Intuitive Surgical weakness attributed to Surgical Science comments

Shares of Intuitive Surgical (ISRG) are down $9.26 or 2%, to $471.19, which may be attributable to comments made by Surgical Science Sweden (SUSRF), whose simulation software is integrated into da Vinci 5 surgical systems. “We are pleased with integrating the Surgical Science simulation technology as part of da Vinci 5, and look forward to continuing our collaboration together,” Intuitive Executive Vice President and Chief Digital Officer Brian Miller was previously quoted as having said on January 15. According to a transcript of Surgical Science’s Q2 earnings call, executives from the company stated: “Simulator sales in the industry declined by 36%. We do consider this business to be more lumpy in nature as well. Due to that order sizes are quite big and order timing can affect a certain quarter considerably up or down. We did build up a large order book during the quarter and had some large simulator orders late in the quarter that ended up as backlog. License revenues during the quarter was weaker than expected, and there were two specific reasons for this. One reason was that robotic surgery customers who have just started selling products from which surgical science earns the license revenue by these licenses in packages, there may be, therefore the timing effects between quarters depending on when these package orders are placed and the licenses are used in this quarter. Revenue from these new customers was unusually low and this is due to that. In many cases, the development times and regulatory approvals for our robotics customers have taken longer time than previously estimated. The other reason for the lower license revenue was attributed to a lower renewal rate in the simulation subscriptions from Intuitive on the older generation of robotic systems.”