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Intuitive Surgical Pre-Q4 Analysis: Buy, Hold or Sell ISRG Stock Now?
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Key Takeaways
ISRG's Q4 prelims showed 18% procedure growth, roughly $2.87B revenues and 532 da Vinci system placements.
ISRG's I&A revenues rose 17% on higher procedures, though pricing pressure remained in China and ASC settings.
ISRG saw strong da Vinci 5 demand lift system ASPs, while tariffs and margins weighed on earnings outlook.
Intuitive Surgical, Inc. (ISRG - Free Report) is set to report fourth-quarter 2025 earnings on Feb. 22. The Zacks Consensus Estimate for sales and earnings is pegged at $2.87 billion and $2.25 per share, respectively. Earnings per share (EPS) estimates for ISRG have remained stable at $8.65 and $9.61 for 2025 and 2026, respectively, over the past 30 days.
Earlier this month, ISRG reported preliminary results for the fourth quarter of 2025, estimating approximately 18% procedure growth worldwide. Average da Vinci system utilization increased 4% during the quarter, primarily driven by the adoption of da Vinci 5 in the United States and continued growth in utilization in ex-U.S. markets. The company placed 532 da Vinci surgical systems, which included 303 da Vinci 5 systems. Preliminary fourth-quarter 2025 revenues totaled approximately $2.87 billion, reflecting an increase of 19%.
Intuitive Surgical’s close peers, Thermo Fisher Scientific (TMO - Free Report) and Boston Scientific (BSX - Free Report) , are slated to announce their quarterly numbers in upcoming weeks. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)
Estimate Movement
In the last reported quarter, ISRG delivered an earnings surprise of 20.6%. Its earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 16.34%.
In the last reported quarter, Thermo Fisher Scientific and Boston Scientific delivered an earnings surprise of 5.27% and 5.63%, respectively.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Intuitive Surgical this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here, as you will see below.
Intuitive Surgical fourth-quarter performance is likely to have been underscored by robust procedure growth and broad adoption of the da Vinci 5 platform. Yet, global CapEx constraints and ongoing tariff pressures, although slowing, could temper the pace of expansion.
The Instruments & Accessories (I&A) segment remains a core revenue engine. In the third quarter, revenue per procedure held steady at nearly $1,800, supported by rising adoption of SP and da Vinci 5 instruments. For the ion platform, I&A revenue per procedure was consistent with prior periods at approximately $2,200. However, per the preliminary results, I&A revenues grew 17% in the fourth quarter on the back of 18% procedure growth, potentially suggesting pricing pressure.
On its third-quarter earnings call, ISRG stated that pricing pressure is likely to continue in China. Moreover, the company’s focus on ambulatory surgery centers (ASC) in the United States may have an unfavorable impact on pricing as reimbursement rates for ASC are a fraction of the reimbursement in a hospital outpatient department. However, rising utilization in the United States, on the back of da Vinci 5 adoption, as well as in the ex-U.S. markets should have offset any potential pricing pressure during the quarter.
The Systems segment is benefiting from strong demand for da Vinci 5. Per the preliminary release, ISRG placed 303 da Vinci 5 systems in the fourth quarter, likely raising average selling prices (ASPs) for da Vinci systems to at least $1.6 million, the price level achieved during the third quarter. Measured rollouts in Europe and Japan might have added to system demand, though macroeconomic budget constraints in these regions likely remained a headwind. The system placement might have faced competition in China from local vendors. However, performance in markets served by distributors continued to be relatively strong during the third quarter, a trend likely to have continued in the fourth quarter.
The Services segment might have continued its steady growth on the back of higher utilization and adoption of Intuitive Surgical’s digital ecosystem, including telepresence tools and data-driven case insights. Increasing integration of AI-enabled insights into clinical practice could have driven long-term stickiness.
Despite the upbeat fundamentals, tariffs remain a notable drag. Management estimates a nearly 70-basis-point impact on 2025 margins. Moreover, while U.S. performance remains robust, uncertainty around Medicaid coverage could pose risks.
Price Performance & Valuation
Intuitive Surgical’s shares have gained 3.6% in the past six months compared with the industry’s 12.2% growth. The company’s shares have underperformed the S&P 500 Index’s gain of 12.8% as well as the Zacks Medical sector’s increase of 14.1%.
ISRG has also underperformed Thermo Fisher Scientific’s 52.8% surge and outperformed Boston Scientific’s 15.2% decline in the past six months.
Six-Month Price Performance
Image Source: Zacks Investment Research
Now, let us take a look at the value Intuitive Surgical offers to its investors at current levels.
Currently, ISRG is trading at a premium compared to its industry, with a forward 12-month P/E of 55.21X compared with the industry’s 30.02X. However, the current valuation came down from a five-year high of 71.50X but is higher than the five-year low of 41.90X. ISRG has traded at a premium to the industry valuation in the past five years, reflecting the company's higher growth prospects. However, the current Value score of D reflects a high valuation.
ISRG's P/E F12M Graph
Image Source: Zacks Investment Research
Investment Thesis
Despite its elevated valuation, Intuitive Surgical is expected to sustain strong top-line performance through 2026, supported by solid da Vinci procedure growth and accelerating adoption of the Ion platform. The rollout of da Vinci SP in Europe, Japan and China, and the broad launch of da Vinci 5 in the United States should continue to drive system adoption. New features and expansion into new indications should boost adoption further. Rising utilization should drive I&A revenues.
Meanwhile, ongoing softness in bariatric procedures and lingering challenges in China may partially offset these gains in the near term.
Although rising da Vinci 5 installations and continued procedure growth should drive revenue growth in 2026, lower margin on da Vinci 5 and potential pricing pressure on I&A are likely to put pressure on the bottom line. This is evident from the Zacks Consensus Estimate for 2026, which implies sales growth of 12.7%. However, earnings growth is likely to be lower at 11.1%.
At the same time, escalating geopolitical tensions and continued tariff tensions raise uncertainty, potentially weighing on global performance. Still, with key manufacturing operations anchored in the United States and Mexico, domestic revenues are well-insulated against tariff exposure.
Sales & EPS Estimates
Image Source: Zacks Investment Research
Conclusion
Intuitive Surgical has strong fundamental factors supporting its uptrend, along with a favorable Zacks Rank. Moreover, the Style Score of C reflects moderate strength in the stock. However, an earnings beat for the fourth quarter remains inconclusive. So, we will advise investors to wait for the earnings release before making an entry into the stock.
Although the valuation for the company has come down but it is still trading above the industry-average. The company’s high valuation may have factored in the strong fundamentals, including growth in procedures and installed base.
While current shareholders may hold their position, new investors should wait for the fourth-quarter results and analyze the new updates before making an entry. However, valuation may continue to remain expensive as ISRG plans to expand its efforts to place systems beyond the United States, increase utilization in existing U.S. accounts and expand into additional indications going ahead.
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Intuitive Surgical Pre-Q4 Analysis: Buy, Hold or Sell ISRG Stock Now?
Key Takeaways
Intuitive Surgical, Inc. (ISRG - Free Report) is set to report fourth-quarter 2025 earnings on Feb. 22. The Zacks Consensus Estimate for sales and earnings is pegged at $2.87 billion and $2.25 per share, respectively. Earnings per share (EPS) estimates for ISRG have remained stable at $8.65 and $9.61 for 2025 and 2026, respectively, over the past 30 days.
Earlier this month, ISRG reported preliminary results for the fourth quarter of 2025, estimating approximately 18% procedure growth worldwide. Average da Vinci system utilization increased 4% during the quarter, primarily driven by the adoption of da Vinci 5 in the United States and continued growth in utilization in ex-U.S. markets. The company placed 532 da Vinci surgical systems, which included 303 da Vinci 5 systems. Preliminary fourth-quarter 2025 revenues totaled approximately $2.87 billion, reflecting an increase of 19%.
Intuitive Surgical’s close peers, Thermo Fisher Scientific (TMO - Free Report) and Boston Scientific (BSX - Free Report) , are slated to announce their quarterly numbers in upcoming weeks. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)
Estimate Movement
In the last reported quarter, ISRG delivered an earnings surprise of 20.6%. Its earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 16.34%.
In the last reported quarter, Thermo Fisher Scientific and Boston Scientific delivered an earnings surprise of 5.27% and 5.63%, respectively.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Intuitive Surgical this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here, as you will see below.
ISRG has an Earnings ESP of 0.00% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Factors to Note
Intuitive Surgical fourth-quarter performance is likely to have been underscored by robust procedure growth and broad adoption of the da Vinci 5 platform. Yet, global CapEx constraints and ongoing tariff pressures, although slowing, could temper the pace of expansion.
The Instruments & Accessories (I&A) segment remains a core revenue engine. In the third quarter, revenue per procedure held steady at nearly $1,800, supported by rising adoption of SP and da Vinci 5 instruments. For the ion platform, I&A revenue per procedure was consistent with prior periods at approximately $2,200. However, per the preliminary results, I&A revenues grew 17% in the fourth quarter on the back of 18% procedure growth, potentially suggesting pricing pressure.
On its third-quarter earnings call, ISRG stated that pricing pressure is likely to continue in China. Moreover, the company’s focus on ambulatory surgery centers (ASC) in the United States may have an unfavorable impact on pricing as reimbursement rates for ASC are a fraction of the reimbursement in a hospital outpatient department. However, rising utilization in the United States, on the back of da Vinci 5 adoption, as well as in the ex-U.S. markets should have offset any potential pricing pressure during the quarter.
The Systems segment is benefiting from strong demand for da Vinci 5. Per the preliminary release, ISRG placed 303 da Vinci 5 systems in the fourth quarter, likely raising average selling prices (ASPs) for da Vinci systems to at least $1.6 million, the price level achieved during the third quarter. Measured rollouts in Europe and Japan might have added to system demand, though macroeconomic budget constraints in these regions likely remained a headwind. The system placement might have faced competition in China from local vendors. However, performance in markets served by distributors continued to be relatively strong during the third quarter, a trend likely to have continued in the fourth quarter.
The Services segment might have continued its steady growth on the back of higher utilization and adoption of Intuitive Surgical’s digital ecosystem, including telepresence tools and data-driven case insights. Increasing integration of AI-enabled insights into clinical practice could have driven long-term stickiness.
Despite the upbeat fundamentals, tariffs remain a notable drag. Management estimates a nearly 70-basis-point impact on 2025 margins. Moreover, while U.S. performance remains robust, uncertainty around Medicaid coverage could pose risks.
Price Performance & Valuation
Intuitive Surgical’s shares have gained 3.6% in the past six months compared with the industry’s 12.2% growth. The company’s shares have underperformed the S&P 500 Index’s gain of 12.8% as well as the Zacks Medical sector’s increase of 14.1%.
ISRG has also underperformed Thermo Fisher Scientific’s 52.8% surge and outperformed Boston Scientific’s 15.2% decline in the past six months.
Six-Month Price Performance
Image Source: Zacks Investment Research
Now, let us take a look at the value Intuitive Surgical offers to its investors at current levels.
Currently, ISRG is trading at a premium compared to its industry, with a forward 12-month P/E of 55.21X compared with the industry’s 30.02X. However, the current valuation came down from a five-year high of 71.50X but is higher than the five-year low of 41.90X. ISRG has traded at a premium to the industry valuation in the past five years, reflecting the company's higher growth prospects. However, the current Value score of D reflects a high valuation.
ISRG's P/E F12M Graph
Image Source: Zacks Investment Research
Investment Thesis
Despite its elevated valuation, Intuitive Surgical is expected to sustain strong top-line performance through 2026, supported by solid da Vinci procedure growth and accelerating adoption of the Ion platform. The rollout of da Vinci SP in Europe, Japan and China, and the broad launch of da Vinci 5 in the United States should continue to drive system adoption. New features and expansion into new indications should boost adoption further. Rising utilization should drive I&A revenues.
Meanwhile, ongoing softness in bariatric procedures and lingering challenges in China may partially offset these gains in the near term.
Although rising da Vinci 5 installations and continued procedure growth should drive revenue growth in 2026, lower margin on da Vinci 5 and potential pricing pressure on I&A are likely to put pressure on the bottom line. This is evident from the Zacks Consensus Estimate for 2026, which implies sales growth of 12.7%. However, earnings growth is likely to be lower at 11.1%.
At the same time, escalating geopolitical tensions and continued tariff tensions raise uncertainty, potentially weighing on global performance. Still, with key manufacturing operations anchored in the United States and Mexico, domestic revenues are well-insulated against tariff exposure.
Sales & EPS Estimates
Image Source: Zacks Investment Research
Conclusion
Intuitive Surgical has strong fundamental factors supporting its uptrend, along with a favorable Zacks Rank. Moreover, the Style Score of C reflects moderate strength in the stock. However, an earnings beat for the fourth quarter remains inconclusive. So, we will advise investors to wait for the earnings release before making an entry into the stock.
Although the valuation for the company has come down but it is still trading above the industry-average. The company’s high valuation may have factored in the strong fundamentals, including growth in procedures and installed base.
While current shareholders may hold their position, new investors should wait for the fourth-quarter results and analyze the new updates before making an entry. However, valuation may continue to remain expensive as ISRG plans to expand its efforts to place systems beyond the United States, increase utilization in existing U.S. accounts and expand into additional indications going ahead.