Intuitive Surgical (ISRG) 10-K risk factor changes: FY2021 vs FY2020

[removed: - If our products do not achieve market acceptance, we will not be able to generate the revenue necessary to support our business.][added: IF OUR PRODUCTS DO NOT ACHIEVE AND MAINTAIN MARKET ACCEPTANCE, WE WILL NOT BE ABLE TO GENERATE THE REVENUE NECESSARY TO SUPPORT OUR BUSINESS.]

[removed: - Public health crises or epidemic diseases, or the perception of their effects, have had and could continue to have a material adverse effect on our business and results of operations.][added: PUBLIC HEALTH CRISES OR EPIDEMIC DISEASES, OR THE PERCEPTION OF THEIR EFFECTS, HAVE AND COULD CONTINUE TO MATERIALLY ADVERSELY AFFECT OUR BUSINESS AND RESULTS OF OPERATIONS.]

[removed: - If defects occur in our products, we may incur additional unforeseen costs, hospitals may not purchase our products, and our reputation may suffer.][added: IF OUR PRODUCTS CONTAIN DEFECTS OR ENCOUNTER PERFORMANCE PROBLEMS, WE MAY HAVE TO RECALL OUR PRODUCTS, INCUR ADDITIONAL UNFORESEEN COSTS, AND OUR REPUTATION MAY SUFFER.]

[removed: - We are subject] [added: Please see our risk factor below titled “We Are Subject] to [removed: product liability] [added: Product Liability] and [removed: negligence claims relating] [added: Negligence Claims Relating] to the [removed: use] [added: Use] of [removed: our products] [added: Our Products] and [removed: other legal proceedings that could materially adversely] [added: Other Legal Proceedings That Could Materially Adversely Affect Our Financial Condition, Divert Management’s Attention, and Harm Our Business.” Our distributors may] affect our [removed: financial condition, divert management’s attention, and harm] [added: ability to effectively market] our [removed: business.][added: products in certain countries or regulatory jurisdictions if a distributor holds the regulatory authorization or certification in such countries or within such regions and causes, by action or inaction, the suspension of such marketing authorization or certification or sanctions for non-compliance.]

[removed: - If we lose key personnel or are unable to attract and retain additional personnel, our ability to compete will be harmed.][added: IF WE LOSE KEY PERSONNEL OR ARE UNABLE TO ATTRACT AND RETAIN ADDITIONAL PERSONNEL, OUR ABILITY TO COMPETE WILL BE HARMED AND INCREASES IN LABOR COSTS COULD MATERIALLY ADVERSELY IMPACT OUR BUSINESS AND RESULTS OF OPERATIONS.]

[removed: - Our reliance on sole and single source suppliers could harm our ability to meet demand for our products in a timely manner or within budget.][added: OUR RELIANCE ON SOLE AND SINGLE SOURCE SUPPLIERS AND OUR ABILITY TO PURCHASE AT ACCEPTABLE PRICES A SUFFICIENT SUPPLY OF MATERIALS, PARTS, AND COMPONENTS COULD HARM OUR ABILITY TO MEET DEMAND FOR OUR PRODUCTS IN A TIMELY MANNER OR WITHIN BUDGET.]

[removed: - Our customers may use unauthorized or unapproved instruments and accessories, which would result in reduced revenue and loss of market share.][added: OUR CUSTOMERS MAY USE UNAUTHORIZED, UNAPPROVED, OR UNCERTIFIED INSTRUMENTS AND ACCESSORIES, WHICH WOULD RESULT IN REDUCED REVENUE AND LOSS OF MARKET SHARE.]

[removed: - We utilize distributors for a portion of our sales, which subjects us to a number of risks that could harm our business.][added: WE UTILIZE DISTRIBUTORS FOR A PORTION OF OUR SALES AND SERVICE OF OUR PRODUCTS IN CERTAIN COUNTRIES, WHICH SUBJECTS US TO A NUMBER OF RISKS THAT COULD HARM OUR BUSINESS.]

[removed: [Table of](#ifd6f4af27a57401890271d74ae2e1592_7) [Contents](#ifd6f4af27a57401890271d74ae2e1592_7)][added: [Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)]

[removed: - Disruptions at the] [added: DISRUPTIONS AT THE] FDA [removed: and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent products from being developed, approved, or commercialized in a timely manner or at all, which may adversely affect our business.][added: AND OTHER GOVERNMENT AGENCIES OR NOTIFIED BODIES CAUSED BY FUNDING SHORTAGES OR GLOBAL HEALTH CONCERNS COULD HINDER THEIR ABILITY TO HIRE, RETAIN, OR DEPLOY KEY LEADERSHIP AND OTHER PERSONNEL, OR OTHERWISE PREVENT PRODUCTS FROM BEING DEVELOPED, CLEARED, CERTIFIED, APPROVED, OR COMMERCIALIZED IN A TIMELY MANNER OR AT ALL, WHICH MAY ADVERSELY AFFECT OUR BUSINESS.]

[removed: - Complying with] [added: COMPLYING WITH] FDA [removed: regulations is a complex process, and our failure to comply fully could subject us to significant enforcement actions.][added: REGULATIONS IS A COMPLEX PROCESS, AND OUR FAILURE TO FULLY COMPLY COULD SUBJECT US TO SIGNIFICANT ENFORCEMENT ACTIONS.]

[removed: If we do not obtain and maintain the necessary domestic regulatory authorizations, we will not be able to sell our products in the U.S.][added: IF WE DO NOT OBTAIN AND MAINTAIN THE NECESSARY INTERNATIONAL REGULATORY APPROVALS OR CERTIFICATIONS, WE WILL NOT BE ABLE TO SELL OUR PRODUCTS IN OTHER COUNTRIES.]

[removed: - Our products are subject to international regulatory processes and approval requirements.][added: OUR PRODUCTS ARE SUBJECT TO INTERNATIONAL REGULATORY PROCESSES AND APPROVAL OR CERTIFICATION REQUIREMENTS.]

[removed: - Changes in healthcare legislation and policy may] [added: Failure to obtain such approvals or to comply with such regulations could] have a material adverse effect on our [added: business,] financial [removed: condition] [added: condition,] and results of operations.

[removed: - If we are unable to fully protect and successfully defend our intellectual property from use by third parties, our ability to compete in the market will be harmed.][added: IF WE ARE UNABLE TO FULLY PROTECT AND SUCCESSFULLY DEFEND OUR INTELLECTUAL PROPERTY FROM USE BY THIRD PARTIES, OUR ABILITY TO COMPETE IN THE MARKET MAY BE HARMED.]

Companies have introduced products in the field of robotic surgery or have made explicit statements about their efforts to enter the field including, but not limited to, the following companies: [added: Asensus Surgical, Inc.;] avateramedical GmbH; CMR Surgical Ltd.; Johnson & [removed: Johnson (including their wholly-owned subsidiaries Auris Health, Inc. and Verb Surgical Inc.);] [added: Johnson;] Medicaroid, Inc.; Medrobotics Corporation; Medtronic plc; [added: meerecompany Inc.;] MicroPort Scientific Corporation; Olympus Corporation; Samsung Group; Shandong Weigao Group Medical Polymer Company Ltd.; [removed: Smart Robot Technology Group Co. Ltd.;] [added: and] Titan Medical [removed: Inc.; and TransEnterix,] Inc. Other companies with substantial experience in industrial robotics could potentially expand into the field of surgical robotics and become competitors.

[removed: IF OUR PRODUCTS DO NOT ACHIEVE MARKET ACCEPTANCE, WE WILL NOT BE ABLE TO GENERATE THE REVENUE NECESSARY TO SUPPORT OUR BUSINESS.][added: If our products fail to achieve or maintain market acceptance, customers will not purchase our products, and we will not be able to generate the revenue necessary to support our business.]

The da Vinci Surgical System and our other products represent a fundamentally new way of performing [removed: surgery.][added: medical procedures.]

Achieving [added: and maintaining] physician, patient, and third-party payor acceptance of robotic-assisted [removed: surgery] [added: medical procedures] as a preferred method of performing [removed: surgery] [added: these procedures] is crucial to our success.

Physicians will not recommend the use of our products unless we can demonstrate that they produce results comparable or superior to existing [removed: surgical] techniques.

Even if we can prove the effectiveness of our products through clinical [removed: trials, surgeons] [added: studies, physicians] may elect not to use our products for any number of other reasons.

In addition, [removed: surgeons] [added: physicians] may be slow to adopt our products because of the perceived liability risks arising from the use of new products and the uncertainty of reimbursement from third-party payors, particularly in light of ongoing healthcare reform initiatives and the evolving U.S. healthcare environment.

We expect that there will [added: continue to] be a learning process involved for [removed: surgical] [added: patient care] teams to become proficient in the use of our products.

Broad use of our products [removed: will require] [added: requires] training of [removed: surgical] [added: patient care] teams.

We may not be able to rapidly train [removed: surgical] [added: patient care] teams in numbers sufficient to generate adequate demand for our products.

Also, [added: as] we [added: are conducting IDE studies to support 510(k) submission for da Vinci platforms and for seeking new indications, we] may experience delays in obtaining new product [removed: approvals] [added: approvals, certifications,] or clearances from the FDA or [added: foreign approvals or certifications from foreign authorities or notified bodies or] delays in recruiting patients [removed: for] [added: in our ongoing and planned] clinical [removed: trials needed for new product approvals.][added: studies.]

For example, our corporate headquarters and many of our operations, including certain of our manufacturing facilities, are located in California, which [removed: has] [added: previously] instituted risk reduction orders applicable to our employees in that region, significantly impacting the ability of our employees to get to their places of work to produce products and hampering our products from moving through the supply chain.

These unprecedented measures to slow the spread of the virus taken by local governments and healthcare authorities globally, including the deferral of elective medical procedures and social distancing measures, have had, and [added: we expect] will continue to have, a [removed: significant] negative impact on our operations and financial results.

[removed: Any of these] outbreaks could negatively impact the number of [removed: da Vinci] procedures performed and have a material adverse effect on our business, financial condition, results of operations, or cash flows.

[added: Other foreign markets have both] private insurance systems and government-managed systems that control reimbursement for new products and procedures.

In addition, healthcare cost containment efforts similar to those in the U.S. are prevalent in many of the other countries in which we [added: sell, and] intend to [removed: sell] [added: sell,] our products, and these efforts are expected to continue.

Costs associated with [removed: product flaws] [added: defects] or performance problems [added: of our products] could have a material adverse effect on our business, financial condition, results of operations, or cash flows.

[added: If] we [added: do not prevail in the purported class actions, product liability litigation, or other legal proceedings, we] may be faced with significant monetary damages or injunctive relief against us that could have a material adverse effect on our business, financial condition, results of operations, or cash flows.

For example, we self-insure our product liability risks, and we indemnify our directors and officers for third-party claims and do not carry insurance to cover that indemnity or the related underlying [added: potential] losses.

We also do not carry, among other types of coverage, earthquake [removed: and cyber] insurance.

We may not be able to attract and retain personnel on acceptable terms given the [added: constrained labor market and] competition for such personnel among technology and healthcare [removed: companies and universities.][added: companies.]

The loss of any of [removed: these persons] [added: our qualified personnel] or our inability to attract and retain qualified personnel could harm our business and our ability to [removed: compete.][added: compete and related expenses could materially adversely affect our results of operations and financial condition.]

While alternative suppliers exist and could be identified for [removed: sole-sourced] [added: single-sourced] components, the disruption or termination of the supply of [removed: components] [added: components, or inflationary pressure in our supply chain,] could cause a significant increase in the costs of these components, which could affect our operating results.

A disruption or termination in the supply of components could also result in our inability to meet demand for our products, which could harm our ability to generate revenues, lead to customer dissatisfaction, and damage our [removed: reputation.][added: reputation and our brand.]

The [removed: delays] [added: time and processes] associated with the verification of a new manufacturer could delay our ability to manufacture our products [removed: in a timely manner] [added: on schedule] or within budget, which may have a material adverse impact on our business, financial condition, results of operations, or cash flows.

In addition, hospitals are also experiencing staffing shortages and supply chain issues that could impact their ability to provide patient care.

Furthermore, our future ways of working changes, including fully remote and hybrid work environments, may present additional risks, uncertainties, and costs that could affect our performance, including increased operational risk, uncertainty regarding office space needs, heightened vulnerability to cyber attacks due to remote work, potential reduced productivity, changes to our company culture, and increased costs to ensure our offices are safe and functional as hybrid offices that enable effective collaboration of both remote and in-person colleagues.

Any of these

In addition, our ability to meet customers’ demands depends, in part, on our ability to timely obtain an adequate delivery of quality materials, parts, and components from our suppliers.

An information technology systems interruption, including cybersecurity attacks, could adversely affect the ordering, distribution, and manufacturing processes of our suppliers.

Difficulties in obtaining a sufficient supply of semiconductor and other component materials continue to increase, and we expect such difficulties to persist in the foreseeable future.

Prices of such materials have also increased, and global supply has become significantly constrained due to the increased demand for materials, including semiconductors, to support expansion of server and cloud networks as a greater proportion of the global population worked remotely, the introduction of 5G, and the continued electrification of vehicles.

We engage in activities to seek to mitigate such supply disruptions by, for example, increasing our communications with our suppliers and modifying our purchase order coverage and inventory levels.

However, notwithstanding these activities, the global semiconductor and materials supply shortage is likely to remain a challenge for the foreseeable future.

Such global shortages in important components have resulted in, and will continue to cause, inflationary pressure in our supply chain, which would impact our profits and profit margin.

If shortages and price increases in important supply-chain materials in the semiconductor or other markets continue, we could also fail to meet product demand, which would adversely impact our business, financial condition, results of operations, or cash flows.

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

THE INFLATIONARY ENVIRONMENT COULD MATERIALLY ADVERSELY IMPACT OUR BUSINESS AND RESULTS OF OPERATIONS.

Changes in economic conditions and supply chain constraints and steps taken by governments and central banks, particularly in response to the COVID-19 pandemic as well as other stimulus and spending programs, could lead to higher inflation than previously experienced or expected, which could, in turn, lead to an increase in costs.

In an inflationary environment, we may be unable to raise the prices of our products sufficiently to keep up with the rate of inflation.

Impacts from inflationary pressures could be more pronounced and materially adversely impact aspects of our business with revenue streams and cost commitments linked to contractual agreements that extend further into the future, as we may not be able to quickly or easily adjust pricing, reduce costs, or implement counter measures.

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

Component failures, manufacturing flaws, design defects or inadequate disclosure of product related risks with respect to our products could result in an unsafe condition or injury to, or death of, the patient.

- product recalls, which can include, but not be limited to, product withdrawals from the market, labeling changes, design changes, customer notifications, and notifications to global regulatory bodies;

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

Moreover, we may encounter higher recruiting expenses, wage rates, and retention benefits.

The extent and duration of the impact of labor market challenges are subject to numerous factors, including the continuing impact of the COVID-19 pandemic, availability of qualified and highly skilled persons in the markets where we operate and unemployment levels within these markets, behavioral changes, such as fully engaging employees and earning loyalty, prevailing wage rates, health and other insurance and benefit costs, inflation, adoption of new or revised employment and labor laws and regulations or government programs, safety levels of our operations, and our reputation within the labor market.

The timing of procedures

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

Tariffs increase the cost of the Company’s products and the components and raw materials that go into making them.

These increased costs adversely impact the gross margin that the Company earns on its products.

Tariffs can also make the Company’s products more expensive for customers, which could make the Company’s products less competitive and reduce consumer demand.

Countries may also adopt other measures, such as controls on imports or exports of goods, technology, or data, that could adversely impact the Company’s operations and supply chain and limit the Company’s ability to offer its products and services as designed.

These measures can require the Company to take various actions, including changing suppliers and restructuring business relationships.

Changing the Company’s operations in accordance with new or changed trade restrictions can be expensive, time-consuming, disruptive to the Company’s operations and distracting to management.

Such restrictions can be announced with little or no advance notice and the Company may not be able to effectively mitigate all adverse impacts from such measures.

Political uncertainty surrounding trade and other international disputes could also have a negative effect on consumer confidence and spending.

The EU–UK Trade and Cooperation Agreement (the “TCA”) was applied provisionally as of January 1, 2021, and entered into force on May 1, 2021.

The TCA does not specifically refer to medical devices.

However, as a result of Brexit, the Medical Devices Regulation (EU) No 2017/745 (the “EU Medical Devices Regulation”) will not be implemented in the UK, and previous legislation that sought to mirror the EU Medical Devices Regulation in the UK law has been revoked.

The regulatory regime for medical devices in Great Britain (England, Scotland, and Wales) continues to be based on the requirements derived from previous EU legislation, and the UK may choose to retain regulatory flexibility or align with the EU Medical Devices Regulation going forward.

CE markings will continue to be recognized in the UK, and certificates issued by EU-recognized notified bodies will be valid in the UK until June 30, 2023.

For medical devices placed on the market in Great Britain after this period, the UK Conformity Assessed (“UKCA”) marking will be mandatory.

In contrast, UKCA marking and certificates issued by UK notified bodies will not be recognized on the EU market.

RISK FACTORS SUMMARY

SUMMARY OF RISKS RELATING TO OUR BUSINESS

- Because our markets are highly competitive, customers may choose to purchase our competitors’ products or services or may not accept da Vinci robotic-assisted surgery, which would result in reduced revenue and loss of market share.

- If institutions or surgeons are unable to obtain coverage and reimbursement from third-party payors for procedures using our products, or if reimbursement is insufficient to cover the costs of purchasing our products, we may be unable to generate sufficient sales to support our business.

- We are subject to significant, uninsured liabilities.

- Negative publicity, whether accurate or inaccurate, concerning our products or our company could reduce market acceptance of our products and could result in decreased product demand and a decline in revenues.

- We experience long and variable capital sales cycles and seasonality in our business, which may cause fluctuations in our financial results.

- New product developments and introductions may adversely impact our financial results.

- We are subject to a variety of risks due to our operations outside of the U.S.

- Disruption of critical information systems or material breaches in the security of our systems could harm our business, customer relations, and financial condition.

- Our business is subject to complex and evolving laws and regulations regarding privacy, data protection, and other matters relating to information collection.

- If we fail to successfully acquire or integrate new businesses, products, and technology, we may not realize expected benefits or our business may be harmed.

- If we do not successfully manage our collaboration arrangements, licensing arrangements, joint ventures, strategic alliances, or partnerships with third parties, we may not realize the expected benefits from such alliances, which may have a material adverse effect on our business, financial condition, results of operations, or cash flows.

- We expect gross profit margins to vary over time, and changes in our gross profit margins could adversely affect our financial condition or results of operations.

- We offer alternative capital acquisition approaches.

As a result, we are exposed to the credit risk of some of our customers and the risk of losses of revenue, which could result in material losses.

- We are exposed to credit risk and fluctuations in the market value of our investments.

- We may incur losses associated with currency fluctuations and may not be able to effectively hedge our exposure.

- We may encounter manufacturing problems or delays that could result in lost revenue.

- Continued consolidation in the healthcare industry could have an adverse effect on our sales and results of operations.

- Economic conditions could have a material adverse effect on our company.

- Natural disasters or other events beyond our control could disrupt our business and result in loss of revenue or higher expenses.

- Changes in our effective tax rate may impact our results of operations.

- We use estimates, make judgments, and apply certain methods in determining our financial results and in measuring the progress of our business.

As these estimates, judgments, and methods change, our results of operations and our assessment of the progress of our business could vary.

SUMMARY OF RISKS RELATING TO OUR REGULATORY ENVIRONMENT

- Our products are subject to a lengthy and uncertain domestic regulatory review process.

- If our manufacturing facilities do not continue to meet federal, state, or other manufacturing standards, we may be required to temporarily cease all of our manufacturing operations, import/export of our products, and/or recall some products, which would result in significant product delivery delays and lost revenue.

If we do not obtain and maintain the necessary international regulatory approvals, we will not be able to sell our products in foreign countries.

- We are subject to federal, state, and foreign laws governing our business practices, which, if violated, could result in substantial penalties.

Additionally, challenges to, or investigation into, our practices could cause adverse publicity and be costly to respond to and, thus, could harm our business.

- If hospitals and other surgery facilities do not continue to meet federal, state, or other regulatory standards, they may be required to temporarily cease all or part of their da Vinci utilization.

SUMMARY OF RISKS RELATING TO OUR INTELLECTUAL PROPERTY

- Others may be successful in asserting that our products infringe their intellectual property rights, which may cause us to pay substantial damages and/or enjoin us from commercializing our products.

- Our products rely on licenses from third parties, which may not be available to us on commercially reasonable terms or at all.

If we lose access to these technologies, our revenues could decline.

SUMMARY OF GENERAL RISKS

- Our future operating results may be below securities analysts' or investors' expectations, which could cause our stock price to decline.

- Our stock price has been, and will likely continue to be volatile.

- Changes to financial accounting standards may affect our reported results of operations.

Our da Vinci products fall into five broad categories: da Vinci Surgical Systems, da Vinci instruments and accessories, da Vinci Stapling, da Vinci Energy, and da Vinci Vision, including Firefly Fluorescence imaging systems [removed: (“Firefly”)] and da Vinci Endoscopes.

We also provide a comprehensive suite of [removed: services, training,] [added: systems, learning,] and [removed: education programs.][added: services offerings.]

We have extended our fourth generation platform by adding the da Vinci X Surgical System, commercialized in [removed: the second quarter of] 2017, and the da Vinci SP Surgical System, commercialized in [removed: the third quarter of] 2018.

We are [removed: early] [added: still] in [removed: the] [added: a measured] launch of our da Vinci SP Surgical System, and we have an installed base of [removed: 69] [added: 99] da Vinci SP Surgical Systems as of December 31, [removed: 2020.][added: 2021.]

Training technologies include our Intuitive Simulation products, our [added: Iris augmented reality imaging product, our] Intuitive Telepresence remote case observation and telementoring tools, and our dual console for use in surgeon proctoring and collaborative surgery.

[removed: [Table of](#ifd6f4af27a57401890271d74ae2e1592_7) [Contents](#ifd6f4af27a57401890271d74ae2e1592_7)][added: [Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)]

Beginning in January 2020, [added: as a result of the spread of COVID-19,] we saw a substantial reduction in da Vinci procedures in China and, by early February 2020, procedures per week in China had declined by approximately 90% compared to the weekly procedure rates experienced in early January 2020.

As the COVID-19 pandemic spread to Western Europe and the U.S., we experienced a significant decline in da Vinci procedures in the last half of March [removed: 2020, and procedures per week in the U.S. declined] [added: 2020] to approximately 65% of the weekly procedure rate experienced earlier in the first quarter of 2020.

In [removed: April] [added: the second quarter of] 2020, procedures per week in the U.S. continued to [removed: decline,] [added: decline in April,] reaching approximately 30% of pre-COVID-19 [removed: levels.][added: levels followed by steady recovery in May and June, as COVID-19 cases dropped and elective procedures were permitted.]

However, [added: with the resurgence of COVID-19 cases] in the last two weeks of [removed: June and into July, with the resurgence of COVID-19 cases, some regions postponed elective procedures, and] [added: June,] we experienced a corresponding decline in da Vinci procedures.

[removed: During the second quarter of 2020, China] [added: In China,] procedures per week continued to increase to a level consistent with the early January 2020 weekly procedure rate.

In the third quarter of 2020, [removed: procedures recovered slowly] in the U.S., [added: procedures recovered slowly,] leveling off [added: to] near pre-COVID-19 levels towards the end of the quarter.

Outside of the U.S., da Vinci procedures varied [removed: in the third quarter of 2020,] depending on the spread and/or resurgence of COVID-19.

Procedures in China grew significantly year over [removed: year in the third quarter of 2020,] [added: year,] while [removed: regional] COVID-19 outbreaks resulted in year-over-year procedure growth rates in Japan slowing somewhat relative to [removed: earlier in] the [removed: year.][added: second quarter.]

The COVID-19 pandemic [removed: has] also affected the volumes of certain procedure types differently.

[removed: Da Vinci bariatric] [added: These] procedures [removed: grew significantly year over year in the third quarter] [added: have been an increased area] of [removed: 2020 due to our optimized instrument set and] focus [removed: by our sales organization] [added: in 2021] and [added: 2020 and] may also have benefited from certain patients prioritizing weight loss as obesity is a significant COVID-19 risk factor.

Outside of the U.S., similar to the trends noted in the third [removed: quarter,] [added: quarter of 2020,] procedures also continued to vary significantly by geography and region.

[removed: We continue to see that the] [added: The] impact of COVID-19 on our procedure volumes varies widely by country, region, and type.

When COVID-19 infection rates spike in a particular region, procedure volumes have been negatively impacted and the diagnoses of new conditions and their related treatments [removed: are] [added: have been] deferred.

[removed: Also, based] [added: Based] on our experience during [removed: 2020,] [added: 2020 and 2021,] we do not expect all markets, regions, and procedure types to recover at the same [added: time or at the same] pace.

In addition, the year-over-year stagnation in procedures [added: during 2020] and, in turn, reduced utilization of our systems [removed: has] [added: had] resulted in unused capacity in the existing installed base.

The depth and extent to which the COVID-19 pandemic will impact individual markets will vary based on the availability of [removed: testing capabilities,] [added: vaccinations,] personal protective equipment, intensive care units and operating rooms, and medical staff, as well as government interventions.

While the short-term payment relief offered did not have a material impact to the results of operations, we deferred $15 million of lease billings and extended payment terms associated with $181 million of trade receivables [removed: since the start of] [added: during] the program, of which $19 million [removed: remain] [added: remained] outstanding as of December 31, 2020.

[removed: Capital markets and worldwide] [added: Worldwide] economies have been significantly impacted by the COVID-19 pandemic, and it is possible that [removed: it] [added: factors related to the COVID-19 pandemic] could cause a prolonged recession in local and/or global economies.

The COVID-19 pandemic and local actions, such as “shelter-in-place” orders and restrictions on our ability to travel and access our customers or temporary closures of our facilities, including our [added: training and] manufacturing operations, or the facilities of our suppliers and their contract manufacturers, could further significantly impact our sales and our ability to produce and ship our products and supply our customers.

Any of these events could negatively impact the number of [removed: da Vinci] procedures performed or the number of system placements and have a material adverse effect on our business, financial condition, results of operations, or cash flows.

Our priorities and actions during the COVID-19 pandemic [removed: are] [added: have been and remain] as follows.

We have built a valuable team over the years, and we believe they will be important in [removed: the] [added: a] recovery that follows the pandemic.

We generate revenue from the placements of da Vinci Surgical Systems, in sales or sales-type lease arrangements where revenue is recognized up-front [added: at a point in time] or in operating lease transactions and usage-based models where revenue is recognized over time.

We earn recurring revenue from the sales of instruments, accessories, and services, as well as [removed: the] revenue from operating leases.

During the fourth quarter of 2020, we launched our Extended Use Program (refer to further discussion immediately below) with the intention to reduce the cost for customers to treat patients, which in turn will reduce our overall instruments and [added: accessories revenue per procedure.]

We generate revenue from [removed: the placements of the] [added: our] Ion endoluminal system in a business model consistent with the da Vinci Surgical System model described above.

We [removed: generate revenue from the placement of Ion systems, and we] earn recurring revenue from the sales of instruments and accessories used in biopsies and ongoing system [removed: service.][added: service, as well as revenue from operating leases.]

The average selling price of an Ion system is generally significantly lower than the average selling price of [removed: our] [added: a] da Vinci Surgical [removed: Systems.][added: System.]

We are introducing [removed: the] [added: our] Ion system in [removed: the U.S. in] a measured fashion.

For the years ended December 31, [removed: 2020,] [added: 2021,] and [removed: 2019,] [added: 2020,] the associated impact to revenue and gross margin was not significant.

In 2020, we introduced our [removed: "Extended] [added: “Extended] Use [removed: Program,"] [added: Program,”] which consists of select da Vinci Xi and da Vinci X instruments possessing 12 to 18 uses [removed: ("Extended] [added: (“Extended] Use [removed: Instruments")] [added: Instruments”)] compared to [removed: the current] [added: previously] 10 [removed: use instruments.][added: uses.]

They will [added: continue to] be introduced at various times throughout [removed: 2021 and] 2022 in other geographies, depending on regulatory processes.

In addition, simultaneous with the regional launches of Extended Use Instruments, we [removed: will lower] [added: have lowered] the price of certain instruments that are most commonly used in lower acuity procedures and/or lower reimbursed procedures within the region.

These actions [removed: will reduce] [added: have reduced] the cost for customers to treat patients, which in turn [removed: will reduce] [added: has reduced] our revenue per procedure.

Digitally-enabled for more than two decades, these three categories aim to decrease variability by offering dependable, consistent functionality and an integrated user experience.

Our systems category includes robotic platforms, software, vision, energy, and instruments and accessories.

Our learning category includes educational technology, such as simulation and telepresence, as well as technical training programs and personalized peer-to-peer learning opportunities.

Our services category assists and optimizes minimally invasive programs through readiness, on-demand support, consultation for minimally invasive program optimization, and hospitals customized analytics.

Within our integrated ecosystem, our focus is to decrease variability in surgery by offering actionable insights, with digital solutions, to take action with the potential to improve outcomes, personalize learning, and optimize efficiency.

The da Vinci SP Surgical System accesses the body through a single incision while the other da Vinci Surgical Systems access the body through multiple incisions.

We also plan to seek clearances in other OUS markets over time.

Our rollout of the Ion system is progressing well, and we are continuing to gather additional clinical evidence.

We plan to seek additional clearances for Ion in OUS markets over time.

The impact of COVID-19 in Europe during the second quarter of 2020 varied by country.

We experienced little impact on the procedure volume in Korea and Japan in the second quarter of 2020.

In the first quarter of 2021, in the U.S., the COVID-19 resurgence that affected procedures later in the fourth quarter of 2020 continued well into January 2021.

Then, as COVID-19 cases subsided, procedures experienced a steady improvement throughout February and March.

In Europe, the spread of COVID-19 varied regionally, and procedure growth rates were mixed.

While there were COVID-19 hot spots within some of our Asia Pacific markets, they tended to be isolated and, in general, procedures performed well.

In the second quarter of 2021, as the U.S. continued its broad rollout of vaccinations, COVID-19 cases and hospitalizations decreased, and procedure volumes recovered, partially attributed to the performance of a number of procedures that were deferred during the pandemic.

In Europe, the rollout of vaccinations and spread of COVID-19 varied regionally, and procedure growth rates were mixed.

We continued to see the impacts of regional resurgences of COVID-19 cases within the Asia Pacific markets.

China growth continued to be strong year over year, primarily reflecting the growth in the system installed base.

In the third quarter of 2021, COVID-19 infections resurged as the quarter progressed, and we saw a corresponding impact to our procedures.

In the U.S., we saw decreasing procedure volumes in August and September compared to June as COVID-19 cases and hospitalizations increased.

Late in the quarter, as COVID-19 cases began to slow, procedures began to recover.

Outside of the U.S., in Europe, the impact of COVID-19 in the third quarter of 2021 varied regionally.

We continued to see the impacts of regional resurgences of COVID-19 cases within the Asia Pacific markets.

China growth in the third quarter continued to be stronger than other Asia Pacific markets.

In the fourth quarter of 2021, procedure volumes continued to recover in October and November from the COVID-19 resurgence related to the Delta variant in the third quarter.

However, in December, procedure volumes were adversely impacted by the increase in hospitalizations in the U.S. and parts of Europe (most notably France and Italy) as the Omicron variant began to spread rapidly.

This trend has continued into January 2022.

In the U.S., high COVID-related hospitalization rates have been

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

exacerbated by staffing shortages.

Despite the fact that hospitals were better equipped to handle COVID patients in the fourth quarter of 2021 compared to the outset of the pandemic, COVID-19 resurgences like those being experienced in the U.S. and parts of Europe have challenged hospital resources and have negatively impacted da Vinci procedure volumes.

In addition, delays in diagnosis and treatment of underlying conditions have, and will continue to, negatively impact da Vinci procedure volumes.

Benign procedures experienced a more significant impact in December, reflecting the deferability of certain elective surgeries.

Our Asia Pacific markets were not significantly impacted by the resurgence in COVID-19 and saw strong procedure growth across multiple specialties in China, South Korea, and Japan.

While there is a backlog of patients, it is unpredictable when those patients will ultimately seek diagnosis and treatment and whether they will be treated through surgery.

However, throughout 2021, we experienced strong system demand, as utilization levels recovered.

In general, we believe that the COVID-19 pandemic had less of an impact on hospital spending capacity and that customers recognize that surgery meets their quadruple aim objectives better than other surgical approaches.

More specifically, during 2021, system demand reflected procedure growth, hospitals purchasing systems in preparation for a post-COVID-19 pandemic environment, and hospitals upgrading their system portfolio to access and/or standardize on fourth generation capabilities.

However, hospitals are currently experiencing staffing shortages and supply chain issues that could impact their ability to provide patient care, defer elective surgeries, and impact their profitability, all of which could impact hospitals’ spend on capital equipment.

Within our integrated ecosystem, our products are designed to decrease variability in surgery by offering dependable, consistent functionality and user experiences for surgeons seeking better outcomes.

We are introducing the Ion system in the U.S. in a measured fashion while we optimize training pathways and our supply chain and collect additional clinical data.

We are early in the launch and have placed 36 Ion systems for commercial use as of December 31, 2020.

We currently have 3 Ion systems placed with hospitals for gathering clinical data in addition to the systems placed for commercial use.

Prior to the spread of COVID-19 in the first quarter of 2020, we experienced procedure growth trends consistent with those experienced in the fourth quarter of 2019, including strength in general surgery, growth in mature procedures in the U.S., and growth in OUS urology.

In May and June, U.S. procedures began a recovery phase, as COVID-19 cases dropped and elective procedures were permitted, and, by the middle of June, had grown to nearly the same level as that measured in the first two weeks of the first quarter of 2020.

The impact of COVID-19 in Europe during the second quarter varied by country with procedures in Italy, France, and the UK declining more steeply, while Germany experienced a year-over-year increase in procedures.

For example, COVID-19 had a less significant impact in Germany where da Vinci procedures grew at mid-single digits relative to the third quarter of 2019, while it had a more significant impact in the U.K. where da Vinci procedures declined year over year.

For example, patient concerns over exposure to COVID-19 and the fact that prostate cancer can be slow growing, combined with lower prostate diagnoses and treatments, have caused the number of dVP procedures to decline in the third quarter of 2020 relative to the third quarter of 2019.

However, the diagnoses and treatment pathways for bariatric patients are long, and many of the patients in the third quarter may have begun their treatment pathway prior to the spread of COVID-19; therefore, we cannot assure you that we will continue to see significant growth in bariatric procedures.

The impact of a resurgence in a particular region can be significant.

The resurgence of COVID-19 had a more significant impact on procedures in Italy, France, and the UK.

Procedures in China continued to grow significantly year over year.

The trends that were noted in the third quarter of 2020 in relation to types of procedures, such as dVP and bariatric procedures, continued into the fourth quarter of 2020.

Due to the uncertainty of the recovery, including the potential for COVID-19 infection rates to increase, the extent and period of time over which the COVID-19 pandemic and any resultant economic recession will impact hospital spending, and additional policy responses that may be outlined by governments and other authorities, we cannot reliably estimate the impact that the COVID-19 pandemic may have on procedure volume in the first quarter of 2021 and beyond.

These deferral decisions continued into the fourth quarter of 2020.

We expect hospitals to first fill their unused capacity before purchasing additional systems.

As COVID-19 continues to disrupt healthcare operations and patient flow, we expect that system placements will lag behind the recovery of da Vinci procedure volume.

While we cannot reliably estimate the extent or period of time over which the COVID-19 pandemic and any resultant economic recession will impact hospital spending, we anticipate lower year-over-year system placements for the first quarter of 2021.

accessories revenue per procedure.

Extended Use Instruments have been introduced in the U.S. in October 2020 and in Europe in November 2020.

Based on 2019 volume and mix of procedures, our Extended Use Program and the reduced pricing on certain other instruments would have reduced 2019 annual instruments and accessories revenue by approximately $150 to $170 million.

In addition, the relationship between the installed base, number of shipments,

The COVID-19 pandemic reduced the number of shipments of da Vinci Surgical Systems in 2020 as compared to the prior year.

More recently, we have entered into usage-based arrangements with certain large customers whereby system and service revenue is recognized as the systems are used.

Our system leasing and usage-based models provide customers with flexibility regarding how they acquire or obtain access to our systems.

Based on the factors outlined in the *COVID-19 Pandemic* section above, the ability to forecast

future system shipments has been significantly disrupted and, therefore, we believe that historical system shipment trends may not be a good indicator of future system shipments.

In 2018, we began direct operations in India and Taiwan.

We are introducing the Ion endoluminal system in a measured fashion while we optimize training pathways and our supply chain and collect additional clinical data.

- In December 2018, we received product registration for our da Vinci Xi Surgical System in China.

The registration approval does not include advanced energy or stapling products that attach to the da Vinci Xi system.

Separate product registrations are required for each of these products by China National Medical Products Administration (“NMPA”).

As of December 31, 2020, we have sold 111 da Vinci Surgical Systems under this quota.

- In May 2018 and July 2018, we received CE mark clearance and FDA clearance, respectively, to market SureForm 60, our first 60mm stapler that completes our product offering of 30, 45, and 60mm lengths.

In January 2019 and February 2019, we obtained FDA clearance and CE mark clearance, respectively, to market SureForm 45.

We have also received regulatory clearance in South Korea and Japan to market both SureForm 60 and SureForm 45.

- In May 2018, we obtained FDA clearance for the da Vinci SP Surgical System for urologic surgical procedures that are appropriate for a single port approach.

In March 2019, we obtained FDA clearance for the da Vinci SP Surgical System for certain transoral procedures.

We also received regulatory clearance for the da Vinci SP Surgical System in South Korea in May 2018.

To achieve this objective, we maintain a diversified portfolio of cash equivalents and short- and long-term investments in a variety of high quality securities, including U.S. treasury and U.S. government agency securities, [removed: taxable and tax-exempt] municipal notes, corporate notes and bonds, commercial paper, non-U.S. government agency securities, cash deposits, and money market funds.

The weighted average duration of our portfolio as of December 31, [removed: 2020,] [added: 2021,] was approximately [removed: 0.7] [added: 1.2] years.

A hypothetical increase [added: or decrease] in interest rate by 25 basis points would have resulted in a decrease [added: or increase] in the fair value of our net investment position of approximately [removed: $10.5 million] [added: $23 million, respectively,] as of December 31, [removed: 2020.][added: 2021.]

For the year ended December 31, [removed: 2020,] [added: 2021,] sales denominated in foreign currencies were approximately 23% of total revenue.

For the year ended December 31, [removed: 2020,] [added: 2021,] our revenue would have decreased by approximately [removed: $72.6] [added: $25.1] million if the U.S. dollar exchange rate strengthened by 10%.

A 10% strengthening of the U.S. dollar exchange rate against all currencies to which we have exposure, after considering foreign currency hedges and offsetting positions as of December 31, [removed: 2020,] [added: 2021,] would have resulted in an approximately [removed: $1.7] [added: $7.6] million increase in the carrying amounts of those net assets.

[removed: [Table of](#ifd6f4af27a57401890271d74ae2e1592_7) [Contents](#ifd6f4af27a57401890271d74ae2e1592_7)][added: [Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)]

Intuitive®, Intuitive Surgical*®*, da Vinci®, da Vinci S®, da Vinci S HD Surgical System®, da Vinci Si®, da Vinci [removed: Si HD Surgical System®, da Vinci] X®, da Vinci Xi®, da Vinci [removed: SP®*,*] [added: SP®,] EndoWrist®, Firefly®, InSite®, [removed: Intuitive Surgical EcoSystem®*,*] SureForm®, Ion®, Iris®, and SynchroSeal® are trademarks or registered trademarks of the Company.

[removed: Our mission reflects that] [added: As part of Intuitive’s mission,] we believe [removed: that] minimally invasive care is life-enhancing care.

In the face of these challenges, we believe [removed: scientific, process,] [added: scientific] and technological advances in biology, computing, imaging, algorithms, and robotics [added: may] offer new methods to solve continued and difficult problems.

Our da Vinci [removed: Surgical Systems provide] [added: surgical systems are comprised of] the following [removed: features and benefits to surgeons:][added: components:]

[removed: *Immersive 3DHD Visualization.*] [added: *3DHD Vision System.*] Our vision system includes a 3DHD endoscope with two independent vision channels linked to two separate color monitors through sophisticated image processing [removed: electronics.][added: electronics and software.]

[removed: With our Firefly Fluorescence Imaging technology, surgeons can use our specialized] [added: This] imaging [removed: hardware in combination with] [added: capability combines] an injectable fluorescent dye [added: with a specialized da Vinci camera head, endoscope, and laser-based illuminator] to [removed: visualize] [added: allow surgeons to identify] vasculature, tissue perfusion, or biliary ducts [added: in three dimensions] beneath tissue surfaces in real-time.

[removed: *Advanced Instruments.*] We offer a comprehensive suite of stapling, energy, and core instrumentation for our surgical systems.

[removed: [Table of](#ifd6f4af27a57401890271d74ae2e1592_7) [Contents](#ifd6f4af27a57401890271d74ae2e1592_7)][added: [Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)]

[removed: *Intuitive Instrument Movements.*] Our technology is designed to transform the surgeon’s natural hand movements outside of the body into corresponding micro-movements inside the patient’s [removed: body.][added: body and suture with precision, just as they can in open surgery.]

[removed: *Scaled, Tremor Filtered Instrument Movement.*] With our technology, a surgeon can also use “motion scaling,” a feature that translates, for example, a three-millimeter hand movement outside the patient’s body into a one-millimeter instrument movement in the surgical field inside the patient’s body.

[removed: *Improved Surgeon Ergonomics.*] The da Vinci Surgical System is designed to allow surgeons to operate while seated, which may be clinically advantageous because of reduced surgeon fatigue.

[removed: *Multi-Specialty Surgical Platform.*] The da Vinci [removed: Surgical System is] [added: surgical systems are] designed to enable surgeons to perform a wide range of surgical procedures within our targeted [removed: gynecologic, urologic,] general surgery, [added: urologic, gynecologic,] cardiothoracic, and head and neck specialties.

[removed: Additionally,] [added: *3D Modeling Services.* In February 2019,] the FDA cleared Iris, Intuitive’s augmented reality imaging product, for use in kidney procedures.

[removed: Iris] [added: The service] extracts CT scans, runs them through machine-learning [removed: algorithms,] [added: algorithms and, after technicians’ revision] and [added: radiologists’ review,] returns a [added: 3D] segmented model of the kidney for use in planning for a procedure and for intraoperative visualization of the area.

It can also be part of the viewing experience [removed: during a procedure] [added: inside of the da Vinci surgeon console] to enhance information and let surgeons know where critical anatomy sits as they work through a procedure.

[removed: da] [added: *Da] Vinci Surgical [removed: Systems][added: Systems*]

[removed: We have commercialized four generational platforms] [added: There are several models] of [added: the] da Vinci Surgical [removed: Systems:] [added: System:] our fourth generation da Vinci X, da Vinci Xi, and da Vinci SP Surgical Systems, our third generation da Vinci Si Surgical System, our second generation da Vinci S Surgical System, and our first generation da Vinci standard Surgical System.

[removed: Using electronic hardware, software, algorithms,] and mechanics, our technology translates the surgeon’s hand movements into precise and corresponding real-time micro movements of the da Vinci instruments positioned inside the patient.

[removed: *Skills Simulator.* The Skills Simulator] [added: *SimNow.* Our cloud-enabled SimNow simulation platform] is a practice tool that gives a user the opportunity to practice their skills and gain familiarity with the surgeon console [removed: controls.][added: controls and supports the user's progressive learning pathway.]

[removed: The Skills Simulator] [added: SimNow] incorporates 3D, physics-based computer simulation technology to immerse the user within a virtual environment and provides training capabilities that have been used extensively by surgeons.

[removed: The Skills Simulator] [added: SimNow] is intended to augment, not replace, existing training programs for the da Vinci X, da Vinci Xi, and da Vinci SP Surgical Systems.

Integrated Table Motion coordinates the movements of the da Vinci robotic arms with an advanced operating room [added: (“OR”)] table, the TS 7000dV OR Table sold by HillromTM, to enable managing the patient’s position in real-time while the da Vinci robotic arms remain docked.

This gives [removed: operating room] [added: OR] teams the capability to optimally position the operating table during da Vinci Surgical System procedures.

*Firefly Fluorescence [removed: Imaging*.][added: Imaging (“Firefly”)*.]

Firefly is a standard feature of the da Vinci X and da Vinci Xi Surgical Systems and is available [added: as an upgrade] on our da Vinci Si Surgical System.

*Intuitive [removed: Cloud.*] [added: Hosted & Managed Services.*] The vast majority of our systems are [added: network] connected [removed: to the] [added: and directly communicate with] Intuitive [removed: cloud] to enable proactive monitoring [removed: and] [added: as well as] provide software [removed: updates.][added: updates and data insights to Intuitive customers.]

We launched our first pilot site in [removed: the U.S.] [added: 2019, continued] in [removed: December 2019] [added: 2020 with select sites,] and have [removed: five] [added: six] pilot sites as of December 31, [removed: 2020.][added: 2021.]

[removed: Da Vinci instruments are offered] in a variety of diameters, of which 8mm and 12mm diameter sizes are the most commonly sold.

In 2020, we [removed: introduced] [added: announced] our [removed: "Extended] [added: “Extended] Use [removed: Program,"] [added: Program,”] which consists of select da Vinci Xi and da Vinci X instruments possessing 12 to 18 uses [removed: ("Extended] [added: (“Extended] Use [removed: Instruments")] [added: Instruments”),] compared to [removed: the prior] [added: previously] 10 [removed: use instruments.][added: uses.]

Instruments included in the program are used across a number of da Vinci [removed: procedures.][added: surgeries.]

We market [removed: four] [added: five] staplers available with the da Vinci X and da Vinci Xi Surgical Systems: the EndoWrist Stapler 30 and 45 and the SureForm [removed: 45] [added: Stapler 30, 45,] and 60, where the numeric designation indicates the length of the staple line.

The SureForm [removed: 45] [added: Stapler 60] is [added: a single-use, fully wristed, stapling instrument] intended to deliver particular utility in [removed: thoracic] [added: bariatric] procedures.

The E-100 generator is [removed: Intuitive's] [added: Intuitive’s] first generator and is offered as an upgrade to power the da Vinci Vessel Sealer Extend and [removed: SynchroSeal.][added: our SynchroSeal instrument, which was cleared by the FDA in November 2019.]

SynchroSeal [removed: will enable] [added: enables] a surgeon to perform rapid, one-step sealing and transection with a single pedal press.

[removed: Ion endoluminal system][added: *Ion Endoluminal System*]

[removed: Our goal aligns with] [added: We align our goals to those of our customers, often called] the Quadruple Aim: enabling physicians and hospitals to improve outcomes for their patients, improve their patient’s and the care team’s experience, and lower the total cost to treat per patient episode.

Through the use of smart, connected systems, robotic technologies, advanced imaging, and informatics, our objective is to create value for patients, surgeons, and hospitals as summarized [removed: below:][added: below.]

*Patient Value.* We believe that the value of a [removed: surgical] [added: medical] procedure to a patient can be defined: *Patient Value = Procedure Efficacy / Invasiveness*.

We define *procedure efficacy* as a measure of the success of the [removed: surgery] [added: procedure] in [removed: resolving] [added: helping resolve] the underlying disease and *invasiveness* as a measure of patient pain and disruption of regular activities.

When the patient value of [removed: a da Vinci] procedure [added: using an Intuitive product] is greater than that of alternative treatment options, patients may benefit from seeking out surgeons and hospitals that offer [removed: that da Vinci surgery,] [added: those products,] which could potentially result in a local market share shift.

Through ingenuity and intelligent technology, we expand the potential of physicians to heal without constraints.

We envision a future of care that is less invasive and profoundly better, where diseases are identified earlier and treated quickly so patients can get back to what matters most.

Intuitive is committed to advancing minimally invasive care through a comprehensive ecosystem of products and services.

This ecosystem includes systems, instruments and accessories, learning, and services connected by a digital portfolio that enables precision and control, seamless interactions and experiences, and meaningful insights to drive better care.

Intuitive brings nearly three decades of experience and technical innovation to our robotic-assisted surgical solutions.

We address our customer needs by sharing their goals reflected in the quadruple aim.

First, we focus on improving patient outcomes through an ecosystem of advanced robotic systems, instruments and accessories, progressive technology learning pathways, and comprehensive support and program assistance services.

Systems

Advanced robotic systems provide precise, powerful systems with high-performance vision extending care team’s capabilities to enhance minimally invasive care.

These systems include the da Vinci Surgical System, which was designed to enable complex surgery using a minimally invasive approach, and the Ion endoluminal system, which extends our commercial offerings beyond surgery into diagnostic procedures, enabling minimally invasive biopsies in the lung.

Da Vinci systems offer surgeons three dimensional, high definition (“3DHD”) vision, a magnified view, and robotic and computer assistance.

They use specialized instrumentation, including a miniaturized surgical camera (endoscope) and wristed instruments (e.g., scissors, scalpels, forceps, etc.) that are designed to help with precise dissection and reconstruction deep inside the body.

Using electronic hardware, software, algorithms,

The system features an ultra-thin, ultra-maneuverable catheter that can articulate 180 degrees in all directions and allows navigation far into the peripheral lung and provides the stability necessary for precision in biopsy.

Da Vinci instruments are offered

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

Extended Use Instruments were introduced in the U.S. and Europe in the fourth quarter of 2020 and were launched in most other countries around the world during the first half of 2021, except China due to regulatory timelines.

They will continue to be introduced at various times throughout 2022 in other geographies, depending on regulatory processes.

The SureForm Staplers 30, 45, and 60 are intended to be used in general surgery, thoracic, gynecologic, urologic, and pediatric surgery procedures.

The SureForm Stapler 30 received U.S. FDA 510(k) clearance in December 2021 and may deliver particular utility in thoracic procedures.

The SureForm 45 may deliver particular utility in thoracic and colorectal procedures where maneuverability and visualization are limited.

Learning

Intuitive provides progressive learning pathways to support the safe and effective use of our technology.

These pathways leverage both learning engagements and learning technologies.

Learning engagement touchpoints vary by specific pathway, skill level, and interest, while learning technologies enable and provide training directly to the customer.

The portfolio of learning offerings includes role-specific Training Pathways, Learning Engagements, and Learning Technology.

*Training Pathways.* Intuitive Training Pathways are progressive learning journeys that help our customers achieve proficiency using Intuitive technology.

There are pathways for surgeons and physicians, residents and fellows, OR care teams, patient side assists, and robotic coordinators, as well as recommendations for executives.

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

*Learning Engagements.* Intuitive Learning Engagements are touchpoints that support customers throughout their learning journeys.

They vary by pathway, skill level, and focus area.

Engagements include case observations, online education, in-service training, simulation/skills training, OR care team training, technology training, reprocessing training, proctoring, advanced training, and curriculum development support.

Many of these programs take place at established Intuitive training centers and include instruction by expert surgeons and physicians.

*Learning Technology.* Learning Technologies include solutions that provide education and training directly to the customer as well as the enabling technologies that make provision possible.

Intuitive’s enabling technologies include Telepresence and the Procedure Analytics Platform.

Specific technology solutions include Intuitive Learning, SimNow, customized training models, remote case observations, and remote proctoring.

Two of the technology solutions most heavily utilized by customers are Intuitive Learning and SimNow.

*Intuitive Learning.* Intuitive Learning provides our customers with access to the technology, procedure, and simulation materials essential to their specific learning journeys.

Both assignment of learning materials and tracking of learning progress occur seamlessly within the platform.

While Intuitive Learning plans guide learners through each step in their pathways, customers are also able to search the platform independently for additional materials that may be relevant to their area of focus.

Intuitive is committed to advancing patient care in surgery and other acute medical interventions.

The Company is focused on innovating to enable physicians and healthcare providers to improve the quality of and access to minimally invasive care.

Intuitive brings more than two decades of leadership in robotic-assisted surgical technology and solutions to its offerings.

We address these needs by focusing on the quadruple aim.

First, we focus on products and services that can improve outcomes and decrease variability in the hands of care teams.

The da Vinci Surgical System is designed to enable complex surgery using a minimally invasive approach.

It consists of an ergonomic surgeon console or consoles, a patient-side cart with an interactive arm or arms, a high-performance vision system, and proprietary instruments and accessories.

Surgeons using the da Vinci system operate while seated comfortably at a console viewing a three-dimensional, high definition (“3DHD”) image of the surgical field.

This immersive visualization connects surgeons to the surgical field and their instruments.

While seated at the console, the surgeon manipulates instrument controls in a natural manner, similar to the open surgery approach.

Our technology is designed to provide surgeons with a range of motion analogous to the motions of a human wrist, while filtering out the tremors inherent in a surgeon’s hands.

In designing our products, we focus on making our technology easy and safe to use.

The da Vinci Surgical System provides visualization of the target anatomy with natural depth-of-field and magnification that is intended to facilitate accurate tissue identification and tissue layer differentiation.

*Precise and Tremor-Free Endoscope Control.* Our imaging system also incorporates our proprietary camera control technology that allows the surgeon to easily change, move, zoom, and rotate his or her field of vision.

Surgeons can reposition the surgical camera quickly with foot controls or zoom in, out, up, down, left, or right by moving their hands while maintaining a stable image.

Most of our proprietary instruments feature EndoWrist technology, incorporating “wrist” joints.

Inspired by the human hand, our wristed instruments enable surgeons to orient the instruments carefully relative to the tissue and suture with precision, just as they can in open surgery.

For example, with the da Vinci Surgical System, a hand movement to the right outside of the body causes the instrument inside the patient to be moved to the right.

In contrast, conventional minimally invasive surgery (“MIS”) instruments are long, rigid levers that rotate around a fulcrum, or pivot point, located at the port created in the body wall.

In conventional MIS, the instrument tip moves in the opposite direction from the surgeon’s hand, and surgeons must adjust their hand-eye coordination to compensate for the direction reversal by the pivot.

While we do not expect all of these different types of procedures to become widely adopted, they demonstrate the flexibility of the da Vinci Surgical System.

*Advanced Training Tools.* Training technologies include our Simulation program, which provides for independent da Vinci skills development through interactive Virtual Reality (“VR”) exercises, and our telementoring program, which provides real-time, surgeon-to-surgeon learning and collaboration during robotic-assisted surgery with a da Vinci Surgical System.

The tool uses augmented reality to give surgeons an image with details of the kidney anatomy – blood vessels, tumor shape, and size – that they may not be able to see well with other imaging.

Intuitive designed Iris, among other things, to be shared as a teaching tool among surgeons to coordinate approaches to complex cases.

Intuitive’s primary platform for robotic-assisted surgery is our family of da Vinci Surgical Systems.

Da Vinci Surgical Systems are comprised of the following components:

*3DHD Vision System.* Our vision system includes our InSite 3D endoscope with two separate vision channels linked to two separate color monitors through high performance video cameras and specialized image processing hardware.

This imaging capability combines a fluorescent dye with a specialized da Vinci camera head, endoscope, and laser-based illuminator to allow surgeons to identify vasculature, tissue perfusion, or biliary ducts in three dimensions beneath tissue surfaces to visualize critical anatomy.

Informatics

*SimNow.* Our cloud-enabled SimNow simulation platform is our latest generation simulator, which allows surgeons to learn and practice their surgical skills.

SimNow is compatible with multiple da Vinci platforms and can be connected to the internet.

*Iris.* In February 2019, the FDA cleared Iris, Intuitive’s augmented reality imaging product, for use in kidney procedures.

Intuitive designed Iris to be shared as a teaching tool among surgeons to coordinate approaches to complex cases, for example.

We are currently only using Iris in pilot studies.

We introduced Extended Use Instruments in the U.S. in October 2020 and in Europe in November 2020.

We expect to introduce Extended Use Instruments in other geographies throughout 2021 and 2022, depending on the timing of regulatory approvals.

The SureForm 60 is a single-use, fully wristed, stapling instrument intended to deliver particular utility in bariatric procedures.

Our Ion endoluminal system extends our commercial offerings beyond surgery into diagnostic procedures with its first application.

The Ion system is our flexible, robotic-assisted, catheter-based platform designed to navigate through very small lung airways to reach peripheral nodules for biopsies.

The Ion system uses an ultra-thin articulating robotic catheter that can articulate 180 degrees in all directions.

The information included in [Note 8 to the Consolidated Financial [removed: Statements](#ifd6f4af27a57401890271d74ae2e1592_259)] [added: Statements](#i30d98ad3bee64d018232130137db9899_268)] included in Part II, Item 8 of this report is incorporated herein by reference.

For the fiscal year ended December 31, [removed: 2020][added: 2021]

[removed: ][added: ]

The aggregate market value of the voting and non-voting common equity held by non-affiliates on June 30, [removed: 2020,] [added: 2021,] based upon the closing price of Common Stock on such date as reported on The Nasdaq Global Select Market, was approximately [removed: $66.4] [added: $108.7] billion.

The number of outstanding shares of the registrant’s common stock as of January [removed: 15, 2021,] [added: 26, 2022,] was [removed: 117,718,298.][added: 357,744,031.]

Part III incorporates information by reference to the definitive proxy statement for the Company’s Annual Meeting of Stockholders to be held on or about April [removed: 22, 2021,] [added: 28, 2022,] to be filed within 120 days of the registrant’s fiscal year ended December 31, [removed: 2020.][added: 2021.]

| [Item [removed: 1.](#ifd6f4af27a57401890271d74ae2e1592_16)] [added: 1.](#i30d98ad3bee64d018232130137db9899_16)] | | | [removed: [Business](#ifd6f4af27a57401890271d74ae2e1592_16)] [added: [Business](#i30d98ad3bee64d018232130137db9899_16)] | | | [removed: [5](#ifd6f4af27a57401890271d74ae2e1592_16)] [added: [6](#i30d98ad3bee64d018232130137db9899_16)] | | |

| [Item [removed: 1A.](#ifd6f4af27a57401890271d74ae2e1592_58)] [added: 1A.](#i30d98ad3bee64d018232130137db9899_58)] | | | [Risk [removed: Factors](#ifd6f4af27a57401890271d74ae2e1592_58)] [added: Factors](#i30d98ad3bee64d018232130137db9899_58)] | | | [removed: [23](#ifd6f4af27a57401890271d74ae2e1592_58)] [added: [24](#i30d98ad3bee64d018232130137db9899_58)] | | |

| [Item [removed: 1B.](#ifd6f4af27a57401890271d74ae2e1592_73)] [added: 1B.](#i30d98ad3bee64d018232130137db9899_76)] | | | [Unresolved Staff [removed: Comments](#ifd6f4af27a57401890271d74ae2e1592_73)] [added: Comments](#i30d98ad3bee64d018232130137db9899_76)] | | | [removed: [48](#ifd6f4af27a57401890271d74ae2e1592_73)] [added: [50](#i30d98ad3bee64d018232130137db9899_76)] | | |

| [Item [removed: 2.](#ifd6f4af27a57401890271d74ae2e1592_76)] [added: 2.](#i30d98ad3bee64d018232130137db9899_79)] | | | [removed: [Properties](#ifd6f4af27a57401890271d74ae2e1592_76)] [added: [Properties](#i30d98ad3bee64d018232130137db9899_79)] | | | [removed: [48](#ifd6f4af27a57401890271d74ae2e1592_76)] [added: [51](#i30d98ad3bee64d018232130137db9899_79)] | | |

| [Item [removed: 3.](#ifd6f4af27a57401890271d74ae2e1592_79)] [added: 3.](#i30d98ad3bee64d018232130137db9899_82)] | | | [Legal [removed: Proceedings](#ifd6f4af27a57401890271d74ae2e1592_79)] [added: Proceedings](#i30d98ad3bee64d018232130137db9899_82)] | | | [removed: [48](#ifd6f4af27a57401890271d74ae2e1592_79)] [added: [51](#i30d98ad3bee64d018232130137db9899_82)] | | |

| [Item [removed: 4.](#ifd6f4af27a57401890271d74ae2e1592_82)] [added: 4.](#i30d98ad3bee64d018232130137db9899_85)] | | | [Mine Safety [removed: Disclosures](#ifd6f4af27a57401890271d74ae2e1592_82)] [added: Disclosures](#i30d98ad3bee64d018232130137db9899_85)] | | | [removed: [48](#ifd6f4af27a57401890271d74ae2e1592_82)] [added: [51](#i30d98ad3bee64d018232130137db9899_85)] | | |

| [Item [removed: 5.](#ifd6f4af27a57401890271d74ae2e1592_88)] [added: 5.](#i30d98ad3bee64d018232130137db9899_91)] | | | [Market for the Registrant’s Common Equity, Related Stockholder Matters [removed: and](#ifd6f4af27a57401890271d74ae2e1592_88)] [added: and](#i30d98ad3bee64d018232130137db9899_91)] [Issuer Purchases of Equity [removed: Securities](#ifd6f4af27a57401890271d74ae2e1592_88)] [added: Securities](#i30d98ad3bee64d018232130137db9899_91)] | | | [removed: [49](#ifd6f4af27a57401890271d74ae2e1592_88)] [added: [52](#i30d98ad3bee64d018232130137db9899_91)] | | |

| [Item [removed: 7.](#ifd6f4af27a57401890271d74ae2e1592_94)] [added: 7.](#i30d98ad3bee64d018232130137db9899_97)] | | | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#ifd6f4af27a57401890271d74ae2e1592_94)] [added: Operations](#i30d98ad3bee64d018232130137db9899_97)] | | | [removed: [53](#ifd6f4af27a57401890271d74ae2e1592_94)] [added: [55](#i30d98ad3bee64d018232130137db9899_97)] | | |

| [Item [removed: 7A.](#ifd6f4af27a57401890271d74ae2e1592_193)] [added: 7A.](#i30d98ad3bee64d018232130137db9899_199)] | | | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#ifd6f4af27a57401890271d74ae2e1592_193)] [added: Risk](#i30d98ad3bee64d018232130137db9899_199)] | | | [removed: [78](#ifd6f4af27a57401890271d74ae2e1592_193)] [added: [80](#i30d98ad3bee64d018232130137db9899_199)] | | |

| [Item [removed: 8.](#ifd6f4af27a57401890271d74ae2e1592_196)] [added: 8.](#i30d98ad3bee64d018232130137db9899_202)] | | | [Financial Statements and Supplementary [removed: Data](#ifd6f4af27a57401890271d74ae2e1592_196)] [added: Data](#i30d98ad3bee64d018232130137db9899_202)] | | | [removed: [79](#ifd6f4af27a57401890271d74ae2e1592_196)] [added: [81](#i30d98ad3bee64d018232130137db9899_202)] | | |

| [Item [removed: 9.](#ifd6f4af27a57401890271d74ae2e1592_289)] [added: 9.](#i30d98ad3bee64d018232130137db9899_298)] | | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#ifd6f4af27a57401890271d74ae2e1592_289)] [added: Disclosure](#i30d98ad3bee64d018232130137db9899_298)] | | | [removed: [116](#ifd6f4af27a57401890271d74ae2e1592_289)] [added: [119](#i30d98ad3bee64d018232130137db9899_298)] | | |

| [Item [removed: 9A.](#ifd6f4af27a57401890271d74ae2e1592_292)] [added: 9A.](#i30d98ad3bee64d018232130137db9899_301)] | | | [Controls and [removed: Procedures](#ifd6f4af27a57401890271d74ae2e1592_292)] [added: Procedures](#i30d98ad3bee64d018232130137db9899_301)] | | | [removed: [116](#ifd6f4af27a57401890271d74ae2e1592_292)] [added: [119](#i30d98ad3bee64d018232130137db9899_301)] | | |

| [Item [removed: 9B.](#ifd6f4af27a57401890271d74ae2e1592_295)] [added: 9B.](#i30d98ad3bee64d018232130137db9899_304)] | | | [Other [removed: Information](#ifd6f4af27a57401890271d74ae2e1592_295)] [added: Information](#i30d98ad3bee64d018232130137db9899_304)] | | | [removed: [116](#ifd6f4af27a57401890271d74ae2e1592_295)] [added: [119](#i30d98ad3bee64d018232130137db9899_304)] | | |

| [Item [removed: 10.](#ifd6f4af27a57401890271d74ae2e1592_301)] [added: 10.](#i30d98ad3bee64d018232130137db9899_310)] | | | [Directors, Executive Officers and Corporate [removed: Governance](#ifd6f4af27a57401890271d74ae2e1592_301)] [added: Governance](#i30d98ad3bee64d018232130137db9899_310)] | | | [removed: [117](#ifd6f4af27a57401890271d74ae2e1592_301)] [added: [121](#i30d98ad3bee64d018232130137db9899_310)] | | |

| [Item [removed: 11.](#ifd6f4af27a57401890271d74ae2e1592_304)] [added: 11.](#i30d98ad3bee64d018232130137db9899_313)] | | | [Executive [removed: Compensation](#ifd6f4af27a57401890271d74ae2e1592_304)] [added: Compensation](#i30d98ad3bee64d018232130137db9899_313)] | | | [removed: [117](#ifd6f4af27a57401890271d74ae2e1592_304)] [added: [121](#i30d98ad3bee64d018232130137db9899_313)] | | |

| [Item [removed: 12.](#ifd6f4af27a57401890271d74ae2e1592_307)] [added: 12.](#i30d98ad3bee64d018232130137db9899_316)] | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#ifd6f4af27a57401890271d74ae2e1592_307)] [added: Matters](#i30d98ad3bee64d018232130137db9899_316)] | | | [removed: [117](#ifd6f4af27a57401890271d74ae2e1592_307)] [added: [121](#i30d98ad3bee64d018232130137db9899_316)] | | |

| [Item [removed: 13.](#ifd6f4af27a57401890271d74ae2e1592_310)] [added: 13.](#i30d98ad3bee64d018232130137db9899_319)] | | | [Certain Relationships and Related Transactions and Director [removed: Independence](#ifd6f4af27a57401890271d74ae2e1592_310)] [added: Independence](#i30d98ad3bee64d018232130137db9899_319)] | | | [removed: [117](#ifd6f4af27a57401890271d74ae2e1592_310)] [added: [121](#i30d98ad3bee64d018232130137db9899_319)] | | |

| [Item [removed: 14.](#ifd6f4af27a57401890271d74ae2e1592_313)] [added: 14.](#i30d98ad3bee64d018232130137db9899_322)] | | | [Principal Accountant Fees and [removed: Services](#ifd6f4af27a57401890271d74ae2e1592_313)] [added: Services](#i30d98ad3bee64d018232130137db9899_322)] | | | [removed: [117](#ifd6f4af27a57401890271d74ae2e1592_313)] [added: [121](#i30d98ad3bee64d018232130137db9899_322)] | | |

| [Item [removed: 15.](#ifd6f4af27a57401890271d74ae2e1592_319)] [added: 15.](#i30d98ad3bee64d018232130137db9899_328)] | | | [Exhibits and Financial Statement [removed: Schedules](#ifd6f4af27a57401890271d74ae2e1592_319)] [added: Schedules](#i30d98ad3bee64d018232130137db9899_328)] | | | [removed: [118](#ifd6f4af27a57401890271d74ae2e1592_319)] [added: [122](#i30d98ad3bee64d018232130137db9899_328)] | | |

| [Item [removed: 16.](#ifd6f4af27a57401890271d74ae2e1592_325)] [added: 16.](#i30d98ad3bee64d018232130137db9899_334)] | | | [Form 10-K [removed: Summary](#ifd6f4af27a57401890271d74ae2e1592_325)] [added: Summary](#i30d98ad3bee64d018232130137db9899_334)] | | | [removed: [119](#ifd6f4af27a57401890271d74ae2e1592_325)] [added: [123](#i30d98ad3bee64d018232130137db9899_334)] | | |

[removed: [Table of](#ifd6f4af27a57401890271d74ae2e1592_7) [Contents](#ifd6f4af27a57401890271d74ae2e1592_7)][added: [Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)]

[removed: FORWARD-LOOKING] [added: CAUTIONARY NOTE REGARDING FORWARD-LOOKING] STATEMENTS

These forward-looking statements include, but are not limited to, statements related to the expected impacts of the COVID-19 pandemic on our business, financial condition, and results of operations, the potential [removed: decline of] [added: impact on] our procedure volume, our acquisitions, our expected business, our expected new product introductions, the impacts of Extended Use Instruments, procedures and procedure adoption, future results of operations, future financial position, our ability to increase our revenues, the anticipated mix of our revenues between product and service revenues, our financing plans and future capital requirements, anticipated costs of revenue, anticipated expenses, our potential tax assets or liabilities, the effect of recent accounting pronouncements, our investments, anticipated cash flows, our ability to finance operations from cash flows and similar matters, and statements based on current expectations, estimates, forecasts, and projections about the economies and markets in which we operate and our beliefs and assumptions regarding these economies and markets.

These forward-looking statements [removed: should, therefore,] [added: should] be considered in light of various important factors, including, but not limited to, the following: [removed: our ability to obtain accurate procedure volume and mix in] the [removed: midst of the COVID-19 pandemic; the] risk that the COVID-19 pandemic could lead to further material delays and cancellations of, or reduced demand for, procedures; curtailed or delayed capital spending by hospitals; disruption to our supply [removed: chain;] [added: chain, including increased difficulties in obtaining a sufficient supply of materials in the semiconductor and other markets;] closures of our facilities; delays in surgeon training; delays in gathering clinical evidence; delays in obtaining new product [removed: approvals] [added: approvals, clearances,] or [removed: clearances] [added: certifications] from the U.S. Food and Drug Administration [added: (“FDA”)] due to [removed: COVID-19;] the [added: effects of the COVID-19 pandemic; the] evaluation of the risks of robotic-assisted surgery in the presence of infectious diseases; diversion of management and other resources to respond to [removed: the] COVID-19 [removed: outbreak;] [added: outbreaks;] the impact of global and regional economic and credit market conditions on healthcare spending; the risk that the COVID-19 virus disrupts local economies and causes economies in our key markets to enter prolonged recessions; [added: the risk of our inability to comply with complex FDA and other regulations, which may result in significant enforcement actions;] healthcare reform legislation in the U.S. and its impact on hospital spending, reimbursement, and fees levied on certain medical device revenues; changes in hospital admissions and actions by payers to limit or manage surgical procedures; the timing and success of product development and market acceptance of developed products; the results of any collaborations, in-licensing arrangements, joint ventures, strategic alliances, or partnerships, including the joint venture with Shanghai Fosun Pharmaceutical (Group) Co., Ltd.; our completion of and ability to successfully integrate acquisitions, including [removed: Schölly Fiberoptic's robotic endoscope business and] Orpheus Medical; procedure counts; regulatory approvals, clearances, [added: certifications,] and restrictions or any dispute that may occur with any regulatory body; guidelines and recommendations in the healthcare and patient communities; intellectual property positions and litigation; competition in the medical device industry and in the specific markets of surgery in which we operate; risks associated with our operations outside of the United States; unanticipated manufacturing disruptions or the inability to meet demand for products; our reliance on sole and single source suppliers; the results of legal proceedings to which we are or may become a party; product liability and other litigation claims; adverse publicity regarding us and the safety of our products and adequacy of training; our ability to expand into foreign markets; the impact of changes to tax legislation, guidance, and interpretations; changes in tariffs, trade barriers, and regulatory requirements; and other risk factors.

Readers are cautioned not to place undue reliance on these forward-looking statements, which are based on current expectations and are subject to risks, uncertainties, and assumptions that are difficult to [removed: predict, including those risk factors described throughout this filing and particularly in Part I, “Item 1A.][added: predict.]

[removed: Risk Factors.”] Our actual results may differ materially and adversely from those expressed in any forward-looking [removed: statement.][added: statement, and we undertake no obligation to publicly update or release any revisions to these forward-looking statements, except as required by law.]

| [PART I](#i30d98ad3bee64d018232130137db9899_13) | | | | | | | | |

| [PART II](#i30d98ad3bee64d018232130137db9899_88) | | | | | | | | |

| [Item 6.](#i30d98ad3bee64d018232130137db9899_94) | | | \[RESERVED\] | | | [54](#i30d98ad3bee64d018232130137db9899_94) | | |

| [Item 9C.](#i30d98ad3bee64d018232130137db9899_2514) | | | [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](#i30d98ad3bee64d018232130137db9899_2514) | | | [120](#i30d98ad3bee64d018232130137db9899_2514) | | |

| [PART III](#i30d98ad3bee64d018232130137db9899_307) | | | | | | | | |

| [PART IV](#i30d98ad3bee64d018232130137db9899_325) | | | | | | | | |

| | | | | | | | | |

| [SIGNATURES](#i30d98ad3bee64d018232130137db9899_337) | | | | | | [124](#i30d98ad3bee64d018232130137db9899_337) | | |

Risks are described throughout this filing, particularly in Part I, “Item 1A.

Risk Factors,” and include, but are not limited to, those summarized on the following pages.

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

RISKS RELATING TO OUR BUSINESS

- Public health crises or epidemic diseases, or the perception of their effects, have and could continue to materially adversely affect our business and results of operations.

- Our reliance on sole and single source suppliers and our ability to purchase at acceptable prices a sufficient supply of materials, parts, and components could harm our ability to meet demand for our products in a timely manner or within budget.

- Because our markets are highly competitive, customers may choose to purchase our competitors’ products or services or may not accept da Vinci robotic-assisted surgery, which would result in reduced revenue and loss of market share.

- The inflationary environment could materially adversely impact our business and results of operations.

- If our products do not achieve and maintain market acceptance, we will not be able to generate the revenue necessary to support our business.

- If institutions or surgeons are unable to obtain coverage and reimbursement from third-party payors for procedures using our products, or if reimbursement is insufficient to cover the costs of purchasing our products, we may be unable to generate sufficient sales to support our business.

- If our products contain defects or encounter performance problems, we may have to recall our products, incur additional unforeseen costs, and our reputation may suffer.

- We are subject to product liability and negligence claims relating to the use of our products and other legal proceedings that could materially adversely affect our financial condition, divert management’s attention, and harm our business.

- We are subject to significant, uninsured liabilities.

- Negative publicity, whether accurate or inaccurate, concerning our products or our company could reduce market acceptance of our products and could result in decreased product demand and a decline in revenues.

- If we lose key personnel or are unable to attract and retain additional personnel, our ability to compete will be harmed and increases in labor costs could materially adversely impact our business and results of operations.

- We experience long and variable capital sales cycles and seasonality in our business, which may cause fluctuations in our financial results.

- New product developments and introductions may adversely impact our financial results.

- We are subject to a variety of risks due to our operations outside of the U.S.

- Disruption of critical information systems or material breaches in the security of our systems could harm our business, customer relations, and financial condition.

- Our business is subject to complex and evolving laws and regulations regarding privacy, data protection, and other matters relating to information collection.

- If we fail to successfully acquire or integrate new businesses, products, and technology, we may not realize expected benefits or our business may be harmed.

- If we do not successfully manage our collaboration arrangements, licensing arrangements, joint ventures, strategic alliances, or partnerships with third parties, we may not realize the expected benefits from such alliances, which may have a material adverse effect on our business, financial condition, results of operations, or cash flows.

- Our customers may use unauthorized, unapproved, or uncertified instruments and accessories, which would result in reduced revenue and loss of market share.

- We expect gross profit margins to vary over time, and changes in our gross profit margins could adversely affect our financial condition or results of operations.

- We utilize distributors for a portion of our sales and service of our products in certain countries, which subjects us to a number of risks that could harm our business.

- We offer alternative capital acquisition approaches.

As a result, we are exposed to the credit risk of some of our customers and the risk of losses of revenue, which could result in material losses.

- We are exposed to credit risk and fluctuations in the market value of our investments.

- We may incur losses associated with currency fluctuations and may not be able to effectively hedge our exposure.

- We may encounter manufacturing problems or delays that could result in lost revenue.

- Disruptions at the FDA and other government agencies or notified bodies caused by funding shortages or global health concerns could hinder their ability to hire, retain, or deploy key leadership and other personnel, or otherwise prevent products from being developed, cleared, certified, approved, or commercialized in a timely manner or at all, which may adversely affect our business.

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

| [PART I](#ifd6f4af27a57401890271d74ae2e1592_13) | | | | | | | | |

| [PART II](#ifd6f4af27a57401890271d74ae2e1592_85) | | | | | | | | |

| [Item 6.](#ifd6f4af27a57401890271d74ae2e1592_91) | | | [Selected Financial Data](#ifd6f4af27a57401890271d74ae2e1592_91) | | | [52](#ifd6f4af27a57401890271d74ae2e1592_91) | | |

| [PART III](#ifd6f4af27a57401890271d74ae2e1592_298) | | | | | | | | |

| [PART IV](#ifd6f4af27a57401890271d74ae2e1592_316) | | | | | | | | |

| [SIGNATURES](#ifd6f4af27a57401890271d74ae2e1592_328) | | | | | | [120](#ifd6f4af27a57401890271d74ae2e1592_328) | | |

We undertake no obligation to publicly update or release any revisions to these forward-looking statements, except as required by law.

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

As of December 31, [removed: 2020,] [added: 2021,] we own approximately [removed: 1.2] [added: 1.8] million square feet of space on [removed: 98] [added: 111] acres of land in Sunnyvale, California, where we house our principal headquarters, research and development, service, and support functions, and certain of our manufacturing operations.

Outside of Sunnyvale, California, we own facilities in other U.S. locations that are used for sales, training, [added: manufacturing,] engineering, and administrative [removed: functions as well as manufacturing.][added: functions, including approximately 530,000 square feet of space on 60 acres of land in Peachtree Corners, Georgia.]

We also lease approximately [removed: 620,000] [added: 660,000] square feet of space for certain engineering, warehousing, and support functions at various locations in the U.S. Outside of the U.S., we own properties in Mexicali, Mexico, primarily for manufacturing operations, and Aubonne, Switzerland, primarily for our international headquarters.

In Germany, we own and lease facilities for manufacturing operations, as we [removed: integrate and] build out operations of our acquisition of certain assets and operations from Schölly Fiberoptic GmbH.

In Israel, we lease facilities, including space for the operations of our [removed: recent acquisition of] [added: subsidiary,] Orpheus Medical.

[removed: [Table of](#ifd6f4af27a57401890271d74ae2e1592_7) [Contents](#ifd6f4af27a57401890271d74ae2e1592_7)][added: [Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)]

As of January [removed: 15, 2021,] [added: 26, 2022,] there were [removed: 159] [added: 136] stockholders of record of our common stock, although we believe that there are a significantly larger number of beneficial owners of our common stock.

The following table contains information as of December 31, [removed: 2020,] [added: 2021,] for two categories of equity compensation plans.

| Plan Category | | | Number of securities to be issued upon exercise of outstanding options, [removed: warrants] [added: warrants,] and rights (a) [added: (2)] | | | | | | [removed: Weighted- average] [added: Weighted-average] exercise [removed: price of outstanding options (2)] [added: price of outstanding options (3)] | | | | | | Number of securities [removed: remaining available] [added: remaining available] for future issuance under equity compensation plans (excluding securities reflected [removed: in column] [added: in column] (a)) [added: (4)] | | |

| Equity compensation plans [added: not] approved by security holders [added: (1)] | | | [removed: 4,104,159] [added: 821,483] | | | | | | $ | [removed: 315.57] [added: 64.68] | | | | | [removed: 9,139,869] [added: —] | | |

| Equity compensation plans [removed: not] approved by security holders [removed: (1)] | | | [removed: 371,711] [added: 15,620,115] | | | | | | $ | [removed: 189.00] [added: 129.64] | | | | | [removed: —] [added: 28,243,671] | | |

This plan expired in October 2019 and, therefore, there are no shares reserved for future [removed: issuance.][added: grant.]

[removed: (2)The] [added: (3)The] weighted-average exercise price is calculated based solely on the exercise prices of the outstanding options and does not reflect the shares that will be issued upon the vesting of outstanding awards of RSUs, which have no exercise price.

In October 2009, the Board adopted our Amended and Restated 2009 Employment Commencement Incentive [removed: Plan, or the 2009 Plan,] [added: Plan (the “2009 Plan”),] pursuant to Rule 5653(c)(4) of the Nasdaq Global Market, which was subsequently amended by the Board in February 2011, July 2011, February 2012, July 2012, January 2013, May 2013, December 2013, and April 2015.

A total of [removed: 4,365,000] [added: 13,095,000] shares of our common stock were reserved for issuance under the 2009 Plan.

The plan administrator has broad discretion to take action under the 2009 Plan, as well as make adjustments to the terms and conditions of existing awards, in the event of certain transactions and events affecting our common stock, including a change in control, stock [removed: dividends, stock splits, mergers, acquisitions, consolidations, and other corporate transactions.]

[removed: [Table of](#ifd6f4af27a57401890271d74ae2e1592_7) [Contents](#ifd6f4af27a57401890271d74ae2e1592_7)][added: [Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)]

The table below summarizes our stock repurchase activity for the quarter ended December 31, [removed: 2020.][added: 2021.]

| October 1 to October 31, [removed: 2020] [added: 2021] | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 1.6 | billion |

| November 1 to November 30, [removed: 2020] [added: 2021] | | | [removed: 51,914] [added: —] | | | | | | $ | [removed: 661.07] [added: —] | | | | | [removed: 51,914] [added: —] | | | | | | $ | 1.6 | billion |

| December 1 to December 31, [removed: 2020] [added: 2021] | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 1.6 | billion |

| Total during quarter ended December 31, [removed: 2020] [added: 2021] | | | [removed: 51,914] [added: —] | | | | | | $ | [removed: 661.07] [added: —] | | | | | [removed: 51,914] [added: —] | | | | | | | | |

As of December 31, [removed: 2020,] [added: 2021,] our Board of Directors [removed: (the] [added: (our] “Board”) had authorized an aggregate amount of up to $7.5 billion for stock repurchases, of which the most recent authorization occurred in January 2019, when [removed: the] [added: our] Board increased the authorized amount available under our share repurchase program to $2.0 billion.

The remaining $1.6 billion represents the amount available to repurchase shares under the authorized repurchase program as of December 31, [removed: 2020.][added: 2021.]

The graph set forth below compares the cumulative total stockholder return on our common stock between December 31, [removed: 2015,] [added: 2016,] and December 31, [removed: 2020,] [added: 2021,] with the cumulative total return of (i) the Nasdaq Composite Index, (ii) the S&P 500 Healthcare Index, and (iii) the S&P 500 Index over the same period.

This graph assumes an investment of $100.00 on December 31, [removed: 2015] [added: 2016] in our common stock, the Nasdaq Composite Index, the S&P Healthcare Index, and the S&P 500 Index and assumes the re-investment of dividends, if any.

[removed: ][added: ]

| | | | [removed: 2015] [added: 2016] | | | | | | [removed: 2016] [added: 2017] | | | | | | [removed: 2017] [added: 2018] | | | | | | [removed: 2018] [added: 2019] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2020] [added: 2021] | | |

All share and per-share information presented have been retroactively adjusted to reflect the three-for-one stock split of our issued and outstanding common stock in October 2021.

| Total | | | 16,441,598 | | | | | | $ | 125.07 | | | | | 28,243,671 | | |

(2)Number of securities includes options to purchase 11,684,236 shares of common stock and 4,757,362 shares of common stock subject to vesting under RSUs.

(4)Number of securities includes 2,775,339 shares remaining available for future issuance under the 2000 Employee Stock Purchase Plan.

This plan expired in October 2019 and, therefore, there are no shares reserved for future grant.

dividends, stock splits, mergers, acquisitions, consolidations, and other corporate transactions.

[Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)

*This graph is not “soliciting material” or deemed “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to liabilities under that Section, and shall not be deemed incorporated by reference into any filings of Intuitive Surgical, Inc. under the Securities Act of 1933, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.*

| Intuitive Surgical, Inc. | | | $ | 100.00 | | | | | $ | 172.64 | | | | | $ | 226.56 | | | | | $ | 281.54 | | | | | $ | 387.01 | | | | | $ | 509.91 | |

| Nasdaq Composite | | | $ | 100.00 | | | | | $ | 129.64 | | | | | $ | 125.96 | | | | | $ | 172.18 | | | | | $ | 249.51 | | | | | $ | 304.85 | |

| S&P 500 Healthcare Index | | | $ | 100.00 | | | | | $ | 120.00 | | | | | $ | 125.63 | | | | | $ | 149.10 | | | | | $ | 166.14 | | | | | $ | 206.29 | |

| S&P 500 Index | | | $ | 100.00 | | | | | $ | 121.83 | | | | | $ | 116.49 | | | | | $ | 153.17 | | | | | $ | 181.35 | | | | | $ | 233.41 | |

| Total | | | 4,475,870 | | | | | | $ | 305.07 | | | | | 9,139,869 | | |

| Intuitive Surgical, Inc. | | | $ | 100.00 | | | | | $ | 116.11 | | | | | $ | 200.46 | | | | | $ | 263.07 | | | | | $ | 326.91 | | | | | $ | 449.37 | |

| Nasdaq Composite | | | $ | 100.00 | | | | | $ | 108.87 | | | | | $ | 141.13 | | | | | $ | 137.12 | | | | | $ | 187.44 | | | | | $ | 271.64 | |

| S&P 500 Healthcare Index | | | $ | 100.00 | | | | | $ | 95.64 | | | | | $ | 114.77 | | | | | $ | 120.16 | | | | | $ | 142.60 | | | | | $ | 158.90 | |

| S&P 500 Index | | | $ | 100.00 | | | | | $ | 111.96 | | | | | $ | 136.40 | | | | | $ | 130.42 | | | | | $ | 171.49 | | | | | $ | 203.04 | |

[removed: [Table of](#ifd6f4af27a57401890271d74ae2e1592_7) [Contents](#ifd6f4af27a57401890271d74ae2e1592_7)][added: [Table](#i30d98ad3bee64d018232130137db9899_7) [of](#i30d98ad3bee64d018232130137db9899_7) [Contents](#i30d98ad3bee64d018232130137db9899_7)]

\[RESERVED\]

The following selected consolidated financial data should be read in conjunction with our Consolidated Financial Statements and the accompanying Notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this report.

The selected data in this section is not intended to replace the Consolidated Financial Statements.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | Fiscal Year | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | 2020 | | | | | | 2019 | | | | | | 2018 | | | | | | 2017 (1) | | | | | | 2016 | | |

| | | | (In millions, except per share amounts and headcount) | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Revenue | | | $ | 4,358.4 | | | | | $ | 4,478.5 | | | | | $ | 3,724.2 | | | | | $ | 3,138.2 | | | | | $ | 2,706.5 | |

| Gross profit | | | $ | 2,861.2 | | | | | $ | 3,110.2 | | | | | $ | 2,604.1 | | | | | $ | 2,202.0 | | | | | $ | 1,892.9 | |

| Net income attributable to Intuitive Surgical, Inc. | | | $ | 1,060.6 | | | | | $ | 1,379.3 | | | | | $ | 1,127.9 | | | | | $ | 670.9 | | | | | $ | 738.3 | |

| Net income per share attributable to Intuitive Surgical, Inc.: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Basic | | | $ | 9.06 | | | | | $ | 11.95 | | | | | $ | 9.92 | | | | | $ | 6.01 | | | | | $ | 6.43 | |

| Diluted | | | $ | 8.82 | | | | | $ | 11.54 | | | | | $ | 9.49 | | | | | $ | 5.77 | | | | | $ | 6.26 | |

| Shares used in computing basic and diluted net income per share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Basic | | | 117.0 | | | | | | 115.4 | | | | | | 113.7 | | | | | | 111.7 | | | | | | 114.9 | | |

| Diluted | | | 120.3 | | | | | | 119.5 | | | | | | 118.8 | | | | | | 116.3 | | | | | | 117.9 | | |

| Cash, cash equivalents, and investments | | | $ | 6,869.1 | | | | | $ | 5,845.2 | | | | | $ | 4,834.4 | | | | | $ | 3,846.5 | | | | | $ | 4,837.9 | |

| Total assets | | | $ | 11,168.9 | | | | | $ | 9,733.2 | | | | | $ | 7,846.7 | | | | | $ | 5,776.8 | | | | | $ | 6,521.4 | |

| Other long-term liabilities | | | $ | 444.6 | | | | | $ | 418.3 | | | | | $ | 338.6 | | | | | $ | 333.6 | | | | | $ | 112.1 | |

| Stockholders’ equity | | | $ | 9,759.1 | | | | | $ | 8,284.7 | | | | | $ | 6,687.5 | | | | | $ | 4,780.4 | | | | | $ | 5,820.1 | |

| Total headcount | | | 8,081 | | | | | | 7,326 | | | | | | 5,527 | | | | | | 4,444 | | | | | | 3,755 | | |

(1)Reflects amounts recorded for the enactment of the 2017 Tax Act.

| | | | [added: | | | | | |] Page No. | | |

| [Report of Independent Registered Public Accounting [removed: Firm](#ifd6f4af27a57401890271d74ae2e1592_199)] [added: Firm](#i30d98ad3bee64d018232130137db9899_205) –] | | | [removed: [80](#ifd6f4af27a57401890271d74ae2e1592_199)] [added: PCAOB ID:] | | | [added: 238 | | | [82](#i30d98ad3bee64d018232130137db9899_205) | | |]

| [Consolidated Balance Sheets [removed: at December 31,](#ifd6f4af27a57401890271d74ae2e1592_202) [2020](#ifd6f4af27a57401890271d74ae2e1592_202)[,] [added: a](#i30d98ad3bee64d018232130137db9899_208)[s of](#i30d98ad3bee64d018232130137db9899_208) [December 31, 202](#i30d98ad3bee64d018232130137db9899_208)[1](#i30d98ad3bee64d018232130137db9899_208)[,] and [removed: 201](#ifd6f4af27a57401890271d74ae2e1592_202)9] [added: 20](#i30d98ad3bee64d018232130137db9899_208)[2](#i30d98ad3bee64d018232130137db9899_208)0] | | | [removed: [81](#ifd6f4af27a57401890271d74ae2e1592_202)] | | | [added: | | | [83](#i30d98ad3bee64d018232130137db9899_208) | | |]

| [Consolidated Statements of Income for the years ended December [removed: 31,](#ifd6f4af27a57401890271d74ae2e1592_208) [2020](#ifd6f4af27a57401890271d74ae2e1592_208)[, 201](#ifd6f4af27a57401890271d74ae2e1592_208)[9](#ifd6f4af27a57401890271d74ae2e1592_208)[,] [added: 31, 202](#i30d98ad3bee64d018232130137db9899_214)[1](#i30d98ad3bee64d018232130137db9899_214)[, 20](#i30d98ad3bee64d018232130137db9899_214)[20](#i30d98ad3bee64d018232130137db9899_214)[,] and [removed: 201](#ifd6f4af27a57401890271d74ae2e1592_208)8] [added: 201](#i30d98ad3bee64d018232130137db9899_214)9] | | | [removed: [82](#ifd6f4af27a57401890271d74ae2e1592_208)] | | | [added: | | | [84](#i30d98ad3bee64d018232130137db9899_214) | | |]

| [Consolidated Statements of Comprehensive Income for the years ended December 31, [removed: 20](#ifd6f4af27a57401890271d74ae2e1592_217)[20](#ifd6f4af27a57401890271d74ae2e1592_217)[, 201](#ifd6f4af27a57401890271d74ae2e1592_217)[9](#ifd6f4af27a57401890271d74ae2e1592_217)[,] [added: 202](#i30d98ad3bee64d018232130137db9899_223)[1](#i30d98ad3bee64d018232130137db9899_223)[, 20](#i30d98ad3bee64d018232130137db9899_223)[20](#i30d98ad3bee64d018232130137db9899_223)[,] and [removed: 201](#ifd6f4af27a57401890271d74ae2e1592_217)8] [added: 201](#i30d98ad3bee64d018232130137db9899_223)9] | | | [removed: [83](#ifd6f4af27a57401890271d74ae2e1592_217)] | | | [added: | | | [85](#i30d98ad3bee64d018232130137db9899_223) | | |]

| [Consolidated Statements of Stockholders’ Equity for the years ended December [removed: 31,](#ifd6f4af27a57401890271d74ae2e1592_223) [2020](#ifd6f4af27a57401890271d74ae2e1592_223)[, 201](#ifd6f4af27a57401890271d74ae2e1592_223)[9](#ifd6f4af27a57401890271d74ae2e1592_223)[,] [added: 31, 202](#i30d98ad3bee64d018232130137db9899_229)[1](#i30d98ad3bee64d018232130137db9899_229)[, 20](#i30d98ad3bee64d018232130137db9899_229)[20](#i30d98ad3bee64d018232130137db9899_229)[,] and [removed: 201](#ifd6f4af27a57401890271d74ae2e1592_223)8] [added: 201](#i30d98ad3bee64d018232130137db9899_229)9] | | | [removed: [84](#ifd6f4af27a57401890271d74ae2e1592_223)] | | | [added: | | | [86](#i30d98ad3bee64d018232130137db9899_229) | | |]

| [Consolidated Statements of Cash Flows for the years ended December [removed: 31,](#ifd6f4af27a57401890271d74ae2e1592_229) [2020](#ifd6f4af27a57401890271d74ae2e1592_229)[, 201](#ifd6f4af27a57401890271d74ae2e1592_229)[9](#ifd6f4af27a57401890271d74ae2e1592_229)[,] [added: 31, 202](#i30d98ad3bee64d018232130137db9899_235)[1](#i30d98ad3bee64d018232130137db9899_235)[, 20](#i30d98ad3bee64d018232130137db9899_235)[20](#i30d98ad3bee64d018232130137db9899_235)[,] and [removed: 201](#ifd6f4af27a57401890271d74ae2e1592_229)8] [added: 201](#i30d98ad3bee64d018232130137db9899_235)9] | | | [removed: [85](#ifd6f4af27a57401890271d74ae2e1592_229)] | | | [added: | | | [87](#i30d98ad3bee64d018232130137db9899_235) | | |]

| [Notes to the Consolidated Financial [removed: Statements](#ifd6f4af27a57401890271d74ae2e1592_232)] [added: Statements](#i30d98ad3bee64d018232130137db9899_238)] | | | [removed: [86](#ifd6f4af27a57401890271d74ae2e1592_232)] | | | [added: | | | [88](#i30d98ad3bee64d018232130137db9899_238) | | |]

| [Schedule II—Valuation and Qualifying [removed: Accounts](#ifd6f4af27a57401890271d74ae2e1592_286)] [added: Accounts](#i30d98ad3bee64d018232130137db9899_295)] | | | [removed: [115](#ifd6f4af27a57401890271d74ae2e1592_286)] | | | [added: | | | [118](#i30d98ad3bee64d018232130137db9899_295) | | |]

We have audited the accompanying consolidated balance sheets of Intuitive Surgical, Inc. and its subsidiaries (the “Company”) as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the related consolidated statements of income, of comprehensive income, of stockholders’ equity and of cash flows for each of the three years in the period ended December 31, [removed: 2020,] [added: 2021,] including the related notes and financial statement schedule listed in the index appearing under Item 15(a)(2) (collectively referred to as the “consolidated financial statements”).

We also have audited the Company’s internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2020] [added: 2021] in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the COSO.

[removed: *Determination] [added: Determination] of Standalone Selling Prices Related to System Sale [removed: Arrangements*][added: Arrangements]

As described in Notes 2 and 5 to the consolidated financial statements, the Company recognized [removed: $1,178.9] [added: $1,693.4] million of systems revenue, during the year ended December 31, [removed: 2020.][added: 2021.]

The principal considerations for our determination that performing procedures relating to the determination of standalone selling prices related to system sale arrangements is a critical audit matter are the [added: significant judgment by management when determining estimates of standalone selling prices, which in turn led to a] high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating audit evidence relating to the estimates of standalone selling prices used to allocate the transaction price of an arrangement to each distinct performance obligation.

| | | | [added: 2021 | | | | | |] 2020 | | | | | | 2019 | | |

| Cash and cash equivalents | | | $ | [removed: 1,622.6] [added: 1,290.9] | | | | | $ | [removed: 1,167.6] [added: 1,622.6] | |

| Short-term investments | | | [removed: 3,488.8] [added: 2,913.1] | | | | | | [removed: 2,054.1] [added: 3,488.8] | | |

| Accounts receivable, net of allowances of [removed: $17.7] [added: $20.2] and [removed: $8.3] [added: $17.7] as of December 31, [removed: 2020,] [added: 2021,] and [removed: 2019,] [added: 2020,] respectively | | | [removed: 645.5] [added: 782.7] | | | | | | [removed: 645.2] [added: 645.5] | | |

| Inventory | | | [removed: 601.5] [added: 587.1] | | | | | | [removed: 595.5] [added: 601.5] | | |

| Prepaids and other current assets | | | [removed: 267.5] [added: 271.1] | | | | | | [removed: 200.2] [added: 267.5] | | |

| Total current assets | | | [removed: 6,625.9] [added: 5,844.9] | | | | | | [removed: 4,662.6] [added: 6,625.9] | | |

| Property, plant, and equipment, net | | | [removed: 1,577.3] [added: 1,876.4] | | | | | | [removed: 1,272.9] [added: 1,577.3] | | |

| Long-term investments | | | [removed: 1,757.7] [added: 4,415.5] | | | | | | [removed: 2,623.5] [added: 1,757.7] | | |

| Deferred tax assets | | | [removed: 367.7] [added: 441.4] | | | | | | [removed: 425.6] [added: 367.7] | | |

| Intangible and other assets, net | | | [removed: 503.6] [added: 633.2] | | | | | | [removed: 441.4] [added: 503.6] | | |

| Goodwill | | | [removed: 336.7] [added: 343.6] | | | | | | [removed: 307.2] [added: 336.7] | | |

| Total assets | | | $ | [removed: 11,168.9] [added: 13,555.0] | | | | | $ | [removed: 9,733.2] [added: 11,168.9] | |

| Accounts payable | | | $ | [removed: 81.6] [added: 121.2] | | | | | $ | [removed: 123.5] [added: 81.6] | |

| Accrued compensation and employee benefits | | | [removed: 235.0] [added: 350.1] | | | | | | [removed: 251.6] [added: 235.0] | | |

| Deferred revenue | | | [removed: 350.3] [added: 377.2] | | | | | | [removed: 337.8] [added: 350.3] | | |

| Other accrued liabilities | | | [removed: 298.3] [added: 301.3] | | | | | | [removed: 317.3] [added: 298.3] | | |

| Total current liabilities | | | [removed: 965.2] [added: 1,149.8] | | | | | | [removed: 1,030.2] [added: 965.2] | | |

| Other long-term liabilities | | | [removed: 444.6] [added: 453.7] | | | | | | [removed: 418.3] [added: 444.6] | | |

| Total liabilities | | | [removed: 1,409.8] [added: 1,603.5] | | | | | | [removed: 1,448.5] [added: 1,409.8] | | |

| Preferred stock, 2.5 shares authorized, $0.001 par value, issuable in series; no shares issued and outstanding as of December 31, [removed: 2020,] [added: 2021,] and [removed: 2019] [added: 2020] | | | — | | | | | | — | | |

| Common stock, [removed: 300.0] [added: 600.0] shares authorized, $0.001 par value, [removed: 117.7] [added: 357.7] shares and [removed: 116.0] [added: 353.1] shares issued and outstanding as of December 31, [removed: 2020,] [added: 2021,] and [removed: 2019,] [added: 2020,] respectively | | | [removed: 0.1] [added: 0.4] | | | | | | [removed: 0.1] [added: 0.4] | | |

| Additional paid-in capital | | | [removed: 6,445.2] [added: 7,164.0] | | | | | | [removed: 5,756.8] [added: 6,444.9] | | |

| Retained earnings | | | [removed: 3,261.3] [added: 4,760.9] | | | | | | [removed: 2,494.5] [added: 3,261.3] | | |

February 3, 2022

| | | | 2021 | | | | | | 2020 | | |

| Basic | | | $ | 4.79 | | | | | $ | 3.02 | | | | | $ | 3.98 | |

| Diluted | | | $ | 4.66 | | | | | $ | 2.94 | | | | | $ | 3.85 | |

| Basic | | | 356.1 | | | | | | 351.1 | | | | | | 346.2 | | |

| Diluted | | | 365.8 | | | | | | 361.0 | | | | | | 358.4 | | |

| Total comprehensive income attributable to Intuitive Surgical, Inc. | | | $ | 1,655.5 | | | | | $ | 1,073.1 | | | | | $ | 1,405.0 | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Other comprehensive income (loss) | | | | | | | | | | | | | | | | | | | | | | | | | | | (49.1) | | | | | | (49.1) | | | | | | (0.7) | | | | | | (49.8) | | |

| Balances as of December 31, 2021 | | | 357.7 | | | | | | $ | 0.4 | | | | | $ | 7,164.0 | | | | | $ | 4,760.9 | | | | | $ | (24.2) | | | | | $ | 11,901.1 | | | | | $ | 50.4 | | | | | $ | 11,951.5 | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

Common Stock Split

Shares issued pursuant to the three-for-one stock split (the "Stock Split") of the Company's issued and outstanding common stock, par value $0.001 per share, were distributed on October 4, 2021, to stockholders of record as of September 27, 2021.

All share and per-share information presented in the Consolidated Financial Statements have been retroactively adjusted to reflect the Stock Split.

hospitals curtail and reduce capital and overall spending.

In particular, the Company has experienced increased difficulties in obtaining a sufficient supply of component materials used in its products, including those in the semiconductor market, as global supply has become significantly constrained due to increased demand in semiconductors and other materials.

Additionally, prices of such materials have increased due to the increased demand and supply shortage.

The Company is engaged in activities to seek to mitigate supply disruptions by, for example, increasing its communications with its suppliers and modifying its purchase order coverage and inventory levels.

However, the global supply chain shortages, including those in the semiconductor market, are likely to remain a challenge for the foreseeable future.

The Company has also experienced challenges in logistics, as certain shipping routes have been impacted by port closures.

Such global shortages in important components and logistics challenges have resulted in, and will continue to cause, inflationary cost pressure in the Company’s supply chain.

To date, these challenges have not materially impacted the Company’s results of operations or ability to deliver product and services to its customers.

However, if shortages in important supply chain materials in the semiconductor or other markets continue, the Company could fail to meet product demand, which would adversely impact its business, financial condition, results of operations, or cash flows.

Increased labor shortages globally, including staff burnout and attrition, could also impact the Company’s ability to hire and retain personnel critical to its manufacturing, logistics, and commercial operations.

The Company is also highly dependent on the principal members of its management and scientific staff.

Attracting and retaining qualified personnel is critical to its success, and competition for them has become more intense.

The loss of critical members of the Company’s team, or its inability to attract and retain qualified personnel, could significantly harm its operations, business, and ability to compete.

In addition, hospitals are also experiencing staffing shortages and supply chain issues that could impact their ability to provide patient care.

There was no similar customer relief program offered in 2021.

with $181 million of billings during the program, of which $19 million remained outstanding as of December 31, 2020.

All of the trade receivables with extended payment terms have been collected as of December 31, 2021.

and services, geographies, and type of customer.

liabilities for the Company’s automobile leases.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| High | | | $ | 101.7 | | | | | $ | 51.0 | | | | | $ | 18.8 | | | | | $ | 7.0 | | | | | $ | 1.7 | | | | | | | | $ | — | | | | | $ | 180.2 | |

| Moderate | | | 109.3 | | | | | | 62.6 | | | | | | 18.8 | | | | | | 7.0 | | | | | | 2.8 | | | | | | | | | 0.6 | | | | | | 201.1 | | |

| | | | | | |

| --- | --- | --- | --- | --- | --- |

*Change in Accounting Principle*

As discussed in Note 2 to the consolidated financial statements, the Company changed the manner in which it accounts for recognition of the income tax consequences of an intra-entity transfer of an asset, other than inventory, in 2018.

February 9, 2021

| | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Basic | | | $ | 9.06 | | | | | $ | 11.95 | | | | | $ | 9.92 | |

| Diluted | | | $ | 8.82 | | | | | $ | 11.54 | | | | | $ | 9.49 | |

| Basic | | | 117.0 | | | | | | 115.4 | | | | | | 113.7 | | |

| Diluted | | | 120.3 | | | | | | 119.5 | | | | | | 118.8 | | |

| Balances at December 31, 2017 | | | 112.3 | | | | | | $ | 0.1 | | | | | $ | 4,679.2 | | | | | $ | 115.0 | | | | | $ | (15.5) | | | | | $ | 4,778.8 | | | | | $ | 1.6 | | | | | $ | 4,780.4 | |

| Adoption of new accounting standards (1) | | | | | | | | | | | | | | | | | | | | | 392.1 | | | | | | (1.3) | | | | | | 390.8 | | | | | | | | | | | | 390.8 | | |

| Other comprehensive income | | | | | | | | | | | | | | | | | | | | | | | | | | | 3.5 | | | | | | 3.5 | | | | | | | | | | | | 3.5 | | |

| (1) Represents the adjustments related to the adoptions of Accounting Standards Update ("ASU") 2016-16, *Income Taxes (Topic 740): Intra-Entity Transfer of Assets Other than Inventory*, and ASU 2018-02, *Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income*. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Capital contribution from noncontrolling interest | | | — | | | | | | 10.0 | | | | | | 10.0 | | |

Beginning in 2018, the Company adopted Accounting Standards Update ("ASU") No. 2016-16, *Income Taxes (Topic 740): Intra-Entity Transfer of Assets Other than Inventory*.

The Company adopted this standard using the modified retrospective approach and, as a result, recorded a cumulative adjustment to retained earnings as of January 1, 2018.

[Table](#ifd6f4af27a57401890271d74ae2e1592_7) [of Contents](#ifd6f4af27a57401890271d74ae2e1592_7)

depending on the customer arrangement.

of the lease term, (2) whether the present value of the minimum lease payments equals or exceeds substantially all of the fair value of the leased system, (3) whether the lease term is for the major part of the remaining economic life of the leased system, (4) whether the lease grants the lessee an option to purchase the leased system that the lessee is reasonably certain to exercise, and (5) whether the underlying system is of such a specialized nature that it is expected to have no alternative use to the Company at the end of the lease term.

The following table summarizes the amortized cost basis by year of origination and credit quality indicator as of December 31, 2020 (in millions):

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| High | | | $ | 78.0 | | | | | $ | 36.4 | | | | | $ | 12.2 | | | | | $ | 7.8 | | | | | $ | 1.5 | | | | | $ | 1.2 | | | | | $ | 137.1 | |

| Moderate | | | 74.6 | | | | | | 30.1 | | | | | | 18.8 | | | | | | 3.6 | | | | | | 2.0 | | | | | | — | | | | | | 129.1 | | |

| Low | | | 5.7 | | | | | | — | | | | | | 1.1 | | | | | | 0.7 | | | | | | 1.3 | | | | | | — | | | | | | 8.8 | | |

| Total | | | $ | 158.3 | | | | | $ | 66.5 | | | | | $ | 32.1 | | | | | $ | 12.1 | | | | | $ | 4.8 | | | | | $ | 1.2 | | | | | $ | 275.0 | |

For the year ended December 31, 2019, there were no credit losses recognized related to available-for-sales debt securities.

Under the treasury stock method, the amount the employee must pay for exercising

the amount can be reasonably estimated.

*Financial Instruments*

In June 2016, the FASB issued ASU No. 2016-13, *Measurement of Credit Losses on Financial Instruments (Topic 326) ("Topic 326"),* which replaces existing incurred loss impairment guidance and establishes a single allowance framework for financial assets carried at amortized cost.

The Company adopted Topic 326 on January 1, 2020, using a modified retrospective transition method, which requires a cumulative-effect adjustment, if any, to the opening balance of retained earnings to be recognized on the date of adoption with prior period not restated.

The cumulative-effect adjustment recorded on January 1, 2020, was not material.

Refer to the description of the Company's "Credit Losses" accounting policy in the "Significant Accounting Policies" section above.

The Company continues to monitor new accounting pronouncements issued by the FASB and does not believe any recently issued accounting pronouncements will have a material impact on the Company's consolidated financial statements.

| Cash | | | $ | 413.1 | | | | | $ | — | | | | | $ | — | | | | | $ | 413.1 | | | | | $ | 413.1 | | | | | $ | — | | | | | $ | — | |

| U.S. treasuries | | | 1,935.8 | | | | | | 9.7 | | | | | | (0.4) | | | | | | 1,945.1 | | | | | | — | | | | | | 890.8 | | | | | | 1,054.3 | | |

| Subtotal | | | 2,662.6 | | | | | | 9.7 | | | | | | (0.4) | | | | | | 2,671.9 | | | | | | 726.8 | | | | | | 890.8 | | | | | | 1,054.3 | | |

Based on the results of our assessment under the framework in the Internal Control—Integrated Framework (2013), our management concluded that our internal control over financial reporting was effective as of December 31, [removed: 2020.][added: 2021.]

The effectiveness of our internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] has been audited by [added: PricewaterhouseCoopers LLP,] an independent registered public accounting firm, as stated in their report, which is included under “Item 8.

There were no changes in our internal control over financial reporting that occurred during the quarter ended December 31, [removed: 2020,] [added: 2021,] that have materially affected, or are reasonably likely to materially affect, our internal control over financial [removed: statements.][added: reporting.]

PART III

Certain information required by Part III is omitted from this report on Form 10-K and is incorporated herein by reference to our definitive Proxy Statement for our next Annual Meeting of Stockholders (the “Proxy Statement”), which we intend to file pursuant to Regulation 14A of the Securities Exchange Act of 1934, as amended, within 120 days after December 31, 2020.

Not applicable.

PART III

Certain information required by Part III is omitted from this report on Form 10-K and is incorporated herein by reference to our definitive Proxy Statement for our next Annual Meeting of Stockholders (the “Proxy Statement”), which we intend to file pursuant to Regulation 14A of the Securities Exchange Act of 1934, as amended, within 120 days after December 31, 2021.

2)The following financial statement schedule of Intuitive Surgical, Inc. for [added: 2021,] 2020, [removed: 2019,] and [removed: 2018] [added: 2019] is filed as part of this report and should be read in conjunction with the financial statements of Intuitive Surgical, Inc.:

| [Schedule II - Valuation and Qualifying [removed: Accounts](#ifd6f4af27a57401890271d74ae2e1592_286)] [added: Accounts](#i30d98ad3bee64d018232130137db9899_295)] | | | [removed: [115](#ifd6f4af27a57401890271d74ae2e1592_286)] [added: [118](#i30d98ad3bee64d018232130137db9899_295)] | | |

| 3.1(1) | | | | | | [Amended and Restated Certificate of Incorporation of the Company, [removed: as amended.](https://www.sec.gov/Archives/edgar/data/1035267/000103526720000166/ex-31xamendedandrestat.htm)] [added: as](https://www.sec.gov/Archives/edgar/data/1035267/000103526720000166/ex-31xamendedandrestat.htm) [A](https://www.sec.gov/Archives/edgar/data/1035267/000103526720000166/ex-31xamendedandrestat.htm)[mended.](https://www.sec.gov/Archives/edgar/data/1035267/000103526720000166/ex-31xamendedandrestat.htm)] | | |

| [removed: 3.2(2)] [added: 3.3(3)] | | | | | | [Amended and Restated Bylaws of the Company.](https://www.sec.gov/Archives/edgar/data/1035267/000103526721000021/exhibit31-amendedandrestat.htm) | | |

| [removed: 4.1(3)] [added: 4.1(4)] | | | | | | [Specimen Stock Certificate.](http://www.sec.gov/Archives/edgar/data/1035267/000089161800002457/0000891618-00-002457.txt) | | |

| 4.2 | | | | | | [Description of the Registrant's Securities Registered Pursuant to Section 12 of the Securities Exchange Act of [removed: 1934](https://www.sec.gov/Archives/edgar/data/1035267/000103526721000028/exhibit42-descriptionofthe.htm).] [added: 1934.](https://www.sec.gov/Archives/edgar/data/1035267/000103526722000014/isrg-20211231xex42q42021xf.htm)] | | |

| [removed: 10.1(4)] [added: 10.1(5)] | | | | | | [2000 Non-Employee Directors’ Stock Option Plan.](http://www.sec.gov/Archives/edgar/data/1035267/000089161800001640/0000891618-00-001640.txt) * | | |

| [removed: 10.2(5)] [added: 10.2(6)] | | | | | | [Form of Indemnity Agreement.](http://www.sec.gov/Archives/edgar/data/1035267/000103526715000087/ex101intuitivesurgicalincf.htm) * | | |

| [removed: 10.3(6)] [added: 10.3(7)] | | | | | | [2009 Employment Commencement Incentive Plan, as amended and restated.](http://www.sec.gov/Archives/edgar/data/1035267/000103526715000051/ex422009employmentcommence.htm) * | | |

| [removed: 10.4(7)] [added: 10.4(8)] | | | | | | [2000 Employee Stock Purchase Plan, as amended and restated.](http://www.sec.gov/Archives/edgar/data/1035267/000103526717000079/ex1012000employeestockpurc.htm) * | | |

| [removed: 10.5(8)] [added: 10.5(9)] | | | | | | [2010 Incentive Award Plan, as amended and [removed: restated.](https://www.sec.gov/Archives/edgar/data/1035267/000103526720000085/ex-101xamendedandresta.htm)] [added: restated.](https://www.sec.gov/Archives/edgar/data/1035267/000103526721000094/ex-101xamendedandrestated2.htm)] * | | |

| [removed: 10.6(9)] [added: 10.6(10)] | | | | | | [Severance Plan.](http://www.sec.gov/Archives/edgar/data/1035267/000119312508246630/dex101.htm) * | | |

| [removed: 10.7(10)] [added: 10.7(11)] | | | | | | [Form of Amended and Restated Intuitive Surgical, Inc. 2009 Employment Commencement Incentive Plan Stock Option Grant Notice.](http://www.sec.gov/Archives/edgar/data/1035267/000103526716000130/isrg-20151231xex109.htm) * | | |

| [removed: 10.8(11)] [added: 10.8(12)] | | | | | | [Form of Amended and Restated Intuitive Surgical, Inc. 2009 Employment Commencement Incentive Plan Restricted Stock Unit Grant Notice.](http://www.sec.gov/Archives/edgar/data/1035267/000103526716000130/isrg-20151231xex1010.htm) * | | |

| [removed: 10.9(12)] [added: 10.9(13)] | | | | | | [Form of Amended and Restated Intuitive Surgical, Inc. 2010 Incentive Award Plan Global Stock Option Grant Notice.](https://www.sec.gov/Archives/edgar/data/1035267/000103526720000122/ex-102x2010planoptionn.htm) * | | |

| [removed: 10.10(13)] [added: 10.10(14)] | | | | | | [Form of Amended and Restated Intuitive Surgical, Inc. 2010 Incentive Award Plan Global Restricted Stock Unit Grant Notice.](https://www.sec.gov/Archives/edgar/data/1035267/000103526720000122/ex-103x2010planrsunoti.htm) * | | |

| 21.1 | | | | | | [Intuitive Surgical, Inc. [removed: Subsidiaries.](https://www.sec.gov/Archives/edgar/data/1035267/000103526721000028/isrg-20201231xex211q42020.htm)] [added: Subsidiaries.](https://www.sec.gov/Archives/edgar/data/1035267/000103526722000014/isrg-20211231xex211q42021x.htm)] | | |

| 23.1 | | | | | | [Consent of Independent Registered Public Accounting [removed: Firm.](https://www.sec.gov/Archives/edgar/data/1035267/000103526721000028/isrg-20201231xex231q42020.htm)] [added: Firm.](https://www.sec.gov/Archives/edgar/data/1035267/000103526722000014/isrg-20211231xex231q42021x.htm)] | | |

| 31.1 | | | | | | [Certification of Principal Executive [removed: Officer.](https://www.sec.gov/Archives/edgar/data/1035267/000103526721000028/isrg-20201231xex311q42020.htm)] [added: Officer.](https://www.sec.gov/Archives/edgar/data/1035267/000103526722000014/isrg-20211231xex311q42021x.htm)] | | |

| 31.2 | | | | | | [Certification of Principal Financial [removed: Officer.](https://www.sec.gov/Archives/edgar/data/1035267/000103526721000028/isrg-20201231xex312q42020.htm)] [added: Officer.](https://www.sec.gov/Archives/edgar/data/1035267/000103526722000014/isrg-20211231xex312q42021x.htm)] | | |

| 32.1 | | | | | | [Certification of Chief Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/1035267/000103526721000028/isrg-20201231xex321q42020.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/1035267/000103526722000014/isrg-20211231xex321q42021x.htm)] | | |

| 101 | | | | | | The following materials from Intuitive Surgical, Inc.’s Annual Report on Form 10-K for the year ended December 31, [removed: 2020,] [added: 2021,] formatted in Inline XBRL (Inline Extensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Stockholders’ Equity, (v) Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements, tagged at Level I through IV. | | |

| 104 | | | | | | The cover page from Intuitive Surgical, [removed: Inc.'s] [added: Inc.’s] Annual Report on Form 10-K for the year ended December 31, [removed: 2020,] [added: 2021,] formatted in Inline XBRL and contained in Exhibit 101. | | |

[removed: (2)Incorporated] [added: (3)Incorporated] by reference to Exhibit 3.1 filed with the Company’s Current Report on Form 8-K filed on February 1, 2021 (File No. 000-30713).

[removed: (3)Incorporated] [added: (4)Incorporated] by reference to Exhibit 4.2 filed with the Company’s Registration Statement Amendment on Form S-1/A filed on May 2, 2000 (File No. 333-33016).

[removed: (4)Incorporated] [added: (5)Incorporated] by reference to exhibits filed with the Company’s Registration Statement on Form S-1 filed on March 22, 2000 (File No. 333-33016).

[removed: (5)Incorporated] [added: (6)Incorporated] by reference to Exhibit 10.1 filed with the Company’s Current Report on Form 8-K filed on August 3, 2015 (File No. 000-30713).

[removed: (6)Incorporated] [added: (7)Incorporated] by reference to Exhibit 4.2 filed with the Company’s Registration Statement on Form S-8 filed on May 1, 2015 (File No. 333-203793).

[removed: (7)Incorporated] [added: (8)Incorporated] by reference to Exhibit 10.1 filed with the Company’s Current Report on Form 8-K filed on April 26, 2017 (File No. 000-30713).

[removed: (8)Incorporated] [added: (9)Incorporated] by reference to Exhibit 10.1 filed with the Company’s Current Report on Form 8-K filed on April [removed: 28, 2020] [added: 26, 2021] (File No. 000-30713).

[removed: (9)Incorporated] [added: (10)Incorporated] by reference to Exhibit 10.1 filed with the Company’s Current Report on Form 8-K filed on December 2, 2008 (File No. 000-30713).

[removed: (10)Incorporated] [added: (11)Incorporated] by reference to Exhibit 10.9 filed with the Company’s 2015 Annual Report on Form 10-K filed on February 2, 2016 (File No. 000-30713).

[removed: (11)Incorporated] [added: (12)Incorporated] by reference to Exhibit 10.10 filed with the Company’s 2015 Annual Report on Form 10-K filed on February 2, 2016 (File No. 000-30713).

[removed: (12)Incorporated] [added: (13)Incorporated] by reference to Exhibit 10.2 filed with the Company’s Quarterly Report on Form 10-Q filed on July 23, 2020 (File No. 000-30713).

[removed: (13)Incorporated] [added: (14)Incorporated] by reference to Exhibit 10.3 filed with the Company’s Quarterly Report on Form 10-Q filed on July 23, 2020 (File No. 000-30713).

[removed: (14)Incorporated] [added: (2)Incorporated] by reference to Exhibit [removed: 10.13] [added: 3.1] filed with the Company’s [removed: 2016 Annual] [added: Quarterly] Report on Form [removed: 10-K] [added: 10-Q] filed on [removed: February 6, 2017] [added: October 20, 2021] (File No. 000-30713).

| 3.2(2) | | | | | | [Amendment to Amended and Restated Certificate of Incorporation of the Company.](https://www.sec.gov/Archives/edgar/data/1035267/000103526721000178/exhibit31-arcertificateofi.htm) | | |

| 10.11 | | | | | | [Form of Amended and Restated Intuitive Surgical, Inc. 2010 Incentive Award Plan Global](https://www.sec.gov/Archives/edgar/data/1035267/000103526722000014/isrg-20211231xex1011q42021.htm) [Performance](https://www.sec.gov/Archives/edgar/data/1035267/000103526722000014/isrg-20211231xex1011q42021.htm) [Stock Unit Grant Notice](https://www.sec.gov/Archives/edgar/data/1035267/000103526722000014/isrg-20211231xex1011q42021.htm). * | | |

| | | | | | | | | |

| 10.11(14) | | | | | | [Master Confirmation and Supplemental Confirmation between Intuitive Surgical, Inc. and Goldman Sachs & Co. LLC dated January 24, 2017](http://www.sec.gov/Archives/edgar/data/1035267/000103526717000021/isrg-20161231xex1013.htm). * | | |

Date: February [removed: 9, 2021][added: 3, 2022]

Each person whose individual signature appears below hereby authorizes and appoints Gary Guthart, Ph.D., and [removed: Marshall Mohr,] [added: Jamie Samath,] and each of them, with full power of substitution and re-substitution and full power to act without the other, as his or her true and lawful attorney-in-fact and agent to act in his or her name, place, and stead and to execute in the name and on behalf of each person, individually and in each capacity stated below, and to file any and all amendments to this annual report on Form 10‑K and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing, ratifying and confirming all that said attorneys-in-fact and agents or any of them or their or his substitute or substitutes may lawfully do or cause to be done by virtue thereof.

| /S/ GARY S. GUTHART | | | | | | President, Chief Executive Officer, and Director (Principal Executive Officer) | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ [removed: MARSHALL L. MOHR] [added: JAMIE E. SAMATH] | | | | | | [removed: Executive] [added: Senior] Vice President and Chief Financial Officer (Principal Financial Officer) | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ CRAIG H. BARRATT | | | | | | Chairman of the Board of Directors | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ JOSEPH C. BEERY | | | | | | Director | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ AMAL M. JOHNSON | | | | | | Director | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ DON R. KANIA | | | | | | Director | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ AMY L. LADD | | | | | | Director | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ KEITH R. LEONARD JR. | | | | | | Director | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ ALAN J. LEVY | | | | | | Director | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ JAMI DOVER NACHTSHEIM | | | | | | Director | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ MARK J. RUBASH | | | | | | Director | | | | | | February [removed: 9, 2021] [added: 3, 2022] | | |

| /S/ FREDRIK C. WIDMAN | | | | | | Vice President, Corporate Controller (Principal Accounting Officer) | | | | | | February 3, 2022 | | |

| Fredrik C. Widman | | | | | | | | | | | | | | |

| /S/ MONICA P. REED | | | | | | Director | | | | | | February 3, 2022 | | |

| Monica P. Reed | | | | | | | | | | | | | | |

| Marshall L. Mohr | | | | | | | | | | | | | | |

| /S/ JAMIE E. SAMATH | | | | | | Senior Vice President, Finance (Principal Accounting Officer) | | | | | | February 9, 2021 | | |