Intuitive Surgical Announces $236 Million Third Quarter Revenue, Up 50 Percent
Third quarter 2008 instruments and accessories revenue increased 53% to $76.0 million from $49.5 million during the third quarter of 2007. Third quarter 2008 da Vinci(r) Surgical Systems revenue increased 48% to $126.3 million from $85.5 million during the third quarter of 2007. Third quarter 2008 service and training revenue increased 54% to $33.7 million from $21.9 million during the third quarter of 2007.
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------ ------------------------
Revenue
($Millions) 2008 2007 Increase 2008 2007 Increase
----------- ---- ---- -------- ---- ---- --------
Instruments/
Accessories $76.0 $49.5 $26.5 $211.4 $135.6 $75.8
Systems 126.3 85.5 40.8 341.6 215.8 125.8
Service/Training 33.7 21.9 11.8 90.4 60.0 30.4
------------------------ ------------------------
$236.0 $156.9 $79.1 $643.4 $411.4 $232.0
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Third quarter 2008 operating income increased 58% to $85.0 million, compared with $54.0 million for the third quarter of 2007. Operating results for the third quarter of 2008 included $21.0 million of non-cash stock-based compensation expense in accordance with the Financial Accounting Standards Board SFAS 123R, compared with $8.7 million for the third quarter of 2007.
Third quarter 2008 net income increased 41% to $57.6 million, compared with $40.9 million for the third quarter of 2007. Diluted earnings per share increased to $1.44 for the third quarter of 2008 from $1.04 for the third quarter of 2007.
Intuitive ended the third quarter of 2008 with cash, cash equivalents and investments of $821 million, up $82 million from June 30, 2008 and up $186 million from December 31, 2007.
Commenting on the announcement, Lonnie Smith, Chairman and CEO of Intuitive Surgical, said, "We are pleased with our third quarter operating results. These results reflect the continued adoption of robotic surgery as a growing number of patients benefit from the improved clinical outcomes and reduced surgical trauma that our da Vinci products enable."
The Company will also announce these results at a conference call today at 1:30 pm PDT. The dial-in numbers for the call are 877-909-3508 for participants located in the U.S. and 517-645-6051 for participants located outside the U.S. The passcode is ISRG and the meeting leader is Mr. Lonnie Smith. To access financial information that will be discussed on the call, please visit Intuitive Surgical's website at www.intuitivesurgical.com.
About Intuitive's Products:
The da Vinci(r) Surgical System consists of a surgeon's viewing and control console having an integrated, high-performance InSite(r) 3-D, high definition vision system, a patient-side cart consisting of three or four robotic arms that position and precisely maneuver endoscopic instruments and an endoscope, and a variety of articulating EndoWrist(r) Instruments. By integrating computer-enhanced technology with surgeons' technical skills, Intuitive believes that its system enables surgeons to perform better surgery in a manner never before experienced. The da Vinci(r) Surgical System seamlessly and directly translates the surgeon's natural hand, wrist and finger movements on instrument controls at the surgeon's console outside the patient's body into corresponding micro-movements of the instrument tips positioned inside the patient through small puncture incisions, or ports.
Intuitive(r), da Vinci(r), da Vinci(r) S(tm), InSite(r), and EndoWrist(r) are trademarks or registered trademarks of Intuitive Surgical, Inc.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are necessarily estimates reflecting the best judgment of our 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 should, therefore, be considered in light of various important factors, including the following: timing and success of product development and market acceptance of developed products; regulatory approvals, clearances and restrictions; guidelines and recommendations in the health care and patient communities; intellectual property positions and litigation; competition in the medical device industry and in the specific markets of surgery in which Intuitive Surgical operates; the impact of the tightening credit market and its impact on health care spending; and unanticipated manufacturing disruptions; delays in regulatory approvals of new manufacturing facilities or the inability to meet demand for products. Words such as "estimate", "project", "plan", "intend", "expect", "anticipate", "believe" and similar expressions are intended to identify forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. We undertake no obligation to publicly update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.
INTUITIVE SURGICAL, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ ------------------
2008 2007 2008 2007
------------------ ------------------
Revenue:
Products $202,267 $135,053 $552,998 $351,387
Services 33,725 21,851 90,376 59,995
-------- -------- -------- --------
Total revenue 235,992 156,904 643,374 411,382
Cost of revenue:
Products 53,517 38,305 148,405 103,067
Services 12,900 10,129 39,532 29,229
-------- -------- -------- --------
Total cost of revenue(1) 66,417 48,434 187,937 132,296
Gross profit 169,575 108,470 455,437 279,086
Operating expenses:
Selling, general and
administrative 62,692 40,163 168,830 112,989
Research and development 21,851 14,319 58,509 32,736
-------- -------- -------- --------
Total operating expenses(1) 84,543 54,482 227,339 145,725
Income from operations 85,032 53,988 228,098 133,361
Interest and other income,
net(2) 4,594 12,220 18,843 22,060
-------- -------- -------- --------
Income before income taxes 89,626 66,208 246,941 155,421
Provision for income taxes(3) 32,032 25,289 93,384 60,037
-------- -------- -------- --------
Net Income $ 57,594 $ 40,919 $153,557 $ 95,384
======== ======== ======== ========
Earnings per share:
Basic $ 1.48 $ 1.08 $ 3.96 $ 2.53
======== ======== ======== ========
Diluted $ 1.44 $ 1.04 $ 3.84 $ 2.46
======== ======== ======== ========
Shares used in computing
earnings per share:
Basic 39,015 38,033 38,790 37,653
======== ======== ======== ========
Diluted 40,108 39,271 39,978 38,776
======== ======== ======== ========
(1) Includes stock compensation expense of $3.1 million and $1.4
million in total cost of revenue and $17.9 million and $7.3
million in total operating expenses for the three months ended
September 30, 2008 and 2007, respectively; $8.3 million and $4.1
million in total cost of revenue and $47.0 million and $22.1
million in total operating expenses for the nine months ended
September 30, 2008 and 2007, respectively.
(2) Includes non-operating foreign exchange losses of $1.5 million
and $1.8 million of foreign exchange gains during the three
months ended September 30, 2008 and 2007, respectively, due to
the impact of the strengthening of the U.S. dollar on foreign
currency denominated assets; and $4.1 million of non-recurring
gains on sale of equity securities during the three and nine
months ended September 30, 2007.
(3) Includes a $3.1 million increase in 2007 research and development
credits recorded after the Company's 2007 tax returns were filed in
September 2008.
INTUITIVE SURGICAL, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
9/30/2008 6/30/2008 12/31/07
---------- ---------- ----------
Cash, cash equivalents, and
investments $ 821,431 $ 739,782 $ 635,381
Accounts receivable, net 173,708 162,088 130,370
Inventory 52,498 42,594 32,416
Property and equipment, net 98,081 94,568 68,093
Goodwill 110,740 110,740 110,740
Deferred tax assets 38,973 32,459 24,577
Other assets 69,240 49,156 38,421
---------- ---------- ----------
Total assets $1,364,671 $1,231,387 $1,039,998
========== ========== ==========
Accounts payable and other accrued
liabilities $ 108,442 $ 91,347 $ 96,632
Deferred revenue 72,801 66,053 54,692
---------- ---------- ----------
Total liabilities 181,243 157,400 151,324
Stockholders' equity 1,183,428 1,073,987 888,674
---------- ---------- ----------
Total liabilities and
stockholders' equity $1,364,671 $1,231,387 $1,039,998
========== ========== ==========
This news release was distributed by GlobeNewswire, www.globenewswire.com
SOURCE: Intuitive Surgical
Intuitive Surgical, Inc.
Ben Gong
408-523-2175
Rae Covington
408-523-2161