Intuitive Surgical sees fewer da Vinci robot sales in 2014
(Reuters) - Intuitive Surgical Inc (ISRG.O) on Thursday said it expects to sell fewer of its high-priced da Vinci surgical robot systems in 2014 than last year and diverged from past practice by not providing a revenue forecast for the year.
The company said it would issue a revenue forecast later in the year when it has a clearer view of business trends, such as da Vinci use for benign gynecology surgeries, which has been slowing in the United States, and whether it secures reimbursements for procedures in Japan in addition to prostate surgeries.
Intuitive said it expects da Vinci procedure growth this year of 9 percent to 12 percent, down from 16 percent in 2013. Procedures grew by about 12 percent in the fourth quarter of 2013.
Intuitive Surgical shares fell 4.5 percent to $419.33 in extended trading, from a Nasdaq close at $439.
Intuitive, which had experienced double-digit revenue growth and steadily rising da Vinci sales in past years, saw those trends hit a wall in 2013 in part due to media reports questioning the cost effectiveness of using the robots for certain procedures, capital spending uncertainty by hospitals, and physicians holding off on recommending prostate surgery for slower-progressing cancers.
As a result, the company missed out on the big 2013 stock rally; its shares were one of the worst performers in healthcare, falling about 21 percent for the year.
The company on Thursday said its growth in general surgeries and improved business outside the United States was partially offsetting declines in U.S. prostate procedures, once the bread and butter for the company.
"For 2014, we are focused on expanding use of da Vinci in general surgery, particularly colorectal surgery and single-incision surgery, supporting worldwide gynecology and urology growth, broadening our stapling and Single-Site launches, and continuing to strengthen our capabilities in international markets, particularly Europe and Japan," Intuitive Chief Executive Gary Guthart said.
Intuitive reported fourth-quarter profit that easily exceeded diminished Wall Street expectations, despite another steep decline in da Vinci sales. Results were helped by a lower tax rate and operating cost reduction.
Net profit fell to $166 million, or $4.28 per share, from a profit of $175 million, or $4.25 per share a year ago. Analysts' on average were looking for earnings of $3.83 per share, according to Thomson Reuters I/B/E/S.
Intuitive earlier this month at an investor conference pre-announced its sales results for the quarter. Da Vinci sales fell 23 percent to $205 million as the company sold 138 systems compared with 175 a year ago. It was an improvement over the third quarter, however, when 101 of the $1.5 million da Vinci systems were sold.
The company, on a conference call with analysts, said it expected to sell more of its less expensive da Vinci systems in 2014, further contributing to revenue uncertainty.
(Reporting by Bill Berkrot; Editing by Bernard Orr and Leslie Adler)