Intuitive Surgical Beats Q3 Estimates but Shares Plunge Amid $450M Settlement

ISRG reported third-quarter 2026 results that beat Wall Street on both lines. Revenue was $3.05 billion, up 22% from $2.51 billion a year earlier, versus a consensus of $2.91 billion, and non-GAAP EPS was $3.00 against an estimate of $2.65. The company placed 546 da Vinci systems, up from 427 in the third quarter of 2025, which points to accelerating placements rather than a slowdown.

The stock reaction was sharply negative anyway. Shares traded down 12.7% to $382.40 immediately after the results in after-hours trading, and were down about 7.5% to $404.99 in premarket trading on Oct 21, so neither figure is a regular-session close. Seeking Alpha's headline framed the move as the beat being outweighed by a $450 million settlement.

The company said it reached a written agreement, without any admission of liability or wrongdoing, to settle the "In re: da Vinci Surgical Robot Antitrust Litigation" class action for a one-time payment of $450 million plus mutually agreed injunctive relief. The charge was booked to selling, general and administrative expense in the third quarter, at $347 million after tax or $0.99 per diluted share, and the settlement still needs preliminary and final court approval. That charge is why GAAP EPS was $1.49 while non-GAAP EPS, which excludes it, was $3.00.

The settlement was not the only item investors were weighing. Management also described pricing actions that are expected to reduce da Vinci instrument and accessory revenue per procedure by approximately 3% to 5% once fully implemented, including a China-specific price reduction starting in November. Against that, worldwide procedures grew approximately 15%, and the company guided to da Vinci procedure growth of approximately 14% to 15% for 2026. Investors may want to watch the court approval process, how much the pricing changes weigh on per-procedure revenue, and whether placement growth continues.