AI Takeaway
Intuitive Surgical delivered a strong Q1 FY2026 with revenue of $2.77B (+23.0% YoY), operating income surging 48.0% to $855.3M, and operating cash flow jumping 56.8% to $911.9M, reflecting robust procedure volume growth and expanding margins.
Revenue
$2.77B
++22.96% YoY
EPS (Basic)
$2.31
++18.46% YoY
Gross Margin
66.1%
++1.38% YoY
Operating Income
$855.3M
++47.95% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-Q filing
Revenue grew 23.0% YoY to $2.77B in Q1 FY2026, up from $2.25B in Q1 FY2025, reflecting continued adoption of the da Vinci surgical system and strong procedure volume growth across key surgical specialties globally.
Source: Source: 10-Q Income Statement Data
Operating income surged 48.0% YoY to $855.3M, with operating margin expanding approximately 520 basis points to 30.9% from 25.7%, demonstrating meaningful operating leverage as revenue growth outpaced SG&A growth of only 8.9% and R&D growth of 14.5%.
Source: Source: 10-Q Income Statement Data
Gross margin improved to 66.1% from 64.7% in the prior year period, a gain of approximately 140 basis points YoY, suggesting favorable product mix, improved manufacturing efficiencies, or pricing power in the installed base.
Source: Source: 10-Q Income Statement & Key Ratios
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Upgrade to unlockCash and equivalents declined 22.0% YoY to $2.01B, driven by $1.12B in share buybacks and $914.5M in investing outflows. While the balance sheet remains strong with a current ratio of 4.61 and low debt-to-equity of 0.14, the aggressive capital return program reduces the liquidity buffer available for strategic acquisitions or unexpected downturns.
Source: Source: 10-Q Balance Sheet & Cash Flow Statement Data
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Upgrade to unlockReported EPS of $2.50 versus the $2.14 analyst consensus — a +16.8% beat for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $2.77B | $2.25B | +22.96% |
Cost of Revenue | $940.3M | $795.7M | +18.17% |
Gross Profit | $1.83B | $1.46B | +25.57% |
Operating Income | $855.3M | $578.1M | +47.95% |
Net Income | $821.5M | $698.4M | +17.63% |
EPS (Basic) | $2.31 | $1.95 | +18.46% |
EPS (Diluted) | $2.28 | $1.92 | +18.75% |
R&D Expense | $361.9M | $316.2M | +14.45% |
SG&A Expense | $613.3M | $563.4M | +8.86% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $20.11B | $19.22B | +4.63% |
Current Assets | $8.81B | $7.66B | +15.04% |
Total Liabilities | $2.51B | $2.01B | +24.90% |
Current Liabilities | $1.91B | $1.54B | +24.24% |
Stockholders' Equity | $17.47B | $17.11B | +2.15% |
Cash & Equivalents | $2.01B | $2.57B | -22.04% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $911.9M | $581.6M | +56.79% |
Investing Cash Flow | $-914.5M | $213.5M | -528.34% |
Financing Cash Flow | $-1.35B | $-235.8M | -474.09% |
Share Buybacks | $1.12B | $0 | — |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Gross Margin | 66.1% | 64.7% | +1.38% |
Operating Margin | 30.9% | 25.7% | +5.21% |
Net Margin | 29.6% | — | — |
ROE | 4.7% | — | — |
ROA | 4.1% | — | — |
Current Ratio | $4.61 | — | — |
Debt to Equity | $0.144 | — | — |
Other companies in Health Care Equipment
Intuitive Surgical reported strong Q1 FY2026 results with revenue of $2.77B, up 23.0% YoY, and net income of $821.5M, up 17.6% YoY. Operating income grew even faster at 48.0% to $855.3M, reflecting significant operating leverage across the business.
ISRG's 23.0% revenue growth to $2.77B in Q1 FY2026 was driven by continued global adoption of its da Vinci robotic surgical platform and strong procedure volume growth. The company also demonstrated pricing power, as gross margin expanded to 66.1% from 64.7% in the prior year period.
Yes, Intuitive Surgical repurchased $1.12B in shares during Q1 FY2026, compared to zero buybacks in Q1 FY2025. This contributed to a financing cash outflow of $1.35B and reduced cash and equivalents by 22.0% YoY to $2.01B.
ISRG's financial health remains excellent, with a current ratio of 4.61, a very low debt-to-equity ratio of 0.14, and stockholders' equity of $17.47B. Operating cash flow of $911.9M significantly exceeded net income, indicating high-quality earnings and a strong balance sheet.
Key risks include ISRG's heavy dependence on procedure volume growth and hospital capital spending, a 24.9% YoY increase in total liabilities, and a significant swing in investing cash flows to -$914.5M from +$213.5M in the prior year. Additionally, the $1.12B share buyback program reduced cash reserves by 22.0%, narrowing the liquidity cushion.