Robotic-assisted surgical technology firm Intuitive Surgical (ISRG 812.82, +53.48 +7.04%) trades to fresh all-time highs today following last night’s Q1 beat and guidance.
For those who may not be familiar, based in California ISRG is a technology company focused on robotic-assisted, minimally invasive surgery tech. Products include the da Vinci Surgical System, the da Vinci EndoWrist and Skills Simulators. AS of December 31, 2016 ISRG had 3,755 employees.
Getting back to the results, ISRG reported better than expected Q1 earnings per share (EPS) and revenues of $5.09 and $674.2 million, respectively. Higher Q1 revenue was driven by growth in recurring instrument, accessory, and service revenue, and higher systems revenue. Additionally, Q1 revenue excludes $23 million that was deferred in association with a customer trade-out program that ISRG plans to offer to certain first quarter customers.
Breaking down the revenue beat, Q1 instrument and accessory revenues were up about 18% to $381 million, compared with $322 million last year as a nearly 18% growth in da Vinci procedure volume aided results. Q1 service revenues were up about 13% to $140 million, compared with $125 million for the first quarter of 2016. Further, Q1 systems revenue improved about 4% to $153 million, compared with $148 million last year.
Worldwide da Vinci procedures grew nearly 18% compared with the Q1 of last year, driven mostly by growth in U.S. general surgery procedures and worldwide urologic procedures. ISRG shipped 133 da Vinci Surgical Systems compared with 110 in the first quarter of 2016.
Looking ahead, ISRG expects their procedure growth rate outside of the United States to slow as the calendar tailwind becomes a calendar headwind of similar magnitude during Q2. The company now anticipates full-year 2017 procedure growth within a range of 12-14% compared to prior expectations of 9-12% growth. ISRG also expects average selling prices to trend lower in the remainder of 2017, and sees full-year 2017 gross profit margin to be in the upper half of 69-71% range.