Intuitive Surgical Plunge 8% As Q1 Results Miss Estimates

(RTTNews) - Shares of Intuitive Surgical, Inc. (ISRG) plunged more than eight percent in extended trade on Tuesday after the surgical systems maker reported results for the first quarter that missed analysts' expectations. The company reported a profit that plunged from last year, hurt mainly by a 24 percent revenue drop amid sharply lower sales of da Vinci systems.

The Sunnyvale, California-based industry leader in surgical robotics reported net income of $44.3 million or $1.13 per share for the first quarter, sharply lower than $188.9 million or $4.56 per share in the prior-year quarter.

The company noted that results for the latest quarter include $67 million litigation accrual and reflects the $26 million revenue deferral associated with a customer trade-out program for the newly launched da Vinci®Xi surgical system.

On average, 18 analysts polled by Thomson Reuters expected the company to report earnings of $3.27 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenues for the quarter declined 24 percent to $464.7 million from $611.4 million in the same quarter last year, and missed eighteen Wall Street analysts' consensus estimate of $507.04 million.

Excluding the $26 million deferral relating to the trade-out program, revenue would decreased about 20 percent to $491 million.

Revenues from instruments and accessories declined 2 percent to $255 million, driven primarily by lower instrument and accessory stocking orders. This was partially offset by seven percent growth in 'da Vinci' surgical procedures amid growth in U.S general surgery and international urology procedures, partially offset by lower U.S. gynecologic procedures.

Systems revenue more than halved to $106 million from last year's $256 million, driven by lower U.S. systems sales and the revenue deferral of $24 million relating to the da Vinci Xi customer trade-out program.

Intuitive Surgical shipped 87 da Vinci Surgical Systems during the first quarter, nearly half the 164 systems shipped in the year-ago quarter, primarily reflecting lower system sales into the U.S. market.

Meanwhile, services revenue increased 10 percent to $103.9 million, reflecting growth in the installed base of da Vinci Surgical Systems.

Operating income for the quarter plunged to $57 million from $251 million in the year-ago quarter.

ISRG closed Tuesday's regular trading session at $422.33, up $11.22 or 2.73% on a volume of 1.01 million shares. However, the stock plunged $34.86 or 8.25% in after-hours trading.