Surgical robots aren't new. Intuitive Surgical (ISRG +0.39%) has been selling them for years. In fact, the company's installed base of robots rose to just over 11,100 by the end of 2025. The company just announced that over 20 million people have been operated on using its da Vinci surgical robotics systems. There are two reasons why Intuitive Surgical could be a great growth stock for you over the next 20 years.
The fly in the ointment with Intuitive Surgical
Before getting to the good stuff, it is important to address the bad. Intuitive Surgical's price-to-earnings ratio is roughly 60x. That's high, however you look at it. Wall Street clearly has very big expectations, and only more aggressive growth investors will want to buy this stock.
Image source: Getty Images.
Intuitive Surgical's growth story isn't slowing down
With that out of the way, Intuitive Surgical's installed base of da Vinci robots expanded 12% in 2025. Revenue in the fourth quarter of the year increased 19% year over year, with adjusted earnings rising from $2.21 in the fourth quarter of 2024 to $2.53. This is a fast growing company and given the many benefits of surgical robots, notably including better patient outcomes, it seems highly likely that growth will continue to be strong in the years ahead. That's the first reason to like the stock.
NASDAQ: ISRG
Key Data Points
However, there's a bigger story than just the number of robots Intuitive Surgical sells. Roughly 75% of the company's revenues are derived from services, instruments, and accessories. These are annuity-like income streams that increase as the installed base of da Vinci systems increases. Demand for services, instruments, and accessories also grows as the use of da Vinci robots expands, noting that procedure growth in 2025 was 18%, well above the 12% growth in da Vinci sales. That highlights the demand for surgical robotics, but the system is being approved for more and more types of surgery, as well.
Intuitive Surgical's flywheel is growing
When you step back, Intuitive Surgical is an industry leader in surgical robotics. The real flywheel of the business is what amounts to parts and services. The sale of new da Vinci systems, increased demand for surgeries performed with surgical robots, and expanding use cases are all powering the flywheel's growth over time. If you can stomach the lofty valuation, Intuitive Surgical could be the healthcare stock for you as it continues to expand its business in the decades ahead.
