AI Takeaway
Intuitive Surgical delivered strong Q2 FY2026 results with revenue up 18.5% YoY to $2,892.3M and operating income up 30.7% YoY to $971.9M, driven by continued da Vinci 5 adoption (installed base of 1,710 systems) and margin expansion despite ongoing tariff headwinds.
Revenue
$2.89B
++18.54% YoY
EPS (Basic)
$2.31
++25.54% YoY
Gross Margin
67.8%
++1.47% YoY
Operating Income
$971.9M
++30.74% YoY
Filed · Source: SEC EDGAR 10-Q filing
Intuitive Surgical (ISRG) reported Q2 FY2026 revenue of $2.89B, up 18.5% year over year. The company posted net income of $818.1M, up 24.3% from a year earlier, with diluted EPS of $2.29. Gross margin was 67.8%.
As of June 30, 2026, Intuitive had an installed base of 1,710 da Vinci 5 surgical systems, of which 136 are located outside the U.S., alongside 445 da Vinci SP systems, reflecting continued platform adoption following the March 2024 FDA clearance.
Source: 10-Q Item 2 MD&A
During the three and six months ended June 30, 2026, tariffs and other trade measures recognized in total cost of revenue were $20.8M and $48.8M, respectively; the company also recognized $35.9M of IEEPA tariff refunds in Q2 2026 that reduced cost of revenue.
Source: 10-Q Item 2 MD&A
In Q2 2026, China's NHSA issued guidelines establishing a unified national framework for robotic-assisted surgery pricing, requiring all provinces to implement NHSA-mandated pricing limits in upcoming quarters; management states this has not yet had a material impact since only a small portion of the China installed base is in currently impacted provinces.
Source: 10-Q Item 2 MD&A
In January 2026, the company obtained FDA clearance for da Vinci 5 use in selected thoracoscopically-assisted cardiac procedures, and in April 2026 obtained NMPA approval for its E-200 generator in China, broadening the addressable procedure base for existing platforms.
Source: 10-Q Item 2 MD&A
The Board increased the Repurchase Program authorization to $5.0 billion in April 2026; during Q2 2026 the company repurchased 863,876 shares for a total of approximately $378.9M at an average price of $438.68 per share, with $4.7B remaining available at quarter-end.
Source: 10-Q Item 2 MD&A / Item 2 Unregistered Sales of Equity Securities
Regulatory authorities have cleared or approved remanufacturing of certain da Vinci instruments by third parties, and third parties have offered remanufactured/unauthorized instruments and unauthorized service on da Vinci and Ion systems, often at lower prices. This could reduce Intuitive's instrument and accessory revenue, create patient safety risks, and cause reputational harm if such products malfunction.
Source: 10-Q Item 1A
China's NHSA issued a unified national framework in Q2 2026 requiring all provinces to implement mandated pricing limits on robotic-assisted surgery, following earlier provincial limits since 2022 that already affected instruments and accessories pricing and procedure volumes in some regions. Further rollout could pressure future China instruments and accessories revenue.
Source: 10-Q Item 2 MD&A
A 10% Section 122 tariff took effect February 24, 2026 following the Supreme Court's invalidation of prior IEEPA tariffs, and this tariff remains subject to ongoing litigation with an uncertain outcome; the company also imports endoscopes from Germany and materials from China that remain exposed to tariffs, having added $48.8M to cost of revenue in H1 2026.
Source: 10-Q Item 2 MD&A
Sales of da Vinci systems in China remain dependent on government-allocated quotas (559 systems under the 2023 Quota, of which 169 have been placed by Intuitive plus 3 under special approval), with future quota-based sales uncertain and open to competitors, limiting visibility into China system placement growth.
Source: 10-Q Item 2 MD&A
Ongoing conflicts including Russia-Ukraine and Middle East tensions involving Iran, combined with potential Chinese export restrictions on rare earth elements and critical minerals, could disrupt component availability for Intuitive's manufacturing, particularly given reliance on sole- and single-sourced suppliers.
Source: 10-Q Item 2 MD&A
Reported EPS of $2.80 versus the $2.55 analyst consensus — a +9.8% beat for Q2 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $2.89B | $2.44B | +18.54% |
Cost of Revenue | $931.9M | $822.1M | +13.36% |
Gross Profit | $1.96B | $1.62B | +21.17% |
Operating Income | $971.9M | $743.4M | +30.74% |
Net Income | $818.1M | $658.4M | +24.26% |
EPS (Basic) | $2.31 | $1.84 | +25.54% |
EPS (Diluted) | $2.29 | $1.81 | +26.52% |
R&D Expense | $370.6M | $313.3M | +18.29% |
SG&A Expense | $617.9M | $561.2M | +10.10% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $20.88B | $20.16B | +3.54% |
Current Assets | $9.54B | $8.75B | +9.11% |
Total Liabilities | $2.58B | $2.21B | +16.69% |
Current Liabilities | $1.92B | $1.69B | +13.61% |
Stockholders' Equity | $18.17B | $17.85B | +1.81% |
Cash & Equivalents | $2.76B | $3.4B | -18.89% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash FlowYTD | $1.97B | $1.3B | +52.11% |
Investing Cash FlowYTD | $-941.1M | $474.2M | -298.46% |
Financing Cash FlowYTD | $-1.64B | $-383.6M | -327.95% |
Share BuybacksYTD | $1.44B | $181M | +697.51% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Gross Margin | 67.8% | 66.3% | +1.47% |
Operating Margin | 33.6% | 30.5% | +3.14% |
Net Margin | 28.3% | — | — |
ROE | 4.5% | — | — |
ROA | 3.9% | — | — |
Current Ratio | $4.963 | — | — |
Debt to Equity | $0.142 | — | — |
Expected release date, analyst estimates & what to watch
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.
Intuitive Surgical delivered a strong FY2025 with revenue surging 20.5% to $10.1B, net income rising 23.0% to $2.86B, and the company initiating a $2.3B share buyback program, reflecting robust demand for its da Vinci surgical systems.
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The filing does not disclose analyst consensus estimates, but ISRG reported revenue of $2,892.3M (up 18.5% YoY) and diluted EPS of $2.29 (up 26.5% YoY) for Q2 FY2026. Both operating margin (33.6%) and gross margin (67.8%) expanded meaningfully versus the prior-year quarter.
Revenue grew 18.5% YoY to $2,892.3M in Q2 FY2026, driven by continued adoption of the da Vinci 5 surgical system, which reached an installed base of 1,710 systems as of June 30, 2026, including 136 systems outside the U.S. Gross profit grew even faster, up 21.2% YoY to $1,960.4M.
Key risks include competition from third-party remanufactured instruments and unauthorized servicing of da Vinci and Ion systems, new China NHSA pricing controls on robotic-assisted surgery, and tariff/trade policy uncertainty including a 10% Section 122 tariff in effect since February 24, 2026. The company also flagged quota constraints on China da Vinci system sales, having placed 169 of 559 available systems under the 2023 Quota.
ISRG maintains a strong balance sheet with a current ratio of 4.96, low debt-to-equity of 0.14, and $2,760.4M in cash and equivalents. Year-to-date operating cash flow rose 52.1% to $1,972.9M, though cash balances declined 18.9% YoY due to $1,443.5M in year-to-date share buybacks.
Tariffs and other trade measures added $20.8M to cost of revenue in Q2 FY2026 alone ($48.8M for the first six months of 2026), but the company also recognized $35.9M in IEEPA tariff refunds during the quarter that reduced cost of revenue. Management notes future tariff impacts remain uncertain pending ongoing litigation over the Section 122 tariffs.