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ISRG · Q2 2026
Archived report (Q2 2026). Latest deep dive →
The quarter in brief
A strong quarter with revenue up 19% and GAAP net income up 24%, driven by robust instrument/accessory pull-through from procedure growth (da Vinci +15%, Ion +36%) and margin expansion, partially offset by rising SG&A/R&D investment and a one-time $28M IEEPA tariff refund benefit that flatters GAAP results.
Net Income (ISRG)
$818M
up 24.3% y/y
Revenue
$2,892M
up 18.5% y/y
Operating Income
$972M
up 30.7% y/y
Gross Profit
$1,960M
up 21.2% y/y
All figures in $M.
| Line item | Amount and change |
|---|---|
| Instruments & Accessories | $1,735 · +17.7% |
| Systems | $685 · +19.2% |
| Services | $472 · +20.8% |
| Revenue | $2,892 · +18.5% |
| Cost of Revenue | $932 · +13.4% |
| Gross Profit | $1,960 · +21.2% · 67.8% margin |
| SG&A | $618 · +10.1% |
| R&D | $371 · +18.3% |
| Operating Income | $972 · +30.7% · 33.6% margin |
| Interest & Other Income* | $83 · -6.8% |
| Pre-Tax Income | $1,055 · +26.7% |
| Income Tax | $231 · +37.7% |
| Noncontrolling Interest | $5 · -12.1% |
| Net Income (ISRG) | $818 · +24.3% · $2.29 diluted EPS |
Verdict: a strong quarter with revenue up 19% and GAAP net income up 24%, driven by robust instrument/accessory pull-through from procedure growth (da Vinci +15%, Ion +36%) and margin expansion, partially offset by rising SG&A/R&D investment and a one-time $28M IEEPA tariff refund benefit that flatters GAAP results.
Cash & investments $8.63B (+$0.65B q/q); repurchased 0.9M shares for $0.38B; FY2026 outlook: da Vinci procedure growth ~13.5-15.5%, non-GAAP gross margin 68-69%, non-GAAP opex growth 11-13%.
Source and notation
* marks non-cash / ≈ estimated. Source: Intuitive Surgical press release / 10-Q (SEC EDGAR).
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- GAAP net income of $818M includes a $28M net-of-tax one-time benefit from IEEPA tariff refunds recognized in cost of revenue ($35.9M pre-tax across product/service COGS).
- Non-GAAP net income of $1.00B (+26%) strips out $213M SBC, $24M intangible amortization, $6.9M facilities abandonment charge, and tax adjustments — a wide GAAP/non-GAAP gap driven mainly by stock comp.
- Instruments & accessories (60% of revenue) grew 18% on procedure volume; Systems revenue grew 19% on higher da Vinci 5 mix and average selling prices; Services grew 21%.
- Operating margin expanded to 33.6% from 30.5% y/y, aided by tariff refund benefit and operating leverage despite R&D up 18% and SG&A up 10%.
- Net income attributable to Intuitive excludes $5.1M of income attributable to noncontrolling interest in the Intuitive-Fosun China joint venture.
- Effective tax rate of 22% reflects a $17.3M excess tax benefit from share-based compensation, lower than a 'normalized' non-GAAP rate.
What distorts the picture in this report and what to watch beyond the headlines.
ISRG — Intuitive Surgical develops robotic-assisted surgical systems, primarily the da Vinci surgical platform used in minimally invasive procedures.
Headquartered in Sunnyvale, California, it operates globally in the medical technology sector.
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