Company: ISRG
Filing Date: 2025-04-23
Form Type: 10-Q
Source: 0001035267-25-000109
Chunk: 62

Company: INTUITIVE SURGICAL INC
Filing Date: 2025-04-23
Form: 10-Q
Item: Item 1
Chunk 62
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 representing 65.6% of service revenue, compared to $222.7 million, representing 71.0% of service revenue, for the three months ended March 31, 2024. The higher service gross profit for the three months ended March 31, 2025, was primarily driven by higher service revenue, reflecting a larger installed base of da Vinci surgical systems, partially offset by a lower service gross profit margin. The lower service gross profit margin for the three months ended March 31, 2025, was primarily driven by an unfavorable repair mix, higher costs associated with our da Vinci 5 surgical system, and incremental fixed costs, including depreciation expense, partially offset by lower logistics costs and lower excess and obsolete inventory charges.

Service gross profit for the three months ended March 31, 2025, and 2024, included share-based compensation expense of $8.2 million and $7.0 million, respectively, and intangible assets amortization expense of $0.2 million and $0.2 million, respectively.

39

Selling, General and Administrative Expenses

Selling, general and administrative expenses include costs for sales, marketing, and administrative personnel, sales and marketing activities, trade show expenses, legal expenses, regulatory fees, and general corporate expenses.

Selling, general and administrative expenses for the three months ended March 31, 2025, increased by 15% to $563.4 million, compared to $491.5 million for the three months ended March 31, 2024. The increase in selling, general and administrative expenses for the three months ended March 31, 2025, was primarily driven by higher headcount and personnel-related expenses, including share-based compensation expense, and higher legal expenses.

Selling, general and administrative expenses for the three months ended March 31, 2025, and 2024, included share-based compensation expense of $82.3 million and $68.2 million, respectively, and intangible assets amortization expense of $0.5 million and $0.8 million, respectively.

Research and Development Expenses

Research and development costs are expensed as incurred and primarily include costs associated with the design, development, testing, and significant enhancement of our products. Our main product development initiatives include multi-port, Ion, and SP platform investments as well as digital products and services.

Research and development expenses for the three months ended March 31, 2025, increased by 11% to $316.2 million,