Intuitive Surgical Reports Strong Q2 Performance, Addresses Industry Challenges

Intuitive Surgical, a leader in robotic surgery, has reported robust financial results for the second quarter of 2025, while addressing concerns about tariffs, Medicaid coverage, and competition from third-party suppliers. The company's performance remains strong despite ongoing macroeconomic challenges in key markets outside the United States.

Q2 Financial Highlights and Procedure Growth

Intuitive Surgical posted impressive financial results for the second quarter of 2025:

• Revenue reached $2.44 billion, a 21% increase year over year
• Net income rose to $658 million, representing a 25% increase from the previous year
• Da Vinci robot placements totaled 395, up from 341 in Q2 2024
• Da Vinci 5 placements reached 180, compared to 70 in Q2 2024

The company reported a 17% growth in total da Vinci procedures for the quarter, matching the rate seen for all of 2024. In response to these strong results, Intuitive has raised the lower end of its expected range for 2025 procedure growth to 15.5% to 17%, up from the previous forecast of 15% to 17%.

Da Vinci 5 Platform Expansion and Global Market Challenges

Dave Rosa, who took over as Intuitive's CEO on July 1, characterized the company's Q2 performance as strong, despite ongoing challenges in Japan, China, and Europe. The company's new da Vinci 5 platform, introduced in early 2024, is now launching broadly in the United States. Limited launches are set to begin in Europe and Japan as the company gains additional regulatory clearances in those markets.

However, Intuitive noted that governments in key markets outside of the U.S. continue to constrain hospital budgets for capital equipment purchases, presenting ongoing challenges for international expansion.

Addressing Industry Concerns: Tariffs, Medicaid, and Competition

CFO Jamie Samath provided updates on several key issues affecting the company:

1. Tariffs: Intuitive now expects the impact of tariffs this year to be about 100 basis points lower than the company's first-quarter estimate. This assumes a 30% rate on imports from China to the U.S., while imports from all other countries face a 10% tariff rate. Imports from Mexico and Canada that comply with the United States-Mexico-Canada Agreement remain exempt from tariffs.

2. Medicaid Coverage: Samath acknowledged the potential for some of the approximately 70 million to 80 million Americans with Medicaid insurance to lose their coverage, which could impact procedures. However, he emphasized that robotic surgery could demonstrate economic and clinical advantages in the current U.S. healthcare environment.

3. Third-Party Competition: Addressing competition from third-party suppliers that remanufacture surgical instruments, CEO Rosa expressed confidence in Intuitive's position. He stated, "Our strong belief is that high-quality instruments with consistent performance, broad operational support and predictable supply chains provide the greatest value."

As Intuitive Surgical continues to navigate these challenges, the company remains focused on expanding its da Vinci 5 platform and maintaining its leadership position in the robotic surgery market.