ISRG's Margins Show Resilience Amid Tariffs, 2026 Guidance Points to Continued Stability

Intuitive Surgical's Q4 margins contracted due to tariffs, facility costs, and an unfavorable mix from newer platforms. However, the company demonstrated strong execution in offsetting these pressures through cost reductions, component savings, and manufacturing scale efficiencies. Despite expected tariff headwinds increasing to 1.2% of revenues in 2026, management's gross margin guidance implies stability. The company's expanding installed base and rising utilization enhance fixed-cost absorption, providing a buffer against external shocks. Boston Scientific delivered strong profitability, expanding adjusted operating margins by 100 basis points to 28% in 2025, but tariffs remain a structural headwind. Henry Schein's Q4 operating margin was stable, but tariffs are a forward risk, and the company is addressing them through price pass-throughs and alternative sourcing strategies.