Changing Surgery
As long as medicine has been practiced, surgery has been a key tool for doctors to cure countless ailments and save lives from traumatic injuries. Until recently, surgery tools have changed very little: a sharp eye and mind, an even sharper scalpel, and various apparatus and equipment to close wounds and incisions.
This has started to change with more advanced tools like laparoscopy and various surgical implants, allowing a surgeon to perform his tasks with very little incision, greatly reducing the risks of infections, recovery time, and other post-surgery issues.
It works by inserting only the surgical instruments and relaying inside the body the orders of the surgeon, while a miniature camera gives him a clear view of the internal organs.
Source: FSA Vein
In the past decades, a new type of tool going beyond laparoscopy has emerged that has revolutionized surgeons’ work when available: surgery robots.
These robots are allowing surgeons to perform their work more safely, quickly, more comfortably, and with fewer risks for the patient. One pioneer company has been and still is at the forefront of this medical revolution: Intuitive Surgical.
And the company’s position as the central innovator in robotic surgery has so far paid off handsomely for its shareholders.
Intuitive Surgical, Inc. (ISRG +1.79%)
Robotic Surgery
Robotic surgery means that instead of an instrument relaying the surgeon’s order mechanically, a more complex digitalized robotic system assists the surgeon.
This provides a few key advantages to the surgical procedures:
- Steadier hands and movement, with the possibility to perform millimeter-moves easily through the manipulation of a joystick.
- The robotic hand can hold very tiny surgical instruments.
- Possibility to zoom in and out at will, with a high-definition camera showing all the required information. Multiple cameras can help monitor other organs or give multiple points of view during the surgery.
- Smaller incisions reduce the recovery time and the risks of possible post-surgery complications (infection, scar tissues, etc.).
Overall, Robotic Assisted Surgeries (RAS) have better outcomes than laparoscopic or manual surgeries, with fewer side effects, complications, blood transfusions, and quicker surgery time with more comfort for the surgeon.
Source: Intuitive Surgical
Besides the improvement in outcome, robotic surgery can combine high-speed and ultra-reliable long distance communication to allow for tele-surgery. For example, a recent record was achieved with a surgery done in Casablanca, Morocco, while operating remotely from Shanghai, China, spanning an incredible 12,000 kilometers.
This suddenly means that surgeons are much less tied to one place of work and that world-class surgery skills, especially for rare or specialized procedures, can now be accessible anywhere a robotic surgery system is installed.
Robotic Surgery Growth
What made the emergence of robotic surgery possible is the fast-improving quality of robotic systems, including precise motors and actuators, low prices on high-definition cameras, and overall reduction of costs for IT and robotic systems.
For example, ultra-low latency time is an absolute must that early robots struggled with.
From 2012 to 2018, the use of robotic surgery increased from 1.8% to 15.1%. Some specific procedures saw an even greater increase over that same period. For example, the use of robotic surgery for inguinal hernia repair grew 41-fold, from 0.7% to 28.8%.3.
This is a quickly growing market, currently worth $11.5B, and expected to grow to $14.1B just by 2026.
Source: Oliver Wyman
A growing familiarity with electronic systems of younger surgeons, as well as a growing openness to the idea of using a robotic system also helps grow the market, as more and more surgeons move away from the idea of an “expert-hands-only” concept of surgery and trust the robot to perform well.
Intuitive Surgical is by very far the dominant actor in this market, with almost 3/4 of the market, followed by medical instrument maker (including laparoscopy) Stryker (SYK +0.33%).
Source: Oliver Wyman
The History of Intuitive Surgical
Intuitive was founded on the basis of research performed by the non-profit research institute SRI International.
Intuitive Surgical Device, which acquired SRI’s intellectual property, was founded in 1995, testing a prototype called initially “Lenny” (after Leonardo da Vinci) in 1997. The da Vinci naming convention would be kept up to these days.
Intuitive started marketing its first surgical robot in 1999 and did an IPO in 2000. In 2000 and a few years later, the FDA cleared the robot for performing surgeries for gallbladder disease, gastroesophageal disease, prostate, thoracoscopic surgery, cardiac procedures performed with adjunctive incisions, and gynecologic procedures.
During this period, it also merged with competitor Computer Motion, solving a long-standing issue about potential patent infringement.
By 2006, the company had 500 da Vinci Systems installed in hospitals worldwide.
In 2024, the company has grown to 10,670+ systems installed in hospitals all over the world, of which 1,790+ were sold in 2024 only.
The Impact of Intuitive Surgical
2,680,000+ surgical procedures have been performed by da Vinci systems in 2024, and 16,940,000 to date. This represents a yearly growth of 17%, expected to mostly continue in the upcoming year.
Source: Intuitive Surgical
A strong force behind the explosive growth of Intuitive installations is that more and more hospitals are increasingly switching their surgeries to robotic systems, with a massive exponential growth of hospitals with 7+ or even 20+ robots.
Source: Intuitive Surgical
A key driver of this growth is that once a surgeon is trained and used to perform surgery with the da Vinci robot, he often tends to prefer to perform all of his work with the machine.
Another growth driver in large clients is that due to reduced complications and quicker surgeries, adopting the da Vinci robot for most surgeries represents ultimately a cost-saving and legal risk reduction for the hospitals, giving them the incentive to push their surgeons to adopt it.
Da Vinci 1 To 5
The 1999 da Vinci 1 system introduced to the world the concept of robotic surgery. It was a revolution but was also very much a work in progress.
Since then, the company has improved the design of its robots with each new generation, adding extra ergonomics, functions, safety, etc., while also integrating the progress made by the larger robotic and electronic industry.
A da Vinci robot costs 1.5-2.5 million dollars, and then a regular service contract is paid early for maintenance, repair, etc.
This elevated price also means that hospitals have a strong incentive to maximize the robot’s utilization, spreading its costs (and benefits) over more surgical procedures.
Today, Intuitive generates most of its income from recurring sources, either from services and sales of instruments and consumables, or operation leases.
Leases include financing options for hospitals to either pay fixed-payment, or a pay-per-use basis, a good option for hospitals willing to first test the robot without having to risk a massive investment.
Source: Intuitive Surgical
All of the da Vinci (and other) robots from Intuitive use a common set of surgical instruments, stapling & cauterization tools, and cameras.
Source: Intuitive Surgical
Da Vinci 5
Successful, But Slow Launch
Released at the beginning of 2024, the da Vinci 5 is the latest iteration of Intuitive Surgical’s main surgery robot, composed of multiple control units and the surgery robotic arms themselves.
Source: Intuitive Surgical
It is still in the roll-out phase, with a gradual ramping-up of the supply chain to ensure perfect quality control and adequate supply to Intuitive’s customers.
In January 2025, 362 da Vinci 5 systems have been placed with customers since launch, of which 174 systems in Q4 2024, and more than 32,000 procedures have been performed on the platform.
The company is evaluating potential tariffs’ impact on its supply chain, an important point as the Trump administration is moving toward broad 25% tariffs with its neighbors.
“We are internally evaluating what the impact of any potential tariff might be and therefore, how we might respond.
We can say that a significant portion of our instruments are currently manufactured in Mexico. And so, to the extent that significant tariffs are implemented there, that could have a material impact for us.”
Jamie Samath – Chief Financial Officer of Intuitive Surgical
Da Vinci 5 Improvement
While it was built on the previous platforms, the new version has been described as transformational and a larger change than previous upgrades.
“We think we’ve brought some first-of-their-kind technologies into the surgical field at scale.”
Gary Guthart – CEO of Intuitive Surgical
A key novel element is the introduction of force feedback, giving a “push back” against the surgeon’s controller stick when pressing the body’s soft tissues.
Source: Intuitive Surgical
This is a first-of-a-kind in robotic surgery and is quite hotly discussed among surgeons. This is because, while it brings the robotic surgery experience much closer to the manual one, this is a radical departure from habits established in the past 2 decades of robotic surgery, using only vision as a feedback mechanism.
“Some surgeons will passionately say, ‘It doesn’t matter.’ And they may be right, but I don’t think so.
Gary Guthart – CEO of Intuitive Surgical
“I think the tissue tension and the ability to feel that instead of having to look for visual cues is a massive transformational improvement for robotic surgery.”
Dr. Sam Bagchi – Chief Clinical Officer at Christus Health
Da Vinci 5 also brings several other radical improvements, making the platform a lot more capable.
This includes an improved design of the controller ergonomics, which also allows for a good perception of the force feedback.
Source: Intuitive Surgical
The vision system, a dual-eye 3D Goggle has improved 3D perception, more accurate colors, better depth perception, and 4x the previous version’s pixel count.
The vision and control system’s ergonomic is also designed to limit the maximum discomfort for the surgeon, with curved armrests and a flexible vision system on a mobile arm.
Source: Intuitive Surgical
Da Vinci 5 AI
Lastly, the Da Vinci 5 system has a radically different computing power, 10,000x greater than the previous Da Vinci robot. It is because this platform is the first one designed with present and future integration of AI in mind.
It is already apparent with integrated media management, telepresence, and connectivity software (My Intuitive). It provides real-time insight on performance, force used, outcome, etc.
Source: Intuitive Surgical
My Intuitive also performs video capture with automation, and direct recording into the electronic medical record (EMR) systems. Bookmarks, manual annotation, and voice comments can also be added to the data. Access, storage, and sharing of the data is also facilitated.
This improved computing power can allow for virtual collaboration, with multiple surgeons working together on the same surgery from different locations.
The high levels of local computing power should help further integrate AI tools in the future, and keep the machine up to date without the hospital needing to engage in a new investment cycle for every new AI tool release. Remote software upgrades will be possible instead, similarly to how over-the-air (OTA) upgrades are becoming common in modern cars.
“You’ll see sequential releases from us in augmented reality, in data analytics, in machine learning and telemedicine.
We put a bunch of compute power in. Now is the time to start taking advantage of that compute power for the benefit of surgeons and for patients.”
Gary Guthart – CEO of Intuitive Surgical
In another example, voice control is likely to grow over time as LLM systems get smarter and more reliable and will be powered by da Vinci 5’s eight microphones with voice-enhancement technology.
Overall, the direction of high local compute in each da Vinci 5 robot is likely a good design choice for AI deployment in surgery, as the recent release of DeepSeek illustrates that future AI systems might not require as much compute as initially expected.
Other Surgery Robots
Besides Da Vinci 5, the company has a few other robots for dedicated applications that fill a role for which a more expensive generalist robot is not required.
Source: Intuitive Surgical
Ion
This is a robot designed for performing “minimally invasive peripheral lung biopsy” in lung cancer patients, with lung cancer the deadliest form of cancer in the US and one diagnosed every 2.5 minutes.
The Ion robot allows for a safe, direct biopsy of the cancer nodules, even if they are located at the deepest level of the lungs.
Source: Intuitive Surgical
The robot comes with dedicated software, increasing the ability to get to the cancer safely without causing any damage to the lungs. This is done through pre-planned paths and shape-sensing, which is able to correct minor differences between the data from integration with CT scans and the actual lungs’ shape.
Source: Intuitive Surgical
My Intuitive is now available for Ion as well. This also provides a much more precise sampling, and the saved time can provide up to one more intervention per day per surgeon.
Since they started to take off in 2021, Ion robots have started to sell at an increasing pace, with a remarkable 51% year-to-year growth in sales. This is despite supply constraints that have hindered some sales.
Source: Intuitive Surgical
Da Vinci X, Xi & SP
For surgeries requiring less than the complete list of capacity of da Vinci 5, smaller and cheaper systems are available.
To resume it roughly, the SP system provides only one robotic arm at a cheaper price tag, while the multi-tool X system has less automation and advanced functions than the Xi.
While these systems are less important to Intuitive’s core business, they provide a valuable service for specific surgeries not requiring the too-expensive multi-function robot, while still contributing to the generalization of robotic surgery.
Expansion of Intuitive Surgical
For a long time, the company has mostly handled its sales in the US directly and relied on a series of distributors for its sales abroad.
This strategy is changing, with, for example, the ongoing plan to acquire 2026 its local distributors Ab Medica, Abex, and Excelencia Robotica in Italy, Spain, and Portugal.
Having a direct presence in Italy, Spain, Portugal, Malta, and San Marino, and associated territories allows us to deepen our understanding of unique customer needs in these countries.”
Gary Guthart – CEO of Intuitive Surgical
Intuitive recently managed to have a lawsuit by Surgical Instrument Service dismissed, in which it was accused of using an alleged monopoly in the multiport soft-tissue surgical robotics space.
This judgment should help clear the risk of monopoly laws striking the company, together with the presence of a very active competitor like Stryker, which is hardly a small company.
New Approvals
A historically important and still crucial part of Intuitive’s business expansion is obtaining new approvals from the FDA and equivalent health agencies abroad for new types of surgery.
This is because even if it is technically able, a generalist surgery robot like da Vinci 5 can only perform a certain type of surgery if authorized to do so.
This is a complex and lengthy process, requiring, most of the time, many years of testing, medical studies, and feedback from surgeons. For example, it took no less than 4 years after approval in the USA for Ion to obtain clearance for many types of surgeries in Europe, Taiwan, and Australia.
Source: Intuitive Surgical
It is also a strong business moat for the company, as any competitor will need to go through the same tedious and costly process to enter Intuitive’s markets. By then, interested hospitals are likely already equipped with Intuitive robots, with surgeons trained and used to the tools and software of the company.
Conclusion
Intuitive Surgical is a company driven from inception by ground-breaking innovations, creating from scratch the modern market for robotic surgery. This has made it a powerful disrupter of established medical device manufacturers like Stryker (SYK +0.33%) and Medtronic (MDT -0.25%), and turned it into a quasi monopole in the sector.
It is still pursuing the same path, as illustrated by the innovation of da Vinci 5, maybe the first truly AI-ready surgery robot.
This has proven to be an extraordinary success for the company shareholders in the past 20 years. Intuitive has also made robotic surgery the clear future of the profession, progressively demonstrating the method’s superiority to old-school surgery.
There is still a lot of potential growth left, as most surgery procedures have a below 10-20% rate of robotic assistance currently.
Combined with the possibilities of remote surgery, it is likely that in the future, almost all planned surgeries will be performed with robots in the long term. As AI gets smarter and smarter, it will progressively become a trusted partner to the human surgeon while also most likely never fully replacing it.