Intuitive Surgical, Inc. (NASDAQ:ISRG) Q4 2014 Earnings Conference Call - Final Transcript

Jan 22, 2015 • 04:30 pm ET


Intuitive Surgical, Inc. (NASDAQ:ISRG) Q4 2014 Earnings Conference Call - Final Transcript


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Ladies and gentlemen, thank you for standing by. And welcome to Intuitive Surgical Q4 2014 Earnings Release Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session; instructions will be given at that time.

(Operator Instructions)

As a reminder, today's conference call will be recorded. And no I will like to turn the conference over to our first speaker, Senior Director of Finance with Intuitive Surgical, Mr. Calvin Darling. Please go ahead, sir.

Calvin Darling

Thank you. Good afternoon. And welcome to Intuitive Surgical's fourth quarter earnings conference call. With me today, we have Gary Guthart, our President and CEO; Marshall Mohr, our Chief Financial Officer; and Patrick Clingan, Director of Finance.

(Forward-Looking Cautionary Statements)

Please note that this conference call will be available for audio replay on our website at on the Audio Archive section under our Investor Relations page. In addition, today's press release and supplementary financial data tables have been posted to our website.

Today's format will consist of providing you with highlights of our fourth quarter results as described in our press release announced earlier today, followed by a question-and-answer session.

Gary will present the quarter's business and operational highlights. Marshall will provide a review of our fourth quarter financial results. Patrick will discuss marketing and clinical highlights.

Then I'll provide our financial outlook for 2015. And finally, we will host a question-and-answer session.

With that, I'll turn it over to Gary.

Gary Guthart

Thank you for joining us on the call today. 2014 has been a year of transition for Intuitive with macro economic uncertainty at the start of the year giving way to improving performance as the year progressed.

At the outset, we focused on driving adoption of our platform in general surgery. And launching key new products and in increasing our organizational capability and performance in international markets, particularly Europe and Japan.

The organization has responded well in the year with solid procedure performance and a strong launch of our newest generation da Vinci platform. General surgery and international procedures have become the growth engine for the business.

Starting with review of procedures. Year-over-year growth was approximately 9%, led by growth in general surgery, growth in the use of da Vinci outside of the United States and the strengthening urology offset by flat annual performance in gynecology.

General surgery growth was approximately 33% for the year comprised of strong growth in da Vinci colorectal surgery, hernia repair and in other general surgery procedures offset by slowing da Vinci Single Site use in cholecystectomy. While Single Site cholecystectomy procedures were up in 2014, they were down in the fourth quarter.

Gary Guthart

Outside of the United States, procedure growth remains robust, rising approximately 20% over procedures in 2013 based on strength in Europe and Asia.

Patrick will review procedure trends in greater detail later in the call. Looking at trends in capital sales for the year, capital placements increase in sequential quarters, helped by the launch of da Vinci Xi in the