Key Points
- Intuitive Surgical reported strong second-quarter results, with revenue up 19% and non-GAAP earnings per share up 28%.
- Investors focused on the company’s unchanged da Vinci procedure-growth guidance, which implies slower growth than in recent years.
- The stock’s premium valuation and technical breakdown could keep pressure on shares, even as analysts remain broadly bullish.
- Special Report: He bet half his $9 billion on ONE stock
Intuitive Surgical (NASDAQ: ISRG) was part of the artificial intelligence (AI)/robotics trade before it became mainstream.
The company manufactures the da Vinci robotic surgical system, which has an installed base of over 11,700 systems as of June 30, 2026.
That was one highlight from the company’s Q2 2026 earnings report.
In the report, released after the market closed on July 16, the company delivered impressive numbers.
Second quarter 2026 revenue of $2.89 billion increased 19%, compared with $2.44 billion in the second quarter of 2025.
Second quarter 2026 non-GAAP net income attributable to Intuitive Surgical, Inc. was $1 billion, or $2.80 per diluted share, compared with $800 million, or $2.19 per diluted share, in the second quarter of 2025.
The Company repurchased 0.9 million shares of its common stock for $380 million in the second quarter of 2026.
Despite the strong report, ISRG fell approximately 10% in after-hours trading. The headline reason is that the company didn’t raise its full-year guidance for da Vinci procedures. The company’s prior guidance was 13.5% to 15.5%, which would mark its slowest growth in several years.
A Kink in the Company’s Critical Flywheel
To be fair, Intuitive Surgical is still posting impressive growth numbers for its da Vinci system. For the quarter just ended:
Worldwide da Vinci procedures grew approximately 15% year over year (YOY).
The company placed 468 da Vinci surgical systems, compared with 395 in the second quarter of 2025.
The second quarter 2026 da Vinci surgical system placements included 246 da Vinci 5 systems, compared with 180 in the second quarter of 2025.
The company grew its da Vinci surgical system installed base to 11,710 systems as of June 30, 2026, an increase of 12% YOY.
But it’s hard to overstate how important the da Vinci is to Intuitive Surgical’s growth. The system is a one-time purchase. But it spawns a host of services, instruments, and accessories that drive revenue and earnings.
To be fair, ISRG has been dropping since July 14. That’s when HCA Healthcare (NYSE: HCA) trimmed its full-year outlook, which implied fewer surgical procedures and sent all medical device stocks lower.
That's not necessarily what Intuitive Surgical is reporting. It’s just reporting slower growth. Yet growth is still growth.
Why Intuitive Surgical Stock Still Commands a Premium Valuation
At the close of trading on July 16, Intuitive Surgical traded for around 46x forward earnings. That’s a premium to the S&P 500, but for investors new to ISRG, it’s a discount to prior price-to-earnings (P/E) ratios, which at one point in the last few years were around 60x.
Nevertheless, ISRG is expensive at a time when investors are becoming more sensitive to the value they’re getting for the price. Some investors will point to companies like Medtronic (NYSE: MDT) and Boston Scientific (NYSE: BSX), which are also in the medical device sector and trade at far lower multiples than Intuitive Surgical.
However, those companies have a broader product portfolio. Whereas Intuitive Surgical is laser-focused on the DaVinci system. The point is it’s not an apples-to-apples comparison. However, even as a standalone stock, ISRG has always commanded a premium price.
Intuitive Surgical Stock Breaks Below Long-Term Support
The weekly chart shows that ISRG is now trading below its 200-week simple moving average (411.89) for the first time in years. This level served as reliable support throughout the 2023-2025 uptrend. Prior to the earnings report, shares had fallen roughly 32% from last year's peak near $590. The post-earnings drop to around $359 would represent a decisive break below that long-term trendline.
The weekly RSI sits at 35.97, its lowest reading since the 2022 bear market, though not yet in oversold territory below 30. That leaves room for further downside before technical buyers would typically step in. The trend structure—lower highs since early 2025—suggests momentum remains firmly with sellers for now. A reclaim of the 200-week average would be the first signal that the technical picture is stabilizing.
Why the Intuitive Surgical Sell-Off May Be Overdone
At a time when high-speed algorithms are programmed to make buy/sell decisions based on raw data, this could be an overcorrection. It’s possible that the stock will reverse direction in the coming days. Analysts remain bullish on ISRG with a consensus price target of $530.92, representing nearly 50% updside potential.
That means if the stock continues to drop, as analysts maintain bullish targets, the opportunity for patient investors becomes even greater. The company may not have an impenetrable moat, but it’s still well fortified. For investors who have had ISRG on a watchlist, the time to buy may be coming.
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