What Happened?
Shares of medical technology company Intuitive Surgical (NASDAQ: ISRG) jumped 16.4% in the morning session after the company reported strong third-quarter 2025 results that surpassed Wall Street's expectations on both the top and bottom lines.
The medical technology company announced revenue of $2.51 billion, a significant 22.9% increase compared to the same period last year and comfortably ahead of the $2.41 billion analysts had forecasted. Profitability was also a bright spot, with adjusted earnings per share (EPS) coming in at $2.40, a 20.7% beat over consensus estimates of $1.99. Furthermore, the company demonstrated improved efficiency, as its operating margin expanded to 30.3% from 28.3% in the prior year's quarter. The robust performance, highlighted by strong growth and better-than-expected profits, fueled investor optimism and sent the shares higher.
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What Is The Market Telling Us
Intuitive Surgical’s shares are not very volatile and have only had 8 moves greater than 5% over the last year. Moves this big are rare for Intuitive Surgical and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 4 months ago when the stock dropped 6.2% on the news that Deutsche Bank cut the stock's rating from Hold to Sell and slashed its price target to $440 from $515, after identifying accelerating competition from lower-cost remanufactured instruments in the Instruments & Accessories segment.
Conversations with multiple robotic-surgery programs suggest a growing shift toward these third-party devices, threatening both Intuitive's market share and margins, and putting up to 46 % of its U.S. I&A revenue at risk. While the bank's model shows little financial drag in 2026, it expects pressure to emerge in 2027 and intensify through 2028.
Intuitive Surgical is up 1.6% since the beginning of the year, but at $532.93 per share, it is still trading 12.7% below its 52-week high of $610.45 from January 2025. Investors who bought $1,000 worth of Intuitive Surgical’s shares 5 years ago would now be looking at an investment worth $2,179.
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