Intuitive Surgical third-quarter net income falls to $523 million after $450 million charge

Intuitive Surgical, Inc. (ISRG) said Tuesday that third-quarter net income fell to $523 million, or $1.49 per diluted share, after the company booked a $450 million charge to settle antitrust litigation.

Revenue rose 22% to $3.05 billion from $2.51 billion a year earlier, the company said in a press release attached to a regulatory filing.

Worldwide procedures using da Vinci and Ion systems grew approximately 15% from the third quarter of 2025. Da Vinci procedures grew approximately 14%, and Ion procedures grew approximately 31%.

Here's how the company did:

• Revenue: $3.05 billion vs. $2.51 billion a year earlier
• GAAP net income attributable to Intuitive Surgical, Inc.: $523 million, or $1.49 per diluted share, vs. $704 million, or $1.95 per diluted share
• Non-GAAP net income attributable to Intuitive Surgical, Inc.: $1.05 billion, or $3.00 per diluted share, vs. $867 million, or $2.40 per diluted share
• GAAP income from operations: $593 million vs. $760 million
• Non-GAAP income from operations: $1.27 billion vs. $976 million
• GAAP gross profit margin: 68.4% vs. 66.4%
• Non-GAAP gross profit margin: 69.9% vs. 68.0%

Revenue growth was driven by procedure volume, higher operating lease revenue, and a larger installed base of systems.

Instruments and accessories revenue rose 18% to $1.80 billion from $1.52 billion. Systems revenue was $769 million, compared with $590 million a year earlier.

Placements and installed base

The company placed 546 da Vinci surgical systems, compared with 427 a year earlier. Of those, 315 were da Vinci 5 systems, up from 240.

Of the da Vinci placements, 291 were placed under operating lease arrangements, including 160 usage-based arrangements.

The company placed 56 Ion endoluminal systems, compared with 50 a year earlier.

Its da Vinci installed base reached 12,094 systems as of Sept. 30, an increase of 12% from 10,763 a year earlier.

The Ion endoluminal system installed base rose 21% to 1,152 systems from 954.

Litigation charge and tariff refunds

In October, following mediation in the "In re: da Vinci Surgical Robot Antitrust Litigation" class action, the company reached a written agreement to settle for a one-time payment of $450 million and mutually agreed injunctive relief.

The agreement includes no admission of liability or wrongdoing. The company recorded the $450 million as a charge to selling, general, and administrative expenses in the third quarter. The expense was $347 million, net of tax, or $0.99 per diluted share.

The settlement remains subject to preliminary and final court approval. The company said there can be no assurance the court will approve it or that individual class members will not object.

Tariff refunds paid under the International Emergency Economic Powers Act, or IEEPA, added a $22 million benefit, net of tax, or $0.06 per diluted share. The refunds covered tariffs paid in prior periods.

2026 financial outlook

The company expects worldwide da Vinci procedure growth of approximately 14% to 15% in 2026, and expects to land closer to the midpoint of that range.

It expects non-GAAP gross profit margin of 68.7% to 69.3% of revenue in 2026. That range includes an estimated tariff impact of 0.9% of revenue, excluding recognized tariff refunds.

Non-GAAP operating expense growth is expected to be 11% to 13% in 2026.

The company said additional tariffs beyond its expectations could be material to its 2026 results.

Intuitive CEO Dave Rosa said: "Our strong performance this quarter was marked by broad-based adoption across our multi-port, single-port, and Ion platforms, with customers using our systems to perform, on average, over 10,000 procedures per day throughout the period."

Cash and buybacks

The company repurchased 7.8 million shares for $2.94 billion in the third quarter.

It ended the quarter with $6.80 billion in cash, cash equivalents, and investments, a decrease of $1.83 billion during the quarter.

The company said the decline was driven primarily by share repurchases and purchases of property, plant, and equipment, partly offset by cash from operations.

For the first nine months, revenue was $8.71 billion, up from $7.20 billion. Diluted GAAP earnings per share were $6.07, compared with $5.67, and non-GAAP diluted earnings per share were $8.30, against $6.40.