TLDR
- Intuitive Surgical (ISRG) stock traded near $405 in Wednesday premarket, down about 8%.
- Q3 adjusted EPS of $3.00 and revenue of $3.05 billion both topped estimates.
- A $450 million antitrust settlement cut GAAP EPS to $1.49 from $1.95 a year ago.
- Planned pricing cuts are expected to lower revenue per procedure by 3% to 5% once fully in place in 2027.
- U.S. procedure growth slowed to 10%, and JPMorgan raised its price target to $475.
Intuitive Surgical (ISRG) stock was trading near $405 in Wednesday’s premarket, down about 8%. The drop followed a third-quarter report that topped estimates but included a $450 million legal charge.
Intuitive Surgical, Inc., ISRG
The stock closed Tuesday up 1.1%. Even so, it is down 23% in 2026 and is on pace for its weakest year since 2022.
Adjusted earnings were $3.00 per share, compared with the $2.65 analysts expected. Revenue rose 22% to $3.05 billion, above the $2.91 billion estimate.
A beat like that usually gives a stock a lift. This time, traders were focused on other things.
The $450 Million Settlement
Intuitive agreed to settle the da Vinci antitrust class action for $450 million. The case dates back to 2021 and involved claims from hospital operators about servicing and repair of instruments.
The company did not admit wrongdoing, and the deal still needs court approval. The charge reduced third-quarter earnings by 99 cents a share.
GAAP net income came in at $523 million, or $1.49 per diluted share. A year earlier, it was $704 million, or $1.95 per share.
Pricing Cuts and Slower U.S. Growth
Management also laid out planned price cuts on the earnings call. They include an extended-use instrument program in the U.S. and a China price reduction that begins in November.
Once fully in place in 2027, the changes should lower instrument and accessory revenue per procedure by about 3% to 5%. That estimate is on a mix-constant basis.
Instruments and accessories are the recurring revenue engine, so the number drew attention. Revenue in that line rose 18% to $1.8 billion in the quarter.
U.S. da Vinci procedure growth was 10%, the slowest domestic pace since the COVID era. International procedures grew 20%, and total procedures rose 15%.
The company narrowed its 2026 worldwide procedure growth forecast to 14% to 15%. The prior range was 13.5% to 15.5%.
There were strong spots. Intuitive placed 546 da Vinci systems, up 28%, and Ion procedures grew 31%.
Rivals are adding pressure. Johnson & Johnson’s Ottava system won approval in July, and Medtronic’s Hugo system was cleared for urological procedures in December 2025.
The broader market offered no help. The S&P 500 rose about 0.1% and the Nasdaq gained about 0.4%.
JPMorgan kept its Overweight rating and raised its price target to $475. Intuitive stock was still down about 8% near $405 in Wednesday premarket trading.
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