Intuitive Surgical (NSDQ:ISRG) delivered another Street-beating quarter today, but investors, spooked by sliding procedure volumes, shaved more than 5% from its share price in after-hours trading.
Intuitive reported profits of $183.3 million, or $4.46 per share, on sales of $$537.8 million during the 3 months ended Sept. 30, representing top-line growth of $20.4% and a bottom-line gain of 49.8%, compared with Q3 2011.
But the Sunnyvale, Calif.-based medical device company said procedure volumes grew by 22%, below its own expectations and 4 points shy of Wall Street’s forecast. Analysts were expecting growth of 26%.
Lower prostatectomy procedure volumes in the U.S. and "procedure underperformance" in Europe were to blame, according to vice president of strategy Aleks Cukic.
"Clinically, we do not meet our procedure expectations for the quarter, achieving year-over-year procedure growth of approximately 22%," Cukic told analysts during a conference call. "The shortfall can be attributed to 2 factors, a larger-than-expected decline in our U.S. [da Vinci prostatectomy] business and procedure underperformance in Europe. The pressure we faced within our U.S. [da Vinci prostatectomy] business can be traced to both conservative PSA screening protocols and a change in treatment recommendations for low-risk cancer patients away from definitive treatment. Our EU procedure business shortfall is a bit more complex to define, as it appears to be both macroeconomic and structural in nature."
ISRG shares gained 3.9% today while the markets were open, but after-hours trading erased that gain and then some. Share were trading down 5.1% at $506 apiece as of about 8 p.m.
"Our third quarter highlighted both market strengths and significant headwinds. Procedures came in below our expectations, driven by conditions in Europe and changes in prostate cancer detection and treatment. On the positive side, acceptance of da Vinci general and gynecologic surgery continues to grow," president & CEO Gary Guthart said in prepared remarks.