Intuitive Surgical, Inc.

Ladies and gentlemen, thank you for standing by. Welcome to the Intuitive Third Quarter Earnings Release Call. At this time, all participants are in a later lesson-only mode. Later, we will conduct a question and answer session. To ask a question, you will please hit 1, then 0 on your telephone keypad. You may withdraw your question at any time by repeating the 1-0 command. If you're using a speakerphone, please pick up the handset before pressing the numbers. Once again, to ask a question, press 1, then 0. If you require assistance during the call, please press star, then 0. As a reminder, this conference is being recorded. I would now like to turn the conference over to our host, Head of Investor Relations, Mr. Brian King. Please go ahead.

Good afternoon, and welcome to Intuitive's third quarter earnings conference call. With me today, we have Gary Guttartz, our CEO. and Jamie Samath, our CFO. Before we begin, I would like to inform you that comments mentioned on today's call may be deemed to contain forward-looking statements. Actual results may differ materially from those expressed or implied as a result of certain risks and uncertainties. These risks and uncertainties are described in detail in our Securities and Exchange Commission filings, including our most recent form, 10-K, filed on February 3rd, 2022, and Form 10-Q, filed on July 22nd, 2022. Our SEC filings can be found through our website or at the SEC's website. Investors are cautioned not to place undue reliance on such forward-looking statements. Please note that this conference call will be available for audio replay on our website at intuitive.com on the event section under our investor relations page. Today's press release and supplementary financial data tables have been posted to our website. Today's format will consist of providing you with highlights of our third quarter results, as described in our press release announced earlier today, followed by a question and answer session. Gary will present the quarter's business and operational highlights. Jamie will provide a review of our financial results. Then I will discuss procedure and clinical highlights and provide our updated financial outlook for 2022. And finally, we will host a question and answer session.

With that, I will turn it over to Gary. Thank you for joining us today. Our business fundamentals strengthened in Q3 with 20% procedure growth in da Vinci procedures compared with Q3 of last year and solid performance in each of our global regions. Our capital placements reflected 13% growth in our install base to meet procedure demand accompanied by continued increases in utilization per system per year, healthy indicators for our customers and for us. ION also experienced increases in installs, procedures performed, and annualized system utilization. Supply chain challenges, while still present, are abating from their pandemic peaks. Looking more closely at procedures, 20% growth is up from 14% last quarter and above our three-year compound annual growth rate of 16% during the pandemic. General surgery, our largest procedure category, is growing at the fastest rate of any category fueled by bariatric surgery, cholecystectomy, hernia repair, and other foregut procedures in the United States. In Europe, several countries are growing nicely with diversified use beyond urology. Germany, the UK, and Ireland, Italy, and Spain stood out in the quarter. In Asia, Japanese procedure growth accelerated relative to Q2, and Korean growth remained solid. procedures in both countries are also diversifying beyond urology. In China, procedure growth was just above our global average, hampered in part by regional rolling lockdowns that continue to impact procedures and utilization. Turning to capital, we placed 305 systems in the quarter, compared with 336 in Q3 a year ago, and 279 last quarter. Strong procedure demand is supporting the installed base growth of 13% in the quarter. Per-system utilization grew 7% in the quarter, up from our three-year compound annual growth of 5% over the pandemic. Utilization was aided by recovery from a softer U.S. procedure quarter last year, as well as customer performance of more types of procedures in higher volume categories and increases in customer efficiency. SI trade-ins continue to slow given the decline in remaining trade-in opportunity. Ion placements grew to 50 this quarter, up from 28 last year and 41 last quarter, reflecting continued growth in an early market. Overall, customers are acquiring systems where there is opportunity for procedure growth. On the investment front, we continue to focus on our platforms in multiport and aluminal, single port and digital through indication and regional regulatory expansions, innovation in products and services that meet customer needs, and product quality and cost refinements. We expect our new platforms to approach our historical levels of contribution margin over time. Progress year-to-date has met our expectations. With regard to our expenses this quarter, we moderated headcount growth to focus on deeply integrating those employees who joined us in the past several quarters. Going into 2023, we expect the rate of growth in fixed expenses to slow, as we pursue leverage in our enabling functions and sequence some of our forward investments. We've had a solid quarter, achieving product and services milestones. We continue to expand access to our multiport products, training, and services globally. Standouts in the quarter include record global quarterly new surgeon training completions to first case and accreditation of our technology training pathway by the Royal College of Surgeons in the U.K., For ION, we submitted our registration application in China, and we obtained German regulatory clinical study approval for ION ablation technology, which starts our clinical journey towards enabling interventions beyond biopsy. ION procedures grew 211% in the quarter. Turning to our single port platform, DaVinci SP, procedures grew 46% year over year, with particular strength in Korea, where our SP team launched next-generation SP instruments and our Firefly-enabled endoscope. We also received PMDA clearance in the quarter to market SP in Japan across a broad set of clinical indications, similar to the indications SP has in Korea. In our digital portfolio, our MyIntuitive app and portal are being adopted broadly in regions in which they are released, as the go-to digital portal for DaVinci customers. Installs of our in-room computing platform, Intuitive Hub, grew 21% over the third quarter last year, and software updates to our Hub install base improved usability and enabled telepresence. In summary, our core business strengthened in the quarter as acute pandemic impacts softened. We are managing spend growth while investing in core growth opportunities for the future. I'll now pass the time over to Jamie to take us through our finances, and some persistent macroeconomic issues in greater detail. Good afternoon.