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- ISRG 3Q25 - Da Vinci 5 - Leonardo would be proud. Bull case $800 Bear case $425
ISRG 3Q25 - Da Vinci 5 - Leonardo would be proud. Bull case $800 Bear case $425
Cheat Sheets
INTUITIVE SURGICAL (ISRG)
🤖 Da Vinci 5 Full Launch | EPS +30% | Revenue $2.5B (+23%) | 427 Systems Placed | 19% DV Procedure Growth | 20% Total Procedure Growth (DV+Ion) | 10,800 Installed Base
240 Da Vinci 5 Systems (56% of placements) | DV5 Utilization Already Outpacing Xi | Multi-Port Utilization +4% | SP Procedures +91% | Ion +52% (38K procedures) | Operating Margin 39%
💰 Market Cap: $164B | 🏢 15,600+ Employees | 🌍 10,800 Systems Installed (DV) + 950 Ion
👨💼 CEO Dave Rosa | 🎯 Pursuing Quintuple Aim | 🇺🇸 Sunnyvale, CA
$538.87
📈 +$76.13 (+16.45%) Today
Q3 2025 Blowout Earnings
Price Targets (12-18 Months)
Current Price: $538.87 (Post-Earnings +16.45%)
$800.00
Bull Case (+48%)
2026 EPS: $11.00 | P/E: 73x
Da Vinci 5 Dominance
🚀 Needs:
DV5 becomes 70%+ of all placements • Utilization keeps beating Xi • Procedure growth stays above 20% • Japan, China, UK issues get resolved • SP gets FDA clearances and explodes • Ion hits 60K procedures • Force feedback clinical data proves it works • Refurbished Xi opens new markets without hurting margins
$675.00
Base Case (+25%)
2026 EPS: $10.00 | P/E: 68x
Steady Leadership
⚖️ Needs:
Procedures keep growing 19-20% • DV5 stays at 50-60% of placements • Systems keep getting used more (4% growth) • Force feedback studies show good results • Europe and Japan customers buy 50+ systems • SP gets to 40 systems per quarter • Operating margins stay around 38-40% • International growth offsets China and UK problems
$425.00
Bear Case (-21%)
2026 EPS: $8.25 | P/E: 52x
Competition Emerges
⚠️ Risk:
Japan, China, UK problems get worse and spread • Europe won't pay DV5 prices, stick with older Xi • Force feedback data disappoints, doesn't help adoption • SP clearances delayed a year or more • Competitors enter Ion's lung biopsy market • Hugo and Ottava steal share with 20-30% lower prices • Hospitals stop buying during recession • Refurbished Xi hurts new system sales • Procedure growth slows to low teens
The TL;DR
💰
What Happened
EPS BEAT: +30% growth in pro forma EPS - exceptional
Revenue: $2.5B (+23%) - strong growth
Systems: 427 placed (240 DV5 = 56% of placements!)
Procedures: DV +19%, Ion +52%, Total +20%
DV5 Launch: "First full quarter of broad availability"
Utilization: Multi-port +4%, SP +35%, Ion +14%
Revenue: $2.5B (+23%) - strong growth
Systems: 427 placed (240 DV5 = 56% of placements!)
Procedures: DV +19%, Ion +52%, Total +20%
DV5 Launch: "First full quarter of broad availability"
Utilization: Multi-port +4%, SP +35%, Ion +14%
📉
Why It Matters
DV5 Outpacing Xi: "Utilization already outpacing Xi" in first 18 months
Upgrade Catalyst: Strong domestic upgrades driving throughput expansion
Full Launch: Q3 = first full quarter of broad DV5 availability in US
Japan/Europe: First 9 systems placed OUS, positive early feedback
Force Feedback: Limited launch, studying clinical outcome impact
Margin: 39% operating margin with strong operating discipline
Upgrade Catalyst: Strong domestic upgrades driving throughput expansion
Full Launch: Q3 = first full quarter of broad DV5 availability in US
Japan/Europe: First 9 systems placed OUS, positive early feedback
Force Feedback: Limited launch, studying clinical outcome impact
Margin: 39% operating margin with strong operating discipline
🎯
Management Strategy
2025 Priorities: (1) Full DV5 launch + regional clearances (2) Focused procedure adoption (3) Industrial scale + quality (4) Digital tool excellence
DV5 Features: Force sensing, surgeon autonomy, telepresence, ForceGauge, Focus Mode
Remote Updates: FDA cleared network config management = streamlined deployment
Quintuple Aim: Better outcomes, patient experience, care team experience, lower cost, access
Refurb Xi: Offering refurbished Xi to expand access in geographies
DV5 Features: Force sensing, surgeon autonomy, telepresence, ForceGauge, Focus Mode
Remote Updates: FDA cleared network config management = streamlined deployment
Quintuple Aim: Better outcomes, patient experience, care team experience, lower cost, access
Refurb Xi: Offering refurbished Xi to expand access in geographies
🔍
Key Concerns
International Headwinds: "Ongoing external dynamics in Japan, China, UK" impacting placements
OUS Pricing: "Incremental cost sensitivity" to DV5 pricing vs US market
Limited FF Launch: Force feedback still in limited launch, full data pending
SP Clearances: US clearances submitted (nipple sparing, gen surgery) - awaiting FDA
Evaluation Time: Europe/Japan customers "work through evaluation process"
Competitive Pressure: Hugo/Ottava still looming with lower pricing
OUS Pricing: "Incremental cost sensitivity" to DV5 pricing vs US market
Limited FF Launch: Force feedback still in limited launch, full data pending
SP Clearances: US clearances submitted (nipple sparing, gen surgery) - awaiting FDA
Evaluation Time: Europe/Japan customers "work through evaluation process"
Competitive Pressure: Hugo/Ottava still looming with lower pricing
🐂 Bull Thesis
🤖
Da Vinci 5 = Game Changer
240 Units in Q3: More than half of all systems sold were DV5 - way better than expected
Already Beating Xi: CEO said DV5 is being used more than Xi was at this point - that's huge
Upgrade Wave: Hospitals upgrading to get better features and handle more surgeries
Already Beating Xi: CEO said DV5 is being used more than Xi was at this point - that's huge
Upgrade Wave: Hospitals upgrading to get better features and handle more surgeries
🔄
Systems Being Used More
Multi-Port +4%: As hospitals upgrade to DV5, they're doing more surgeries per system
SP +35% Usage: Single Port in Korea is being used more than Xi. Surgeons love shorter hospital stays
Ion +14% Usage: 38K lung procedures. AI helps plan each biopsy perfectly
SP +35% Usage: Single Port in Korea is being used more than Xi. Surgeons love shorter hospital stays
Ion +14% Usage: 38K lung procedures. AI helps plan each biopsy perfectly
🏰
Force Feedback Could Be Big
Testing Now: Working with hospitals to see if force feedback improves patient outcomes
Early Studies: Looking at nerve damage in prostate surgery and bowel recovery in colon surgery
New Features: FDA approved visual force display and video replay to help surgeons learn faster
Early Studies: Looking at nerve damage in prostate surgery and bowel recovery in colon surgery
New Features: FDA approved visual force display and video replay to help surgeons learn faster
🌍
SP and Ion Growing Fast
SP +91% Procedures: Korea loves it. New stapler approved for colon and chest surgeries. Surgeons are excited
Ion +52% Procedures: 38K lung biopsies. AI reads CT scans and plans the best path to the tumor
1,100+ Doctors Meeting: Healthcare pros from 450+ hospitals sharing data on how robotics helps patients
Ion +52% Procedures: 38K lung biopsies. AI reads CT scans and plans the best path to the tumor
1,100+ Doctors Meeting: Healthcare pros from 450+ hospitals sharing data on how robotics helps patients
🐻 Bear Thesis
📉
International Problems
3 Big Markets Struggling: CEO said Japan, China, and UK have "ongoing problems" that hurt sales
Price Too High Overseas: Europe and Japan hospitals think DV5 costs too much compared to US prices
Slow Start Abroad: Only 9 DV5 systems sold in Europe and Japan. Customers still deciding if it's worth it
Price Too High Overseas: Europe and Japan hospitals think DV5 costs too much compared to US prices
Slow Start Abroad: Only 9 DV5 systems sold in Europe and Japan. Customers still deciding if it's worth it
💸
Force Feedback Not Ready Yet
Limited Release: Force feedback still only available to select hospitals, not everyone can buy it
Waiting on Proof: Still studying whether it actually improves patient results - no conclusive data yet
Unknown Timeline: Management said data will be "the catalyst" but won't say when that data is coming
Waiting on Proof: Still studying whether it actually improves patient results - no conclusive data yet
Unknown Timeline: Management said data will be "the catalyst" but won't say when that data is coming
⚔️
SP Needs FDA Approvals
Waiting on FDA: Filed for breast surgery and general surgery approvals but no word yet from FDA
Clearances Matter: Management said "broad clearances are important" - Korea has them, US doesn't yet
Small Numbers Still: 91% growth sounds good but only 30 SP systems sold in Q3 - still tiny
Clearances Matter: Management said "broad clearances are important" - Korea has them, US doesn't yet
Small Numbers Still: 91% growth sounds good but only 30 SP systems sold in Q3 - still tiny
💰
Too Dependent on US
Three Big Markets Weak: CEO specifically mentioned problems in Japan, China, and UK - that's a lot of growth missing
US Carrying Everything: Domestic upgrades driving growth, but what happens if international doesn't recover?
Refurb Strategy Risk: Selling refurbished Xi systems might steal sales from more profitable new DV5 systems
US Carrying Everything: Domestic upgrades driving growth, but what happens if international doesn't recover?
Refurb Strategy Risk: Selling refurbished Xi systems might steal sales from more profitable new DV5 systems
This analysis is for informational purposes only and should not be considered investment advice. Please consult with a financial advisor before making investment decisions.
