an increase of 7%compared with$1.55 billion in thefourth quarter of 2021. You may automatically receive Intuitive Surgical financial information by e-mail. These awards were modified in the fourth quarter of 2021 and are now valued based on certain key performance metrics. To understand our system placement and capital performance over this period, we look to annual system utilization trends, which have recovered to utilization rates at the high end of our historical averages. The impact of the COVID-19 pandemic on the Companys business has, and continues to, differ by geography and region. Keep up-to-date with changes . While this did not have a material impact to our operating results in Q2, the outlook we are providing does not reflect any potential significant disruption or additional costs related to supply constraints. In closing, we continue to believe there is a substantial and durable opportunity to fundamentally improve surgery and acute interventions. So I think those are the key kind of procedure highlights. And we think that the extended use instruments lowers barriers for purchases of systems. J Global Clinical Engineering, Special Issue 4, 2021 - Proceedings IV ICEHTMC 2021 - ISSN 2578 2762 1 dicembre 2021 . Fourth quarter 2022 GAAP income from operations also included litigation charges of $21million. I will now summarize our GAAP results. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release and which are based on current expectations and are subject to risks, uncertainties, and assumptions that are difficult to predict, including those risk factors identified under the heading Risk Factors in the Companys Annual Report on Form 10-K for the year ended December31, 2021, and the Companys Quarterly report on Form 10-Q for the quarter ended September 30, 2022, as updated by the Companys other filings with the Securities and Exchange Commission. Shifting to the extended use program, you know, you've been out for around six months, smaller rollout in Europe in the fourth quarter. The next page will display a menu of options. OK. And last one on SP. The Company undertakes no obligation to publicly update or release any revisions to these forward-looking statements, except as required by law. So that's a multi-quarter conversation. And with that, I'd like to turn it over to Jamie. Turning to gross profit. Fourth quarter 2022 non-GAAP* net income attributable to Intuitive Surgical, Inc. was $439 million, or $1.23 per diluted share, compared with $473 million, or $1.29 per diluted share, in the fourth quarter of 2021. Marshall, the operating margin coming in at the 43%, I'm just wondering how much we can extrapolate here? And our posture to that has been -- it may delay some sales as we may have some competitive conversations and tenders, and we'll lose some. Contact Information. The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning, forecasting, and analyzing future periods. Forward-looking statements relate to expectations concerning matters that are not historical facts. any time, re-enter your e-mail address and click Submit, then adjust your form entries. Thirty-eight percent of systems placed in the second quarter involved trade-ins, which is lower than the 40% last year and the 44% last quarter. Submit. And we're pleased. Management addresses these limitations by providing specific information regarding the GAAP amounts excluded from non-GAAP net income attributable to Intuitive Surgical, Inc. and non-GAAP EPS and evaluating non-GAAP net income attributable to Intuitive Surgical, Inc. and non-GAAP EPS together with net income attributable to Intuitive Surgical, Inc. and net income per share attributable to Intuitive Surgical, Inc. calculated in accordance with GAAP. Growth in our second largest market, China, continued to be strong with multiple specialties contributing. Investors are cautioned not to place undue reliance on these forward-looking statements, including statements about our results of operations, growth strategy and commercial opportunity. Just on the recent spread of COVID and variants and the potential impact on demand and hospitals' ability to do procedures, are you starting to see that impact now? Larry Biegelsen -- Wells Fargo Securities -- Analyst. The higherfourth quarter revenue was driven by growth in da Vinci procedure volume, partially offset by a decline in system placements and foreign currency impacts. Just to be clear on your answer to Tycho's question. Good afternoon, and welcome to Intuitive's second-quarter earnings conference call. Is Intuitive Surgical Stock Still Worth Buying Hand Over Fist in 2023? 2 Reasons to Avoid a Roth 401(k) for Your Retirement Savings, Warren Buffett's Latest $2.9 Billion Buy Brings His Total Investment in This Stock to $66 Billion in 4 Years, Want $1 Million in Retirement? The high end of the range assumes strength in U.S. general surgery, a return to normalized diagnostic pipelines, the vaccines are effective against any new COVID-19 variants and the vaccine rollouts in OUS markets continue as currently expected by governments around the world. To change your e-mail options at We also find that our economic offerings with da Vinci X and EUP, we have choices that we ourselves can offer our customers. That concludes our prepared comments. Marshall L. Mohr Executive Vice President and Chief Financial Officer. Copyright 2023 Intuitive Surgical. Customer adjustment of buying patterns will reduce I&A revenue per procedure. And so we'll spend there. In Q2, we launched our SureForm stapling line in India. Our total Ion clinical experience is approximately 4,000 cases to date. COVID-19 has had, and may continue to have, an adverse impact on the Companys procedure volumes. During 2021, COVID-19 resurgences continued to impact da Vinci procedure volumes. It is in fact a physically taxing procedure, as Gary described. Next, we'll go to Bob Hopkins with Bank of America. Examining procedure trends more deeply. Moving on to capital placements. In the U.S., Q2 procedure results were positively impacted by a continuing recovery from COVID-19, including, we believe, a number of procedures that had been previously deferred. So bariatric obviously has been highly laparoscopically penetrated historically. Our pro forma spending grew over 24% from a year ago, representing increased investment in our business. On the why side, it's -- bariatrics has been a little different than other procedure for us. Reported revenue and procedure results are consistent with the Companys press release issued on January 12, 2022. And I suspect that's most of what we're seeing, at least in the United States in terms of that. We kind of outlined what was assumed in the high end of the procedure guidance. Richard Wolf GmbH 10.6 . I think the noise levels will go up. I think that when you think about our product cycles, I would just have you look back earlier in the da Vinci experience in that these are long development cycles. I think that would be a mistake. Another third works closely with customers in the field, and the remaining third have traditionally worked in lab and office environments. Intuitive Surgical Investor Presentation. The Company undertakes no obligation to publicly update or release any revisions to these forward-looking statements, except as required by law. Pro forma gross margin for the second quarter of 2021 was 71.7%, compared with 62.4% for the second quarter of 2020 and 71.8% last quarter. Instruments and accessories, training programs, support staff, analytics capability, publication, scientific publications demonstrating what you've done, the analytics, and evidence-based build are all, I think, important. OUS markets grew 51% year over year or 19% on a two-year compound annual growth rate basis. You're developing, trying to increase efficiency, decrease costs, that kind of thing. Intuitive Surgical, Inc. (Nasdaq:ISRG), headquartered in Sunnyvale, Calif., is the pioneer and a global technology leader in robotic-assisted, minimally invasive surgery. *Average returns of all recommendations since inception. your options for e-mail notification, please enter your e-mail address below and click We expect our pro forma rate for the last six months of 2021 to be between 21% and 22% versus our previous guidance of 20% to 21%, reflecting a greater proportion of U.S. income for the year. Or is this simply and primarily just something about the pandemic accelerating the use of da Vinci and robotics surgery broadly? Intuitive Surgical's adjusted net . Product and brand names/logos are trademarks or registered trademarks of Intuitive Surgical or their respective owner. 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. Partly, it's delays in getting in and getting tested and starting the journey and then getting in and having a procedure or treatment, whatever that might be. Can you talk about kind of next steps to the program here, particular geographies you're targeting? The Company grew its da Vinci Surgical System installed base to 7,544 systems as of, Fourth quarter 2022 GAAP net income attributable to Intuitive was, Fourth quarter 2022 non-GAAP* net income attributable to Intuitive was. Jamie will provide additional procedure commentary later in this call. The next page will display a menu of options. However, as the installed base of older-generation product declines, the number of trade-ins will decline over time. That says that we're not putting out more capital than folks need, even though it's been healthy capital quarters, it means our customers are getting good benefit out of what they're using those systems for. One is we are focused on making sure that our ecosystem, our products, our systems, everything goes around it really delivers against the Quadruple Aim all the way through. The Company defines non-GAAP gross profit as gross profit, excluding intangible asset charges and SBC and long-term incentive plan expenses. Yes, Tycho. And we also see, I think, increased patient confidence is a function of the improving vaccination rates. Good afternoon. All Rights Reserved. Listen to Webcast. Thanks. To change your e-mail options at We also believe that growth benefited from some procedures that were previously deferred due to delays in testing and patient concern over COVID. To change your e-mail options at And I guess why won't that continue? Jamie will provide spend guidance later in this call. So good morning, everyone, and welcome to Medistim's Fourth Quarter Presentation for 2022. I've had the privilege of seeing Intuitive develop the use of robotics in multiple clinical indications over the years. First, we are broadening access to our advanced instruments for our da Vinci Fourth Generation Multiport Systems through pursuit of additional clearances and launches outside the U.S. Second, we are expanding our da Vinci SP offering by broadening its regional and clinical indications and by adding it to its suite of instruments and accessories. In the U.S., procedures that are dependent on diagnostic pipelines also grew, albeit at lower rates as compared to benign procedures. Intuitive has managed multiple ways of working for many years. We recognized $26 million of lease buyout revenue in the second quarter, compared with $9 million last year and $19 million last quarter. Gary S. Guthart Chief Executive Officer, Member of the Board of Directors. (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. There are several models of the da Vinci Surgical System. There appears to be some. Jamie will discuss procedure and clinical highlights and provide an update of our financial outlook. Pagination. We are also working on our regulatory filings to bring SP to Europe under the European Union's new medical device regulation framework. However, we anticipate more customers will seek leasing or alternative financing arrangements than reflected in historical run rates. Our actual tax rate will fluctuate with changes in the geographic mix of income, changes in taxation made by local authorities, and with the impact of one-time items. Lockdowns decrease patient mobility and willingness to go get their tests and then hospitalization diminishes ICU capacity. So we're excited about that because it gives them fast and easy access. Instrument and accessory revenue per procedure of $1,940 increased, compared with $1,900 per procedure for the second quarter of last year, and decreased, compared with $1,950 per procedure in the first quarter. Our SEC filings can be found through our website or at the SEC's website. (1) Services revenue includes the effect of the following item: (2) Selling, general and administrative includes the effect of the following item: (3) Income from operations includes the effect of the following item: (4) Interest and other income, net includes the effect of the following item: (5) Income tax expense includes the effect of the following items: Excess tax benefits related to share-based compensation arrangements. The fourth quarter 2022 system placements included 154systems placed under operating lease and usage-based arrangements, compared with 143 systems in thefourth quarter of 2021. It's taking getting the advanced instruments, put them together as a set, getting our workflows and our clinical pathways right, and I think that's been powerful to date. In addition, COVID delayed some R&D work, resulting in underspend on prototypes. Gross profit, income from operations, net income attributable to Intuitive Surgical, Inc., and net income per diluted share attributable to Intuitive Surgical, Inc. are reported on a GAAP and non-GAAP* basis. These system-controlled staplers, vessel sealers, and energy instruments support a range of procedures from bariatrics to colorectal procedures, to thoracic and gynecologic applications. Marshall L. Mohr Executive Vice President and Chief Financial Officer. 2021 Proxy Statement - Special Meeting 224.6 KB. Investors have assigned a high trading . Listen to Webcast. Additional revenue statistics and trends are as follows. Finally, our team is making good progress in scaling our operations. That's helpful, Gary. Yes. Looking forward, we see the following capital revenue dynamics. The Companys calculated non-GAAP effective tax rate is generally higher than its GAAP effective tax rate. Revenues are anticipated to be about $1.55 . And then now we have rolled it out to most other markets in the first six months of this year, except for China where there are longer regulatory timelines. Fourth quarter 2022 constant currency revenue increased 10% compared to the fourth quarter of 2021. The Motley Fool owns shares of and recommends Intuitive Surgical. The second quarter of 2020 included $59 million of service credits issued in conjunction with our Customer Relief Program, higher period costs associated with lower production, and higher excess and obsolete inventory charges. . And we're early in the Ion product cycle, and we're early in the SP or early mid in SP. Where are we going with this one? Second-quarter spending was below our expectations due to activities restricted by COVID, including clinical development, marketing events, and travel costs. Copyright 2023 Intuitive Surgical. Listen to Webcast. So it takes a while. So we don't really call them out as individual revenue lines. The Zacks . The Company grew its da Vinci Surgical System installed base to 6,730 systems as of, Fourth quarter 2021 GAAP net income attributable to Intuitive was $381million, or, Fourth quarter 2021 non-GAAP* net income attributable to Intuitive was. System placements in the quarter reflected procedure growth and hospitals upgrading to -- in order to access or standardize on fourth-generation capabilities. ET. Gary S. Guthart Chief Executive Officer, Member of the Board of Directors. Hi, Gary. And Jamie, as to kind of where we are. See www.intuitive.com/trademarks. Without excluding these tax effects, investors would only see the gross effect that these non-GAAP adjustments had on the Companys operating results. 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. You may automatically receive Intuitive Surgical financial information by e-mail. Obviously, you made some comments about variance and not factoring in kind of an increase. 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. And those two things come together, they also allow hospitals to start to address the backlog that's accumulated. Conversion rates to open surgery were lower in the robotic group compared to the laparoscopic group, 0.6% as compared to 4.9%, and reoperation rates in the 30 days post procedure were comparable between robotic and laparoscopic and lower for robotic as compared to open, 0.6% as compared to 3.1%. These forward-looking statements are necessarily estimates reflecting the judgment of the Companys 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. First quarter 2022 non-GAAP* net income attributable to Intuitive Surgical, Inc. was $413 million, or $1.13 per diluted share, compared with $427 million, or $1.17 per diluted share, in the first quarter of 2021. Non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income attributable to Intuitive Surgical, Inc., and non-GAAP EPS exclude items such as intangible asset charges, re-measurement of contingent consideration, SBC and long-term incentive plan expenses, excess tax benefits or deficiencies associated with SBC arrangements, and non-cash amortization of deferred tax assets related to intra-entity transfer of non-inventory assets, which are primarily recurring items. As the phases of the pandemic evolve, we're supporting our team in addressing the opportunities and challenges posed by the pandemic and the ways we work. 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 continue to operate in a challenging supply chain environment and have experienced longer lead times and delayed deliveries from our suppliers. . INTUITIVE at 2022 Wells Fargo Healthcare Conference. Intuitive Surgical, and Verb Surgical, among other countless innovations. Google's Women Techmakers program provides visibility, community, and resources for women in technology. The study contains 371 patients that underwent an incisional hernia repair procedure across 17 institutions within the United States between May 2016 and September 2019. The outlook we are providing on today's call does not reflect risks associated with a significant increase in COVID-related hospitalizations in relation to the Delta variant or other potential new variants. 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. Please go ahead. Now, I'd turn the conference over to our host, Brian King, Head of Investor Relations for Intuitive Surgical. 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. 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? To choose The Company calculates constant currency revenue by translating current period revenue using prior period exchange rates. Next, we will go to Amit Hazan with Goldman Sachs. In Q2, U.S. procedures grew 77% year over year, which equates to 16% on a two-year compound annual growth rate basis. The Board of Directors of Intuitive Surgical approved a 3:1 stock split on August 5th, 2021. So I think all of you on the call, you should expect increased alternatives for the customer base. In this Backstage Pass video, which aired Sept. 29, Motley Fool contributor Brian Withers shares his thoughts on Intuitive Surgical, highlighting the metrics investors need to watch when the . We are in the execution and launch phase of four efforts. Trade-in activity can fluctuate and be difficult to predict. We expect these programs to continue their ramp as our labs and development programs recover efficiency. That said, other teams are out. The Motley Fool recommends Johnson & Johnson and recommends the following options: long January 2022 $580 calls on Intuitive .