INTUITIVE SURGICAL INC

Previous wording

The following management’s discussion and analysis is provided in addition to the accompanying Condensed Consolidated Financial Statements and Notes thereto. Management’s discussion and analysis of financial condition as of June 30, 2026, and results of operations for the three and six months ended June 30, 2026, should be read in conjunction with management’s discussion and analysis of financial condition and results of operations included in our Annual Report on Form 10-K for the year ended December 31, 2025.

Current wording

The following management’s discussion and analysis is provided in addition to the accompanying Condensed Consolidated Financial Statements and Notes thereto. Management’s discussion and analysis of financial condition as of September 30, 2026, and results of operations for the three and nine months ended September 30, 2026, should be read in conjunction with management’s discussion and analysis of financial condition and results of operations included in our Annual Report on Form 10-K for the year ended December 31, 2025.

Previous wording

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements relate to expectations concerning matters that are not historical facts. Statements using words such as “estimates,” “projects,” “believes,” “anticipates,” “plans,” “expects,” “intends,” “may,” “will,” “could,” “should,” “commit,” “would,” “seek,” “potential,” “targeted,” and similar words and expressions are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to the following: statements related to future results of operations; future financial condition; the goals we share with our customers, including improving patient outcomes; our financing plans and future capital requirements; our potential tax assets or liabilities; statements based on current expectations, estimates, forecasts, projections, and assumptions about the economies and geographic markets in which we operate; our beliefs and assumptions regarding these economies and markets; expectations regarding future procedure volumes and adoption rates; anticipated future depreciation, amortization, and research and development expenses; expectations regarding future system placements, including the factors that may impact such placements; statements regarding competition and competitive dynamics; expectations regarding the timing and receipt of regulatory clearances, approvals, and certifications; expectations regarding the integration of acquisitions, including the transition to a direct sales model in certain markets; statements regarding the expansion of our product offerings and commercialization of new products; expectations regarding future lease buyout activity; and expectations regarding our liquidity and capital expenditures. These forward-looking statements are necessarily estimates reflecting the judgment of our management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. These forward-looking statements should be considered in light of various important factors, including, but not limited to, the following: the overall macroeconomic environment, which may impact customer spending and our costs, including tariffs, the levels of inflation, and interest rates; the conflict in Ukraine; conflicts in the Middle East, including Israel and Iran; disruption to our supply chain, including increased difficulties in obtaining a sufficient supply of materials; curtailed or delayed capital spending by hospitals; the impact of global and regional economic and credit market conditions on healthcare spending; delays in obtaining new product approvals, clearances, or certifications from the United States (“U.S.”) Food and Drug Administration (“FDA”), comparable regulatory authorities, or notifie…

Excerpt shortened here; the source contains the full paragraph.

Current wording

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements relate to expectations concerning matters that are not historical facts. Statements using words such as “estimates,” “projects,” “believes,” “anticipates,” “plans,” “expects,” “intends,” “may,” “will,” “could,” “should,” “commit,” “would,” “seek,” “potential,” “targeted,” and similar words and expressions are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to the following: statements related to future results of operations; future financial condition; the goals we share with our customers, including improving patient outcomes; our financing plans and future capital requirements; our potential tax assets or liabilities, including the expected impact of global minimum tax rules; statements based on current expectations, estimates, forecasts, projections, and assumptions about the economies and geographic markets in which we operate; our beliefs and assumptions regarding these economies and markets; expectations regarding future procedure volumes and adoption rates; anticipated future depreciation, amortization, and research and development expenses; expectations regarding future system placements, including the factors that may impact such placements; statements regarding competition and competitive dynamics; expectations regarding the timing and receipt of regulatory clearances, approvals, and certifications; expectations regarding the integration of acquisitions, including the transition to a direct sales model in certain geographic markets; statements regarding the expansion of our product offerings and commercialization of new products; expectations regarding the impact of tariffs and other trade measures, including the amount and timing of tariff refunds; expectations regarding future lease buyout activity; the proposed settlement of the antitrust class action litigation, including the receipt of preliminary and final court approval, and the extent of any class member objections; and expectations regarding our liquidity and capital expenditures. These forward-looking statements are necessarily estimates reflecting the judgment of our management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. These forward-looking statements should be considered in light of various important factors, including, but not limited to, the following: the overall macroeconomic environment, which may impact customer spending and our costs, including tariffs, the levels of inflation, and interest rates; the conflict in Ukraine; conflicts in the Middle East, including Israel and Iran; disruption to our supply chain, including increased difficulties in obtaining a …

Excerpt shortened here; the source contains the full paragraph.

Previous wording

•In July 2025, we obtained European certification in accordance with the EU MDR for our da Vinci 5 surgical system for adult and pediatric use in minimally invasive endoscopic procedures across abdominopelvic and thoracoscopic surgical procedures, including urologic, gynecologic, and general laparoscopic procedures, excluding the use of force feedback. We are currently seeking European certification for the use of force feedback in the future. In June 2025, we obtained regulatory clearance in Japan for the da Vinci 5 surgical system for use in all surgical specialties and procedures indicated for da Vinci Xi, except for cardiac indications. In October 2024, we obtained regulatory clearance in South Korea for the da Vinci 5 surgical system for use in urologic, general, gynecologic, thoracoscopic, thoracoscopically-assisted cardiotomy, and transoral otolaryngology surgical procedures. In March 2024, we obtained FDA clearance for our da Vinci 5 surgical system for use in all surgical specialties and procedures indicated for da Vinci Xi, except for cardiac and pediatric indications as well as one contraindication related to the use of force feedback in hysterectomy and myomectomy surgical procedures.

Current wording

In March 2024, we obtained FDA clearance for our da Vinci 5 surgical system, our next-generation multi-port system, for use in all surgical specialties and procedures indicated for da Vinci Xi, except for cardiac and pediatric indications as well as one contraindication related to the use of force feedback in hysterectomy and myomectomy surgical procedures. In October 2024, we obtained regulatory clearance in South Korea for the da Vinci 5 surgical system for use in urologic, general, gynecologic, thoracoscopic, thoracoscopically-assisted cardiotomy, and transoral otolaryngology surgical procedures. In June 2025, we obtained regulatory clearance in Japan for the da Vinci 5 surgical system for use in all surgical specialties and procedures indicated for da Vinci Xi, including select cardiac indications. In July 2025, we obtained European certification in accordance with Regulation (EU) 2017/745 of the European Parliament and of the Council of 5 April 2017 on medical devices (the “EU MDR”) for the da Vinci 5 surgical system for adult and pediatric use in minimally invasive endoscopic procedures across abdominopelvic and thoracoscopic surgical procedures, including urologic, gynecologic, and general laparoscopic procedures. In select geographic markets outside of the U.S. (“OUS”) where we have obtained regulatory clearance, we have launched our da Vinci 5 surgical system. As of September 30, 2026, we have an installed base of 2,023 da Vinci 5 surgical systems, of which 177 systems are located in geographic markets outside of the U.S.

Previous wording

Additionally, we extended our fourth-generation platform by adding the da Vinci SP surgical system, commercialized in 2018. The da Vinci SP surgical system accesses the body through a single incision, while the other da Vinci surgical systems access the body through multiple incisions. We are in the early stages of launching our da Vinci SP surgical system, and we have an installed base of 445 da Vinci SP surgical systems as of June 30, 2026. We have received FDA clearance for the da Vinci SP surgical system for urologic, colorectal, general thoracoscopic, and certain transoral procedures. Additionally, the da Vinci SP surgical system has received regulatory clearance in South Korea for a broad set of procedures. The da Vinci SP surgical system has also received regulatory clearance in Japan for the same set of procedures that are currently allowed with the da Vinci Xi surgical system in Japan. In January 2024, the da Vinci SP surgical system received European certification in accordance with the EU MDR for use in endoscopic abdominopelvic, thoracoscopic, transoral otolaryngology, transanal colorectal, and breast surgical procedures, and we are broadening the commercialization of the da Vinci SP surgical system in additional countries and surgical specialties. In August 2024, we obtained regulatory clearance in Taiwan for our da Vinci SP surgical system for use in endoscopic abdominopelvic, thoracoscopic, transoral otolaryngology, transanal colorectal, transanal total mesorectal excision, and breast surgical procedures. We plan to seek FDA clearances for additional indications for the da Vinci SP surgical system and expand the system’s regulatory approvals (including for additional indications) in other OUS geographic markets over time. The success of the da Vinci SP surgical system is dependent on positive experiences and improved clinical outcomes for the procedures for which it has been cleared as well as securing additional clinical clearances.

Current wording

Additionally, we extended our fourth-generation platform by adding the da Vinci SP surgical system, commercialized in 2018. The da Vinci SP surgical system accesses the body through a single incision, while the other da Vinci surgical systems access the body through multiple incisions. We are in the early stages of launching our da Vinci SP surgical system, and we have an installed base of 487 da Vinci SP surgical systems as of September 30, 2026. We have received FDA clearance for the da Vinci SP surgical system for urologic, colorectal, general thoracoscopic, and certain transoral procedures. Additionally, the da Vinci SP surgical system has received regulatory clearance in South Korea for a broad set of procedures. The da Vinci SP surgical system has also received regulatory clearance in Japan for the same set of procedures that are currently allowed with the da Vinci Xi surgical system in Japan. In January 2024, the da Vinci SP surgical system received European certification in accordance with the EU MDR for use in endoscopic abdominopelvic, thoracoscopic, transoral otolaryngology, transanal colorectal, and breast surgical procedures, and we are broadening the commercialization of the da Vinci SP surgical system in additional countries and surgical specialties. In August 2024, we obtained regulatory clearance in Taiwan for our da Vinci SP surgical system for use in endoscopic abdominopelvic, thoracoscopic, transoral otolaryngology, transanal colorectal, transanal total mesorectal excision, and breast surgical procedures. We plan to seek FDA clearances for additional indications for the da Vinci SP surgical system and expand the system’s regulatory approvals (including for additional indications) in other OUS geographic markets over time. The success of the da Vinci SP surgical system is dependent on positive experiences and improved clinical outcomes for the procedures for which it has been cleared as well as securing additional clinical clearances.

Previous wording

Beginning in 2025, the U.S. implemented a baseline tariff framework on most imports with higher country- and product-specific rates for certain trading partners, including Mexico, Germany, and China, among others, in some cases giving rise to retaliatory tariffs announced by other jurisdictions. In February 2026, the U.S. Supreme Court ruled that these tariffs levied under the International Emergency Economic Powers Act (“IEEPA”) were unlawful, because IEEPA does not authorize the

Current wording

Beginning in 2025, the U.S. implemented a baseline tariff framework on most imports with higher country- and product-specific rates for certain trading partners, including Mexico, Germany, and China, among others, in some cases giving rise to retaliatory tariffs announced by other jurisdictions. In February 2026, the U.S. Supreme Court ruled that these tariffs levied under the International Emergency Economic Powers Act (“IEEPA”) were unlawful, because IEEPA does not authorize the President to impose tariffs.

Previous wording

As a result of the Supreme Court’s ruling, and in response to the order from the U.S. Court of International Trade, the U.S. Customs and Border Protection (“CBP”) agency formalized a process for refunds. On April 20, 2026, the CBP launched an online portal to submit IEEPA tariff refund requests. All requests will be reviewed by the CBP to determine validity prior to the issuance of refunds. The U.S. Department of Justice has filed a notice of appeal of the refund order in the U.S. Court of Appeals for the Federal Circuit.

Current wording

As a result of the Supreme Court’s ruling in February 2026, and in response to the order from the U.S. Court of International Trade, the U.S. Customs and Border Protection (“CBP”) agency formalized a process for refunds. On April 20, 2026, the CBP launched an online portal to submit IEEPA tariff refund requests. The U.S. Department of Justice has filed a notice of appeal of the refund order in the U.S. Court of Appeals for the Federal Circuit.

Previous wording

During the three and six months ended June 30, 2026, tariffs and other trade measures recognized in total cost of revenue were $20.8 million and $48.8 million, respectively. During the three months ended June 30, 2026, the Company recognized $35.9 million of refunds related to IEEPA tariffs paid in prior periods, which reduced total cost of revenue. Future changes to tariff rates and the imposition of new tariffs by the U.S. and/or other countries could result in a material impact to our results of operations. The ultimate impact of changes to tariffs and trade barriers will depend on various factors, including the timing, amount, scope, and nature of any tariffs or trade barriers that are implemented, all of which could have a material adverse effect on our business, financial condition, or results of operations.

Current wording

During the three and nine months ended September 30, 2026, tariffs and other trade measures recognized in total cost of revenue were $23.4 million and $72.4 million, respectively. During the three and nine months ended September 30, 2026, the Company recognized $27.8 million and $63.7 million, respectively, of refunds related to IEEPA tariffs paid in prior periods, which reduced total cost of revenue. Future changes to tariff rates and the imposition of new tariffs by the U.S. and/or other countries could result in a material impact on our results of operations. The ultimate impact of changes to tariffs and trade barriers will depend on various factors, including the timing, amount, scope, and nature of any tariffs or trade barriers that are implemented, all of which could have a material adverse effect on our business, financial condition, or results of operations.

Previous wording

Our future results of operations and liquidity could be materially adversely affected by uncertainties surrounding macroeconomic and geopolitical factors both in the U.S. and globally. These uncertainties include any introduction or modification of tariffs or trade barriers as well as supply chain constraints resulting from inflationary pressures, market pressures, elevated interest rates, and disruptions in the commodity markets associated with conflicts, including those between Russia and Ukraine and conflicts in the Middle East, including those with Iran.

Current wording

Our future results of operations and liquidity could be materially adversely affected by uncertainties surrounding macroeconomic and geopolitical factors, both in the U.S. and globally. These uncertainties include the introduction or modification of tariffs and trade restrictions, as well as supply constraints resulting from price inflation, industry demand, elevated interest rates, and disruptions within commodity markets associated with political conflicts, including those between Russia and Ukraine and conflicts in the Middle East, including those with Iran.

Previous wording

Existing tariffs and country‑specific trade requirements, including export licensing controls between major economies, may contribute to future cost inflation in certain raw materials and/or may result in supply constraints due to shipment delays or limited availability of alternative sources for critical materials used in the manufacture of our products. Additionally, multi-year lead times in certain commodity markets are creating price volatility and availability risks with certain raw materials and finished components. Elevated interest rates may also impact the ability of certain suppliers to fund necessary investments in capacity and infrastructure. Deteriorating financial health or insolvency of suppliers, including sole- and single-sourced suppliers, could present heightened supply continuity risks.

Current wording

Existing tariffs and country-specific trade requirements, including export license controls between major economies, may contribute to cost inflation in certain raw materials and/or may result in supply constraints due to shipment delays or limited availability of alternative sources for critical materials used in the manufacture of our products. Additionally, lengthened lead times in certain commodity markets are creating price volatility and availability risks with certain raw materials and finished components. Elevated interest rates may also impact the ability of certain suppliers to fund necessary investments in capacity and infrastructure. Deteriorating financial health or insolvency of suppliers, including sole- and single-sourced suppliers, could present heightened supply continuity risks.

Previous wording

In addition, while the conflict in the Middle East has not resulted in any material disruption to the supply of component materials that we source directly or the delivery of our products to customers, we continue to monitor supplier operations, commodity markets, and transportation-related factors, including shipping lanes. These geopolitical factors, including increased defense industry consumption, could adversely affect the availability and cost of raw materials sourced by our direct suppliers, as well as the cost and timing of transporting our products to customers.

Current wording

In addition, while the conflict in the Middle East has not resulted in any material disruption to the supply of component materials that we source directly or the delivery of our products to customers, we continue to monitor supplier operations, commodity markets, and transportation-related factors, including shipping lanes. These geopolitical factors, including increased defense industry consumption, could adversely affect the availability and cost of raw materials as well as the cost and timing of transporting our products to customers.

Previous wording

We continue to experience extended delivery lead times and price volatility for certain semiconductor materials, including memory, driven by accelerated demand associated with data processing and storage applications. We are actively managing these pressures through ongoing supplier engagement and other mitigation efforts and continue to monitor developments closely. While these dynamics have not had a material impact on our business to date, they may result in material cost pressures and supply constraints in future periods.

Current wording

We continue to experience extended delivery lead times and price volatility for certain semiconductor components, including memory and printed circuit boards, driven by industry demand for data processing and storage applications. We are actively managing these pressures through ongoing supplier engagement, focused mitigations, and close monitoring of relevant developments. While these dynamics have not had a material impact on our business to date, they may result in material cost pressures and supply constraints in future periods.

Previous wording

(the “EU MDR”) for the da Vinci 5 surgical system for adult and pediatric use in minimally invasive endoscopic procedures across abdominopelvic and thoracoscopic surgical procedures, including urologic, gynecologic, and general laparoscopic procedures, excluding the use of force feedback. We are currently seeking European certification for the use of force feedback in the future. In select geographic markets outside of the U.S. (“OUS”) where we have obtained regulatory clearance, we have launched our da Vinci 5 surgical system. As of June 30, 2026, we have an installed base of 1,710 da Vinci 5 surgical systems, of which 136 systems are located in geographic markets outside of the U.S.

Current wording

•In September 2026, we obtained European certification in accordance with the EU MDR for our da Vinci 5 surgical system for adult cardiac surgery, as well as the use of force feedback instruments on our da Vinci 5 surgical system. In July 2025, we obtained the same certification for adult and pediatric use in minimally invasive endoscopic procedures across abdominopelvic and thoracoscopic surgical procedures, including urologic, gynecologic, and general laparoscopic procedures. In August 2026, we obtained regulatory approval in Brazil in accordance with the Brazil Ministry of Health for our da Vinci 5 surgical system for adult and pediatric use in minimally invasive endoscopic abdominopelvic and thoracoscopic procedures, including the use of force feedback. In July 2026, we obtained regulatory approval in India for the da Vinci 5 surgical system for adult and pediatric use in minimally invasive endoscopic procedures across abdominopelvic and thoracoscopic surgical procedures, including urologic, gynecologic, and general laparoscopic procedures, including the use of force feedback.

Previous wording

In March 2024, we obtained FDA clearance for our da Vinci 5 surgical system, our next-generation multi-port system, for use in all surgical specialties and procedures indicated for da Vinci Xi, except for cardiac and pediatric indications as well as one contraindication related to the use of force feedback in hysterectomy and myomectomy surgical procedures. In October 2024, we obtained regulatory clearance in South Korea for the da Vinci 5 surgical system for use in urologic, general, gynecologic, thoracoscopic, thoracoscopically-assisted cardiotomy, and transoral otolaryngology surgical procedures. In June 2025, we obtained regulatory clearance in Japan for the da Vinci 5 surgical system for use in all surgical specialties and procedures indicated for da Vinci Xi, except for cardiac indications. In July 2025, we obtained European certification in accordance with Regulation (EU) 2017/745 of the European Parliament and of the Council of 5 April 2017 on medical devices

Current wording

In June 2025, we obtained regulatory clearance in Japan for the da Vinci 5 surgical system for use in all surgical specialties and procedures indicated for da Vinci Xi, including select cardiac indications. In October 2024, we obtained regulatory clearance in South Korea for the da Vinci 5 surgical system for use in urologic, general, gynecologic, thoracoscopic, thoracoscopically-assisted cardiotomy, and transoral otolaryngology surgical procedures.

Previous wording

•In March 2026, we obtained FDA clearance for updates to our force feedback instruments used with our da Vinci 5 surgical system, including approval for extended instrument lives. Five of the six force feedback instruments were cleared for up to 15 uses, while the remaining instrument was cleared for up to 10 uses. Following this clearance, as we increase manufacturing volumes of these force feedback instruments, they will become broadly available for use with our da Vinci 5 surgical system.

Current wording

•In March 2026, we obtained FDA clearance for updates to our force feedback instruments used with our da Vinci 5 surgical system, including approval for extended instrument lives. Five of the six force feedback instruments were cleared for up to 15 uses, while the remaining instrument was cleared for up to 10 uses. Following this clearance, these force feedback instruments are now broadly available for use with our da Vinci 5 surgical system.

Previous wording

•In August 2024, we obtained regulatory clearance in Taiwan for our da Vinci SP surgical system for use in endoscopic abdominopelvic, thoracoscopic, transoral otolaryngology, transanal colorectal, transanal total mesorectal excision, and breast surgical procedures. In January 2024, we obtained European certification in accordance with the EU MDR for our da Vinci SP surgical system for use in endoscopic abdominopelvic, thoracoscopic, transoral otolaryngology, transanal colorectal, and breast surgical procedures.

Current wording

•In September 2026, we obtained European certification in accordance with the EU MDR for the use of our da Vinci SP surgical system in transvaginal gynecologic procedures. In January 2024, we obtained European certification in accordance with the EU MDR for our da Vinci SP surgical system for use in endoscopic abdominopelvic, thoracoscopic, transoral otolaryngology, transanal colorectal, and breast surgical procedures.

Previous wording

In June 2023, the China National Health Commission published the 14th five-year plan quota for major medical equipment to be sold in China on its official website (the “2023 Quota”). Under the original 2023 Quota, the government will allow for the sale of 559 new surgical robots into China, which could include da Vinci surgical systems as well as surgical systems introduced by others. As of June 30, 2026, including systems that were sold in prior quarters, we have placed 169 da Vinci surgical systems under the original 2023 Quota and 3 da Vinci surgical systems under special approval. Future sales of da Vinci surgical systems under this and any previously published open quotas are uncertain, as they are open to other medical device companies that have introduced robotic-assisted surgical systems and are dependent on hospitals completing a tender process and receiving associated approvals. Our ability to track the number of systems that could be sold under these quotas in the future is limited by provincial and national agencies making such information publicly available.

Current wording

In June 2023, the China National Health Commission published the 14th five-year plan quota for major medical equipment to be sold in China on its official website (the “2023 Quota”). Under the original 2023 Quota, the government will allow for the sale of 559 new surgical robots into China, which could include da Vinci surgical systems as well as surgical systems introduced by others. As of September 30, 2026, including systems that were sold in prior quarters, we have placed 176 da Vinci surgical systems under the original 2023 Quota and 3 da Vinci surgical systems under special approval. Future sales of da Vinci surgical systems under this and any previously published open quotas are uncertain, as they are open to other medical device companies that have introduced robotic-assisted surgical systems and are dependent on hospitals completing a tender process and receiving associated approvals. Our ability to track the number of systems that could be sold under these quotas in the future is limited by provincial and national agencies making such information publicly available.

Previous wording

Since 2022, several provinces in China have implemented significant limits on what hospitals can charge patients for surgeries using robotic-assisted surgical technology, including soft tissue surgery. These limits have impacted the number of procedures performed in those provinces as well as pricing of our instruments and accessories, which have impacted our instruments and accessories revenue. During the second quarter of 2026, China’s National Healthcare Security Administration (“NHSA”) issued guidelines establishing a unified national framework for robotic-assisted surgery pricing and requiring all provinces to implement robotic-assisted surgery pricing within NHSA-mandated limits in the upcoming quarters. As of the date of this report, the limits that have been implemented have not had a material impact on our business, financial condition, or results of operations, as only a small portion of our installed base in China is currently located in impacted provinces. We cannot assure you that the rollout of the NHSA unified national framework or future actions by provincial or national healthcare agencies will not result in further pricing limits or pressures, which could have a material impact on procedure volumes and our instruments and accessories revenue in China.

Current wording

Since 2022, several provinces in China have implemented significant limits on what hospitals can charge patients for surgeries using robotic-assisted surgical technology, including soft tissue surgery. These limits have impacted the number of procedures performed in those provinces as well as pricing of our instruments and accessories, which have impacted our instruments and accessories revenue. During the second quarter of 2026, China’s National Healthcare Security Administration (“NHSA”) issued guidelines establishing a unified national framework for robotic-assisted surgery pricing and requiring all provinces to implement robotic-assisted surgery pricing within NHSA-mandated limits in the upcoming quarters. As of the date of this report, the limits that have been implemented have not had a material impact on our business, financial condition, or results of operations, as only a small portion of our installed base in China is currently located in impacted provinces. Beginning in the fourth quarter of 2026, we expect to implement price reductions on instruments sold in China in response to the continued rollout of the NHSA unified national pricing framework. We expect these price reductions to reduce instruments and accessories revenue per procedure. We cannot assure you that the rollout of the NHSA unified national framework or future actions by provincial or national healthcare agencies will not result in further pricing limits or pressures, which could have a material impact on procedure volumes and our instruments and accessories revenue in China.

Previous wording

Second Quarter 2026 Operational and Financial Highlights

Current wording

Third Quarter 2026 Operational and Financial Highlights

Previous wording

•Approximately 889,000 da Vinci procedures were performed during the three months ended June 30, 2026, an increase of 15% compared to approximately 775,000 da Vinci procedures for the three months ended June 30, 2025.

Current wording

•Approximately 906,000 da Vinci procedures were performed during the three months ended September 30, 2026, a growth of 14% compared to approximately 797,000 da Vinci procedures for the three months ended September 30, 2025.

Previous wording

•Approximately 47,900 Ion procedures were performed during the three months ended June 30, 2026, an increase of 36% compared to approximately 35,300 Ion procedures for the three months ended June 30, 2025.

Current wording

•Approximately 49,700 Ion procedures were performed during the three months ended September 30, 2026, a growth of 31% compared to approximately 37,900 Ion procedures for the three months ended September 30, 2025.

Previous wording

•Instruments and accessories revenue increased by 18% to $1.73 billion for the three months ended June 30, 2026, compared to $1.47 billion for the three months ended June 30, 2025.

Current wording

•Instruments and accessories revenue increased by 18% to $1.80 billion for the three months ended September 30, 2026, compared to $1.52 billion for the three months ended September 30, 2025.

Previous wording

•468 da Vinci surgical systems were placed during the three months ended June 30, 2026, an increase of 18% compared to 395 systems during the three months ended June 30, 2025. The second quarter 2026 da Vinci surgical system placements included 246 da Vinci 5 systems compared to 180 systems in the second quarter of 2025.

Current wording

•546 da Vinci surgical systems were placed during the three months ended September 30, 2026, an increase of 28% compared to 427 systems during the three months ended September 30, 2025. The third quarter 2026 da Vinci surgical system placements included 315 da Vinci 5 systems compared to 240 systems in the third quarter of 2025.

Previous wording

•As of June 30, 2026, we had a da Vinci surgical system installed base of approximately 11,710 systems, an increase of 12% compared to an installed base of approximately 10,488 systems as of June 30, 2025.

Current wording

•As of September 30, 2026, we had a da Vinci surgical system installed base of approximately 12,094 systems, an increase of 12% compared to an installed base of approximately 10,763 systems as of September 30, 2025.

Previous wording

•Utilization of da Vinci surgical systems, measured in terms of procedures per system per year, increased 3% relative to the second quarter of 2025.

Current wording

•Utilization of da Vinci surgical systems, measured in terms of procedures per system per year, increased 2% relative to the third quarter of 2025.

Previous wording

•55 Ion systems were placed during the three months ended June 30, 2026, an increase of 2% compared to 54 systems during the three months ended June 30, 2025.

Current wording

•56 Ion systems were placed during the three months ended September 30, 2026, an increase of 12% compared to 50 systems during the three months ended September 30, 2025.

Previous wording

•As of June 30, 2026, we had an Ion system installed base of approximately 1,096 systems, an increase of 21% compared to an installed base of approximately 905 systems as of June 30, 2025.

Current wording

•As of September 30, 2026, we had an Ion system installed base of approximately 1,152 systems, an increase of 21% compared to an installed base of approximately 954 systems as of September 30, 2025.

Previous wording

•Gross profit as a percentage of revenue was 67.8% for the three months ended June 30, 2026, compared to 66.3% for the three months ended June 30, 2025.

Current wording

•Gross profit as a percentage of revenue was 68.4% for the three months ended September 30, 2026, compared to 66.4% for the three months ended September 30, 2025.

Previous wording

•Operating income increased by 31% to $972 million for the three months ended June 30, 2026, compared to $743 million during the three months ended June 30, 2025. Operating income included $213 million and $200 million of share-based compensation expense related to employee stock plans and $24.0 million and $4.8 million of intangible asset-related charges for the three months ended June 30, 2026, and 2025, respectively.

Current wording

•Operating income decreased by 22% to $592.6 million for the three months ended September 30, 2026, compared to $759.7 million during the three months ended September 30, 2025. Operating income included $215.7 million and $206.0 million of share-based compensation expense related to employee stock plans and $9.3 million and $3.9 million of intangible asset-related charges for the three months ended September 30, 2026, and 2025, respectively.

Previous wording

•During the three months ended June 30, 2026, we repurchased 0.9 million shares of our common stock with an aggregate value of $0.38 billion.

Current wording

•During the three months ended September 30, 2026, we repurchased 7.8 million shares of our common stock at an aggregate cost of $2.94 billion.

Previous wording

•As of June 30, 2026, we had $8.63 billion in cash, cash equivalents, and investments, compared to $9.03 billion as of December 31, 2025. Cash, cash equivalents, and investments decreased by $0.41 billion, primarily driven by cash used for repurchases of common stock and the acquisition of a business, partially offset by cash generated from operations.

Current wording

•As of September 30, 2026, we had $6.80 billion in cash, cash equivalents, and investments, compared to $9.03 billion as of December 31, 2025. Cash, cash equivalents, and investments decreased by $2.23 billion, primarily driven by cash used for repurchases of common stock, the acquisition of a business, and purchases of property, plant, and equipment, partially offset by cash generated from operations.

Previous wording

Overall. Total da Vinci procedures performed by our customers grew approximately 15% for the three months ended June 30, 2026, compared to approximately 17% for the three months ended June 30, 2025, and grew approximately 15% for the six months ended June 30, 2026, compared to approximately 17% for the six months ended June 30, 2025. The second quarter 2026 procedure growth was largely attributable to growth in general surgery, gynecology, and OUS urology procedures.

Current wording

Overall. Total da Vinci procedures performed by our customers grew approximately 14% for the three months ended September 30, 2026, compared to approximately 19% for the three months ended September 30, 2025, and grew approximately 15% for the nine months ended September 30, 2026, compared to approximately 18% for the nine months ended September 30,

Previous wording

U.S. Procedures. U.S. da Vinci procedures grew approximately 12% for the three months ended June 30, 2026, compared to approximately 14% for the three months ended June 30, 2025, and grew approximately 13% for the six months ended June 30, 2026, compared to approximately 14% for the six months ended June 30, 2025. The second quarter 2026 U.S. procedure growth was largely attributable to strong growth in general surgery procedures, most notably cholecystectomy, hernia repair, and appendectomy procedures, as well as growth in gynecological procedures, partially offset by a high-single-digit decline in U.S. bariatric procedures, which comprise approximately 2% of our total da Vinci procedures. We believe that U.S. procedure growth was also modestly negatively impacted by the expiration of enhanced ACA premium subsidies. The extent of the continued impact of these expirations on U.S. procedure volumes remains uncertain.

Current wording

U.S. Procedures. U.S. da Vinci procedures grew approximately 10% for the three months ended September 30, 2026, compared to approximately 16% for the three months ended September 30, 2025, and grew approximately 12% for the nine months ended September 30, 2026, compared to approximately 14% for the nine months ended September 30, 2025. The third quarter 2026 U.S. procedure growth was primarily attributable to strong growth in general surgery procedures, most notably cholecystectomy, hernia repair, and appendectomy procedures, as well as growth in gynecological procedures. The growth in general surgery procedures was partially offset by a low double-digit decline in U.S. bariatric procedures, which comprise approximately 2% of our total worldwide da Vinci procedures. We believe that U.S. procedure growth was also modestly negatively impacted by the expiration of enhanced ACA premium subsidies. The extent of the continued impact of these expirations on U.S. procedure volumes remains uncertain.

Previous wording

OUS Procedures. OUS da Vinci procedures grew approximately 20% for the three months ended June 30, 2026, compared to approximately 23% for the three months ended June 30, 2025, and grew approximately 20% for the six months ended June 30, 2026, compared to approximately 24% for the six months ended June 30, 2025. The second quarter 2026 OUS procedure growth was largely attributable to growth in general surgery procedures, most notably colorectal, hernia repair, and cholecystectomy procedures; urologic procedures, most notably prostatectomy and partial nephrectomy procedures; and gynecologic procedures, most notably hysterectomy procedures. The second quarter 2026 OUS procedure growth rate reflects continued da Vinci adoption in European and Asian markets. We saw strong procedure growth in India, Italy, and the United Kingdom during the second quarter of 2026. We believe that growth in these global markets is being driven by increased acceptance among surgeons and health systems, supported by expanded global evidence validating the clinical and economic value of da Vinci procedures as well as increased surgeon training.

Current wording

OUS Procedures. OUS da Vinci procedures grew approximately 20% for the three months ended September 30, 2026, compared to approximately 24% for the three months ended September 30, 2025, and grew approximately 20% for the nine months ended September 30, 2026, compared to approximately 24% for the nine months ended September 30, 2025. The third quarter 2026 OUS procedure growth was primarily attributable to growth in general surgery procedures, most notably hernia repair, colorectal, and cholecystectomy procedures; urologic procedures, most notably prostatectomy and partial nephrectomy procedures; and gynecologic procedures, most notably hysterectomy procedures. The third quarter 2026 OUS procedure growth rate reflects continued da Vinci adoption in European and Asian markets. We saw strong procedure growth in Japan, Germany, India, the United Kingdom, and Italy during the third quarter of 2026, partially offset by lower procedure growth in South Korea compared to the prior year, as the prior-year period benefited from a recovery in procedure volumes following the conclusion of physician strikes, and lower procedure growth in China, which reflects fewer da Vinci surgical systems placed in recent quarters. We believe that growth in these global markets is being driven by increased acceptance among surgeons and health systems, supported by expanded global evidence validating the clinical and economic value of da Vinci procedures as well as increased surgeon training.

Previous wording

In the three months ended June 30, 2026, approximately 47,900 biopsy procedures were performed by our customers with Ion systems, compared to approximately 35,300 in the three months ended June 30, 2025. The growth in our overall procedure volume reflects a larger installed base of approximately 1,096 systems, an increase of 21% compared to the installed base of approximately 905 systems as of June 30, 2025. Currently, the vast majority of Ion biopsy procedures are performed in the U.S.

Current wording

In the three months ended September 30, 2026, approximately 49,700 biopsy procedures were performed by our customers with Ion systems, compared to approximately 37,900 in the three months ended September 30, 2025. In the nine months ended September 30, 2026, approximately 140,300 biopsy procedures were performed by our customers with Ion systems, compared to approximately 103,900 in the nine months ended September 30, 2025. The growth in our overall procedure volume reflects a larger installed base of approximately 1,152 systems as of September 30, 2026, an increase of 21% compared to the installed base of approximately 954 systems as of September 30, 2025. Currently, the vast majority of Ion biopsy procedures are performed in the U.S.

Previous wording

During the second quarter of 2026, 468 da Vinci surgical systems were placed compared to 395 systems in the second quarter of 2025. By geography, 267 systems were placed in the U.S., 79 in Europe, 75 in Asia, and 47 in other geographic markets during the second quarter of 2026, compared to 216 systems placed in the U.S., 73 in Europe, 69 in Asia, and 37 in other geographic markets during the second quarter of 2025. The increase in system placements reflects continued demand for additional capacity by our customers as a result of procedure growth as well as increased demand for our da Vinci 5 system, including the impact from customers trading in fourth-generation da Vinci systems. During the second quarter of 2026, we placed 246 da Vinci 5 systems, compared to 180 systems in the second quarter of 2025.

Current wording

During the third quarter of 2026, 546 da Vinci surgical systems were placed compared to 427 systems in the third quarter of 2025. By geography, 335 systems were placed in the U.S., 115 in Europe, 78 in Asia, and 18 in other geographic markets during the third quarter of 2026, compared to 263 systems placed in the U.S., 63 in Europe, 60 in Asia, and 41 in other geographic markets during the third quarter of 2025. The increase in system placements reflects continued customer demand for additional capacity driven by procedure growth, as well as increased demand for our full portfolio of surgical systems, including da Vinci 5 and Xi systems, inclusive of customers trading in fourth-generation da Vinci systems. During the third quarter of 2026, we placed 315 da Vinci 5 systems, compared to 240 systems in the third quarter of 2025.

Previous wording

As of June 30, 2026, we had a da Vinci surgical system installed base of approximately 11,710 systems compared to approximately 10,488 systems as of June 30, 2025. By geography, 6,615 systems were in the U.S., 2,325 in Europe, 2,111 in Asia, and 659 in the rest of the world. The incremental system installed base reflects continued procedure growth and further customer validation that robotic-assisted surgery addresses their Quintuple Aim objectives.

Current wording

As of September 30, 2026, we had a da Vinci surgical system installed base of approximately 12,094 systems compared to approximately 10,763 systems as of September 30, 2025. By geography, 6,807 systems were in the U.S., 2,436 in Europe, 2,176 in Asia, and 675 in the rest of the world. The incremental system installed base reflects continued procedure growth and further customer validation that robotic-assisted surgery addresses their Quintuple Aim objectives.

Previous wording

During the second quarter of 2026, 55 Ion systems were placed compared to 54 systems in the second quarter of 2025. By geography, 42 systems were placed in the U.S., 9 in Europe, 2 in Asia, and 2 in other geographic markets during the second quarter of 2026, compared to 47 systems placed in the U.S., 3 in Europe, 2 in Asia, and 2 in other geographic markets during the second quarter of 2025. In the U.S., where we estimate that Ion’s penetration of overall lung biopsy procedures has exceeded the halfway point, our customers’ focus has begun to shift from increasing capacity to increasing utilization of their existing systems. As of June 30, 2026, we had an Ion system installed base of approximately 1,096 systems, compared to approximately 905 systems as of June 30, 2025.

Current wording

During the third quarter of 2026, 56 Ion systems were placed compared to 50 systems in the third quarter of 2025. By geography, 44 systems were placed in the U.S., 10 in Europe, 1 in Asia, and 1 in other geographic markets during the third quarter of 2026, compared to 41 systems placed in the U.S., 5 in Europe, and 4 in Asia during the third quarter of 2025. In the U.S., where we estimate that Ion’s penetration of overall lung biopsy procedures has exceeded the halfway point, our customers’ focus has begun to shift from increasing capacity to increasing utilization of their existing systems. As of September 30, 2026, we had an Ion system installed base of approximately 1,152 systems, compared to approximately 954 systems as of September 30, 2025.

Previous wording

We continue to see some customers challenged by lower public funding of healthcare in certain geographic markets and other financial pressures. As a result, we expect our customers to continue to be cautious about their overall capital spending. In addition, system demand in China has been adversely affected by increasing competition from domestic robotic-assisted surgical system manufacturers as well as a broader central government focus on systematic governance. Targeting the healthcare sector, this campaign was initially launched by the Chinese government in July 2023 and has resulted in heightened scrutiny by medical institutions with respect to initiating tenders, with some tenders being canceled or delayed without a timeline. In the second quarter of 2026, the competitive dynamics in China, various measures related to industrial policy, and the effects of this campaign contributed to fewer systems being placed in China than we anticipated. Currently, the extent and impact of the competitive dynamics in China, any additional measures related to industrial policy, and this campaign on our business remain uncertain.

Current wording

System demand in China has been adversely affected by increasing competition from domestic robotic-assisted surgical system manufacturers as well as a broader central government focus on systematic governance. Targeting the healthcare sector, this campaign was initially launched by the Chinese government in July 2023 and has resulted in heightened scrutiny by medical institutions with respect to initiating tenders, with some tenders being canceled or delayed without a timeline. In the third quarter of 2026, the competitive dynamics in China, various measures related to industrial policy, and the effects of this campaign contributed to fewer systems being placed in China than we anticipated. Currently, the extent and impact of the competitive dynamics in China, any additional measures related to industrial policy, and this campaign on our business remain uncertain.

Previous wording

Variable lease revenue, which is primarily recognized from usage-based operating lease arrangements, has been included in our operating lease metrics herein. Operating lease revenue has grown at a faster rate than overall systems revenue and was $262 million and $214 million for the three months ended June 30, 2026, and 2025, respectively, of which $169 million and $130 million, respectively, was variable lease revenue, primarily related to our usage-based operating lease arrangements.

Current wording

Variable lease revenue, which is primarily recognized from usage-based operating lease arrangements, has been included in our operating lease metrics. Operating lease revenue was $275 million and $787 million for the three and nine months ended September 30, 2026, respectively, of which $178 million and $504 million, respectively, represented variable lease revenue, primarily related to our usage-based operating lease arrangements. Operating lease revenue was $223 million and $632 million for the three and nine months ended September 30, 2025, respectively, of which $138 million and $380 million, respectively, represented variable lease revenue, primarily related to our usage-based operating lease arrangements.

Previous wording

For some operating lease arrangements, our customers are provided with the right to purchase the leased system at certain points during and/or at the end of the lease term. Revenue generated from customer purchases of systems under operating lease arrangements (“Lease Buyouts”) was $56 million and $30 million for the three months ended June 30, 2026, and 2025, respectively. We expect that revenue recognized from customer exercises of buyout options will fluctuate based on the timing of when, and if, customers choose to exercise such buyout options.

Current wording

For some operating lease arrangements, our customers are provided with the right to purchase the leased system at certain points during and/or at the end of the lease term. Revenue generated from customer purchases of systems under operating lease arrangements (“Lease Buyouts”) was $45 million and $153 million for the three and nine months ended September 30, 2026, respectively, compared to $22 million and $91 million for the three and nine months ended September 30, 2025, respectively. We expect that revenue recognized from Lease Buyouts will fluctuate based on the timing of when, and if, customers choose to exercise such buyout options.