Intuitive Surgical’s robot procedures and system placements grew at a healthy clip in the first quarter, but a focus on launch plans for the da Vinci 5 platform dominated the company’s earnings call.
Surgeons have now completed their first cases using the system, which gained Food and Drug Administration clearance last month, and the new robot is drawing positive early reviews for improved precision, efficiency, ergonomics, imaging and analytical capabilities, CEO Gary Guthart said on the Thursday call.
Eight of the next-generation systems were placed with customers during the quarter.
System placements may be choppy in the coming months, however, as da Vinci 5 is rolled out on a limited basis, Intuitive executives cautioned.
The phased launch of the much-anticipated da Vinci 5, first announced last month, will extend through this year and into early 2025, Guthart said, as the company concentrates on ensuring supply chain quality and incorporating customer feedback and planned updates.
“We're working hard to optimize our supply chains and manufacturing capabilities for da Vinci 5 components. We will remain in our measured rollout as we stabilize supply and respond to customer input,” Guthart said.
Some customers interested in da Vinci 5 may wait for adequate supply before acquiring the robot or opt for a fourth-generation system with an upgrade arrangement, the executives said.
“It's really hard for us, sitting where we are today, to predict the depth and timing of a replacement cycle,” the CEO added, in response to an analyst’s question. Much of the discussion in the question-and-answer portion of the call centered on reaction to da Vinci 5, including the potential of the robot’s new technology that simulates the feeling of force on tissue.
Guthart said the sensing instruments are generating great interest among surgeons, and the company is studying the implications for procedures as well as the training of doctors new to robotics.
Intuitive also faces supply constraints affecting adoption of its Ion lung biopsy system.
The company has made progress resolving supply challenges affecting Ion’s catheter and vision probe, but more work remains to be done, Guthart said. The FDA earlier this month cleared design changes to the catheter that will alleviate some of the supply constraints while improving the economics of the device, he said.
Procedure outlook raised
Intuitive raised its forecast for full-year procedure growth to a range of 14% to 17%, from its prior outlook of 13% to 16%.
In the first quarter, procedures using the da Vinci robot grew about 16% worldwide, compared with the year-ago period, when a backlog of cases remaining from the COVID-19 pandemic elevated patient volumes, Intuitive executives said. Bariatric procedure growth in the U.S., which has been hurt by patient interest in new weight-loss drugs, continued to moderate and was flat in the quarter, compared to a year ago, the company said.
Intuitive placed 313 da Vinci systems, compared with 312 in the first quarter of 2023.
With strong early clinician feedback on da Vinci 5, the system’s broader launch could lift investors’ earnings expectations for 2025 and 2026, BTIG analyst Ryan Zimmerman said in a research note.
“Going into results, we thought that the Street was too low on systems (with the idea being that hospitals would hold off ahead of [da Vinci 5]) but we believe with the option to upgrade and a healthy capex environment, system demand is proving more robust,” Zimmerman wrote. “Still, we think results take a backseat to [the] focus on [da Vinci 5].”
