Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
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Intuitive Surgical Inc. pages available for free this week:
- Income Statement
- Balance Sheet: Assets
- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Solvency Ratios
- Enterprise Value to EBITDA (EV/EBITDA)
- Return on Assets (ROA) since 2005
- Current Ratio since 2005
- Total Asset Turnover since 2005
- Analysis of Revenues
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Economic Profit
Intuitive Surgical Inc., economic profit calculation
US$ in thousands
| 12 months ended: | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | ||||||
| Cost of capital2 | ||||||
| Invested capital3 | ||||||
| Economic profit4 | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2024 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =
- Net Operating Profit After Taxes (NOPAT)
- NOPAT exhibited a fluctuating trend across the five years. It increased significantly from $1,149,207 thousand in 2020 to a peak of $1,700,018 thousand in 2021, followed by a substantial decline to $1,187,823 thousand in 2022. Subsequently, it rebounded to $1,596,933 thousand in 2023 and reached its highest value of $2,242,154 thousand in 2024, indicating a strong recovery and overall growth trend by the end of the period.
- Cost of Capital
- The cost of capital remained remarkably stable throughout the period, consistently around 18.69%. This stability suggests a consistent risk profile and financing environment for the company over the five years.
- Invested Capital
- Invested capital demonstrated a steady and significant upward trajectory. Starting at $4,486,200 thousand in 2020, it saw moderate growth in 2021 at $4,517,800 thousand, followed by a notable increase to $5,396,200 thousand in 2022. The growth accelerated further in 2023, reaching $7,159,800 thousand, and continued to rise to $7,798,800 thousand in 2024. This trend reflects substantial reinvestment or expansion in capital assets over the years.
- Economic Profit
- Economic profit showed considerable volatility while generally reflecting positive value creation. The figure rose sharply from $310,818 thousand in 2020 to $855,738 thousand in 2021, then dropped significantly to $179,581 thousand in 2022. After a recovery to $258,672 thousand in 2023, economic profit surged again to $784,464 thousand in 2024. These fluctuations align with changes in NOPAT and invested capital but indicate the company was able to generate economic value above its cost of capital for most of the years, especially in 2021 and 2024.
Net Operating Profit after Taxes (NOPAT)
Intuitive Surgical Inc., NOPAT calculation
US$ in thousands
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in allowances.
3 Addition of increase (decrease) in deferred revenue.
4 Addition of increase (decrease) in equity equivalents to net income attributable to Intuitive Surgical, Inc..
5 2024 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =
6 2024 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =
7 Addition of after taxes interest expense to net income attributable to Intuitive Surgical, Inc..
8 2024 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =
9 Elimination of after taxes investment income.
The financial performance of the company over the analyzed five-year period reveals notable fluctuations and an overall upward trajectory in profitability metrics.
- Net Income Attributable to the Company
- The net income shows growth from 1,060,600 thousand USD in 2020 to 1,704,600 thousand USD in 2021, representing a significant increase. However, in 2022, there was a decline to 1,322,300 thousand USD. Subsequently, the net income rose again to 1,798,000 thousand USD in 2023 and further increased to 2,322,600 thousand USD in 2024. This trend suggests strong recovery and expansion in profitability following the dip in 2022.
- Net Operating Profit After Taxes (NOPAT)
- NOPAT began at 1,149,207 thousand USD in 2020 and increased to 1,700,018 thousand USD in 2021, indicating improved operational efficiency or performance. Similar to net income, NOPAT decreased to 1,187,823 thousand USD in 2022, followed by a recovery to 1,596,933 thousand USD in 2023. By 2024, NOPAT reached 2,242,154 thousand USD, the highest point in the period analyzed. This reflects a strengthening operational position and effective management of after-tax operating profit.
Overall, both net income and NOPAT exhibit a clear pattern of initial growth, a temporary downturn in 2022, and a subsequent robust recovery through 2024. The increase in these key profitability measures in the final two years highlights enhanced financial performance and possibly improvements in market conditions, operational efficiency, or cost management strategies.
Cash Operating Taxes
Intuitive Surgical Inc., cash operating taxes calculation
US$ in thousands
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Income Tax Expense
- The income tax expense exhibited a generally upward trend over the analyzed period with some variability. Starting at 140,200 thousand USD at the end of 2020, it increased to 162,200 thousand USD in 2021. A significant jump was observed in 2022 when the value rose sharply to 262,400 thousand USD. This was followed by a notable decrease in 2023 to 141,600 thousand USD, nearly returning to the 2020 level. However, in 2024, the tax expense surged to its highest point in the period at 336,300 thousand USD. This volatility indicates fluctuating taxable income or varying tax rates and regulations affecting the tax liabilities.
- Cash Operating Taxes
- The cash operating taxes showed a marked increasing trend throughout the period. Beginning at 82,150 thousand USD in 2020, the figure nearly tripled by 2021 to 226,657 thousand USD. The upward trajectory continued with a sharp increase to 448,291 thousand USD in 2022, followed by a slight decline to 423,020 thousand USD in 2023. In 2024, the cash operating taxes rose again to 472,970 thousand USD. The steady rise suggests growing operational profitability or changes in tax cash payment practices. The slight dip in 2023 could reflect timing differences in tax payments or adjustments in taxable income.
- Comparative Observations
- The relationship between income tax expense and cash operating taxes indicates a different pattern in volatility and behavior. While the income tax expense showed significant fluctuations, cash operating taxes tended to increase consistently with minor deviations. This may suggest differences in accounting recognition versus actual cash tax payments, highlighting potential timing differences or altered tax strategies.
Invested Capital
Intuitive Surgical Inc., invested capital calculation (financing approach)
US$ in thousands
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of allowance for doubtful accounts receivable.
4 Addition of deferred revenue.
5 Addition of equity equivalents to total Intuitive Surgical, Inc. stockholders’ equity.
6 Removal of accumulated other comprehensive income.
7 Subtraction of construction-in-process.
8 Subtraction of available-for-sale marketable securities.
- Total reported debt & leases
- The total reported debt and leases showed a gradual increase from 79,900 thousand USD at the end of 2020 to 93,800 thousand USD by the end of 2022. In 2023, there was a slight decline to 89,800 thousand USD, followed by a significant rise to 146,000 thousand USD in 2024. This pattern indicates a generally upward trend in liabilities with a notable acceleration in debt levels during the most recent year.
- Total stockholders’ equity
- Stockholders' equity grew consistently over the analyzed period, starting from 9,731,500 thousand USD in 2020 and rising to 16,433,700 thousand USD by the end of 2024. There was a dip observed in 2022, where equity decreased to 11,041,900 thousand USD from 11,901,100 thousand USD in 2021. However, this was followed by substantial growth in the subsequent years, reaching the highest recorded value in 2024. Overall, the equity position strengthened considerably, reflecting a growing net asset base.
- Invested capital
- Invested capital displayed a steady increase throughout the period. It began at 4,486,200 thousand USD in 2020 and moved marginally to 4,517,800 thousand USD in 2021. From 2022 onwards, there was significant expansion, with invested capital reaching 5,396,200 thousand USD, then sharply increasing to 7,159,800 thousand USD in 2023 and further to 7,798,800 thousand USD in 2024. This demonstrates an intensifying commitment of resources into operations or assets over these years.
Cost of Capital
Intuitive Surgical Inc., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Operating lease liability3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2024-12-31).
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Operating lease liability3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2023-12-31).
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Operating lease liability3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2022-12-31).
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Operating lease liability3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2021-12-31).
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Operating lease liability3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2020-12-31).
Economic Spread Ratio
Intuitive Surgical Inc., economic spread ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Economic profit1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| Economic spread ratio3 | ||||||
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| Abbott Laboratories | ||||||
| Elevance Health Inc. | ||||||
| Medtronic PLC | ||||||
| UnitedHealth Group Inc. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Economic profit. See details »
2 Invested capital. See details »
3 2024 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
The financial data demonstrates significant fluctuations across the assessed periods, notable in economic profit, invested capital, and economic spread ratio.
- Economic Profit
- This indicator exhibits pronounced variability. Starting at 310,818 thousand US dollars in 2020, economic profit sharply increased to 855,738 thousand US dollars in 2021. A marked decline followed in 2022, with the figure decreasing to 179,581 thousand US dollars. Then, a moderate recovery occurred in 2023, reaching 258,672 thousand US dollars, followed by a substantial increase in 2024 to 784,464 thousand US dollars. This pattern suggests a volatile profitability environment with a strong rebound in the most recent year.
- Invested Capital
- Invested capital presents a consistent upward trend throughout the period. It rose from 4,486,200 thousand US dollars in 2020 to 4,517,800 thousand US dollars in 2021, then increased more noticeably each year to reach 5,396,200 thousand in 2022, 7,159,800 thousand in 2023, and finally 7,798,800 thousand in 2024. This steady growth indicates ongoing capital deployment and expansion.
- Economic Spread Ratio (%)
- The economic spread ratio shows significant fluctuations but generally aligns with trends in economic profit. It increased sharply from 6.93% in 2020 to 18.94% in 2021, then dropped substantially to 3.33% in 2022. A slight improvement followed in 2023, reaching 3.61%, and a more pronounced increase occurred in 2024, rising to 10.06%. Although volatility is apparent, the increase in 2024 reflects improved effectiveness of capital utilization relative to prior years.
Overall, the data reflects a volatile profitability environment with strong growth in invested capital and a rebound in key performance indicators by 2024. The relationship between increasing invested capital and fluctuating economic profit and spread ratios suggests that while investment has grown, returns on this capital have experienced periods of decline and recovery, highlighting areas for potential operational or strategic focus.
Economic Profit Margin
Intuitive Surgical Inc., economic profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Economic profit1 | ||||||
| Revenue | ||||||
| Add: Increase (decrease) in deferred revenue | ||||||
| Adjusted revenue | ||||||
| Performance Ratio | ||||||
| Economic profit margin2 | ||||||
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| Abbott Laboratories | ||||||
| Elevance Health Inc. | ||||||
| Medtronic PLC | ||||||
| UnitedHealth Group Inc. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Economic profit. See details »
2 2024 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenue
= 100 × ÷ =
3 Click competitor name to see calculations.
- Economic Profit
- The economic profit exhibited significant fluctuations over the five-year period. It increased notably from 310,818 thousand US dollars in 2020 to 855,738 thousand US dollars in 2021. However, there was a sharp decline in 2022 to 179,581 thousand US dollars, followed by a moderate recovery in 2023 with 258,672 thousand US dollars. By 2024, the economic profit surged again to 784,464 thousand US dollars, indicating a substantial rebound towards the end of the period.
- Adjusted Revenue
- Adjusted revenue demonstrated a consistent upward trend throughout the observed years. Starting at 4,375,500 thousand US dollars in 2020, it rose steadily each year, reaching 5,741,800 thousand US dollars in 2021, 6,246,500 thousand US dollars in 2022, 7,177,500 thousand US dollars in 2023, and peaking at 8,383,300 thousand US dollars in 2024. This reflects strong and continuous growth in the company's revenue base.
- Economic Profit Margin
- The economic profit margin followed a variable pattern reflecting changes in the economic profit relative to revenue. It increased substantially from 7.1% in 2020 to 14.9% in 2021, indicating improved profitability efficiency. However, this margin decreased markedly to 2.87% in 2022 and showed a slight improvement to 3.6% in 2023. In 2024, the margin rose again to 9.36%, reflecting a recovery in profit generation relative to the revenue achieved.
- Summary
- Overall, the company exhibited strong revenue growth across the observed period. Economic profit and economic profit margin showed volatility, with significant gains in 2021 and 2024, and notable declines especially in 2022. The rebound in both economic profit and margin by 2024 suggests enhanced operational effectiveness or cost management, contributing to improved profitability relative to the increasing revenue base.