isrg_investor presentation 050316

8/17/2019 ISRG_Investor Presentation 050316

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Investor PresentationQ2 2016


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Risks

Serious complications may occur in any surgery, including da

Vinci ® Surgery, up to and including death. Individual surgical

results may vary. Patients should talk to their doctor to

decide if da Vinci ® Surgery is right for them. Patients and

doctors should review all available information on non-

surgical and surgical options in order to make an informed

decision. Please also refer to

http://www.daVinciSurgery.com/Safety for Important Safety

Information.


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Contents Outline

• Company Overview & Business

Model

• Business Review

• Opportunities & Catalysts for

Growth

• Corporate Assets & 2016

Priorities


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COMPANY OVERVIEW ANDBUSINESS MODEL


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Corporate Overview• Founded in 1995, IPO 2000

• Over 3 million da Vinci® procedures performed to date

• Approximately 652,000 da Vinci® procedures performed in2015, up 14% from 2014

–

Q1 2016 procedures up approximately 17%• $2.38 billion 2015 Revenue, up 12% from 2014

– Q1 2016 revenue up 12%

• 3,660 da Vinci ® System installed base as of 3/31/16

– 2,431 United States, 1,229 OUS

• Numerous FDA and International Regulatory Clearances

• Primary Markets - Urology, Gynecology, General Surgery,Cardiothoracic


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Annual ServiceAgreement

$100K - $170K/Year

2015 Rev = $465M

da Vinci® Surgical System

$0.6M - $2.5M

2015 Rev = $722M

Instruments &Accessories

$700-$3,200per procedure

2015 Rev $1,198M

Recurring Revenue Model

http://creative.gettyimages.com/source/search/ImageEnlarge.aspx?MasterID=dv072019a&s=ImageDetailSearchState|3|5|0|15|2|1|0|0|1|37|60|2ed3.d7c5.03ff.e000.002f.0ef0|3|0|%22contract%22||1|0&pk=6


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Annual Service Rev Per System

da Vinci® Surgical System ASP

Inst & Accy Rev Per Procedure

Multiple Segment Product Offering

$0.6M

$170K$100K

$3,200$700

$2.5M

da Vinci Si-e

Single-Site

• Dual Console Xi

• Firefly

• Table Motion

Endowrist

• Vessel Sealer

• Stapler

2015: $1.54M

2015: $1,840

2015: $138K Dual Console Xida Vinci Si-e

Includes company estimates and approximate ranges


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• Length of stay

• Conversions to open surgery

• Complications

• Readmissions

• Surgical site infections (SSI)

• Instrument and accessory costs

Comprehensive Cost of Care

• Capital costs

• OR time costs


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Family of da Vinci Systems ~1400 Skill Simulators,Dual Surgeon Consoles

3D HD Imaging,

Fluorescent Imaging

24/7/365

Comprehensive

Support

Integrated Energy,

Stapling, Vessel Sealing

40+ Training

Course Offerings

10,000 Peer-Reviewed Publications

1700+ Comparative Studies

Analytics and

Efficiency Programs

da Vinci Ecosystem


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BUSINESS REVIEW


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2015 Objectives• Expanding da Vinci in general

surgery, particularly colorectal

surgery and hernia repair

• Filling out our product line for

da Vinci Xi and launching in keymarkets globally

• Developing our organizational

capabilities and markets in

Europe and Asia• Advancing our technologies to

improve surgery

• Lowering our direct product costs

• Areas of Strength

– General surgery growth

– International procedure

growth

– da Vinci Xi product line

and feature set

– Growing acceptance of

robotic -assisted surgery

– Extensive, established

da Vinci ecosystem

• Challenges – Structural barriers in

some markets

– Single-Site procedures

2015 Commentary


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Worldwide Procedure Trend

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

2010 2011 2012 2013 2014 2015 2016

Urology Gynecology General Surgery Other

2015:14% Growth

2016 Guidance:

12-14% Growth

Company estimates


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0

100,000

200,000

300,000

400,000

500,000

2010 2011 2012 2013 2014 2015

Urology Gynecology General Surgery Other

+11%

US Procedure Trend

Company estimates


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Company estimates

OUS Procedure Trend

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

2010 2011 2012 2013 2014 2015

Europe Asia Rest of World

+26%


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System Placement Trend

0

20

40

60

80

100

120

140

160

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2014 2015 2016

U.S. Europe Asia Rest-of-World

Q116

+11%

2015 +14%


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Total Revenue*

$0

$500

$1,000

$1,500

$2,000

$2,500

2010 2011 2012 2013 2014 2015

Systems Service Inst & Accy

2015

70%

Recurring

*Dollar amounts in millions


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Europe

616

USA2,431

Installs by Country and Region

Asia

441

da Vinci® System Installed Base

Rest of World: 172


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OPPORTUNITIES AND CATALYSTSFOR GROWTH


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Open Surgery Remains Common – U.S.

Yr: 2004

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Prostate Malignant

Hyst

Benign Hyst

Robotic Other MIS Open

Source: ISI estimates and third party data


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Yr: 2015

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Prostate Malignant

Hyst

Benign Hyst




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Yr: 2015

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Prostate Malignant

Hyst

Benign Hyst Colorectal Ventral

Hernia

Thoracic




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Total Procedure Markets

• As many as 4 million annual proceduresavailable for products on the market today in

countries for which we have clearances

• Over time, O.U.S. opportunity will be greaterthan U.S.

• Roughly half of opportunity based on

underlying cancer as cause


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ISI Investments

•Advanced imaging

• Advanced instrumentation and computer-

enhanced precision at tissue

• Less invasive access• Training technologies

• Next generation robotic technologies

• International organization

• Continued clinical and economic validation


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Building da Vinci Xi Value:

New Xi Products / Markets

• Vessel Sealer and Firefly launched 2014

• Korea Clearance Q4 14

• 45 mm Stapler launched Q1 15

•Clearance in Japan end of Q1 15

• Harmonic curved shears and other new

instruments FDA Cleared Q2 15

• Table motion FDA Cleared Q1 16

• Single-Site FDA Cleared Q1 16

• 30 mm Stapler FDA Cleared Q1 16


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da Vinci Sp

The da Vinci SP is not commercially available. 2016 emphasis is on clinical investigations focused

on trans oral, trans abdominal, and trans anal procedures.


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2016 PRIORITIES ANDCORPORATE ASSETS


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2016 Priorities

• Expand da Vinci in thoracic and general surgery,particularly colorectal surgery and hernia repair

• Advance key technologies – extend our product

leadership position

• Drive international performance and strengthen

our organization

• Maximize total-cost-to-treat value for customers


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Extraordinary people

3,660 da Vinci® System installed base 3/31/16

Numerous FDA and international regulatory clearances

Extensive instrument and accessory product line

Intuitive Surgical training centers worldwide

Ownership of or exclusive rights to over 2,250 U.S. and

foreign patents and more than 1,550 US and foreignpatent applications

da Vinci® patient awareness

Corporate Assets


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