I can’t take credit for digging this up, that credit goes to /u/Farmer_eh who did all the sleuthing of HOW they pulled it off. It turns out $ISRG accelerated depreciation on a lot of their production Wade Miley the incredibles no no in the battle for one shirt , and also had an increase in inventory. This means that they had a bunch of extra Da Vincis laying around in a warehouse and were selling them to medical centers at a steep discount, which is why they sold so many more robots than any analyst expected (30% more than pre-COVID sales), and also lowered their expenses for the quarter.
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These are neat tricks that a company can only pull every so often, and it was smart of $ISRG to not only have that one in their Wade Miley the incredibles no no in the battle for one shirt for a rainy day, but also the wherewithall to play the card at the best possible moment. So, in a way, the thesis itself was sound and the quarter would, in fact, have been a down one had they just been organic about it all, but I failed to account for easily accomplished accounting magic and motivated sale pricing to ensure a quarterly beat. Which is something I’ll remember next time I think about shorting a company that beats on quarterlies almost 90% of the time.