Intuitive (the “Company”) (Nasdaq: ISRG), a global technology
leader in minimally invasive care and the pioneer of
robotic-assisted surgery, today announced financial results for the
quarter ended December 31, 2022.
Q4
Highlights
- Worldwide da
Vinci procedures grew approximately 18% compared with the fourth
quarter of 2021. The fourth quarter of 2022 reflected a resurgence
in COVID-19 in China, which negatively impacted procedure volumes
in the region. The fourth quarter of 2021 also reflected COVID-19
disruptions later in the quarter in the U.S. and Europe, which
impacted our procedures. The compound annual growth rate between
the fourth quarter of 2019 and the fourth quarter of 2022 was
approximately 14%.
- The Company
placed 369 da Vinci Surgical Systems, a decrease of 4% compared
with 385 in the fourth quarter of 2021.
- The Company grew
its da Vinci Surgical System installed base to 7,544 systems as of
December 31, 2022, an increase of 12% compared with 6,730 as
of the end of the fourth quarter of 2021.
- Fourth quarter
2022 revenue of $1.66 billion increased 7% compared with $1.55
billion in the fourth quarter of 2021.
- Fourth quarter
2022 GAAP net income attributable to Intuitive was $325 million, or
$0.91 per diluted share, compared with $381 million, or $1.04 per
diluted share, in the fourth quarter of 2021.
- Fourth quarter
2022 non-GAAP* net income attributable to Intuitive 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.
- The Company
repurchased $1 billion of common stock in the fourth quarter of
2022.
Q4 Financial
Summary
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. Additionally, constant currency
revenue growth is reported on a non-GAAP* basis. The non-GAAP*
measures are described below and are reconciled to the
corresponding GAAP measures at the end of this release.
Fourth quarter 2022 revenue was $1.66
billion, an increase of 7% compared with $1.55 billion in
the fourth quarter of 2021. The higher fourth quarter
revenue was driven by growth in da Vinci procedure volume,
partially offset by a decline in system placements and foreign
currency impacts. On a constant currency basis, fourth quarter 2022
revenue increased 10% compared to the fourth quarter of 2021.
Fourth quarter 2022 instruments and accessories
revenue increased by 12% to $941 million, compared with $843
million in the fourth quarter of 2021. The increase in instruments
and accessories revenue was primarily driven by approximately 18%
growth in da Vinci procedure volume, partially offset by customer
buying patterns and foreign currency impacts.
Fourth quarter 2022 systems revenue decreased by
4% to $451 million, compared with $470 million in the fourth
quarter of 2021. 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 fourth quarter 2022 system placements
included 154 systems placed under operating lease and
usage-based arrangements, compared with 143 systems in
the fourth quarter of 2021.
Fourth quarter 2022 GAAP income from operations
decreased to $373 million, compared with $450 million in the fourth
quarter of 2021. Fourth quarter 2022 GAAP income from operations
included share-based compensation expense of $129 million, compared
with $120 million in the fourth quarter of 2021. Fourth quarter
2022 GAAP income from operations also included litigation charges
of $21 million. Fourth quarter 2022 non-GAAP* income from
operations decreased to $530 million, compared with $583 million in
the fourth quarter of 2021.
Fourth quarter 2022 GAAP net income attributable
to Intuitive Surgical, Inc. was $325 million, or $0.91 per diluted
share, compared with $381 million, or $1.04 per diluted share, in
the fourth quarter of 2021. Fourth quarter 2022 GAAP net income
attributable to Intuitive Surgical, Inc. included excess tax
benefits of $18 million, or $0.05 per diluted share, compared with
$27 million, or $0.07 per diluted share, in the fourth quarter of
2021.
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.
The Company ended the fourth quarter of 2022
with $6.74 billion in cash, cash equivalents, and investments, a
decrease of $651 million during the quarter, primarily driven by
share repurchases of $1 billion and capital expenditures, partially
offset by cash generated from operations.
Impact of COVID-19 Pandemic
During 2022, the impact of the COVID-19 pandemic
on the Company’s business has differed by geography and region.
During the first half of 2022, the Company saw COVID-19 resurgences
impact da Vinci procedure volumes in the U.S. and Europe followed
by recoveries. During the second half of 2022, the Company saw
COVID-19 resurgences impact da Vinci procedure volumes in China.
COVID-19 has had, and may continue to have, an adverse impact on
the Company’s procedure volumes.
Additional supplemental financial and procedure
information has been posted to the Investor Relations section of
the Intuitive website at https://isrg.gcs-web.com/.
Webcast and Conference Call
Information
Intuitive will hold a teleconference at 1:30
p.m. PDT today to discuss the fourth quarter 2022 financial
results. The call will be webcast by Nasdaq OMX and can be accessed
on Intuitive’s website at www.intuitive.com or by dialing (844)
867-6169 using the access code 525958. 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.
About Intuitive
Intuitive (Nasdaq: ISRG), headquartered in
Sunnyvale, California, is a global leader in minimally invasive
care and the pioneer of robotic surgery. Our technologies include
the da Vinci surgical system and the Ion endoluminal system. By
uniting advanced systems, progressive learning, and value-enhancing
services, we help physicians and their teams optimize care delivery
to support the best outcomes possible. At Intuitive, we envision a
future of care that is less invasive and profoundly better, where
diseases are identified early and treated quickly, so patients can
get back to what matters most.
Product and brand names/logos are trademarks or
registered trademarks of Intuitive Surgical or their respective
owner. See www.intuitive.com/trademarks.
For more information, please visit the Company’s
website at www.intuitive.com.
Forward-Looking
Statements
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. Forward-looking statements relate to
expectations concerning matters that are not historical facts.
Statements using words such as “estimates,” “projects,” “believes,”
“anticipates,” “plans,” “expects,” “intends,” “may,” “will,”
“could,” “should,” “would,” “targeted,” and similar words and
expressions are intended to identify forward-looking statements.
These forward-looking statements are necessarily estimates
reflecting the judgment of the Company’s 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. These forward-looking statements include, but are not
limited to, statements related to the expected impacts of the
COVID-19 pandemic on the Company’s business, financial condition,
and results of operations, future results of operations, future
financial position, the Company’s financing plans and future
capital requirements, the Company’s potential tax assets or
liabilities, and statements based on current expectations,
estimates, forecasts, and projections about the economies and
markets in which the Company operates and the Company’s beliefs and
assumptions regarding these economies and markets. These
forward-looking statements should be considered in light of various
important factors, including, but not limited to, the following:
the overall macroeconomic environment, which impacts customer
spending and the Company’s costs, including increased inflation and
interest rates, the conflict in Ukraine, disruption to the
Company’s supply chain, including increased difficulties in
obtaining a sufficient supply of materials in the semiconductor and
other markets, the risk that the COVID-19 pandemic could lead to
material delays and cancellations of, or reduced demand for,
procedures; curtailed or delayed capital spending by hospitals;
closures of the Company’s facilities; delays in surgeon training;
delays in gathering clinical evidence; delays in obtaining new
product approvals, clearances, or certifications from the U.S. Food
and Drug Administration (“FDA”), comparable regulatory authorities,
or notified bodies; diversion of resources to respond to COVID-19
outbreaks; the impact of global and regional economic and credit
market conditions on healthcare spending; the risk of the Company’s
inability to comply with complex FDA and other regulations, which
may result in significant enforcement actions; regulatory
approvals, clearances, certifications, and restrictions or any
dispute that may occur with any regulatory body; guidelines and
recommendations in the healthcare and patient communities;
healthcare reform legislation in the U.S. and its impact on
hospital spending, reimbursement, and fees levied on certain
medical device revenues; changes in hospital admissions and actions
by payers to limit or manage surgical procedures; the timing and
success of product development and market acceptance of developed
products; the results of any collaborations, in-licensing
arrangements, joint ventures, strategic alliances, or partnerships,
including the joint venture with Shanghai Fosun Pharmaceutical
(Group) Co., Ltd.; the Company’s completion of and ability to
successfully integrate acquisitions, including Opheus Medical;
procedure counts; intellectual property positions and litigation;
competition in the medical device industry and in the specific
markets of surgery in which the Company operates; risks associated
with the Company’s operations and any expansion outside of the
United States; unanticipated manufacturing disruptions or the
inability to meet demand for products; the Company’s reliance on
sole and single source suppliers; the results of legal proceedings
to which we are or may become a party, including but not limited to
product liability claims; adverse publicity regarding us and the
safety of the Company’s products and adequacy of training; the
impact of changes to tax legislation, guidance, and
interpretations; changes in tariffs, trade barriers, and regulatory
requirements; and other risks and uncertainties. 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 Company’s Annual Report on Form 10-K for the
year ended December 31, 2021, and the Company’s Quarterly
report on Form 10-Q for the quarter ended September 30, 2022, as
updated by the Company’s other filings with the Securities and
Exchange Commission. The Company undertakes no obligation to
publicly update or release any revisions to these forward-looking
statements, except as required by law.
*About Non-GAAP Financial
Measures
To supplement its consolidated financial
statements, which are prepared and presented in accordance with
accounting principles generally accepted in the United States
(“GAAP”), the Company uses the following non-GAAP financial
measures: constant currency revenue, non-GAAP gross profit,
non-GAAP income from operations, non-GAAP net income attributable
to Intuitive Surgical, Inc., non-GAAP net income per diluted share
attributable to Intuitive Surgical, Inc. (“EPS”), and non-GAAP
diluted shares outstanding. 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.
The Company uses these non-GAAP financial
measures for financial and operational decision-making and as a
means to evaluate period-to-period comparisons. 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. Long-term incentive plan expense relates to
phantom share awards granted in China by the Company’s
Intuitive-Fosun joint venture to its employees that vest over four
years and can remain outstanding for seven to ten years. These
awards are valued based on certain key performance metrics.
Accordingly, they are subject to significant volatility based on
the performance of these metrics and are not tied to performance of
the Company’s business within the period. The Company presents
constant currency revenue to provide a framework for assessing how
our underlying business performed excluding the effect of foreign
currency fluctuations. 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. These non-GAAP financial
measures also facilitate management’s internal comparisons to its
historical performance. The Company believes these non-GAAP
financial measures are useful to investors, because (1) they allow
for greater transparency with respect to key metrics used by
management in its financial and operational decision-making, and
(2) they are used by institutional investors and the analyst
community to help them analyze the performance of the Company’s
business.
Constant currency revenue growth. The Company
calculates constant currency revenue by translating current period
revenue using prior period exchange rates. The constant currency
revenue percentage change is calculated by determining the increase
in the current period constant currency revenue over the prior
period revenue. Fourth quarter 2022 as reported revenue increased
7% compared to the fourth quarter of 2021. Foreign
currency fluctuations had a 3% unfavorable impact on fourth quarter
2022 revenue. Fourth quarter 2022 constant currency revenue
increased 10% compared to the fourth quarter of 2021.
Non-GAAP gross profit. The Company defines
non-GAAP gross profit as gross profit, excluding amortization of
intangible assets and SBC and long-term incentive plan
expenses.
Non-GAAP income from operations. 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.
Non-GAAP net income attributable to Intuitive
Surgical, Inc. and EPS. The Company defines non-GAAP net income as
net income attributable to Intuitive Surgical, Inc., excluding
amortization of intangible assets, SBC and long-term incentive plan
expenses, litigation charges and recoveries, a gain on the sale of
a business, gains (losses) on strategic investments, adjustments
attributable to noncontrolling interest in joint venture, net of
the related tax effects, and tax adjustments, including the excess
tax benefits or deficiencies associated with SBC arrangements and
the net tax effects related to intra-entity transfers of
non-inventory assets. The Company excludes the excess tax benefits
or deficiencies associated with SBC arrangements as well as the tax
effects associated with non-cash amortization of deferred tax
assets related to intra-entity non-inventory transfers, because the
Company does not believe these items correlate with the on-going
results of its core operations. The tax effects of the non-GAAP
items are determined by applying a calculated non-GAAP effective
tax rate, which is commonly referred to as the with-and-without
method. Without excluding these tax effects, investors would only
see the gross effect that these non-GAAP adjustments had on the
Company’s operating results. The Company’s calculated non-GAAP
effective tax rate is generally higher than its GAAP effective tax
rate. 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.
There are a number of limitations related to the
use of non-GAAP measures versus measures calculated in accordance
with GAAP. 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 amortization of intangible
assets, 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. SBC expense has been, and will continue to be for
the foreseeable future, a significant recurring expense in the
Company’s business. 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. 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.
INTUITIVE SURGICAL, INC.
UNAUDITED QUARTERLY CONDENSED CONSOLIDATED STATEMENTS OF
INCOME (IN MILLIONS, EXCEPT PER SHARE
DATA)
|
Three Months Ended |
|
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2021 |
Revenue: |
|
|
|
|
|
Instruments and accessories |
$ |
940.7 |
|
|
$ |
871.6 |
|
|
$ |
842.8 |
|
Systems |
|
451.0 |
|
|
|
425.9 |
|
|
|
469.9 |
|
Services |
|
263.3 |
|
|
|
259.9 |
|
|
|
238.0 |
|
Total revenue |
|
1,655.0 |
|
|
|
1,557.4 |
|
|
|
1,550.7 |
|
Cost of revenue: |
|
|
|
|
|
Product |
|
460.4 |
|
|
|
421.6 |
|
|
|
415.0 |
|
Service |
|
83.7 |
|
|
|
83.7 |
|
|
|
74.9 |
|
Total cost of revenue |
|
544.1 |
|
|
|
505.3 |
|
|
|
489.9 |
|
Gross profit |
|
1,110.9 |
|
|
|
1,052.1 |
|
|
|
1,060.8 |
|
Operating expenses: |
|
|
|
|
|
Selling, general and administrative (1) |
|
494.3 |
|
|
|
436.1 |
|
|
|
427.0 |
|
Research and development |
|
244.1 |
|
|
|
217.1 |
|
|
|
183.4 |
|
Total operating expenses |
|
738.4 |
|
|
|
653.2 |
|
|
|
610.4 |
|
Income from operations
(2) |
|
372.5 |
|
|
|
398.9 |
|
|
|
450.4 |
|
Interest and other income, net
(3) |
|
22.2 |
|
|
|
3.9 |
|
|
|
3.8 |
|
Income before taxes |
|
394.7 |
|
|
|
402.8 |
|
|
|
454.2 |
|
Income tax expense (4) |
|
58.0 |
|
|
|
78.1 |
|
|
|
71.5 |
|
Net income |
|
336.7 |
|
|
|
324.7 |
|
|
|
382.7 |
|
Less: net income attributable to noncontrolling interest in joint
venture |
|
11.8 |
|
|
|
0.7 |
|
|
|
2.1 |
|
Net income attributable to
Intuitive Surgical, Inc. |
$ |
324.9 |
|
|
$ |
324.0 |
|
|
$ |
380.6 |
|
Net income per share
attributable to Intuitive Surgical, Inc.: |
|
|
|
|
|
Basic |
$ |
0.93 |
|
|
$ |
0.91 |
|
|
$ |
1.06 |
|
Diluted (5) |
$ |
0.91 |
|
|
$ |
0.90 |
|
|
$ |
1.04 |
|
Weighted average
shares outstanding: |
|
|
|
|
|
Basic |
|
351.1 |
|
|
|
355.3 |
|
|
|
357.5 |
|
Diluted |
|
357.0 |
|
|
|
360.5 |
|
|
|
367.4 |
|
|
|
|
|
|
|
(1) Selling, general and
administrative includes the effect of the following item: |
|
|
|
|
|
Contribution to the Intuitive Foundation |
$ |
— |
|
|
$ |
— |
|
|
$ |
(30.0 |
) |
(2) Income from operations
includes the effect of the following items: |
|
|
|
|
|
Amortization of intangible assets |
$ |
(7.6 |
) |
|
$ |
(7.9 |
) |
|
$ |
(6.6 |
) |
Expensed IP charged to R&D |
$ |
(7.7 |
) |
|
$ |
(0.3 |
) |
|
$ |
(5.0 |
) |
(3) Interest and other income,
net includes the effect of the following item: |
|
|
|
|
|
Gains (losses) on strategic investments |
$ |
0.3 |
|
|
$ |
(3.2 |
) |
|
$ |
(7.5 |
) |
(4) Income tax expense
includes the effect of the following item: |
|
|
|
|
|
Excess tax benefits related to share-based compensation
arrangements |
$ |
(18.3 |
) |
|
$ |
(18.1 |
) |
|
$ |
(26.9 |
) |
(5) Diluted net income per
share attributable to Intuitive Surgical, Inc. includes the effect
of the following items: |
|
|
|
|
|
Contribution to the Intuitive Foundation, net of tax |
$ |
— |
|
|
$ |
— |
|
|
$ |
(0.06 |
) |
Amortization of intangible assets, net of tax |
$ |
(0.02 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.02 |
) |
Expensed IP charged to R&D, net of tax |
$ |
(0.02 |
) |
|
$ |
— |
|
|
$ |
(0.01 |
) |
Gains (losses) on strategic investments, net of tax |
$ |
— |
|
|
$ |
(0.01 |
) |
|
$ |
(0.02 |
) |
Excess tax benefits related to share-based compensation
arrangements |
$ |
0.05 |
|
|
$ |
0.05 |
|
|
$ |
0.07 |
|
INTUITIVE SURGICAL, INC.
UNAUDITED TWELVE MONTHS ENDED CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (IN MILLIONS, EXCEPT PER
SHARE DATA)
|
Twelve Months Ended |
|
December 31, |
|
|
2022 |
|
|
|
2021 |
|
Revenue: |
|
|
|
Instruments and accessories |
$ |
3,517.9 |
|
|
$ |
3,100.5 |
|
Systems |
|
1,680.1 |
|
|
|
1,693.4 |
|
Services |
|
1,024.2 |
|
|
|
916.2 |
|
Total revenue |
|
6,222.2 |
|
|
|
5,710.1 |
|
Cost of revenue: |
|
|
|
Product |
|
1,700.3 |
|
|
|
1,464.1 |
|
Service |
|
325.9 |
|
|
|
287.5 |
|
Total cost of revenue |
|
2,026.2 |
|
|
|
1,751.6 |
|
Gross profit |
|
4,196.0 |
|
|
|
3,958.5 |
|
Operating expenses: |
|
|
|
Selling, general and administrative (1) |
|
1,739.9 |
|
|
|
1,466.5 |
|
Research and development |
|
879.0 |
|
|
|
671.0 |
|
Total operating expenses |
|
2,618.9 |
|
|
|
2,137.5 |
|
Income from operations
(2) |
|
1,577.1 |
|
|
|
1,821.0 |
|
Interest and other income, net
(3) |
|
29.7 |
|
|
|
69.3 |
|
Income before taxes |
|
1,606.8 |
|
|
|
1,890.3 |
|
Income tax expense (4) |
|
262.4 |
|
|
|
162.2 |
|
Net income |
|
1,344.4 |
|
|
|
1,728.1 |
|
Less: net income attributable to noncontrolling interest in joint
venture |
|
22.1 |
|
|
|
23.5 |
|
Net income attributable to
Intuitive Surgical, Inc. |
$ |
1,322.3 |
|
|
$ |
1,704.6 |
|
Net income per share
attributable to Intuitive Surgical, Inc.: |
|
|
|
Basic |
$ |
3.72 |
|
|
$ |
4.79 |
|
Diluted (5) |
$ |
3.65 |
|
|
$ |
4.66 |
|
Weighted average
shares outstanding: |
|
|
|
Basic |
|
355.7 |
|
|
|
356.1 |
|
Diluted |
|
362.0 |
|
|
|
365.8 |
|
|
|
|
|
(1) Selling, general and
administrative includes the effect of the following item: |
|
|
|
Contribution to the Intuitive Foundation |
$ |
— |
|
|
$ |
(30.0 |
) |
(2) Income from operations
includes the effect of the following items: |
|
|
|
Amortization of intangible assets |
$ |
(27.8 |
) |
|
$ |
(27.4 |
) |
Expensed IP charged to R&D |
$ |
(17.6 |
) |
|
$ |
(8.4 |
) |
(3) Interest and other income,
net includes the effect of the following item: |
|
|
|
Gains (losses) on strategic investments |
$ |
(21.0 |
) |
|
$ |
14.7 |
|
(4) Income tax expense
includes the effect of the following items: |
|
|
|
One-time tax benefit from re-measurement of certain deferred tax
assets |
$ |
— |
|
|
$ |
(66.4 |
) |
Excess tax benefits related to share-based compensation
arrangements |
$ |
(98.7 |
) |
|
$ |
(185.8 |
) |
Discrete tax expense arising from the conclusion of a tax
matter |
$ |
— |
|
|
$ |
11.1 |
|
(5) Diluted net income per
share attributable to Intuitive Surgical, Inc. includes the effect
of the following items: |
|
|
|
Contribution to the Intuitive Foundation, net of tax |
$ |
— |
|
|
$ |
(0.06 |
) |
Amortization of intangible assets, net of tax |
$ |
(0.06 |
) |
|
$ |
(0.06 |
) |
Expensed IP charged to R&D, net of tax |
$ |
(0.04 |
) |
|
$ |
(0.02 |
) |
Gains (losses) on strategic investments, net of tax |
$ |
(0.05 |
) |
|
$ |
0.03 |
|
One-time tax benefit from re-measurement of certain deferred tax
assets |
$ |
— |
|
|
$ |
0.18 |
|
Excess tax benefits related to share-based compensation
arrangements |
$ |
0.27 |
|
|
$ |
0.51 |
|
Discrete tax expense arising from the conclusion of a tax
matter |
$ |
— |
|
|
$ |
(0.03 |
) |
INTUITIVE SURGICAL, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(IN MILLIONS)
|
December 31, 2022 |
|
December 31, 2021 |
Cash, cash equivalents, and investments |
$ |
6,741.5 |
|
$ |
8,619.5 |
Accounts receivable, net |
|
942.1 |
|
|
782.7 |
Inventory |
|
893.2 |
|
|
587.1 |
Property, plant, and
equipment, net |
|
2,374.2 |
|
|
1,876.4 |
Goodwill |
|
348.5 |
|
|
343.6 |
Deferred tax assets |
|
664.6 |
|
|
441.4 |
Other assets |
|
1,009.9 |
|
|
904.3 |
Total assets |
$ |
12,974.0 |
|
$ |
13,555.0 |
|
|
|
|
Accounts payable and other
accrued liabilities |
$ |
1,423.1 |
|
$ |
1,189.5 |
Deferred revenue |
|
438.3 |
|
|
414.0 |
Total liabilities |
|
1,861.4 |
|
|
1,603.5 |
Stockholders’ equity |
|
11,112.6 |
|
|
11,951.5 |
Total liabilities and stockholders’ equity |
$ |
12,974.0 |
|
$ |
13,555.0 |
INTUITIVE SURGICAL,
INC.UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP
FINANCIAL MEASURES(IN MILLIONS, EXCEPT PER SHARE
DATA)
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2021 |
|
December 31, 2022 |
|
December 31, 2021 |
GAAP gross profit |
|
$ |
1,110.9 |
|
|
$ |
1,052.1 |
|
|
$ |
1,060.8 |
|
|
$ |
4,196.0 |
|
|
$ |
3,958.5 |
|
Share-based compensation
expense |
|
|
11.9 |
|
|
|
28.2 |
|
|
|
22.4 |
|
|
|
90.0 |
|
|
|
88.9 |
|
Long-term incentive plan
expense |
|
|
0.3 |
|
|
|
0.3 |
|
|
|
0.7 |
|
|
|
1.1 |
|
|
|
0.7 |
|
Amortization of intangible
assets |
|
|
5.6 |
|
|
|
5.9 |
|
|
|
3.9 |
|
|
|
19.2 |
|
|
|
17.4 |
|
Non-GAAP gross
profit |
|
$ |
1,128.7 |
|
|
$ |
1,086.5 |
|
|
$ |
1,087.8 |
|
|
$ |
4,306.3 |
|
|
$ |
4,065.5 |
|
|
|
|
|
|
|
|
|
|
|
|
GAAP income from
operations |
|
$ |
372.5 |
|
|
$ |
398.9 |
|
|
$ |
450.4 |
|
|
$ |
1,577.1 |
|
|
$ |
1,821.0 |
|
Share-based compensation
expense |
|
|
127.6 |
|
|
|
138.1 |
|
|
|
117.8 |
|
|
|
513.2 |
|
|
|
451.5 |
|
Long-term incentive plan
expense |
|
|
1.3 |
|
|
|
2.8 |
|
|
|
8.1 |
|
|
|
6.8 |
|
|
|
8.1 |
|
Amortization of intangible
assets (1) |
|
|
7.6 |
|
|
|
7.9 |
|
|
|
6.6 |
|
|
|
27.8 |
|
|
|
27.4 |
|
Litigation charges
(recoveries) |
|
|
20.8 |
|
|
|
6.9 |
|
|
|
— |
|
|
|
27.7 |
|
|
|
(0.9 |
) |
Gain on sale of business |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3.8 |
) |
|
|
— |
|
Non-GAAP income from
operations |
|
$ |
529.8 |
|
|
$ |
554.6 |
|
|
$ |
582.9 |
|
|
$ |
2,148.8 |
|
|
$ |
2,307.1 |
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
attributable to Intuitive Surgical, Inc. |
|
$ |
324.9 |
|
|
$ |
324.0 |
|
|
$ |
380.6 |
|
|
$ |
1,322.3 |
|
|
$ |
1,704.6 |
|
Share-based compensation
expense |
|
|
127.6 |
|
|
|
138.1 |
|
|
|
117.8 |
|
|
|
513.2 |
|
|
|
451.5 |
|
Long-term incentive plan
expense |
|
|
1.3 |
|
|
|
2.8 |
|
|
|
8.1 |
|
|
|
6.8 |
|
|
|
8.1 |
|
Amortization of intangible
assets (1) |
|
|
7.6 |
|
|
|
7.9 |
|
|
|
6.6 |
|
|
|
27.8 |
|
|
|
27.4 |
|
Litigation charges
(recoveries) |
|
|
20.8 |
|
|
|
6.9 |
|
|
|
— |
|
|
|
27.7 |
|
|
|
(0.9 |
) |
Gain on sale of business |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3.8 |
) |
|
|
— |
|
(Gains) losses on strategic
investments |
|
|
(0.4 |
) |
|
|
3.3 |
|
|
|
7.3 |
|
|
|
21.2 |
|
|
|
(14.6 |
) |
Tax adjustments (2) |
|
|
(42.4 |
) |
|
|
(53.3 |
) |
|
|
(44.4 |
) |
|
|
(217.1 |
) |
|
|
(362.1 |
) |
Adjustments attributable to
noncontrolling interest in joint venture |
|
|
(0.7 |
) |
|
|
(1.2 |
) |
|
|
(3.4 |
) |
|
|
(3.3 |
) |
|
|
(4.7 |
) |
Non-GAAP net income
attributable to Intuitive Surgical, Inc. |
|
$ |
438.7 |
|
|
$ |
428.5 |
|
|
$ |
472.6 |
|
|
$ |
1,694.8 |
|
|
$ |
1,809.3 |
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income per
share attributable to Intuitive Surgical, Inc. -
diluted |
|
$ |
0.91 |
|
|
$ |
0.90 |
|
|
$ |
1.04 |
|
|
$ |
3.65 |
|
|
$ |
4.66 |
|
Share-based compensation
expense |
|
|
0.36 |
|
|
|
0.38 |
|
|
|
0.32 |
|
|
|
1.42 |
|
|
|
1.23 |
|
Long-term incentive plan
expense |
|
|
— |
|
|
|
0.01 |
|
|
|
0.02 |
|
|
|
0.02 |
|
|
|
0.02 |
|
Amortization of intangible
assets (1) |
|
|
0.02 |
|
|
|
0.02 |
|
|
|
0.02 |
|
|
|
0.07 |
|
|
|
0.07 |
|
Litigation charges
(recoveries) |
|
|
0.06 |
|
|
|
0.02 |
|
|
|
— |
|
|
|
0.08 |
|
|
|
— |
|
Gain on sale of business |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.01 |
) |
|
|
— |
|
(Gains) losses on strategic
investments |
|
|
— |
|
|
|
0.01 |
|
|
|
0.02 |
|
|
|
0.06 |
|
|
|
(0.04 |
) |
Tax adjustments (2) |
|
|
(0.12 |
) |
|
|
(0.15 |
) |
|
|
(0.12 |
) |
|
|
(0.60 |
) |
|
|
(0.99 |
) |
Adjustments attributable to
noncontrolling interest in joint venture |
|
|
— |
|
|
|
— |
|
|
|
(0.01 |
) |
|
|
(0.01 |
) |
|
|
(0.01 |
) |
Non-GAAP net income
per share attributable to Intuitive Surgical, Inc. -
diluted |
|
$ |
1.23 |
|
|
$ |
1.19 |
|
|
$ |
1.29 |
|
|
$ |
4.68 |
|
|
$ |
4.94 |
|
|
|
|
|
|
|
|
|
|
|
|
(1) Beginning with the quarter ended March 31, 2022, the Company is
no longer adjusting non-GAAP income from operations, non-GAAP net
income attributable to Intuitive Surgical, Inc., or non-GAAP net
income per share attributable to Intuitive Surgical, Inc. for
charges relating to intellectual property and license arrangements
expensed to R&D. The Company made these changes to its
presentation of non-GAAP financial measures based on its
understanding of the U.S. Securities and Exchange Commission’s (the
“SEC”) current views on this practice from knowledge of
communications between the SEC and a number of pharmaceutical and
life sciences companies and independent registered public
accounting firms. Historical non-GAAP measures presented in our
earnings release have been adjusted for comparability. For the
three and twelve months ended December 31, 2022, the impact of
this adjustment was a decrease of non-GAAP income from operations
of $7.7 million and $17.6 million, respectively, or $0.02 and $0.04
to the diluted net income per share attributable to Intuitive
Surgical, Inc., net of tax. For the three and twelve months ended
December 31, 2021, the impact was a decrease of non-GAAP
income from operations of $5.0 million and $8.4 million,
respectively, or $0.01 and $0.02 to the diluted net income per
share attributable to Intuitive Surgical, Inc., net of tax. |
(2) For the three months ended December 31, 2022, tax
adjustments included: (a) excess tax benefits associated with
share-based compensation arrangements of $(18.3) million, or
$(0.05) per diluted share; (b) tax impact related to intra-entity
transfers of non-inventory assets of $6.9 million, or $0.02 per
diluted share; and (c) other tax adjustments effects determined by
applying a calculated non-GAAP effective tax rate of $(31.0)
million, or $(0.09) per diluted share. For the twelve months ended
December 31, 2022, tax adjustments included: (a) excess tax
benefits associated with share-based compensation arrangements of
$(98.7) million, or $(0.27) per diluted share; (b) tax impact
related to intra-entity transfers of non-inventory assets of $27.9
million, or $0.08 per diluted share; and (c) other tax adjustments
effects determined by applying a calculated non-GAAP effective tax
rate of $(146.3) million, or $(0.40) per diluted share. |
Contact: Investor Relations(408) 523-2161
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