Intuitive Surgical Announces Record $35.5 Million Third Quarter Revenue, Up 52% and $6.1 Million Net Income, $0.17 per Share
SUNNYVALE, CA--(MARKET WIRE)--Oct 26, 2004 -- Intuitive Surgical, Inc. (NasdaqNM:ISRG - News), the industry leader in surgical robotics, today reported record third quarter 2004 sales of $35.5 million, increasing 52% from $23.4 million for the third quarter of 2003. Higher sales were driven by continued recurring revenue growth and higher da Vinci® Surgical System shipments. Third quarter 2004 recurring revenue, consisting of instrument, accessory, service and training revenue, totaled $16.5 million, up 110% over the prior year. Third quarter 2004 recurring revenue increased to 46% of total sales from 34% during the third quarter of 2003.
Third quarter 2004 system revenue increased to $19.0 million from $15.5 million during the third quarter 2003. Intuitive sold 18 da Vinci® Surgical Systems during the third quarter of 2004, compared to 15 in the third quarter of 2003. Intuitive ended the third quarter 2004 with 261 cumulative da Vinci® Surgical Systems sold, compared to 192 at the end of the third quarter 2003.
Three Months Ended, Nine Months Ended,
9/30/04 9/30/03 Increase 9/30/04 9/30/03 Increase
----- ----- ----- ----- ----- -----
Revenue
($Millions)
Systems $19.0 $15.5 $3.5 $51.7 $44.3 $7.4
Instruments/
Accessories $10.3 $5.0 $5.3 $25.9 $12.7 $13.2
Service/
Training $6.2 $2.9 $3.3 $16.0 $7.1 $8.9
----- ----- ----- ----- ----- -----
$35.5 $23.4 $12.1 $93.6 $64.1 $29.5
===== ===== ===== ===== ===== =====
Cumulative
da Vinci®
Surgical System
Unit Sales
Shipments 18 15 3 51 43 8
Cumulative
Shipments 261 192 69 261 192 69
Gross profit increased to $22.7 million, or 64.0% of sales, for the third quarter 2004, compared to $12.1 million, or 51.6% of sales for the third quarter 2003.
Third quarter 2004 operating expenses of $17.2 million were $1.5 million higher than the third quarter 2003.
The company reported third quarter 2004 net income of $6.1 million, or $0.17 per diluted share, compared to a net loss of $3.4 million, or ($0.12) per diluted share for the third quarter 2003.
Intuitive was $14.8 million cash flow positive for the third quarter 2004, ending the period with $121.2 million in cash and short-term investments.
Commenting on the announcement, Lonnie Smith, Chairman and CEO of Intuitive Surgical said, "We are pleased with the strength of our third quarter revenue and earnings performance. Our continued sales and earnings growth demonstrates the ongoing market adoption of our da Vinci® Surgical System platform as well as the power of our business model."
The company will also announce these results at a conference call today at 1:30 pm PDT. The dial-in numbers for the call are 877-909-3508 for participants located in the U.S. and 484-630-4228 for participants located outside the U.S. The passcode is ISRG and the meeting leader is Mr. Lonnie Smith. To access financial information that will be discussed on the call, please visit Intuitive Surgical's website at www.intuitivesurgical.com.
About Intuitive's Products:
The da Vinci® Surgical System consists of a surgeon's viewing and control console having an integrated, high-performance InSite® 3-D vision system, a patient-side cart consisting of three or four robotic arms that position and precisely maneuver endoscopic instruments and an endoscope, and a variety of articulating EndoWrist® Instruments. By integrating computer-enhanced technology with surgeons' technical skills, Intuitive believes that its system enables surgeons to perform better surgery in a manner never before experienced. The da Vinci® Surgical System seamlessly and directly translates the surgeon's natural hand, wrist and finger movements on instrument controls at the surgeon's console outside the patient's body into corresponding micro-movements of the instrument tips positioned inside the patient through small puncture incisions, or ports.
The Aesop® Endoscope Positioner is a voice-activated robotic arm that automates the critical task of endoscope positioning, providing the surgeon with direct control over a smooth, precise and stable view of the internal surgical field.
The Hermes® Control Center is a centralized system designed to voice control a series of networked "smart" medical devices.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are necessarily estimates reflecting the best judgment of our management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. These forward-looking statements should, therefore, be considered in light of various important factors, including the following: timing and success of product development and market acceptance of developed products; regulatory approvals, clearances and restrictions; guidelines and recommendations in the health care and patient communities; intellectual property positions and litigation; competition in the medical device industry and in the specific markets of surgery in which Intuitive Surgical operates; and unanticipated manufacturing disruptions, delays in regulatory approvals of new manufacturing facilities or the inability to meet demand for products. Words such as "estimate," "project," "plan," "intend," "expect," "anticipate," "believe" and similar expressions are intended to identify forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. We undertake no obligation to publicly update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.
Intuitive®, da Vinci®, InSite®, EndoWrist®, Hermes®, and Aesop® are registered trademarks of Intuitive Surgical, Inc.
INTUITIVE SURGICAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
Three Months Ended, Nine Months Ended,
9/30/04 9/30/03 9/30/04 9/30/03
-------- -------- -------- --------
Sales:
Products $ 29,262 $ 20,515 $ 77,583 $ 56,958
Services 6,231 2,878 16,026 7,123
-------- -------- -------- --------
Total sales 35,493 23,393 93,609 64,081
Cost of sales:
Products 9,798 9,397 27,871 24,075
Services 2,973 1,932 7,552 5,513
-------- -------- -------- --------
Total cost of sales 12,771 11,329 35,423 29,588
-------- -------- -------- --------
Gross profit 22,722 12,064 58,186 34,493
Gross profit % 64.0% 51.6% 62.2% 53.8%
Operating costs and
expenses:
Selling, general, and
administrative 12,600 11,320 34,378 29,303
Research and development 4,635 4,407 13,571 11,457
-------- -------- -------- --------
Total operating costs
and expenses 17,235 15,727 47,949 40,760
-------- -------- -------- --------
Income (loss) from
operations 5,487 (3,663) 10,237 (6,267)
Other income, net 692 310 1,924 1,499
-------- -------- -------- --------
Income (loss) before
income tax provision 6,179 (3,353) 12,161 (4,768)
Income tax provision 66 0 365 0
-------- -------- -------- --------
Net income (loss) $ 6,113 $ (3,353) $ 11,796 $ (4,768)
======== ======== ======== ========
Net earnings (loss) per share -
Basic $ 0.18 $ (0.12) $ 0.35 $ (0.22)
======== ======== ======== ========
Diluted $ 0.17 $ (0.12) $ 0.34 $ (0.22)
======== ======== ======== ========
Weighted average shares outstanding
used to compute net earnings (loss)
per share -
Basic 33,823 26,878 33,556 21,296
======== ======== ======== ========
Diluted 35,305 26,878 34,534 21,296
======== ======== ======== ========
INTUITIVE SURGICAL, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
Unaudited
9/30/04 12/31/03(a)
--------- ---------
Assets
Current assets:
Cash and cash equivalents 11,268 11,335
Short-term investments 109,947 101,614
Accounts receivable, net 26,361 26,820
Inventories, net 6,596 8,788
Prepaid expenses and other current assets 3,688 3,203
Restricted cash equivalents 204 188
--------- ---------
Total current assets 158,064 151,948
Property and equipment, net 27,779 10,288
Restricted cash equivalents 319 642
Intangible assets, net 6,688 8,089
Goodwill 143,332 143,106
Other assets 641 921
--------- ---------
Total assets $ 336,823 $ 314,994
========= =========
Liabilities and stockholders' equity
Current liabilities:
Accounts payable 5,214 5,894
Accrued compensation and employee benefits 7,450 5,267
Restructuring accrual 806 971
Other accrued liabilities 7,488 9,134
Deferred revenue 14,092 11,345
Current portion of notes payable 813 1,030
--------- ---------
Total current liabilities 35,863 33,641
Long-term notes payable 52 695
Deferred revenue 1,077 1,148
Other accrued liabilities 57 553
Stockholders' equity
Common stock 34 33
Preferred stock - -
Additional paid-in capital 426,390 416,559
Deferred compensation - (99)
Accumulated deficit (126,618) (138,414)
Accumulated other comprehensive income (32) 878
--------- ---------
Total stockholders' equity 299,774 278,957
--------- ---------
Total liabilities and stockholders' equity $ 336,823 $ 314,994
========= =========
(a) - Derived from the audited financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2003 but does not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.
Contacts:
Ben Gong
408-523-2175
Sarah Norton
408-523-2161