Intuitive Surgical, Inc. (ISRG): Strong Top & Bottom Line Beat vs. In-Line US Procedures; Good, But Not Enough

Intuitive Surgical delivered a strong 3Q26 beat on nearly all headline metrics, with revenue ahead by nearly $150M, adjusted EPS beating by $0.36 (14%), operating margin ahead by 230bp, and US placements and I&A also above expectations. However, US da Vinci procedure growth of 10% was only in line with the Street and 100-200bp below elevated buy-side expectations, which is pressuring the shares after a strong run into the print. Management narrowed its 2026 da Vinci procedure growth guidance to +14-15% and still expects to land near the midpoint. The announced pricing actions imply a 3-5% headwind to da Vinci I&A revenue per procedure once fully implemented, better than feared. The company repurchased about $3B of stock at roughly $377 and disclosed several telesurgery clearances in 1H28. We maintain Overweight and raise our Dec-2027 price target to $475 from $450; we would be buyers if shares remain down about 7% into the open.