Intuitive Surgical 2025 Q2 Earnings Beats Expectations with Net Income Surging 25%

Intuitive Surgical (ISRG), ranking 67th by market capitalization, reported its fiscal 2025 Q2 earnings on Jul 22nd, 2025. The company surpassed expectations with a revenue of $2.44 billion against the consensus estimate of $2.35 billion, marking a year-over-year increase of 21.4%. Adjusted earnings per share (EPS) came in at $2.19, exceeding analyst predictions of $1.93. Intuitive Surgical raised its guidance, anticipating da Vinci procedure growth between 15.5% and 17%, along with a pro forma gross margin range of 66% to 67% of revenue. With strong results compared to expectations and adjusted guidance, the company demonstrated robust financial health and market resilience.

Revenue
The total revenue of Intuitive Surgical increased by 21.4% to $2.44 billion in 2025 Q2, up from $2.01 billion in 2024 Q2.

Earnings/Net Income
Intuitive Surgical's EPS rose 24.3% to $1.84 in 2025 Q2 from $1.48 in 2024 Q2, marking continued earnings growth. Meanwhile, the company's profitability strengthened with net income of $664.20 million in 2025 Q2, marking 25.0% growth from $531.50 million in 2024 Q2. Remarkably, in 2025 Q2, the company set a new record high for fiscal Q2 net income, the highest in over 20 years. The EPS growth reflects strong performance in the period.

Post-Earnings Price Action Review
The strategy of buying ISRG when earnings beat expectations and selling after 30 days delivered moderate returns but underperformed the market. The CAGR was 8.62%, trailing the benchmark by 25.89%. Although the strategy had a maximum drawdown of 0% and a Sharpe ratio of 0.47, indicating minimal risk, it lacked significant growth potential. This approach might appeal to risk-averse investors valuing stability over aggressive growth, but those seeking higher returns may find it less attractive. The slight decline in stock price during the latest trading day and week indicates cautious market sentiment, possibly driven by Intuitive Surgical's updated guidance and projected procedure growth rates. Investors generally scrutinize post-earnings trends and strategies, weighing them against broader market performance to assess future investment decisions.

CEO Commentary
David J. Rosa, CEO & Director, expressed gratitude for the leadership of former CEO Gary Guthart while emphasizing strong financial metrics and procedure growth despite macro challenges. He highlighted a 17% growth in da Vinci procedures, driven by benign general surgery and strong international performance, particularly in India and Korea. Rosa described the successful launch of the da Vinci 5 platform and noted the importance of innovation and operational efficiency in supporting the Quintuple Aim. He conveyed optimism about the company’s ability to navigate challenges and capitalize on growth opportunities, reaffirming the commitment to advance minimally invasive care.

Guidance
Intuitive Surgical updated its guidance for 2025, projecting da Vinci procedure growth between 15.5% and 17%. The company expects pro forma gross margin to range from 66% to 67% of revenue, with operating expenses anticipated to grow between 10% and 14%. Other income is estimated to be between $370 million and $390 million, while capital expenditures are projected at $650 million to $725 million. The effective tax rate is expected to remain between 22% and 23% of pretax income.

Additional News
Intuitive Surgical has demonstrated its commitment to innovation and global expansion through various strategic moves in recent weeks. On July 2, 2025, the company's da Vinci 5 Surgical System received the CE Mark, enhancing its presence in the European market and broadening access to advanced surgical technology. Additionally, on July 16, 2025, Intuitive showcased its telesurgery capabilities, underscoring its focus on enhancing surgical outcomes through cutting-edge technology. The leadership transition effective July 1, 2025, saw David Rosa taking over as CEO, following Gary Guthart's tenure. This change signifies a new chapter for the company, as it continues to prioritize innovation and expansion in the global healthcare landscape.