Intuitive Surgical Inc. (NASDAQ:ISRG)

Current Income Tax Expense

The current income tax expense exhibits a general upward trend from 2020 to 2024. Starting at $82,600 thousand in 2020, it increased significantly to $226,200 thousand in 2021, followed by a further rise to $447,700 thousand in 2022. In 2023, there was a slight decrease to $422,400 thousand, but the figure rose again in 2024 to $471,600 thousand. This pattern suggests growing taxable income or changes in tax rates, with a minor dip in 2023 before resuming its upward trajectory.

Deferred Income Tax Expense (Benefit)

The deferred income tax expense presents a contrasting pattern with mostly negative values after 2020, indicating deferred tax benefits. The deferred tax was a positive $57,600 thousand in 2020 but then shifted to a negative $64,000 thousand in 2021. It further deepened to negative $185,300 thousand in 2022 and reached its lowest at negative $280,800 thousand in 2023 before partially recovering to negative $135,300 thousand in 2024. This trend reflects changes in the timing of tax liabilities and may indicate increasing deferred tax assets or reversal of deferred tax liabilities over these years.

Total Income Tax Expense

The total income tax expense reflects a combination of the current and deferred components, resulting in a fluctuating overall tax charge. It rose from $140,200 thousand in 2020 to $162,200 thousand in 2021 and then saw a substantial increase to $262,400 thousand in 2022. In 2023, the total tax expense decreased significantly to $141,600 thousand, the lowest since 2021, likely due to the sizable deferred tax benefits recorded that year. However, in 2024, the total tax expense surged to its highest level of $336,300 thousand, driven by a considerable increase in current tax expense despite the deferred tax benefit continuing to mitigate the overall tax burden.

Summary

Overall, the data indicates that while current income tax expenses have generally increased over the five-year period, deferred income tax expenses shifted from being a liability to a benefit, reducing total tax expenses in some years notably in 2023. The fluctuation in deferred taxes suggests significant timing differences in recognizing tax obligations. The large deferred tax benefits in 2022 and 2023 substantially lowered the effective tax burden during those years. The combined effect in 2024 shows an increased total tax expense largely driven by a rise in current taxes, despite deferred tax continuing to provide some relief.

The effective income tax rate exhibited notable variability over the five-year period, contrasting with the consistent statutory federal income tax rate of 21% throughout the same timeframe.

Effective Income Tax Rate Trends

Starting at 11.62% in 2020, the rate decreased to 8.58% in 2021, marking the lowest point in the observed period. It then increased to 16.33% in 2022, followed by a sharp decline to 7.23% in 2023. In 2024, the rate rose again to 12.58%, though it remained below the statutory rate.

Comparison with Statutory Tax Rate

Throughout the analyzed years, the effective income tax rate stayed significantly below the statutory rate of 21%. This discrepancy indicates utilization of tax planning strategies, credits, deductions, or differences in taxable income recognition that reduced the overall tax burden relative to the nominal federal tax rate.

Insights

The fluctuations in the effective tax rate suggest changing tax positions or benefits that affected taxable income or effective rates on reported earnings. The relatively low effective rates compared to the statutory rate may indicate favorable tax circumstances or consistent application of tax optimization measures.

Intangible assets

Displayed an overall increasing trend from 321,800 thousand US dollars in 2020 to 377,500 thousand US dollars in 2024, peaking at 420,900 thousand US dollars in 2023 before slightly declining.

Capitalized research and development expenditures

Started with no recorded value in 2020, then showed significant and consistent growth from 4,800 thousand in 2021 to 468,600 thousand in 2024, indicating increased investment in R&D capitalized as assets.

Research and development credits

Exhibited continuous growth from 76,300 thousand US dollars in 2020 to 240,300 thousand US dollars in 2024, supporting increased activities in research and development.

Share-based compensation expense

Consistently rose each year, increasing from 101,100 thousand in 2020 to 155,300 thousand in 2024, reflecting higher expenses related to equity compensation.

Swiss tax credits

First appeared in 2023 valued at 122,400 thousand, followed by a decline to 107,400 thousand in 2024, suggesting the establishment and subsequent reduction of these credits.

Expenses deducted in later years for tax purposes

Generally increased over the period, from 29,300 thousand in 2020 to 67,400 thousand in 2024, with a slight dip in 2023 indicating some volatility.

Lease liabilities

Demonstrated a growing trend with figures rising from 12,000 thousand in 2020 to 23,000 thousand in 2024, indicating an increase in lease obligations.

Net operating losses

Showed a declining pattern from 27,700 thousand in 2020 down to a low of 2,800 thousand in 2023, followed by a modest uptick to 4,500 thousand in 2024, indicating reduced carryforward losses.

Net unrealized losses on available-for-sale securities and other

Values were missing in 2020 and subsequently fluctuated, peaking at 45,500 thousand in 2022 before decreasing to 11,300 thousand in 2024, indicating volatile unrealized losses.

Gross deferred tax assets

Increased substantially from 568,200 thousand in 2020 to 1,455,300 thousand in 2024, nearly tripling over the period, indicating higher anticipated tax benefits.

Valuation allowance

Consistently negative and increasing in absolute value from -81,400 thousand in 2020 to -314,800 thousand in 2024, suggesting growing reservations against deferred tax assets.

Deferred tax assets

Following a positive trajectory from 486,800 thousand in 2020 to 1,140,500 thousand in 2024, reflecting strong accumulation of tax benefit positions net of allowances.

Property, plant, and equipment

Negative values were reported across all years with a slight reduction in magnitude from -91,100 thousand in 2020 to -65,700 thousand in 2024, indicating possible accumulated depreciation or impairment effects.

Right-of-use assets

Also negative throughout, increasing in absolute value from -8,400 thousand in 2020 to -18,900 thousand in 2024, correlating with rising lease liabilities.

Intangible assets (negative entries)

Negative figures showed a slight improvement in 2024 at -8,500 thousand compared to earlier years, with minor fluctuations, indicating some amortization or impairment.

Other (negative)

Amounts steadily approached zero from -13,200 thousand in 2020 to -200 thousand in 2023, before a minor reversal to -2,300 thousand in 2024, denoting a reduction in other negative deferred items.

Deferred tax liabilities

Negative values decreased from -122,800 thousand in 2020 to -95,400 thousand in 2024, reflecting a reduction in temporary taxable differences over time.

Net deferred tax assets (liabilities)

Demonstrated strong growth from 364,000 thousand in 2020 to 1,045,100 thousand in 2024, indicating an enhanced net asset position from deferred tax accounts.

The analysis of the provided annual financial data reveals several notable trends regarding deferred tax assets and liabilities over the period from 2020 to 2024.

Deferred Tax Assets

Deferred tax assets have shown a consistent and significant upward trajectory throughout the analyzed period. Starting at 367.7 million US dollars at the end of 2020, there was a steady increase each year, reaching 441.4 million in 2021, 664.6 million in 2022, 910.5 million in 2023, and culminating at 1.0451 billion by the end of 2024.

This increasing trend suggests that the company has been recognizing growing amounts of deductible temporary differences or carryforwards, which could potentially reduce future tax payments. The considerable jumps between years, particularly from 2021 to 2022 and from 2022 to 2023, indicate substantial improvements in tax assets, likely driven by changes in the company's tax position or operational activities that generate deferred tax benefits.

Deferred Tax Liabilities

Deferred tax liabilities have consistently decreased over the examined timeframe. Starting at a relatively low base of 3.7 million US dollars in 2020, the amount declined sharply to 0.6 million in 2021, then further to 0.1 million in 2022, after which no deferred tax liabilities were reported for 2023 and 2024.

This decreasing pattern suggests a reduction or elimination of taxable temporary differences that would result in future tax obligations. The absence of deferred tax liabilities in the last two years may imply effective tax planning, changes in asset valuations, or other strategic decisions reducing future tax burdens.

Overall, the company's tax position appears to be strengthening, with an increasing recognition of deferred tax assets and a corresponding decline in deferred tax liabilities. This shift likely contributes positively to the company's future tax expense outlook and may reflect underlying operational or financial strategies aimed at optimizing tax outcomes.

The analysis of the financial data over the five-year period reveals several noteworthy trends and insights regarding the company's asset base, liabilities, equity, and profitability when considering both reported and adjusted figures.

Total Assets

The reported total assets exhibit a generally upward trend, increasing from approximately $11.17 billion in 2020 to $18.74 billion in 2024. The adjusted total assets follow a similar pattern but are consistently lower than the reported figures by a few percentage points, which reflects the impact of tax-related adjustments. Notably, there is a dip in 2022 in both reported and adjusted totals before resuming growth, indicating a temporary contraction or asset revaluation during that year.

Total Liabilities

Both reported and adjusted total liabilities increased steadily from roughly $1.41 billion in 2020 to about $2.21 billion in 2024. The closeness of reported to adjusted liabilities suggests that deferred income tax adjustments have minimal influence on the liability side. The rate of increase in liabilities is moderate compared to assets, signaling controlled growth in obligations relative to asset expansion.

Stockholders’ Equity

Reported stockholders’ equity rose overall from $9.73 billion in 2020 to $16.43 billion in 2024, with a noticeable decrease in 2022, mirroring the asset trend but with more pronounced volatility. The adjusted equity again is slightly lower than the reported equity across all years, consistent with deferred tax adjustments reducing net equity. The equity growth after 2022 is strong, suggesting resumed profitability and retained earnings accumulation despite the mid-cycle dip.

Net Income Attributable to Company

Reported net income shows variability but an overall increasing trajectory, peaking at $2.32 billion in 2024. The adjusted net income is generally lower than the reported, which is attributable to deferred tax implications. Importantly, adjusted net income decreased substantially in 2022 compared to 2021, reflecting a period of profit contraction or increased tax expenses, before recovering in subsequent years. This pattern highlights a year of operational or tax-related challenges in 2022, followed by improved financial performance.

General Insights

The data indicates solid growth in the company's asset base and equity, underpinned by increasing net income despite some fluctuations in 2022. Deferred income tax adjustments exert a consistent downward adjustment on key metrics, especially equity and net income, signaling the material impact of such tax considerations on financial statement presentation. Liabilities remain a small and gradually growing proportion of the balance sheet, evidencing a conservative leverage profile. Overall, the financial trends portray resilience and expansion with temporary setbacks corresponding to the 2022 fiscal year.

The analysis of the financial performance metrics over the five-year period reveals several notable trends and variations between reported and adjusted figures. Both sets of data provide insights into profitability, efficiency, and leverage, reflecting the company's operational and financial dynamics.

Net Profit Margin

The reported net profit margin experienced fluctuations, starting at 24.33% in 2020, increasing to a peak of 29.85% in 2021, then decreasing sharply to 21.25% in 2022 before recovering to 27.81% by 2024. The adjusted net profit margin follows a similar pattern but shows lower values especially in 2022 and 2023, reaching as low as 18.27% in 2022. This suggests that after accounting for deferred income tax effects, profitability margins were somewhat dampened particularly in the mid-period, indicating possible tax adjustments impacting net profitability.

Total Asset Turnover

The total asset turnover ratio, indicating asset utilization efficiency, shows a generally positive trend in both reported and adjusted figures. Reported turnover rose from 0.39 in 2020 to a high of 0.48 in 2022, slightly declining to 0.45 by 2024. Adjusted figures follow this trajectory but remain consistently marginally higher, peaking at 0.51 in 2022. This improvement over time denotes enhanced efficiency in generating revenues from assets, although a slight reduction in the final years suggests stabilization or minor inefficiencies.

Financial Leverage

Financial leverage ratios remain relatively stable throughout the period, fluctuating narrowly around 1.14 to 1.19. The reported leverage decreases slightly from 1.15 in 2020 to 1.14 in 2024, while adjusted leverage indicates a mild increase reaching 1.19 in 2022 before reverting close to initial levels. This stability indicates a consistent capital structure with limited reliance on debt or significant shifts in equity financing.

Return on Equity (ROE)

ROE demonstrates a variable pattern corresponding with net profit and asset turnover changes. Reported ROE improves from 10.9% in 2020 to 14.32% in 2021, dips in 2022, and climbs back to 14.13% by 2024. Adjusted ROE mirrors this trend but shows a lower value in 2022 at 10.96%, indicating that tax adjustments affected shareholder returns more markedly that year. The recovery in later years implies a restoration of profitability and effective equity utilization.

Return on Assets (ROA)

ROA trends are consistent with net profit margin and asset turnover movements. Reported ROA increases from 9.5% in 2020 to 12.58% in 2021, falls in 2022, and then gradually rises to 12.39% by 2024. Adjusted ROA follows a similar descent and recovery pattern with a more pronounced low point at 9.24% in 2022. This pattern reflects fluctuations in overall asset profitability, affected both by operational outcomes and tax-related adjustments.

In summary, the financial performance of the company shows generally positive returns with notable peaks in 2021 followed by a dip in 2022 across most metrics, which is partially attributed to deferred income tax adjustments. Efficiency of asset use improved over the period but showed signs of plateauing recently. The leverage remained stable, indicating a conservative financing strategy. Overall profitability and returns strengthened towards 2024, revealing recovery and growth resilience.

The data reveals noteworthy trends in both reported and adjusted net income and net profit margins over the five-year period ending December 31, 2024.

Reported Net Income Attributable to the Company

The reported net income increased significantly from 1,060,600 thousand USD in 2020 to 1,704,600 thousand USD in 2021, marking a strong growth phase. However, this was followed by a decline to 1,322,300 thousand USD in 2022. Subsequently, the reported net income rebounded in the following years, rising to 1,798,000 thousand USD in 2023 and further to 2,322,600 thousand USD in 2024. The overall trajectory exhibits a pronounced upward trend with temporary volatility in 2022.

Adjusted Net Income Attributable to the Company

Adjusted net income demonstrated a different pattern, starting higher than the reported net income in 2020 at 1,118,200 thousand USD but showing a decrease in 2021 to 1,640,600 thousand USD. This was followed by a more pronounced drop in 2022 to 1,137,000 thousand USD. From 2022 onward, adjusted net income increased steadily to 1,517,200 thousand USD in 2023 and then rose substantially in 2024 to 2,187,300 thousand USD. Despite the volatility, adjusted net income mirrors the overall recovery and growth observed in the reported figures.

Reported Net Profit Margin

The reported net profit margin experienced growth from 24.33% in 2020 to a peak of 29.85% in 2021, indicating improved profitability during this period. However, there was a distinct decline to 21.25% in 2022, suggesting reduced profitability or increased costs. This margin recovered moderately to 25.24% in 2023 and further to 27.81% in 2024. The pattern reflects a recovery phase after a margin contraction in 2022.

Adjusted Net Profit Margin

Adjusted net profit margin also peaked in 2021 at 28.73% after rising from 25.66% in 2020. However, it dropped markedly to 18.27% in 2022, a sharper decline compared to the reported margin, implying significant adjustments affected profitability measures. This margin improved in subsequent years to 21.3% in 2023 and 26.19% in 2024 but remained below the earlier peak. The adjusted margin reveals greater fluctuation and a more cautious profitability stance over the period.

Overall, the financial data indicates that the company experienced robust growth and profitability improvements up to 2021, followed by a downturn in 2022 affecting both reported and adjusted figures. The years 2023 and 2024 show recovery and strengthening financial performance, with both net income and profit margins approaching or surpassing prior peak levels. Adjusted figures suggest more volatility and highlight the impact of non-recurring or deferred tax effects on reported financial results.

The financial data reveals several notable trends related to the company's asset base and asset utilization efficiency over the five-year period from 2020 to 2024.

Total Assets

Both reported and adjusted total assets exhibit a progressive increase throughout the timeframe. Reported total assets rose from approximately 11.17 billion US dollars in 2020 to around 18.74 billion US dollars in 2024, reflecting an overall growth of about 68%. Adjusted total assets follow a similar upward trajectory, increasing from about 10.80 billion to 17.70 billion US dollars in the same periods. The consistent increase in assets suggests ongoing investments or asset acquisitions over these years.

Asset Turnover Ratios

The reported total asset turnover ratio indicates moderate fluctuations but maintains an overall positive trend. It increased from 0.39 in 2020 to a peak of 0.48 in 2022, followed by a slight decline to 0.45 in 2024. Similarly, the adjusted total asset turnover ratio demonstrates a comparable pattern, rising from 0.40 to a high of 0.51 in 2022 and then gradually decreasing to 0.47 by the end of 2024. These ratios reflect how efficiently the company generates revenue relative to its asset base and imply that the efficiency improved until 2022 before marginally declining in the subsequent years.

Comparison Between Reported and Adjusted Figures

The adjusted total assets are consistently slightly lower than the reported figures, likely due to accounting adjustments for deferred income taxes or other factors. The adjusted total asset turnover ratios are also marginally higher than the reported ratios, which may suggest that adjustments lead to a somewhat better perceived efficiency in asset utilization.

In summary, the company has steadily expanded its asset base over the five-year period while maintaining or slightly improving asset turnover efficiency up to 2022, with a slight reduction thereafter. The adjustments applied to total assets and turnover ratios slightly affect the magnitude but not the overall trend of these metrics.

An analysis of the financial data over the five-year period reveals several noteworthy trends in the reported and adjusted figures related to total assets, stockholders’ equity, and financial leverage ratios.

Total Assets

Both reported and adjusted total assets show an overall upward trajectory from 2020 through 2024. Reported total assets increased from approximately $11.17 billion in 2020 to about $18.74 billion in 2024, reflecting a significant growth trend. Similarly, adjusted total assets rose from roughly $10.80 billion to $17.70 billion over the same period. Despite a slight decline in 2022, the general trend is one of expansion, indicating an accumulation of resources or investments over time.

Stockholders’ Equity

Reported stockholders’ equity also demonstrates consistent growth, moving from around $9.73 billion in 2020 to approximately $16.43 billion in 2024. Adjusted equity follows a comparable pattern, rising from about $9.37 billion to $15.39 billion. There is a noticeable dip in 2022 in both reported and adjusted equity figures, followed by a recovery and further increase in subsequent years. This pattern could suggest periodic adjustments or external influences impacting equity but does not disrupt the overall growth trajectory.

Financial Leverage Ratios

The financial leverage, expressed as a ratio, remains relatively stable throughout the period with minor fluctuations. Reported financial leverage hovers close to 1.15, dipping slightly to 1.14 in both 2021 and 2024 and peaking at 1.17 in 2022. Adjusted financial leverage follows a similar pattern, experiencing a modest increase to 1.19 in 2022 before normalizing closer to 1.15 by 2024. This consistency indicates a stable capital structure with moderate use of debt relative to equity.

Overall, the examined data suggest steady growth in asset base and equity, accompanied by stable financial leverage ratios. The slight dip in 2022 across multiple metrics may warrant further investigation, but does not appear to have altered the fundamental positive trend in financial position over the period analyzed.

The financial data reveals several important trends over the five-year period. Net income, both reported and adjusted, fluctuates but shows an overall upward trajectory from 2020 to 2024. Reported net income increases from approximately 1.06 billion US dollars in 2020 to about 2.32 billion US dollars in 2024, despite a dip in 2022. Adjusted net income follows a similar pattern, rising from roughly 1.12 billion US dollars to 2.19 billion US dollars over the same period, with a notable decline in 2022 as well.

Total stockholders' equity, measured on both a reported and adjusted basis, also demonstrates consistent growth. Reported equity grows from approximately 9.73 billion US dollars in 2020 to 16.43 billion US dollars in 2024, showing resilience despite a decrease in 2022. Adjusted equity exhibits similar behavior, increasing from around 9.37 billion US dollars to 15.39 billion US dollars across the five years, with a dip in 2022 followed by recovery and growth.

Return on equity (ROE) metrics indicate a relatively stable yet fluctuating profitability trend. Reported ROE starts at 10.9% in 2020 and reaches 14.13% in 2024, with a peak in 2021 at 14.32% and a decline in 2022 to 11.98%. Adjusted ROE begins higher at 11.94% in 2020, dips to 10.96% in 2022, and ends slightly above reported ROE at 14.21% in 2024. This suggests that adjusted performance measures are somewhat more conservative but converge toward reported results by the end of the period.

Net Income Trends

Both reported and adjusted net income exhibit growth with temporary declines in 2022, suggesting the influence of non-recurring factors or adjustments affecting profitability that year.

Stockholders’ Equity Trends

The continuous increase in equity, notwithstanding the 2022 dip, reflects ongoing capital accumulation and retained earnings growth over the analyzed period.

Return on Equity Evolution

The ROE trends indicate fluctuations in profitability relative to equity, with adjusted ROE generally lower than reported ROE except at the start and end of the timeline, indicating adjustments have a moderating effect on profitability metrics.

Overall Observations

The financial performance demonstrates resilience and expansion despite intermittent setbacks, with trends in net income and equity growth suggesting strong operational and financial management. Adjusted figures provide a more conservative view but align closely with reported outcomes by 2024, illustrating consistency in financial reporting and performance.

The financial data for the periods ending from 2020 to 2024 reveals several noteworthy trends in income, assets, and return on assets (ROA) metrics, both reported and adjusted.

Net Income

The reported net income attributable to the company demonstrates a generally upward trajectory, with an increase from approximately 1,060,600 thousand USD in 2020 to 2,322,600 thousand USD in 2024. Despite fluctuations, such as a decrease in 2022, the overall trend indicates substantial growth in profitability over the five-year period. Adjusted net income follows a somewhat similar pattern but shows a decline from 2021 to 2022 that is more pronounced than in the reported figures. From 2022 onward, adjusted net income recovers and reaches 2,187,300 thousand USD by 2024, approaching the reported figures.

Total Assets

Both reported and adjusted total assets exhibit steady growth over the examined period. Reported total assets increased from 11,168,900 thousand USD in 2020 to 18,743,200 thousand USD in 2024, demonstrating the company’s expanding asset base. Adjusted total assets similarly rose from 10,801,200 thousand USD to 17,698,100 thousand USD during the same timeframe. The adjusted values consistently remain slightly below the reported values, reflecting the impact of deferred income tax adjustments or other accounting considerations.

Return on Assets (ROA)

The reported ROA shows initial growth from 9.5% in 2020 to a peak of 12.58% in 2021, followed by a dip to 10.19% in 2022. Subsequently, it recovers and gradually increases to 12.39% by 2024. This pattern suggests some variability in asset efficiency but a generally positive trend toward higher profitability relative to asset base. The adjusted ROA values similarly peak in 2021 at 12.51%, decline more sharply to 9.24% in 2022, and then improve to 12.36% by 2024. The sharper downturn and subsequent recovery in adjusted ROA compared to reported ROA indicate that adjustments have a notable effect on perceived asset efficiency during this period.

Overall, the data reflects a strong growth trajectory in both income and asset size, despite some short-term volatility, particularly in 2022. The alignment in trends between reported and adjusted metrics suggests consistency in financial performance, while the adjustments provide insights into the impacts of accounting treatments on reported results. The improvement in ROA towards the end of the period underscores increasing efficiency in utilizing assets to generate income.