Analysis of Short-term (Operating) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Short-term Activity Ratios (Summary)
Intuitive Surgical Inc., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
An examination of short-term operating activity ratios reveals several noteworthy trends between 2021 and 2025. Generally, the period is characterized by decreasing efficiency in inventory management, a relatively stable receivables collection process, and consistent payables management. Working capital turnover exhibits fluctuations, while the cash conversion cycle demonstrates a lengthening timeframe.
- Inventory Management
- Inventory turnover decreased consistently from 2.98 in 2021 to 1.86 in 2025. This indicates a growing inefficiency in converting inventory into sales. Correspondingly, the average inventory processing period lengthened substantially, increasing from 122 days in 2021 to 196 days in 2025, suggesting inventory is held for a longer duration. This could be due to a variety of factors, including shifts in sales patterns, increased inventory levels, or potential obsolescence.
- Receivables Management
- Receivables turnover experienced a moderate decline from 7.30 in 2021 to 6.59 in 2025. The average receivable collection period increased from 50 days to 55 days over the same period. While a slight decrease in efficiency is observed, the changes are less pronounced than those seen with inventory, indicating a relatively stable process for collecting receivables.
- Payables Management
- Payables turnover decreased from 14.45 in 2021 to 13.42 in 2025. The average payables payment period increased from 25 days to 27 days. These changes suggest a slight lengthening in the time taken to settle obligations to suppliers, but the impact appears minimal and consistent.
- Working Capital & Cash Conversion
- Working capital turnover initially increased from 1.22 in 2021 to 1.29 in 2022, then decreased to 1.14 in 2023 before rising to 1.56 in 2024 and falling back to 1.29 in 2025. This indicates fluctuating efficiency in utilizing working capital to generate sales. The operating cycle lengthened from 172 days in 2021 to 251 days in 2025, reflecting the combined effect of slower inventory turnover and a slightly extended receivables collection period. The cash conversion cycle also increased, moving from 147 days in 2021 to 224 days in 2025, indicating a longer time between paying for inventory and receiving cash from sales.
In summary, the observed trends suggest a growing inefficiency in inventory management and a lengthening cash conversion cycle. While receivables and payables management remain relatively stable, the increasing time required to convert inventory into cash warrants further investigation.
Turnover Ratios
Average No. Days
Inventory Turnover
Intuitive Surgical Inc., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Cost of revenue | 3,422,400) | 2,717,900) | 2,394,600) | 2,026,200) | 1,751,600) | |
| Inventory | 1,840,000) | 1,487,200) | 1,220,600) | 893,200) | 587,100) | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 1.86 | 1.83 | 1.96 | 2.27 | 2.98 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| Abbott Laboratories | — | 3.02 | 2.74 | 3.10 | 3.59 | |
| Medtronic PLC | 2.12 | 2.15 | 2.03 | 2.20 | 2.43 | |
| Inventory Turnover, Sector | ||||||
| Health Care Equipment & Services | — | 32.90 | 30.37 | 30.70 | 31.85 | |
| Inventory Turnover, Industry | ||||||
| Health Care | — | 7.56 | 7.36 | 7.85 | 7.90 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Inventory turnover = Cost of revenue ÷ Inventory
= 3,422,400 ÷ 1,840,000 = 1.86
2 Click competitor name to see calculations.
The inventory turnover ratio demonstrates a declining trend over the five-year period. While the cost of revenue consistently increased, inventory levels rose at a faster rate, resulting in a decreasing ratio. This suggests a lengthening of the sales cycle or potentially increasing inefficiencies in inventory management.
- Inventory Turnover Trend
- The inventory turnover ratio decreased from 2.98 in 2021 to 2.27 in 2022, representing a significant drop. This decline continued in subsequent years, reaching 1.96 in 2023 and 1.83 in 2024. A slight increase to 1.86 was observed in 2025, but the ratio remained substantially lower than the value recorded in 2021.
- Cost of Revenue
- Cost of revenue increased steadily throughout the period, moving from US$1,751.6 million in 2021 to US$3,422.4 million in 2025. This indicates growing sales volume or increasing production costs, or a combination of both.
- Inventory Levels
- Inventory experienced substantial growth, rising from US$587.1 million in 2021 to US$1,840.0 million in 2025. The rate of inventory increase exceeded the rate of cost of revenue increase, contributing to the declining inventory turnover ratio. This suggests the company is holding a larger proportion of inventory relative to sales.
The stabilization of the inventory turnover ratio in 2025, although minimal, may indicate that inventory accumulation is beginning to moderate. However, further monitoring is necessary to determine if this represents a sustained trend or a temporary fluctuation. The continued increase in both cost of revenue and inventory levels warrants further investigation into the underlying drivers of these changes.
Receivables Turnover
Intuitive Surgical Inc., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | 10,064,700) | 8,352,100) | 7,124,100) | 6,222,200) | 5,710,100) | |
| Accounts receivable, net of allowances | 1,527,300) | 1,225,400) | 1,130,200) | 942,100) | 782,700) | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 6.59 | 6.82 | 6.30 | 6.60 | 7.30 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Abbott Laboratories | — | 6.06 | 6.11 | 7.02 | 6.64 | |
| Elevance Health Inc. | — | 18.00 | 18.08 | 18.81 | 20.66 | |
| Medtronic PLC | 5.15 | 5.28 | 5.21 | 5.71 | 5.51 | |
| UnitedHealth Group Inc. | — | 17.66 | 17.27 | 18.22 | 20.07 | |
| Receivables Turnover, Sector | ||||||
| Health Care Equipment & Services | — | 13.93 | 13.74 | 14.33 | 14.76 | |
| Receivables Turnover, Industry | ||||||
| Health Care | — | 7.97 | 7.66 | 8.22 | 8.00 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Receivables turnover = Revenue ÷ Accounts receivable, net of allowances
= 10,064,700 ÷ 1,527,300 = 6.59
2 Click competitor name to see calculations.
The receivables turnover ratio exhibits a generally stable, yet slightly declining, pattern over the five-year period. While fluctuations occur, the ratio remains within a relatively narrow range, suggesting consistent efficiency in collecting receivables, though with a subtle trend towards slower collection.
- Overall Trend
- The receivables turnover ratio decreased from 7.30 in 2021 to 6.59 in 2025. This indicates a lengthening of the average collection period, although the change is not dramatic.
- Year-over-Year Changes
- A decrease in the ratio is observed from 2021 to 2022, moving from 7.30 to 6.60. This represents a reduction in the speed at which receivables are converted into cash. A further decline occurred between 2022 and 2023, with the ratio falling to 6.30. The year 2024 saw a slight recovery, with the ratio increasing to 6.82. However, this improvement was not sustained, as the ratio decreased again in 2025 to 6.59.
- Relationship to Revenue
- Despite increasing revenue each year, the receivables turnover ratio did not consistently increase. This suggests that the growth in revenue was accompanied by a corresponding increase in accounts receivable, offsetting any potential gains in collection efficiency. The increase in accounts receivable appears to be growing at a faster rate than revenue.
- Potential Implications
- The observed trend warrants further investigation. While the ratio remains at a reasonable level, the consistent decline could indicate a loosening of credit terms, a shift in customer mix, or potential issues with the collection process. Monitoring this ratio closely is recommended to ensure that the company maintains efficient cash flow from its sales.
Payables Turnover
Intuitive Surgical Inc., payables turnover calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Cost of revenue | 3,422,400) | 2,717,900) | 2,394,600) | 2,026,200) | 1,751,600) | |
| Accounts payable | 255,100) | 193,400) | 188,700) | 147,000) | 121,200) | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 13.42 | 14.05 | 12.69 | 13.78 | 14.45 | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Abbott Laboratories | — | 4.46 | 4.19 | 4.15 | 4.21 | |
| Elevance Health Inc. | — | 8.10 | 7.72 | 7.47 | 7.59 | |
| Medtronic PLC | 4.75 | 4.65 | 4.03 | 4.46 | 4.98 | |
| UnitedHealth Group Inc. | — | 7.72 | 7.47 | 7.26 | 7.63 | |
| Payables Turnover, Sector | ||||||
| Health Care Equipment & Services | — | 7.48 | 7.14 | 6.94 | 7.18 | |
| Payables Turnover, Industry | ||||||
| Health Care | — | 6.10 | 5.97 | 5.79 | 5.84 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Payables turnover = Cost of revenue ÷ Accounts payable
= 3,422,400 ÷ 255,100 = 13.42
2 Click competitor name to see calculations.
The accounts payable turnover ratio exhibits a generally decreasing trend over the observed period, though with some fluctuation. This indicates a changing pattern in how quickly the company pays its suppliers. A closer examination reveals nuances in this trend.
- Overall Trend
- From 2021 to 2023, the payables turnover ratio declined from 14.45 to 12.69, representing a decrease of approximately 12.5%. This suggests the company was taking longer to pay its suppliers during this timeframe. However, the ratio increased to 14.05 in 2024 before decreasing again to 13.42 in 2025.
- Cost of Revenue and Accounts Payable Relationship
- The cost of revenue consistently increased throughout the period, rising from US$1,751.6 million in 2021 to US$3,422.4 million in 2025. Accounts payable also increased, moving from US$121.2 million to US$255.1 million over the same period. The increase in accounts payable, however, did not fully offset the growth in cost of revenue, contributing to the initial decline in the turnover ratio.
- Fluctuations and Potential Drivers
- The increase in the payables turnover ratio in 2024, despite continued growth in both cost of revenue and accounts payable, suggests a possible shift in payment terms or supplier relationships during that year. The subsequent decrease in 2025 could indicate a return to previous practices or the impact of new agreements. Further investigation into the company’s payment policies and supplier contracts would be necessary to determine the specific drivers behind these fluctuations.
In summary, while the company generally maintained a relatively stable payables turnover ratio, the observed fluctuations warrant further scrutiny to understand the underlying operational and financial factors influencing these changes.
Working Capital Turnover
Intuitive Surgical Inc., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Current assets | 9,779,500) | 7,111,000) | 7,888,000) | 6,253,000) | 5,844,900) | |
| Less: Current liabilities | 2,006,200) | 1,745,300) | 1,658,700) | 1,422,100) | 1,149,800) | |
| Working capital | 7,773,300) | 5,365,700) | 6,229,300) | 4,830,900) | 4,695,100) | |
| Revenue | 10,064,700) | 8,352,100) | 7,124,100) | 6,222,200) | 5,710,100) | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | 1.29 | 1.56 | 1.14 | 1.29 | 1.22 | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Abbott Laboratories | — | 4.42 | 4.54 | 4.48 | 3.87 | |
| Elevance Health Inc. | — | 7.85 | 7.83 | 8.37 | 7.23 | |
| Medtronic PLC | 3.07 | 2.90 | 2.47 | 2.97 | 2.15 | |
| UnitedHealth Group Inc. | — | — | — | — | — | |
| Working Capital Turnover, Sector | ||||||
| Health Care Equipment & Services | — | 23.57 | 23.27 | 25.59 | 16.28 | |
| Working Capital Turnover, Industry | ||||||
| Health Care | — | 12.35 | 10.99 | 11.30 | 8.57 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Working capital turnover = Revenue ÷ Working capital
= 10,064,700 ÷ 7,773,300 = 1.29
2 Click competitor name to see calculations.
The working capital turnover ratio exhibited fluctuations over the five-year period. While generally remaining above one, indicating efficient utilization of working capital to generate revenue, the ratio did not demonstrate a consistent trend.
- Overall Trend
- The working capital turnover ratio increased from 1.22 in 2021 to 1.29 in 2022, suggesting improved efficiency in utilizing working capital to generate sales. However, this was followed by a decrease to 1.14 in 2023, indicating a less efficient turnover. A significant increase to 1.56 was observed in 2024, representing the highest ratio within the observed period. The ratio then decreased again in 2025, settling at 1.29.
- Working Capital
- Working capital increased from US$4,695.1 million in 2021 to US$4,830.9 million in 2022, a modest rise. A more substantial increase to US$6,229.3 million occurred in 2023. This was followed by a decrease to US$5,365.7 million in 2024, before rising again to US$7,773.3 million in 2025. The fluctuations in working capital levels likely influenced the observed turnover ratio.
- Revenue
- Revenue demonstrated a consistent upward trend throughout the period, increasing from US$5,710.1 million in 2021 to US$10,064.7 million in 2025. The rate of revenue growth accelerated in later years, particularly between 2023 and 2025. This revenue growth, in conjunction with the working capital fluctuations, contributed to the varying working capital turnover ratios.
The peak in the working capital turnover ratio in 2024 coincided with the largest absolute increase in revenue and a decrease in working capital. The subsequent decrease in the ratio in 2025, despite continued revenue growth, suggests that working capital increased at a faster rate than revenue during that year.
Average Inventory Processing Period
Intuitive Surgical Inc., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 1.86 | 1.83 | 1.96 | 2.27 | 2.98 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 196 | 200 | 186 | 161 | 122 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| Abbott Laboratories | — | 121 | 133 | 118 | 102 | |
| Medtronic PLC | 172 | 170 | 180 | 166 | 150 | |
| Average Inventory Processing Period, Sector | ||||||
| Health Care Equipment & Services | — | 11 | 12 | 12 | 11 | |
| Average Inventory Processing Period, Industry | ||||||
| Health Care | — | 48 | 50 | 46 | 46 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 1.86 = 196
2 Click competitor name to see calculations.
The average inventory processing period exhibited a consistent upward trend between 2021 and 2024, followed by a slight decrease in the most recent year. This indicates a lengthening in the time required to convert inventory into sales, before stabilizing somewhat.
- Average Inventory Processing Period
- In 2021, the average inventory processing period was 122 days. This figure increased to 161 days in 2022, representing a substantial rise. The period continued to lengthen, reaching 186 days in 2023 and peaking at 200 days in 2024. A modest decrease was observed in 2025, with the period falling to 196 days.
Concurrently, inventory turnover decreased over the same period. This inverse relationship between the average inventory processing period and inventory turnover is expected; as it takes longer to sell inventory, the number of times inventory is sold and replaced during the year declines.
- Inventory Turnover
- Inventory turnover decreased from 2.98 in 2021 to 1.83 in 2024. A slight increase to 1.86 was noted in 2025, but remains significantly lower than the 2021 level. This suggests a slowing in the rate at which inventory is sold and replenished.
The sustained increase in the average inventory processing period, coupled with the declining inventory turnover, warrants further investigation. Potential contributing factors could include changes in product mix, shifts in demand patterns, or inefficiencies in inventory management processes. The stabilization in 2025, while positive, does not fully reverse the prior trend and requires continued monitoring.
Average Receivable Collection Period
Intuitive Surgical Inc., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 6.59 | 6.82 | 6.30 | 6.60 | 7.30 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 55 | 54 | 58 | 55 | 50 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Abbott Laboratories | — | 60 | 60 | 52 | 55 | |
| Elevance Health Inc. | — | 20 | 20 | 19 | 18 | |
| Medtronic PLC | 71 | 69 | 70 | 64 | 66 | |
| UnitedHealth Group Inc. | — | 21 | 21 | 20 | 18 | |
| Average Receivable Collection Period, Sector | ||||||
| Health Care Equipment & Services | — | 26 | 27 | 25 | 25 | |
| Average Receivable Collection Period, Industry | ||||||
| Health Care | — | 46 | 48 | 44 | 46 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 6.59 = 55
2 Click competitor name to see calculations.
The average receivable collection period exhibited a generally increasing trend from 2021 to 2023, followed by stabilization and a slight decrease. This suggests a lengthening in the time required to collect payments from customers initially, with recent indications of potential improvement.
- Average Receivable Collection Period
- The average receivable collection period increased from 50 days in 2021 to 58 days in 2023. This indicates that, on average, it took longer to convert accounts receivable into cash over this period. A rise in this metric could suggest a loosening of credit terms, potential issues with customer payment behavior, or inefficiencies in the collection process.
- In 2024, the average collection period decreased to 54 days, representing a potential reversal of the prior trend. This improvement was marginal, however, and the period remained higher than the 2021 level.
- The average collection period remained relatively stable in 2025 at 55 days, indicating that the improvement observed in 2024 did not fully sustain. The consistency between 2024 and 2025 suggests the collection process may have reached a new equilibrium.
Concurrently, the receivables turnover ratio decreased from 7.30 in 2021 to 6.30 in 2023, aligning with the increase in the average collection period. The ratio then showed a slight recovery to 6.82 in 2024, before settling at 6.59 in 2025. This inverse relationship between the two metrics is expected, as a lower turnover implies a longer collection period.
Overall, the observed trends suggest a potential shift in the company’s credit and collection policies or customer payment patterns between 2021 and 2023. The recent stabilization and slight improvement in collection efficiency, as indicated by the 2024 and 2025 figures, warrant continued monitoring to determine if this represents a sustained change.
Operating Cycle
Intuitive Surgical Inc., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 196 | 200 | 186 | 161 | 122 | |
| Average receivable collection period | 55 | 54 | 58 | 55 | 50 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 251 | 254 | 244 | 216 | 172 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| Abbott Laboratories | — | 181 | 193 | 170 | 157 | |
| Medtronic PLC | 243 | 239 | 250 | 230 | 216 | |
| Operating Cycle, Sector | ||||||
| Health Care Equipment & Services | — | 37 | 39 | 37 | 36 | |
| Operating Cycle, Industry | ||||||
| Health Care | — | 94 | 98 | 90 | 92 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 196 + 55 = 251
2 Click competitor name to see calculations.
The operating cycle has demonstrated a consistent lengthening trend over the observed period. Each component contributing to the operating cycle – average inventory processing period and average receivable collection period – has also exhibited directional changes, contributing to the overall trend.
- Average Inventory Processing Period
- The average inventory processing period has increased from 122 days in 2021 to 186 days in 2023. While the increase slowed in 2024, reaching 200 days, a slight decrease to 196 days was noted in 2025. This suggests a growing duration for converting raw materials into finished goods and ultimately, saleable inventory, though the most recent period indicates a potential stabilization.
- Average Receivable Collection Period
- The average receivable collection period showed a gradual increase from 50 days in 2021 to 58 days in 2023. The period then decreased slightly to 54 days in 2024, followed by a return to 55 days in 2025. This indicates a lengthening, albeit modest, in the time required to collect payments from customers, with limited improvement in the most recent year.
- Operating Cycle
- The operating cycle, calculated as the sum of the average inventory processing period and the average receivable collection period, has increased steadily from 172 days in 2021 to 254 days in 2024. The rate of increase slowed in 2025, with the operating cycle reported at 251 days. This lengthening cycle suggests that the company is taking longer to convert its investments in inventory and receivables into cash.
The combined effect of increasing inventory processing and receivable collection periods has resulted in a substantial extension of the operating cycle. While the increases in both component periods have moderated in the latest year, the overall trend remains upward, potentially indicating inefficiencies in either inventory management, credit policies, or both.
Average Payables Payment Period
Intuitive Surgical Inc., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 13.42 | 14.05 | 12.69 | 13.78 | 14.45 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 27 | 26 | 29 | 26 | 25 | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Abbott Laboratories | — | 82 | 87 | 88 | 87 | |
| Elevance Health Inc. | — | 45 | 47 | 49 | 48 | |
| Medtronic PLC | 77 | 78 | 91 | 82 | 73 | |
| UnitedHealth Group Inc. | — | 47 | 49 | 50 | 48 | |
| Average Payables Payment Period, Sector | ||||||
| Health Care Equipment & Services | — | 49 | 51 | 53 | 51 | |
| Average Payables Payment Period, Industry | ||||||
| Health Care | — | 60 | 61 | 63 | 63 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 13.42 = 27
2 Click competitor name to see calculations.
The average payables payment period exhibited a generally increasing trend over the observed five-year period, with some fluctuation. Payables turnover demonstrated a corresponding, though less consistent, decline. These movements suggest shifts in the company’s management of its supplier credit and purchasing practices.
- Average Payables Payment Period
- The average payables payment period increased from 25 days in 2021 to 29 days in 2023. This indicates the company took progressively longer to settle its obligations to suppliers during this timeframe. A slight decrease was observed in 2024, with the period falling to 26 days, followed by a further increase to 27 days in 2025. The overall trend suggests a lengthening of the cash conversion cycle related to payables.
- Payables Turnover
- Payables turnover decreased from 14.45 in 2021 to 12.69 in 2023, aligning with the increase in the payment period. This signifies that the company was taking longer to use and replenish its trade credit. A rebound occurred in 2024, with turnover rising to 14.05, but it subsequently decreased again to 13.42 in 2025. The fluctuations in payables turnover suggest potential changes in purchasing volume or supplier terms.
The observed correlation between the average payables payment period and payables turnover suggests a deliberate or reactive strategy regarding supplier relationships. The lengthening payment period could be a tactic to preserve cash flow, potentially negotiating extended terms with suppliers. Alternatively, it could indicate challenges in maintaining efficient procurement processes. The slight reversal in 2024 and subsequent decline in 2025 warrant further investigation to determine the underlying causes.
Cash Conversion Cycle
Intuitive Surgical Inc., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 196 | 200 | 186 | 161 | 122 | |
| Average receivable collection period | 55 | 54 | 58 | 55 | 50 | |
| Average payables payment period | 27 | 26 | 29 | 26 | 25 | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | 224 | 228 | 215 | 190 | 147 | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| Abbott Laboratories | — | 99 | 106 | 82 | 70 | |
| Medtronic PLC | 166 | 161 | 159 | 148 | 143 | |
| Cash Conversion Cycle, Sector | ||||||
| Health Care Equipment & Services | — | -12 | -12 | -16 | -15 | |
| Cash Conversion Cycle, Industry | ||||||
| Health Care | — | 34 | 37 | 27 | 29 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 196 + 55 – 27 = 224
2 Click competitor name to see calculations.
An examination of short-term operating activity reveals increasing trends in several key metrics between 2021 and 2024, followed by some stabilization in 2025. The average inventory processing period, average receivable collection period, average payables payment period, and the resulting cash conversion cycle all demonstrate notable changes over the five-year period.
- Average Inventory Processing Period
- The average inventory processing period exhibited a consistent upward trend from 122 days in 2021 to 200 days in 2024. This indicates a lengthening of the time required to convert raw materials into finished goods and ultimately sell them. A slight decrease to 196 days was observed in 2025, suggesting a potential stabilization, but the period remains significantly higher than in 2021.
- Average Receivable Collection Period
- The average receivable collection period also increased between 2021 and 2023, rising from 50 days to 58 days. This suggests a lengthening in the time taken to collect payments from customers. The period decreased slightly to 54 days in 2024, and then stabilized at 55 days in 2025. While fluctuations occurred, the collection period remained elevated compared to the 2021 level.
- Average Payables Payment Period
- The average payables payment period showed a gradual increase from 25 days in 2021 to 29 days in 2023. This indicates a lengthening in the time taken to pay suppliers. The period decreased to 26 days in 2024 and remained at 27 days in 2025, suggesting a potential plateau after the earlier increase.
- Cash Conversion Cycle
- The cash conversion cycle demonstrated a consistent and substantial increase from 147 days in 2021 to 228 days in 2024. This lengthening cycle suggests that the company is taking longer to convert its investments in inventory and other resources into cash flows. The cycle decreased slightly to 224 days in 2025, indicating a possible moderation in the trend, but remains considerably higher than the 2021 figure. The increase in the cash conversion cycle is likely driven by the combined effects of the increasing inventory processing and receivable collection periods, partially offset by the increase in the payables payment period.
Overall, the trends suggest a growing inefficiency in the company’s short-term operating cycle. While the 2025 figures indicate potential stabilization in some areas, the overall cash conversion cycle remains elevated, warranting further investigation into the underlying causes and potential mitigation strategies.