Intuitive Surgical Inc. (NASDAQ:ISRG)

Gross property, plant, and equipment (PP&E) exhibited a substantial and consistent increase over the five-year period, rising from US$2.845 billion in 2021 to US$7.619 billion in 2025. This growth was driven by increases across most PP&E categories, with particularly significant expansion in building and building/leasehold improvements, and operating lease assets related to Intuitive System Leasing. Accumulated depreciation also increased steadily throughout the period, as expected with a growing asset base, moving from negative US$968.6 million in 2021 to negative US$2.277 billion in 2025. Consequently, net PP&E increased significantly, from US$1.876 billion in 2021 to US$5.342 billion in 2025.

Land

Land values increased from US$367.8 million in 2021 to US$479.7 million in 2025, representing a cumulative increase of approximately 30.4%. The rate of increase slowed after 2023, suggesting a potential stabilization of land acquisition activity.

Buildings and Building/Leasehold Improvements

This category experienced the most substantial growth, increasing from US$812.5 million in 2021 to US$2.834 billion in 2025. This represents a more than 248% increase over the period. The largest single-year increase occurred between 2023 and 2024, suggesting significant investment in facilities during that time.

Machinery and Equipment

Machinery and equipment increased from US$497.6 million in 2021 to US$1.024 billion in 2025, a growth of approximately 105.7%. The growth rate was relatively consistent throughout the period.

Operating Lease Assets (Intuitive System Leasing)

This category also demonstrated significant growth, increasing from US$616.1 million in 2021 to US$2.097 billion in 2025, representing a 240.8% increase. This suggests an expansion of the leasing program for Intuitive Systems. The growth rate accelerated in 2023 and 2024.

Computer and Office Equipment

Computer and office equipment showed a steady, albeit smaller, increase, rising from US$123.7 million in 2021 to US$247.7 million in 2025, a growth of approximately 100.3%.

Capitalized Software

Capitalized software values increased modestly, from US$217.6 million in 2021 to US$299.3 million in 2025, representing a 37.6% increase. Growth was relatively consistent year-over-year.

Construction-in-Process

Construction-in-process exhibited substantial volatility. It increased significantly from US$209.7 million in 2021 to US$1.355 billion in 2023, then decreased substantially to US$638.1 million in 2025. This suggests large-scale projects were underway, reaching peak investment in 2023, and nearing completion by 2025.

The consistent growth in net PP&E indicates ongoing investment in the business. The significant increases in buildings, machinery, and operating lease assets suggest expansion of facilities, production capacity, and the leasing program. The fluctuations in construction-in-process warrant further investigation to understand the nature and progress of capital projects.

An analysis of property, plant, and equipment age-related metrics reveals several noteworthy trends over the five-year period. The average age ratio demonstrates a generally decreasing pattern, while estimates of useful life and remaining life fluctuate. These movements suggest evolving asset management strategies and potential shifts in the composition of the asset base.

Average Age Ratio

The average age ratio decreased from 39.10% in 2021 to 31.09% in 2024, indicating a relative reduction in the proportion of assets nearing the end of their useful lives. A slight increase to 31.89% is observed in 2025, but remains below the levels recorded in the earlier years of the period. This suggests a potential focus on acquiring newer assets or more effectively managing the depreciation of existing ones.

Estimated Total Useful Life

The estimated total useful life of assets increased from 9 years in 2021 to a peak of 14 years in 2024, before decreasing to 12 years in 2025. This increase could be attributable to revisions in depreciation schedules, the acquisition of assets with longer expected lifespans, or improvements in maintenance practices extending asset usability. The subsequent decrease in 2025 warrants further investigation to determine if it reflects a change in asset acquisition patterns or revised life estimates.

Estimated Age and Remaining Life

The estimated age, representing the time elapsed since purchase, remained constant at 4 years throughout the period. Simultaneously, the estimated remaining life increased from 5 years in 2021 to 9 years in 2024, then decreased to 8 years in 2025. The consistent age suggests a steady rate of asset acquisition, while the increase and subsequent decrease in remaining life correlate with the changes observed in the estimated total useful life. This indicates that the company is, on average, acquiring assets with increasing expected lifespans, but this trend may be moderating.

In summary, the observed trends suggest a dynamic approach to asset management. The decreasing average age ratio, coupled with the initial increase in estimated useful and remaining life, points to a potential strategy of modernizing the asset base. The fluctuations in 2025 warrant continued monitoring to assess the sustainability of these trends and their impact on future capital expenditure requirements.

The values associated with property, plant, and equipment demonstrate a consistent pattern of growth between 2021 and 2025. Accumulated depreciation and gross property, plant, and equipment both increased steadily throughout the period, indicating ongoing investment in fixed assets. The average age ratio exhibits a generally decreasing trend, though with a slight increase in the final year observed.

Gross Property, Plant, and Equipment

Gross property, plant, and equipment increased from US$2,845,000 thousand in 2021 to US$7,618,900 thousand in 2025. This represents a substantial expansion of the asset base over the five-year period, with the largest absolute increase occurring between 2022 and 2023. The rate of increase appears to moderate slightly in the later years, but remains positive.

Accumulated Depreciation

Accumulated depreciation mirrored the growth in gross property, plant, and equipment, rising from US$968,600 thousand in 2021 to US$2,276,500 thousand in 2025. The consistent increase suggests a regular depreciation process applied to the expanding asset base. The absolute increase in accumulated depreciation also peaked between 2022 and 2023, aligning with the largest growth in gross property, plant, and equipment.

Land

The value of land increased steadily, though at a slower pace than the overall property, plant, and equipment. It rose from US$367,800 thousand in 2021 to US$479,700 thousand in 2025. The incremental increases suggest periodic land acquisitions, but land represents a relatively stable portion of the total asset base.

Average Age Ratio

The average age ratio, expressed as a percentage, generally decreased from 39.10% in 2021 to 31.09% in 2024. This indicates that, on average, the property, plant, and equipment were becoming newer over time. However, the ratio increased slightly to 31.89% in 2025, potentially suggesting a slower rate of asset replacement or a larger proportion of recently acquired assets entering the depreciation cycle. The overall trend suggests a relatively modern asset base.

In summary, the financial items related to property, plant, and equipment demonstrate a period of significant investment and asset growth. The decreasing average age ratio, with a minor deviation in the final year, suggests effective asset management and a relatively young asset base.

Gross property, plant, and equipment exhibited a consistent upward trend over the five-year period, increasing from US$2.845 billion in 2021 to US$7.619 billion in 2025. Land holdings also increased, though at a slower pace, rising from US$367.8 million to US$479.7 million during the same timeframe. Depreciation expense demonstrated a steady increase, moving from US$280 million in 2021 to US$600 million in 2025, which aligns with the growth in gross property, plant, and equipment. The estimated total useful life of these assets, however, showed fluctuations.

Gross Property, Plant, and Equipment Trend

The substantial increase in gross property, plant, and equipment suggests significant investment in assets over the period. This expansion could be indicative of growth initiatives, capacity increases, or technological upgrades. The rate of increase accelerated between 2022 and 2024, before moderating slightly in 2025.

Depreciation Expense Trend

The increasing depreciation expense is a natural consequence of the growing asset base. The expense grew at a relatively consistent rate until 2025, where it experienced a more pronounced increase. This could be due to a larger proportion of recently acquired assets entering their depreciation period, or a change in depreciation methods.

Estimated Useful Life Analysis

The estimated total useful life of the assets initially increased from 9 years in 2021 to 14 years in 2024. This lengthening of the estimated useful life could reflect improvements in asset quality, maintenance practices, or a reassessment of asset longevity. However, in 2025, the estimated useful life decreased to 12 years. This reduction may indicate a change in the composition of assets being acquired, the introduction of technology with shorter lifecycles, or a more conservative approach to estimating asset lives.

The interplay between increasing gross property, plant, and equipment, rising depreciation expense, and fluctuating estimated useful life warrants further investigation. The decrease in estimated useful life in 2025, following a period of increases, is a notable observation that could impact future depreciation charges and profitability assessments.

Accumulated depreciation and depreciation expense exhibit consistent increases over the observed period. The reported time elapsed since purchase remains constant, suggesting a consistent pattern of asset acquisition and depreciation.

Accumulated Depreciation

Accumulated depreciation increased steadily from US$968.6 million in 2021 to US$2,276.5 million in 2025. This represents a cumulative increase of 135.1% over the five-year period. The rate of increase appears to be accelerating, with larger absolute increases observed in later years.

Depreciation Expense

Depreciation expense also demonstrates a consistent upward trend, rising from US$280 million in 2021 to US$600 million in 2025. This signifies a 114.3% increase over the period. The increase in depreciation expense is not linear; the increment from 2024 to 2025 (US$161 million) is notably larger than the increment from 2021 to 2022 (US$46 million). This suggests a potential increase in the value of assets placed in service in recent years, or a change in estimated useful lives.

Time Elapsed Since Purchase

The reported time elapsed since purchase is consistently four years throughout the period. This indicates that the company has not reported any significant purchases of new property, plant, and equipment that would reset the age calculation. The consistent value suggests a focus on depreciating existing assets rather than acquiring new ones, or that new asset purchases are offset by disposals of older assets, maintaining a relatively stable average age.

The increasing depreciation expense, coupled with the constant time elapsed since purchase, suggests that the company’s asset base is either growing in value through recent additions, or that the depreciation methods or useful lives of existing assets have been adjusted. Further investigation into capital expenditure schedules and asset lives would be necessary to determine the underlying cause of these trends.

Property, plant, and equipment, net has demonstrated a consistent upward trend over the five-year period, increasing from US$1,876.4 million in 2021 to US$5,342.4 million in 2025. This growth indicates significant investment in fixed assets. Land holdings have also increased, though at a slower pace, rising from US$367.8 million to US$479.7 million during the same timeframe. Depreciation expense has steadily risen alongside the net property, plant, and equipment balance, moving from US$280.0 million in 2021 to US$600.0 million in 2025, reflecting the increasing asset base being depreciated.

Estimated Remaining Life

The estimated remaining life of the property, plant, and equipment initially increased from 5 years in 2021 to 9 years in 2024, before decreasing to 8 years in 2025. The increase suggests a potential reassessment of asset useful lives, possibly due to improvements in maintenance or technological advancements extending the period over which assets contribute to revenue generation. The subsequent decrease in 2025 could indicate new acquisitions with shorter estimated lives, or a revised assessment of existing assets.

The relationship between the increasing depreciation expense and the fluctuating estimated remaining life warrants further investigation. While the net value of property, plant, and equipment is growing, the increasing depreciation suggests a larger portion of the asset base is being expensed each year. The initial lengthening of the estimated remaining life would have reduced annual depreciation, but the recent shortening suggests a potential increase in depreciation expense in future periods, assuming consistent depreciation methods.

The growth in land holdings, while present, is less pronounced than the growth in overall property, plant, and equipment. This suggests that the primary driver of asset growth is investment in depreciable assets rather than land acquisition. The consistent increase in depreciation expense is a natural consequence of the expanding asset base and should be monitored in relation to capital expenditure plans and overall profitability.