Intuitive Surgical expects revenue below estimates as da Vinci sales fall

Tue Apr 8, 2014 6:28pm EDT

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(Reuters) - Intuitive Surgical Inc (ISRG.O) estimated first-quarter revenue well below analysts' average expectation mainly due to a steep 60 percent drop in sales of its flagship da Vinci robot system.

The company's shares fell nearly 10 percent in extended trading.

Intuitive Surgical said it expects revenue of $465 million for the quarter. Analysts on average were expecting sales of $537.9 million, according to Thomson Reuters I/B/E/S.

The medical device maker reported revenue of $611 million a year earlier.

Revenue from da Vinci Surgical Systems fell nearly 59 percent to about $106 million in the first quarter of 2014, Intuitive said on Tuesday.

The device maker sold 87 systems in the quarter, compared to 164 a year earlier. U.S. sales fell to 45 from 115.

The company cited lower procedural volumes, the implementation of the Affordable Care Act and expectations of a new version of the robot system for lower U.S. shipments.

Intuitive Surgical launched an upgraded version of the device, da Vinci Xi Surgical System, on April 1. ID:nL4N0MT3PX]

The company said the revenue estimate included a $26 million deferral related to trade-in of da Vinci 'Si' systems for the upgraded version.

Intuitive Surgical said it would also record a $67 million pre-tax charge to reflect estimated costs of settling a number of claims related to its surgical robot system.

The company's shares closed at $489.84 on the Nasdaq.

(Reporting by Natalie Grover in Bangalore; Editing by Sriraj Kalluvila)

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