Intuitive Surgical Plunges 14% on Unchanged da Vinci Forecast

Intuitive Surgical stock fell 14% on Friday, marking its lowest level since early 2024 and making it the biggest decliner in both the S&P 500 and Nasdaq 100. The selloff brings the shares down roughly 40% since the start of the year. The move followed the release of second-quarter earnings that exceeded Wall Street expectations but failed to satisfy investors demanding higher forward guidance.

The company reported adjusted earnings of $2.80 per share on revenue of $2.89 billion, representing a 19% year-over-year increase. However, the Sunnyvale, California-based firm declined to raise its full-year forecast for worldwide procedures using its da Vinci surgical systems. Management kept the projection at roughly 13.5% to 15.5%, noting it "expects to be closer to the midpoint of this range."

That midpoint target signals an ongoing deceleration in procedure volumes. Growth in da Vinci procedures slowed to 15% in the second quarter, down from 17% in the first quarter. For a company historically rewarded for consistent expansion, this trajectory suggests underlying procedure demand is cooling.

William Blair analysts attributed the market reaction to the stock's premium valuation, noting in a client note that "a reiterated procedure guide didn't quite pass the mark for a beat-and-raise." The firm kept its "outperform" rating but highlighted specific challenges pressuring volume, including rising competition in China and declining procedure volumes tied to lower ACA enrollment.

Despite the steep drop, the broader analyst community still sees significant value in the shares. The average price target among analysts surveyed by Visible Alpha stands at $509, representing nearly 50% upside from Friday's closing price. This divergence highlights a fundamental market debate over whether the current growth slowdown is a temporary headwind or a lasting shift for the medical device maker.