Intuitive Surgical on Tuesday joined a growing list of medtech companies factoring tariff costs into 2025 plans, offering a look at how the robot maker is navigating the evolving U.S. trade policy during its first-quarter call.
The company lowered its full-year profit margin forecast to reflect tariffs with a stated percentage and implementation date. The forecast includes tariffs already announced, and assumes they stay in place.
Intuitive raised its outlook for da Vinci procedure growth to about 15% to 17% in 2025, from its previous forecast of 13% to 16% growth. Da Vinci procedure growth was 17% in 2024.
Tariff talk dominated the earnings call, during which executives discussed what was otherwise a solid quarter for the company. Intuitive saw strong procedure growth, especially in its core U.S. general surgery market, with the number of physicians using its products at the high end of expectations, CEO Gary Guthart said.
The company continues to ramp manufacturing operations and supply chain capabilities to support the broad launch of its da Vinci 5 robot midyear.
To manage the impact of tariffs, Guthart said Intuitive does not plan pricing changes in the near term, but will look to optimize production costs and rebalance product flows within its existing manufacturing and supply chain footprint.
“We will adjust our supply chain strategy and assess adjustments to our pricing when we see the signs of a durable planning environment for trade,” the CEO said. “Our first priority is to ensure supply of our products to our customers globally.”
Tariff breakdown
CFO Jamie Samath said Intuitive is a significant U.S. manufacturer and net U.S. exporter. The company made 98% of its robotic systems in the U.S. last year, 70% of its endoscopes in Europe and about 80% of its instruments and accessories in Mexico. It sources raw materials and other components from suppliers around the world.
Components from China-based suppliers imported into the U.S. for use in Intuitive products are expected to incur U.S. tariffs of 145%, while subassemblies imported into China for domestic production will incur Chinese tariffs of 125%.
The Chinese tariffs could have a material impact on product costs in China, hurting the company’s ability to compete for tenders there, Samath said.
Component imports to the U.S. and imports of endoscopes from Intuitive’s factories in Europe are subject to the 10% baseline tariffs plus increased tariff rates after the current 90-day pause.
Most Intuitive products made in Mexico meet U.S.-Mexico-Canada Agreement requirements and are not subject to import tariffs, Samath said, with the exception of “a small portion” that will incur 25% tariffs upon import to the U.S.
The CFO cautioned that the trade environment, financial pressures on hospitals and macroeconomic risks could cause customers globally to reprioritize capital budgets or extend timelines for investing in surgical robots.
But Guthart said “high-quality minimally invasive care at industrial scale” will remain a global need regardless of trade policy.
Intuitive opened two new facilities during the quarter at its Sunnyvale, California, headquarters that “significantly” expand its U.S. manufacturing and research footprint, in addition to a recently opened factory in Georgia.
“These facilities provide a space to grow over the midterm,” Samath said.
The company also plans to open new manufacturing facilities in Germany and Bulgaria and expand instrument manufacturing capacity in Mexico.
