Intuitive Surgical Stock Drops After da Vinci Recall Concerns Raise Investor Worries
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Table of Contents Intuitive Surgical stock drops on news of a fresh FDA recall of parts used in the company's da Vinci robotic surgery system, with investors reacting negatively. The leader in robotic surgery still reports strong financials, but the new recall notices and a conservative growth strategy have investors re-assessing the company's near-term prospects. The U.S. FDA has announced further Class II recall notifications for certain da Vinci system components, including the da Vinci SP Instrument Arm Drape and other components used in robotic-assisted surgical systems. The recalls concern particular parts that could impact system operation in certain circumstances, the agency said. Intuitive Surgical has notified consumers of corrective procedures and the communications are not a full recall of the affected systems. Recalls are not uncommon in the medical device sector, but the action taken on the company's flagship robotic surgery platform will be eagerly watched by investors. The platform generates recurrent revenue from procedures, instruments and service contracts. Intuitive Surgical still has good operating performance despite market reaction. The company just reported quarterly revenue of $2.89 billion, up about 19% year-over-year, while adjusted earnings came in at $2.80 per share, ahead of analyst estimates. The number of procedures continued to climb, driven...
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