Intuitive Surgical (ISRG) has seen its shares soar approximately 580% over the past decade, significantly outperforming the S&P 500’s 240% gain. The company’s success is largely attributed to its da Vinci surgical robots, which have become increasingly popular due to their ability to enhance patient outcomes. In the first quarter of 2026, Intuitive Surgical installed 431 new systems, reflecting a 12% year-over-year increase in its installed base, with surgeries performed using these robots rising by 17%.
However, the real growth driver lies beyond the initial sale of the da Vinci systems. Only 23% of Intuitive Surgical’s revenue comes from robot sales, while a substantial 60% is generated from instruments and accessories, complemented by 15% from services. This annuity-like revenue model creates a robust flywheel effect, as increased robot usage leads to higher demand for replacement parts and servicing.
For market professionals, the key takeaway is to recognize that Intuitive Surgical’s long-term growth potential is closely tied to its parts and services revenue, rather than just the sale of surgical robots. This insight is crucial for assessing the company’s valuation and future performance.
Source: fool.com