intuitive surgical investor presentation 202123 Apr intuitive surgical investor presentation 2021
Copyright 2023 Intuitive Surgical. The split must be approved by the shareholders but this is merely a formality. Are we starting to see leverage potentially that could enable a little bit better margins as we think about next year, year after? Our actual gross profit margin will vary quarter to quarter depending largely on product, regional, and trade-in mix, the impact of product cost reductions, and manufacturing efficiencies and pricing pressure. All Rights Reserved. And we think that the extended use instruments lowers barriers for purchases of systems. Intuitive Surgical didn't offer an outlook for 2021. Our technologies include the da Vinci surgical system and the Ion endoluminal system. We're taking a first-principles approach to return-to-office environments with our team, bringing back face-to-face interactions for those tasks best completed in person while enabling hybrid work environments for tasks that are well accomplished by distributed teams. To change your e-mail options at And with that, I'd like to turn it over to Jamie. We are now slightly increasing our forecast and expect full-year gross profit margin to be between 70.5% and 71.5% of revenue. COVID had a significant impact on da Vinci procedure volumes in the second quarter of 2020. Fourth quarter 2021 GAAP income from operations included share-based compensation expense of $120 million, compared with $104 million in the fourth quarter of 2020. And finally, we will host a question-and-answer session. Unrealized gain (loss) - net of tax expense (recovery) effect of $347 and $37 for the three months ended December 31, 2022 and 2021, respectively; ($859) and $(354) for the six months ended . Shifting to the extended use program, you know, you've been out for around six months, smaller rollout in Europe in the fourth quarter. And then given that it's cancer procedure, in some cases, it's a little bit longer follow-up. Building a great robot is a hard first step. Intuitive Surgical's adjusted net income of $435 million in Q3 2021 reflected a good 30% rise from its $334 million figure in the prior-year quarter. Are you seeing any impact thus far? Frankly, the lack of precision in that estimate is such that it's probably not useful for us to share. . 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. So we're excited about that because it gives them fast and easy access. Good afternoon. And I think for a subset of the benign procedures that have been kind of deferred elective procedures, hospitals can recover those pretty quickly. Ladies and . Copyright 2023 Intuitive Surgical. That low end also reflects some impact of a resurgence in the U.S. So those are the drivers we watch. Can you maybe just talk a little bit about the road map? Listen to Webcast. Intuitive Announces Fourth Quarter Earnings, www.intuitive.com/en-us/products-and-services/ion, Less: net income (loss) attributable to noncontrolling interest in joint venture. INTUITIVE at 2022 Wells Fargo Healthcare Conference. Philip Kim, our head of investor relations, will not be joining on today's call as he's currently on paternity leave following the birth of his daughter. And we've seen both good clinical outcomes, but also high surgeon satisfaction and better ergonomics. Fourth quarter 2022 constant currency revenue increased 10% compared to the fourth quarter of 2021. The next page will display a menu of options. Non-GAAP net income attributable to Intuitive Surgical, Inc. and EPS. The adjustments between pro forma and GAAP net income are outlined and quantified on our website. Jamie will provide additional procedure commentary later in this call. (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 Company placed 369 da Vinci Surgical Systems in the fourth quarter of 2022, compared with 385 systems in the fourth quarter of 2021. The Company shipped 385 da Vinci Surgical Systems in the fourth quarter of 2021, compared with 326 systems . During 2022, the impact of the COVID-19 pandemic on the Companys business has differed by geography and region. There was the usual impact of seasonality from vacations like Easter, but nothing notable within the quarter. Second-quarter 2021 OUS procedure growth was driven by growth in prostatectomy procedures and earlier-stage growth in kidney cancer procedures, general surgery, gynecology, and thoracic. And I know case rises have been largely decoupled from hospitalizations. Now turning to the clinical side of our business. With me today, we have Gary Guthart, our CEO; Marshall Mohr, our CFO; and Jamie Samath, our senior vice president of finance. The call will be webcast by Nasdaq OMX and can be accessed on Intuitives website at www.intuitive.com or by dialing (877) 692-8955 using the access code 5830756. And regarding the backlog, how do you know there was catch-up and why won't that continue for the next few quarters? There are a number of limitations related to the use of non-GAAP measures versus measures calculated in accordance with GAAP. Intuitive Surgical, Inc. engages in the development, manufacture, and marketing of da Vinci Surgical Systems, and related instruments and accessories for . Just to be clear on your answer to Tycho's question. 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. [Operator Instructions] As a reminder, today's call is being recorded. Go ahead, Mr. Hopkins. The rise in earnings was driven by higher . They're giving their PowerPoints about what they think is going to happen next and some other things. Good afternoon, and welcome to Intuitive's second-quarter earnings conference call. Intuitive Surgical Investor Relations. 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. I would just add, Bob, as you saw the COVID hospitalization rates in the U.S. come down in March and into Q2, that frees hospital resources to increase the level of surgery that we do. The next page will display a menu of options. 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. Just so really speaking backward-looking, so far, so good. Bob Hopkins -- Bank of America Merrill Lynch -- Analyst. That's helpful, Gary. The compound annual growth rate between the second quarter of 2019 and the second quarter of 2021 was 16.5%. Making the world smarter, happier, and richer. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. (2021) Dropped off in 2022. From a market perspective, about 60%-ish or so are sleeves, about 15% are revisions. Attendees can engage with peers, connect with Intuitive resource teams, and explore innovative robotic-assisted technology spanning the care continuum. Or is this simply and primarily just something about the pandemic accelerating the use of da Vinci and robotics surgery broadly? In terms of our underlying numbers, we're growing at a little faster rate in the revision section, sleeves and bypass grow about the same rate. Second-quarter OUS procedure volume grew approximately 51%, compared with a 7% decline for the second quarter of 2020 and 23% growth last quarter. In terms of penetration or adoption, we're in the early to mid-innings kind of range is what I'd say in the U.S. market. We recognized $26 million of lease buyout revenue in the second quarter, compared with $9 million last year and $19 million last quarter. 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? You've got COVID. The webcast replay of the call will be made available on our website at www.intuitive.com within 24 hours after the end of the live teleconference and will be accessible for at least 30 days. Thanks, Tycho. (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. Ion system placements and procedures are excluded from our overall system and procedure counts. Intuitive Announces Fourth Quarter Earnings, Less: net income attributable to noncontrolling interest in joint venture. Moving on to gross margin and operating expenses. I'll now turn the time over to Marshall to take you through our financial performance in greater detail. Actual results may differ materially from those expressed or implied as a result of certain risks and uncertainties. The Company shipped 385 da Vinci Surgical Systems in the fourth quarter of 2021, compared with 326 systems in the fourth quarter of 2020. The Safety Communication issued on August 20, 2021 by the FDA, is specific to the use and study of robotic-assisted surgery in mastectomy. All Rights Reserved. Good afternoon. There are no upcoming events available at this time. Our rollout of Ion will continue to be measured while we optimize training pathways in our supply chain. any time, re-enter your e-mail address and click Submit, then adjust your form entries. Third, we are launching and refining our flexible diagnostic platform, Ion, by working with early customers to help establish high-performing sites and by improving our technology and supply chain capabilities. So it takes a while. I will now turn to our financial outlook for 2021. And so we watch that number because we know it's highly sensitive. So we don't really call them out as individual revenue lines. Second, disciplined execution of our launches, including our advanced instruments, SP, Ion, and digital efforts. Procedure growth drives capital purchases in many of our markets. The meta-analysis combined 18 studies across different countries containing over 11,000 patients, of which just over 5,000 received da Vinci robotic-assisted thoracic surgery and just over 6,000 received VATs. Now, I'd turn the conference over to our host, Brian King, Head of Investor Relations for Intuitive Surgical. INTUITIVE SURGICAL, INC.-14.33%: 79 654: BOSTON . This presentation contains forward-looking statements. Turning to our single-port system. In the second quarter, we modified the useful life of a deferred-tax asset, which resulted in a current charge to pro forma income. Intuitive Announces Fourth Quarter Earnings, Intuitive Announces Preliminary Fourth Quarter and Full Year 2022 Results, Intuitive becomes largest robotic-assisted surgery provider to be accredited by the Royal College of Surgeons of England, Q4 2022 INTUITIVE Earnings Conference Call, INTUITIVE at J.P. Morgan Healthcare Conference, J.P. Morgan Healthcare Conference 2023 Presentation, Q3 2022 INTUITIVE Earnings Conference Call. The Motley Fool owns shares of and recommends Intuitive Surgical. There are a number of limitations related to the use of non-GAAP measures versus measures calculated in accordance with GAAP. 06/14/22 - 1:20 PM PDT. Listen to Webcast. The company strives to make surgery more effective, less invasive and easier on surgeons, patients and their families. Customer appreciation and recurring use of our products has been growing nicely. In addition, the components of the costs that the Company excludes in its calculation of non-GAAP net income attributable to Intuitive Surgical, Inc. and non-GAAP EPS may differ from the components that its peer companies exclude when they report their results of operations. COVID has impacted global supplies of semiconductors and other materials used in our products, while we carry safety stocks of critical components and are otherwise working to secure supply necessary to ensure fulfillment of customer demand, global shortages could result in higher production costs and production development and regulatory delays. The compound annual growth rate between the fourth quarter of 2019 and the fourth quarter of 2021 was 6%. Gotcha. I'll maybe start with Marshall on the first one and then go to Gary for the second one. Bringing it all together. Jamie, I'll let you take it from there. Intuitive Surgical 10.5. 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. Leasing and alternative financing arrangements enable customer access to capital. *Stock Advisor returns as of June 7, 2021. [Inaudible] on a nice quarter. Listen to Webcast. So that's a multi-quarter conversation. Without excluding these tax effects, investors would only see the gross effect that these non-GAAP adjustments had on the Companys operating results. (2) Selling, general and administrative includes the effect of the following items: One-time tax benefit from re-measurement of certain deferred tax assets, Discrete tax expense arising from the conclusion of a tax matter, Gains on strategic investments, net of tax, Accounts payable and other accrued liabilities, Total liabilities and stockholders equity, Adjustments attributable to noncontrolling interest in joint venture. Fourth quarter 2021 non-GAAP* net income attributable to Intuitive Surgical, Inc. was $477 million, or $1.30 per diluted share, compared with $434 million, or $1.19 per diluted share, in the fourth quarter of 2020. ET. The Company defines non-GAAP income from operations as income from operations, excluding amortization of intangible assets, SBC and long-term incentive plan expenses, litigation charges and recoveries, and a gain on the sale of a business. I think our customers will take their time to evaluate new things as they go. In addition, COVID delayed some R&D work, resulting in underspend on prototypes. 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. Through ingenuity and intelligent technology, we expand the potential of physicians to heal without constraints. Looking forward, we see the following capital revenue dynamics. Contents: Prepared Remarks; Questions and Answers; Call Participants; Prepared Remarks: Operator. We expect spending on activities restricted by COVID to increase as the impacts of the pandemic decline. COVID has delayed some work in R&D and clinical trials, leading to some underspend in programs, prototypes, and some delay in hiring. Taken together, this combination of a recovery in procedures and healthy utilization supports our solid capital placement trends and rounds out a healthy commercial recovery year to date. your options for e-mail notification, please enter your e-mail address below and click We continue to operate in a challenging supply chain environment and have experienced longer lead times and delayed deliveries from our suppliers. Those things are ongoing now. Looking at the past eight quarters in context, our compound annual growth rate for procedures for the period Q2 2019 through Q2 2021 of 16.5% is approximately the growth we would have expected absent the pandemic. And I'm actually curious more what's going on with service and software at the hospitalwide kind of department of surgery level. 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. And so we have some catch-up to do in terms of infrastructure and support necessary to support the overall business. In addition to that, we still think this is a great opportunity to continue to invest in the ecosystem of products and capabilities at this point in time before competition really gets any kind of toehold. Q2 2022 INTUITIVE Earnings Conference Call. 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? The stock movement pushed Intuitive . Mehr Brsen-Nachrichten . Thanks. Trade-in activity can fluctuate and be difficult to predict. Intuitive Surgical, and Verb Surgical, among other countless innovations. 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. It's not just the robot. And so we'll spend there. I think the noise levels will go up. To change your e-mail options at At the time you receive a -- by the time you're at -- that market penetration rates that are significant. Non-GAAP gross profit. An investor who was able to pick up $1,000 worth of Intuitive Surgical shares at its IPO price and held on has seen that investment grow to a whopping . Our focus right now is not rapid expansion of the installed base. So it's not a scientific study, just my view. May 2021 - Present 1 year 10 months. While there continues to be COVID hotspots within some of our Asia Pacific markets, overall procedures in the region performed well. 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. We kind of outlined what was assumed in the high end of the procedure guidance. Non-GAAP income from operations. There are no upcoming events available at this time.
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