Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Oct. 08, 2013 | |
Document Document And Entity Information [Abstract] | ||
Entity Registrant Name | INTUITIVE SURGICAL INC | |
Trading Symbol | ISRG | |
Entity Central Index Key | 1035267 | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | 30-Sep-13 | |
Document Fiscal Year Focus | 2013 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | FALSE | |
Entity Common Stock, Shares Outstanding | 38,064,183 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $586.80 | $553.70 |
Short-term investments | 626.1 | 770.7 |
Accounts receivable, net | 280.6 | 370.3 |
Inventories | 200.1 | 121.5 |
Prepaids and other current assets | 30 | 67.3 |
Deferred tax assets | 9.9 | 9.3 |
Total current assets | 1,733.50 | 1,892.80 |
Property, plant and equipment, net | 294.2 | 241.8 |
Long-term investments | 1,319.40 | 1,596.10 |
Long-term deferred tax assets | 121.6 | 87 |
Intangible and other assets, net | 91.3 | 103.4 |
Goodwill | 137.4 | 138.1 |
Total assets | 3,697.40 | 4,059.20 |
Current Liabilities: | ||
Accounts payable | 62 | 57.6 |
Accrued compensation and employee benefits | 54.9 | 104 |
Deferred revenue | 192.6 | 185.7 |
Other accrued liabilities | 57.8 | 54.3 |
Total current liabilities | 367.3 | 401.6 |
Other long-term liabilities | 65.8 | 77.5 |
Total liabilities | 433.1 | 479.1 |
Contingencies (Note 5) | ||
Stockholders’ equity | ||
Preferred stock, 2.5 shares authorized, $0.001 par value, issuable in series; no shares issued and outstanding as of September 30, 2013 and December 31, 2012, respectively | 0 | 0 |
Common stock, 100.0 shares authorized, $0.001 par value, 38.1 shares and 40.2 shares outstanding as of September 30, 2013 and December 31, 2012, respectively | 0 | 0 |
Additional paid-in capital | 2,450.70 | 2,240.10 |
Retained earnings | 813.2 | 1,333.40 |
Accumulated other comprehensive income | 0.4 | 6.6 |
Total stockholders’ equity | 3,264.30 | 3,580.10 |
Total liabilities and stockholders’ equity | $3,697.40 | $4,059.20 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ||
Preferred stock, shares authorized (in shares) | 2,500,000 | 2,500,000 |
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares outstanding (in shares) | 38,100,000 | 40,200,000 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenue: | ||||
Product | $397.60 | $450 | $1,395 | $1,317.50 |
Service | 101.4 | 87.8 | 293.9 | 252 |
Total revenue | 499 | 537.8 | 1,688.90 | 1,569.50 |
Cost of revenue: | ||||
Product | 112 | 119.3 | 399.2 | 353.9 |
Service | 30.3 | 28.4 | 93.5 | 83.2 |
Total cost of revenue | 142.3 | 147.7 | 492.7 | 437.1 |
Gross profit | 356.7 | 390.1 | 1,196.20 | 1,132.40 |
Operating expenses: | ||||
Selling, general and administrative | 139.3 | 129 | 426.3 | 374.1 |
Research and development | 43.2 | 49.7 | 126 | 128.3 |
Total operating expenses | 182.5 | 178.7 | 552.3 | 502.4 |
Income from operations | 174.2 | 211.4 | 643.9 | 630 |
Interest and other income, net | 3.9 | 4.3 | 12.5 | 12.1 |
Income before taxes | 178.1 | 215.7 | 656.4 | 642.1 |
Income tax expense | 21.3 | 32.4 | 151.6 | 160.4 |
Net income | 156.8 | 183.3 | 504.8 | 481.7 |
Net income per share: | ||||
Basic (in dollars per share) | $4.06 | $4.59 | $12.75 | $12.10 |
Diluted (in dollars per share) | $3.99 | $4.46 | $12.46 | $11.72 |
Shares used in computing net income per share: | ||||
Basic (in shares) | 38.6 | 39.9 | 39.6 | 39.8 |
Diluted (in shares) | 39.3 | 41.1 | 40.5 | 41.1 |
Total comprehensive income | $159.30 | $185.50 | $498.50 | $486.60 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Operating activities: | ||
Net income | $504.80 | $481.70 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 32.6 | 25.2 |
Amortization of intangible assets | 16.6 | 17.2 |
Accretion of discounts and amortization of premiums on investments, net | 28.6 | 23.8 |
Deferred income taxes | -33.8 | -19.3 |
Income tax benefits from employee stock option plans | 29.7 | 54.8 |
Excess tax benefit from stock-based compensation | -31.1 | -54.7 |
Share-based compensation expense | 127.3 | 115 |
Changes in operating assets and liabilities, net of effects of acquisition: | ||
Accounts receivable | 89.7 | -34.8 |
Inventories | -87.9 | -21 |
Prepaids and other assets | 9.7 | -5.5 |
Accounts payable | 4.4 | 6.9 |
Accrued compensation and employee benefits | -49.1 | -8.1 |
Other liabilities | 9.4 | 6.2 |
Net cash provided by operating activities | 650.9 | 587.4 |
Investing activities: | ||
Purchase of investments | -1,130 | -1,448.80 |
Proceeds from sales of investments | 878.1 | 262.8 |
Proceeds from maturities of investments | 649.8 | 569.1 |
Purchase of property, plant and equipment, intellectual property and business | -75.7 | -43.5 |
Acquisition of business, net of cash acquired | 0 | -27.6 |
Acquisition-related restricted cash | 0 | -15 |
Net cash provided by (used in) investing activities | 322.2 | -703 |
Financing activities: | ||
Proceeds from issuance of common stock, net | 137.9 | 176.5 |
Excess tax benefit from stock-based compensation | 31.1 | 54.7 |
Repurchase and retirement of common stock | -1,109.20 | -185.1 |
Net cash provided by (used in) financing activities | -940.2 | 46.1 |
Effect of exchange rate changes on cash and cash equivalents | 0.2 | -0.1 |
Net increase (decrease) in cash and cash equivalents | 33.1 | -69.6 |
Cash and cash equivalents, beginning of period | 553.7 | 465.8 |
Cash and cash equivalents, end of period | $586.80 | $396.20 |
DESCRIPTION_OF_BUSINESS
DESCRIPTION OF BUSINESS | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | |
DESCRIPTION OF BUSINESS | DESCRIPTION OF BUSINESS |
Intuitive designs, manufactures and markets da Vinci® Surgical Systems and related instruments and accessories, which taken together, are advanced surgical systems that the Company considers a new generation of surgery. This new generation of surgery, which the Company calls da Vinci surgery, combines the benefits of minimally invasive surgery (“MIS”) for patients with the ease of use, precision and dexterity of open surgery. A da Vinci Surgical System consists of a surgeon’s console, a patient-side cart and a high performance vision system. The da Vinci Surgical System translates a surgeon’s natural hand movements, which are performed on instrument controls at a console, into corresponding micro-movements of instruments positioned inside the patient through small incisions, or ports. The da Vinci Surgical System is designed to provide its operating surgeons with intuitive control, range of motion, fine tissue manipulation capability and Three Dimensional (“3-D”), High-Definition (“HD”) vision while simultaneously allowing surgeons to work through the small ports enabled by MIS procedures. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Basis of Presentation | |
In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements (“financial statements”) of Intuitive Surgical, Inc. and its wholly-owned subsidiaries have been prepared on a consistent basis with the audited Consolidated Financial Statements for the fiscal year ended December 31, 2012 and include all adjustments, consisting of only normal recurring adjustments, necessary to fairly state the information set forth herein. The financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”), and, therefore, omit certain information and footnote disclosure necessary to present the financial statements in accordance with United States (“U.S.”) generally accepted accounting principles (“U.S. GAAP”). These financial statements should be read in conjunction with the audited Consolidated Financial Statements and Notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, which was filed on February 4, 2013. The results of operations for the first nine months of fiscal 2013 are not necessarily indicative of the results to be expected for the entire fiscal year or any future periods. | |
New Accounting Standards Recently Adopted | |
Effective January 1, 2013, the Company adopted the accounting guidance which requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. The Company elected to present the information in the notes to the Company’s financial statements. | |
In June 2013, the Financial Accounting Standards Board determined that an unrecognized tax benefit should be presented as a reduction of a deferred tax asset for a net operating loss (“NOL”) carryforward or other tax credit carryforward when settlement in this manner is available under applicable tax law. This guidance is effective for the Company’s interim and annual periods beginning January 1, 2014. The Company does not believe the adoption of this guidance will have a material impact on its consolidated financial statements. |
FINANCIAL_INSTRUMENTS
FINANCIAL INSTRUMENTS | 9 Months Ended | |||||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||||
Investments, All Other Investments [Abstract] | ||||||||||||||||||||||||||||
FINANCIAL INSTRUMENTS | FINANCIAL INSTRUMENTS | |||||||||||||||||||||||||||
Cash, Cash Equivalents and Investments | ||||||||||||||||||||||||||||
The following tables summarize the amortized cost, gross unrealized gains, gross unrealized losses, and fair value of the Company’s cash and available-for-sale securities by investment category that are recorded as cash and cash equivalents, or short-term or long-term investments as of September 30, 2013 and December 31, 2012 (in millions): | ||||||||||||||||||||||||||||
Amortized | Gross | Gross | Fair | Cash and | Short- | Long- | ||||||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Cash | term | term | ||||||||||||||||||||||
Gains | Losses | Equivalents | Investments | Investments | ||||||||||||||||||||||||
30-Sep-13 | ||||||||||||||||||||||||||||
Cash | $ | 183.1 | $ | — | $ | — | $ | 183.1 | $ | 183.1 | $ | — | $ | — | ||||||||||||||
Level 1: | ||||||||||||||||||||||||||||
Money market funds | 368.5 | — | — | 368.5 | 368.5 | — | — | |||||||||||||||||||||
U.S. Treasuries | 84 | — | (0.4 | ) | 83.6 | — | 33.7 | 49.9 | ||||||||||||||||||||
Subtotal | 452.5 | — | (0.4 | ) | 452.1 | 368.5 | 33.7 | 49.9 | ||||||||||||||||||||
Level 2: | ||||||||||||||||||||||||||||
Commercial paper | 121.9 | — | — | 121.9 | 33.2 | 88.7 | — | |||||||||||||||||||||
Corporate securities | 758.7 | 2.8 | (1.7 | ) | 759.8 | — | 235.8 | 524 | ||||||||||||||||||||
U.S. government agencies | 425 | 1 | (0.8 | ) | 425.2 | 2 | 103.3 | 319.9 | ||||||||||||||||||||
Non-U.S. government securities | 68 | 0.3 | (0.2 | ) | 68.1 | — | 41.4 | 26.7 | ||||||||||||||||||||
Municipal securities | 513.8 | 1.2 | (0.3 | ) | 514.7 | — | 123.2 | 391.5 | ||||||||||||||||||||
Subtotal | 1,887.40 | 5.3 | (3.0 | ) | 1,889.70 | 35.2 | 592.4 | 1,262.10 | ||||||||||||||||||||
Level 3: | ||||||||||||||||||||||||||||
Municipal securities | 8 | — | (0.6 | ) | 7.4 | — | — | 7.4 | ||||||||||||||||||||
Subtotal | 8 | — | (0.6 | ) | 7.4 | — | — | 7.4 | ||||||||||||||||||||
Total assets measured at fair value | $ | 2,531.00 | $ | 5.3 | $ | (4.0 | ) | $ | 2,532.30 | $ | 586.8 | $ | 626.1 | $ | 1,319.40 | |||||||||||||
Amortized | Gross | Gross | Fair | Cash and | Short- | Long- | ||||||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Cash | term | term | ||||||||||||||||||||||
Gains | Losses | Equivalents | Investments | Investments | ||||||||||||||||||||||||
31-Dec-12 | ||||||||||||||||||||||||||||
Cash | $ | 89.7 | $ | — | $ | — | $ | 89.7 | $ | 89.7 | $ | — | $ | — | ||||||||||||||
Level 1: | ||||||||||||||||||||||||||||
Money market funds | 388.1 | — | — | 388.1 | 388.1 | — | — | |||||||||||||||||||||
U.S. Treasuries & corporate equity securities | 179.2 | 0.2 | — | 179.4 | — | 155.4 | 24 | |||||||||||||||||||||
Subtotal | 567.3 | 0.2 | — | 567.5 | 388.1 | 155.4 | 24 | |||||||||||||||||||||
Level 2: | ||||||||||||||||||||||||||||
Commercial paper | 157.4 | — | — | 157.4 | 75.9 | 81.5 | — | |||||||||||||||||||||
Corporate securities | 952.1 | 5.8 | (0.4 | ) | 957.5 | — | 274.6 | 682.9 | ||||||||||||||||||||
U.S. government agencies | 636.9 | 2.6 | — | 639.5 | — | 133.6 | 505.9 | |||||||||||||||||||||
Non-U.S. government securities | 90.8 | 0.5 | — | 91.3 | — | 21.8 | 69.5 | |||||||||||||||||||||
Municipal securities | 409.3 | 1.1 | (0.2 | ) | 410.2 | — | 103.8 | 306.4 | ||||||||||||||||||||
Subtotal | 2,246.50 | 10 | (0.6 | ) | 2,255.90 | 75.9 | 615.3 | 1,564.70 | ||||||||||||||||||||
Level 3: | ||||||||||||||||||||||||||||
Municipal securities | 8 | — | (0.6 | ) | 7.4 | — | — | 7.4 | ||||||||||||||||||||
Subtotal | 8 | — | (0.6 | ) | 7.4 | — | — | 7.4 | ||||||||||||||||||||
Total assets measured at fair value | $ | 2,911.50 | $ | 10.2 | $ | (1.2 | ) | $ | 2,920.50 | $ | 553.7 | $ | 770.7 | $ | 1,596.10 | |||||||||||||
The following table summarizes the contractual maturities of the Company’s cash equivalents and available-for-sale securities, excluding corporate equity securities, at September 30, 2013 (in millions): | ||||||||||||||||||||||||||||
Amortized | Fair | |||||||||||||||||||||||||||
Cost | Value | |||||||||||||||||||||||||||
Mature in less than one year | $ | 1,028.60 | $ | 1,029.80 | ||||||||||||||||||||||||
Mature in one to five years | 1,311.30 | 1,312.00 | ||||||||||||||||||||||||||
Mature in after five years | 8 | 7.4 | ||||||||||||||||||||||||||
Total | $ | 2,347.90 | $ | 2,349.20 | ||||||||||||||||||||||||
During the three and nine months ended September 30, 2013, net realized gains recognized on the sale of investments were approximately $0.6 million and $0.7 million, respectively. Net realized losses recognized on the sale of investments during the three and nine months ended September 30, 2012 were approximately $0.2 million and $1.7 million, respectively. As of September 30, 2013 and December 31, 2012, net unrealized gains of $1.7 million and $6.2 million, respectively, were included in accumulated other comprehensive income in the accompanying unaudited Condensed Consolidated Balance Sheets. | ||||||||||||||||||||||||||||
There have been no transfers between Level 1 and Level 2 measurements during the nine months ended September 30, 2013, and there were no changes in the Company’s valuation technique. Level 3 assets consist of municipal bonds with auction rate securities (“ARS”) whose underlying assets are student loans which are generally backed by the federal government. Since the auctions for these securities have continued to fail since February 2008, these investments are not currently trading and therefore do not have a readily determinable fair value. The Company has valued its ARS using a discounted cash flow model utilizing unobservable inputs including estimates of interest rates, timing and amount of cash flows, credit and liquidity premiums and expected holding periods of the ARS. | ||||||||||||||||||||||||||||
Foreign currency derivatives | ||||||||||||||||||||||||||||
The objective of the Company’s hedging program is to mitigate the impact of changes in currency exchange rates on net cash flow from foreign currency denominated sales and intercompany balances and other monetary assets or liabilities denominated in currencies other than the U.S. dollar. The Company has $3.0 million of derivative liabilities recorded as other accrued liabilities in the unaudited Condensed Consolidated Balance Sheets at September 30, 2013, compared to $2.7 million of derivative liabilities recorded as other accrued liabilities in the Condensed Consolidated Balance Sheets at December 31, 2012. The derivative liabilities are measured using Level 2 fair value inputs. | ||||||||||||||||||||||||||||
Cash Flow Hedges | ||||||||||||||||||||||||||||
The Company enters into currency forward contracts as cash flow hedges to hedge certain forecasted revenue transactions denominated in currencies other than the U.S. dollar, primarily the European Euro (“EUR”) and the Korean Won (“KRW”). | ||||||||||||||||||||||||||||
As of September 30, 2013, the Company had notional amounts of EUR 36.9 million and KRW 1.8 billion of outstanding currency forward contracts entered into to hedge EUR and KRW denominated sales, compared to EUR 20.0 million and KRW 4.4 billion of outstanding currency forward contracts at December 31, 2012. The net gains (losses) reclassified to revenue related to the hedged revenue transactions for the three and nine months ended September 30, 2013 and 2012 were not significant. Other impacts of derivative instruments designated as cash flow hedges were not significant for the three and nine months ended September 30, 2013 and 2012. | ||||||||||||||||||||||||||||
Other Derivatives Not Designated as Hedging Instruments: | ||||||||||||||||||||||||||||
Other derivatives not designated as hedging instruments consist primarily of forward contracts that the Company uses to hedge intercompany balances and other monetary assets or liabilities denominated in currencies other than the U.S. dollar, primarily the EUR, the British Pound (“GBP”), the Swiss Franc (“CHF”), Japanese Yen (“JPY”) and the KRW. Accordingly, any gains or losses from changes in the fair value of the forward contracts are recorded in interest and other income, net. The gains and losses on these forward contracts generally offset the gains and losses associated with the underlying assets and liabilities, which are also recorded in interest and other income, net. The duration of the forward contracts for hedging the Company’s balance sheet exposure is approximately one month. | ||||||||||||||||||||||||||||
Derivative instruments used to hedge against balance sheet foreign currency exposures at the end of each period were as follows (in millions): | ||||||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||||
Recognized gains (losses) in interest and other income, net | $ | (2.6 | ) | $ | — | $ | (1.8 | ) | $ | 0.6 | ||||||||||||||||||
Foreign exchange gains (losses) related to re-measurement | $ | 2.4 | $ | 0.2 | $ | 1 | $ | (0.4 | ) | |||||||||||||||||||
The notional amounts for derivative instruments provide one measure of the transaction volume. Total gross notional amounts (in local currency) for derivatives (recorded at fair value) outstanding at the end of each period were as follows (in millions): | ||||||||||||||||||||||||||||
September 30, | December 31, | |||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||
European Euro | 31.6 | 37.6 | ||||||||||||||||||||||||||
Korean Won | 12,204.20 | 4,600.00 | ||||||||||||||||||||||||||
British Pound | 7 | 5.4 | ||||||||||||||||||||||||||
Swiss Franc | — | 1 | ||||||||||||||||||||||||||
Japanese Yen | 70 | — | ||||||||||||||||||||||||||
BALANCE_SHEET_DETAILS
BALANCE SHEET DETAILS | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||
BALANCE SHEET DETAILS | BALANCE SHEET DETAILS | |||||||
Inventories | ||||||||
The following table summarizes the Company’s inventories as of September 30, 2013 and December 31, 2012 (in millions): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Inventories: | ||||||||
Raw materials | $ | 59.1 | $ | 41.2 | ||||
Work-in-process | 6.8 | 4.4 | ||||||
Finished goods | 134.2 | 75.9 | ||||||
Total inventories | $ | 200.1 | $ | 121.5 | ||||
CONTINGENCIES
CONTINGENCIES | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | CONTINGENCIES |
On August 6, 2010, a purported class action lawsuit entitled Perlmutter v. Intuitive Surgical et al., No. CV10-3451, was filed against seven of the Company’s current and former officers and directors in the United States District Court for the Northern District of California. The lawsuit seeks unspecified damages on behalf of a putative class of persons who purchased or otherwise acquired the Company’s common stock between February 1, 2008 and January 7, 2009. The complaint alleges that the defendants violated federal securities laws by making allegedly false and misleading statements and omitting certain material facts in the Company’s filings with the Securities and Exchange Commission. On February 15, 2011, the Police Retirement System of St. Louis was appointed lead plaintiff in the case pursuant to the Private Securities Litigation Reform Act of 1995. An amended complaint was filed on April 15, 2011, making allegations substantially similar to the allegations described above. On May 23, 2011, the Company filed a motion to dismiss the amended complaint. On August 10, 2011, that motion was granted and the action was dismissed; the plaintiffs were given 30 days to file an amended complaint. On September 12, 2011, plaintiffs filed their amended complaint. The allegations contained therein are substantially similar to the allegations in the prior complaint. The Company filed a motion to dismiss the amended complaint. A hearing occurred on February 16, 2012, and on May 22, 2012 the Company’s motion was granted. The complaint was dismissed with prejudice, and a final judgment was entered in the Company’s favor on June 1, 2012. On June 20, 2012, plaintiffs filed a notice of appeal with the United States Court of Appeals for the Ninth Circuit. The appeal is styled Police Retirement System of St. Louis v. Intuitive Surgical, Inc. et al., No. 12-16430. Plaintiffs filed their opening brief on September 28, 2012. The Company filed an answering brief on November 13, 2012, and plaintiffs filed a reply brief on December 17, 2012. No oral argument date has been set, and the appeal remains pending. | |
On August 19, 2010, an alleged stockholder caused a purported stockholder’s derivative lawsuit entitled Himmel v. Smith et al., No. 1-10-CV-180416, to be filed in the Superior Court of California for the County of Santa Clara naming the Company as a nominal defendant, and naming 14 of the Company’s current and former officers and directors as defendants. The lawsuit seeks to recover, for the Company’s benefit, unspecified damages purportedly sustained by the Company in connection with allegedly misleading statements and/or omissions made in connection with the Company’s financial reporting for the period between February 1, 2008 and January 7, 2009. It also seeks a series of changes to the Company’s corporate governance policies and an award of attorneys’ fees. On September 15, 2010, another purported stockholder filed an essentially identical lawsuit entitled Applebaum v. Guthart et al., No. 1-10-CV-182645, in the same court against 15 of the Company’s current and former officers and directors. On October 5, 2010, the court ordered that the two cases be consolidated for all purposes. By agreement with the plaintiffs, all activity in the case has been stayed pending the results of the appeal in the purported shareholder class action lawsuit discussed above. | |
On April 26, 2013, a purported class action lawsuit entitled Abrams v. Intuitive Surgical et al., No. 5-13-cv-1920, was filed against nine of the Company’s current and former officers and directors in the United States District Court for the Northern District of California. A substantially identical complaint, entitled Adel v. Intuitive Surgical, et al., No. 5:13-cv-02365, was filed in the same court against the same defendants on May 24, 2013. The Adel case was voluntarily dismissed without prejudice on August 20, 2013. The Abrams lawsuit seeks unspecified damages on behalf of a putative class of persons who purchased or otherwise acquired the Company’s common stock between October 19, 2011 and April 18, 2013. The complaint alleges that the defendants violated federal securities laws by making allegedly false and misleading statements and omitting certain material facts in the Company’s filings with the Securities and Exchange Commission. Motions seeking appointment as lead plaintiff in the Abrams case were filed by two parties on June 25, 2013. One of those motions was subsequently withdrawn. The remaining motion is scheduled to be heard on November 22, 2013. By agreement with the plaintiff in the Abrams action, no response to the complaint is required until after a lead plaintiff is appointed by the Court and that duly appointed lead plaintiff files a consolidated complaint or informs us that it has chosen to proceed with the complaint already on file. Also by agreement with plaintiff, the lead plaintiff filed a consolidated complaint on October 15, 2013, and the Company must respond by December 16, 2013. | |
The Company is currently named as a defendant in about 50 individual product liability lawsuits filed in various state and federal courts by plaintiffs who allege that they underwent surgical procedures that utilized the da Vinci Surgical System and sustained a variety of personal injuries and, in some cases, death as a result of such surgery. In addition, the Company has been named as a defendant in a purported class action filed in Louisiana state court seeking damages on behalf of all patients who were allegedly injured by the da Vinci Surgical System at a single hospital in Louisiana. The cases raise a variety of allegations including, to varying degrees, that the plaintiffs' injuries resulted from purported defects in the da Vinci Surgical System and/or failure on the Company’s part to provide adequate training resources to the healthcare professionals who performed plaintiffs’ surgeries. The cases further allege that the Company failed to adequately disclose and/or misrepresented the potential risks and/or benefits of the da Vinci Surgical System. Plaintiffs also assert a variety of causes of action, including for example, strict liability based on purported design defects, negligence, fraud, breach of express and implied warranties, unjust enrichment, and loss of consortium. Plaintiffs seek recovery for alleged personal injuries and, in many cases, punitive damages. Except for a few cases, including the Taylor case described below, these cases generally are in the early stages of pretrial activity. | |
Plaintiffs’ attorneys are engaged in well-funded national advertising campaigns soliciting clients who have undergone da Vinci surgery and claim to have suffered an injury. The plaintiffs’ attorneys are now alleging that Intuitive Surgical is liable for those injuries under products liability theories. The Company has seen a substantial increase in these claims; however, the Company has not received detailed information regarding many of these claims. In an effort to provide an orderly process for evaluating claims before they result in costly litigation, the Company has entered into tolling agreements with certain plaintiffs’ counsel acting on behalf of such claimants. The tolling agreements provide that the statute of limitations for each individual will be tolled for a period of three to six months in exchange for the individual’s agreement that, if he or she ultimately files a lawsuit, it will be filed in certain agreed upon venues. The tolling agreements provide the parties and their legal counsel with additional time to evaluate the claims, and to explore whether the claims have merit and whether they can be resolved without litigation. The Company does not currently know how many individuals will ultimately file lawsuits or decide not to pursue their claims, nor is the Company able at this time to estimate the financial impact of their claims or predict the final disposition of such claims. Based on currently available information, the Company believes that it has meritorious defenses in the above matters and intends to assert them vigorously. | |
In February 2011, the Company was named as a defendant in a product liability action that had originally been filed in Washington State Superior Court for Kitsap County against the healthcare providers and hospital involved in the plaintiff’s decedent’s surgery (Josette Taylor, as Personal Representative of the Estate of Fred E. Taylor, deceased; and on behalf of the Estate of Fred E. Taylor v. Intuitive Surgical, Inc., No. 09-2-03136-5). In Taylor, plaintiff asserted wrongful death and product liability claims against the Company, generally alleging that the decedent died four years after surgery as a result of injuries purportedly suffered during the surgery, which was conducted with the use of the da Vinci Surgical System. The plaintiff in Taylor asserted that such injuries were caused, in whole or in part, by the Company’s purported failure to properly train, warn, and instruct the surgeon. The lawsuit sought unspecified damages for past medical expenses, pain and suffering, loss of consortium as well as punitive damages. A trial commenced in the action on April 15, 2013. On May 23, 2013, the jury returned a defense verdict, finding that the Company was not negligent. Judgment was entered in favor of Intuitive Surgical on June 7, 2013. Plaintiff has filed a notice of appeal. | |
Due to the uncertainty surrounding the litigation process, the Company is unable, at this time, to reasonably predict the ultimate outcome of the above matters or estimate the possible loss or range of losses which may be incurred. Based on currently available information, the Company believes that it has meritorious defenses in the above matters and intends to assert them vigorously. | |
The Company is also a party to various other legal actions that have arisen in the ordinary course of its business. The Company does not believe that any of these other legal actions will have a material adverse impact on its business, financial position or results of operations. |
STOCKHOLDERS_EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Equity [Abstract] | ||||||||||||||||
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITY | |||||||||||||||
Share Repurchase Program | ||||||||||||||||
The following table provides the share repurchase activities during the three and nine months ended September 30, 2013 and 2012 (in millions, except per share amounts): | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Shares repurchased | 1.8 | 0.3 | 2.6 | 0.4 | ||||||||||||
Average price per share | $ | 398.87 | $ | 495.09 | $ | 429.09 | $ | 497.28 | ||||||||
Value of shares repurchased | $ | 693.8 | $ | 169.8 | $ | 1,109.20 | $ | 185.1 | ||||||||
On July 25, 2013 and March 20, 2013, the Company’s Board of Directors (the “Board”) authorized additional stock repurchases of $779 million and $1.0 billion, respectively. As of September 30, 2013, the remaining amount of share repurchases authorized by the Board was approximately $1.0 billion. | ||||||||||||||||
On July 29, 2013, in connection with the stock repurchase authorization, the Company entered into an accelerated share repurchase program (the “ASR Program”) with Goldman, Sachs & Co. (“Goldman”) to repurchase $500 million of the Company’s common stock. Under the ASR Program, the Company paid an initial purchase price of $500 million to Goldman and received an initial delivery of approximately 1.2 million shares of its common stock. On September 11, 2013, Goldman exercised its early termination option under the ASR Program and the pricing period was closed. The settlement price was $385.16 per share. Based on this settlement price, the final number of shares repurchased by the Company and delivered by Goldman under the ASR Program was 1.3 million shares. The Company received the additional 0.1 million shares from Goldman on September 16, 2013 to settle the difference between the initial share delivery and the total number of shares repurchased. | ||||||||||||||||
In addition to the ASR Program, the Company repurchased an additional 0.5 million shares of the Company’s common stock during the three months ended September 30, 2013. All of these shares were repurchased in the open market. | ||||||||||||||||
All common stock repurchased has been retired as of September 30, 2013. As a result of the stock repurchases made during the three months ended September 30, 2013, the Company reduced common stock and APIC by an aggregate of $57.4 million and charged $636.4 million to retained earnings. | ||||||||||||||||
Accumulated Other Comprehensive Income | ||||||||||||||||
The components of accumulated other comprehensive income, net of tax, for the three and nine months ended September 30, 2013 and 2012 are as follows (in millions): | ||||||||||||||||
Three Months Ended September 30, 2013 | ||||||||||||||||
Gains (Losses) | Unrealized Gains | Foreign | Total | |||||||||||||
on Hedge | (Losses) on | Currency | ||||||||||||||
Instruments | Available-for- | Translation | ||||||||||||||
Sale Securities | Gains (Losses) | |||||||||||||||
Beginning balance | $ | 0.6 | $ | (2.8 | ) | $ | 0.1 | $ | (2.1 | ) | ||||||
Other comprehensive income before reclassifications | (3.0 | ) | 3.9 | 0.5 | 1.4 | |||||||||||
Reclassified from accumulated other comprehensive income | 0.5 | 0.6 | — | 1.1 | ||||||||||||
Net current-period other comprehensive income | (2.5 | ) | 4.5 | 0.5 | 2.5 | |||||||||||
Ending balance | $ | (1.9 | ) | $ | 1.7 | $ | 0.6 | $ | 0.4 | |||||||
Three Months Ended September 30, 2012 | ||||||||||||||||
Gains (Losses) | Unrealized Gains | Foreign | Total | |||||||||||||
on Hedge | (Losses) on | Currency | ||||||||||||||
Instruments | Available-for- | Translation | ||||||||||||||
Sale Securities | Gains (Losses) | |||||||||||||||
Beginning balance | $ | 0.3 | $ | 3.3 | $ | — | $ | 3.6 | ||||||||
Other comprehensive income before reclassifications | (1.7 | ) | 3.5 | 0.1 | 1.9 | |||||||||||
Reclassified from accumulated other comprehensive income | 0.2 | 0.1 | — | 0.3 | ||||||||||||
Net current-period other comprehensive income | (1.5 | ) | 3.6 | 0.1 | 2.2 | |||||||||||
Ending balance | $ | (1.2 | ) | $ | 6.9 | $ | 0.1 | $ | 5.8 | |||||||
Nine Months Ended September 30, 2013 | ||||||||||||||||
Gains (Losses) | Unrealized Gains | Foreign | Total | |||||||||||||
on Hedge | (Losses) on | Currency | ||||||||||||||
Instruments | Available-for- | Translation | ||||||||||||||
Sale Securities | Gains (Losses) | |||||||||||||||
Beginning balance | $ | — | $ | 6.2 | $ | 0.4 | $ | 6.6 | ||||||||
Other comprehensive income before reclassifications | (1.4 | ) | (5.4 | ) | 0.2 | (6.6 | ) | |||||||||
Reclassified from accumulated other comprehensive income | (0.5 | ) | 0.9 | — | 0.4 | |||||||||||
Net current-period other comprehensive income | (1.9 | ) | (4.5 | ) | 0.2 | (6.2 | ) | |||||||||
Ending balance | $ | (1.9 | ) | $ | 1.7 | $ | 0.6 | $ | 0.4 | |||||||
Nine Months Ended September 30, 2012 | ||||||||||||||||
Gains (Losses) | Unrealized Gains | Foreign | Total | |||||||||||||
on Hedge | (Losses) on | Currency | ||||||||||||||
Instruments | Available-for- | Translation | ||||||||||||||
Sale Securities | Gains (Losses) | |||||||||||||||
Beginning balance | $ | — | $ | 1.1 | $ | (0.2 | ) | $ | 0.9 | |||||||
Other comprehensive income before reclassifications | (1.0 | ) | 5.5 | 0.3 | 4.8 | |||||||||||
Reclassified from accumulated other comprehensive income | (0.2 | ) | 0.3 | — | 0.1 | |||||||||||
Net current-period other comprehensive income | (1.2 | ) | 5.8 | 0.3 | 4.9 | |||||||||||
Ending balance | $ | (1.2 | ) | $ | 6.9 | $ | 0.1 | $ | 5.8 | |||||||
SHAREBASED_COMPENSATION
SHARE-BASED COMPENSATION | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION | |||||||||||||||
Stock Option Plans | ||||||||||||||||
2009 Employment Commencement Incentive Plan | ||||||||||||||||
In January 2013, the Board amended and restated the 2009 Employment Commencement Incentive Plan (“2009 Plan”) to provide for an increase in the number of shares of common stock authorized for issuance pursuant to awards granted under the 2009 Plan from 730,000 to 855,000. In May 2013, the Board amended and restated the 2009 Plan to provide for an additional increase in the number of shares of common stock authorized for issuance pursuant to awards granted under the 2009 Plan from 855,000 to 1,155,000. | ||||||||||||||||
2010 Incentive Award Plan | ||||||||||||||||
On April 25, 2013, the Shareholders approved an amended and restated 2010 Incentive Award Plan (“2010 Plan”) to provide for an increase in the number of shares of common stock reserved for issuance from 3,650,000 to 4,850,000. | ||||||||||||||||
A summary of stock option activity under all stock plans for the nine months ended September 30, 2013 is presented as follows (in millions, except per share amounts): | ||||||||||||||||
Stock Options Outstanding | ||||||||||||||||
Shares | Number | Weighted Average | ||||||||||||||
Available | Outstanding | Exercise Price Per | ||||||||||||||
for Grant | Share | |||||||||||||||
Balance at December 31, 2012 | 1.7 | 4.8 | $ | 340.83 | ||||||||||||
Options authorized | 1.6 | — | — | |||||||||||||
Options granted | (1.5 | ) | 1.5 | 473.68 | ||||||||||||
Options exercised | — | (0.4 | ) | 253.53 | ||||||||||||
Options forfeited/expired | 0.1 | (0.2 | ) | 456.31 | ||||||||||||
Balance at September 30, 2013 | 1.9 | 5.7 | $ | 379.15 | ||||||||||||
As of September 30, 2013, options to purchase an aggregate of 3.1 million shares of common stock were exercisable at a weighted-average price of $312.11 per share. | ||||||||||||||||
Employee Stock Purchase Plan | ||||||||||||||||
Under the Employee Stock Purchase Plan (“ESPP”), employees purchased approximately 37.7 thousand shares for $12.4 million and 47.6 thousand shares for $13.9 million during the three months ended September 30, 2013 and 2012, respectively. Employees purchased approximately 92.2 thousand shares for $28.8 million and 96.8 thousand shares for $27.8 million during the nine months ended September 30, 2013 and 2012, respectively. | ||||||||||||||||
Share-based Compensation | ||||||||||||||||
The following table summarizes share-based compensation expense for the three and nine months ended September 30, 2013 and 2012 (in millions): | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Cost of sales - products | $ | 5.2 | $ | 4.3 | $ | 13.2 | $ | 10.6 | ||||||||
Cost of sales - services | 3.6 | 4.1 | 9.5 | 9.6 | ||||||||||||
Total cost of sales | 8.8 | 8.4 | 22.7 | 20.2 | ||||||||||||
Selling, general and administrative | 30.6 | 28.2 | 76.6 | 69.7 | ||||||||||||
Research and development | 11 | 10.7 | 28 | 25.1 | ||||||||||||
Share-based compensation expense before income taxes | 50.4 | 47.3 | 127.3 | 115 | ||||||||||||
Income tax benefit | 16.5 | 14.9 | 41.1 | 36 | ||||||||||||
Share-based compensation expense after income taxes | $ | 33.9 | $ | 32.4 | $ | 86.2 | $ | 79 | ||||||||
The fair value of each option grant and the fair value of the option component of the ESPP shares were estimated at the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions, assuming no expected dividends: | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Stock Options | ||||||||||||||||
Average risk free interest rate | 1.5 | % | 0.8 | % | 1.2 | % | 0.8 | % | ||||||||
Average expected term (in years) | 4.5 | 4.1 | 4.5 | 4.3 | ||||||||||||
Average expected volatility | 31 | % | 35 | % | 30 | % | 33 | % | ||||||||
Weighted average fair value at grant date | $ | 110.81 | $ | 148.05 | $ | 126.87 | $ | 145.6 | ||||||||
ESPP | ||||||||||||||||
Average risk free interest rate | 0.2 | % | 0.2 | % | 0.2 | % | 0.2 | % | ||||||||
Average expected term (in years) | 1.3 | 1.3 | 1.3 | 1.3 | ||||||||||||
Average expected volatility | 35 | % | 32 | % | 34 | % | 32 | % | ||||||||
Weighted average fair value at grant date | $ | 115.84 | $ | 143.36 | $ | 153.33 | $ | 138.61 | ||||||||
INCOME_TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2013 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES |
Income tax expense for the three month period ended September 30, 2013 was $21.3 million, or 12.0% of pre-tax income, compared with $32.4 million, or 15.0% of pre-tax income for the three month period ended September 30, 2012. Income tax expense for the nine month period ended September 30, 2013 was $151.6 million, or 23.1% of pre-tax income, compared with $160.4 million, or 25.0% of pre-tax income for the nine month period ended September 30, 2012. The Company's effective tax rates for these periods differ from the U.S. federal statutory rate of 35% due primarily to the effect of the reversal of unrecognized tax benefits, and associated interest, in connection with the expiration of certain statutes of limitations, and income earned by certain of the Company’s overseas entities being taxed at rates lower than the federal statutory rate, partially offset by state income taxes and non-deductible stock option expenses. The Company intends to indefinitely reinvest outside the U.S. all of its undistributed foreign earnings that were not previously subject to U.S. tax. | |
The income tax provision for the three month periods ended September 30, 2013 and 2012 included discrete benefits of $26.2 million and $35.1 million, respectively, primarily related to the reversal of unrecognized tax benefits, and associated interest, in connection with the expiration of certain statutes of limitations in multiple jurisdictions. The income tax provision for the nine month period ended September 30, 2013 reflected a net tax benefit of $7.5 million related to 2012 federal research and development (“R&D”) credit which was retroactively reinstated during the three month period ended March 31, 2013. No federal R&D credit benefit was recorded in the income tax provision for the nine month period ended September 30, 2012. The income tax provision for the nine month period ended September 30, 2012 included a discrete recognition of certain previously unrecognized tax benefits as a result of new IRS guidance issued in the first quarter of 2012. | |
As of September 30, 2013, the Company had total gross unrecognized tax benefits of approximately $77.6 million compared with approximately $88.0 million as of December 31, 2012, representing a net decrease of approximately $10.4 million for the nine months ended September 30, 2013. The net decrease is primarily related to the above mentioned reversal of previously unrecognized tax benefits as a result of the expiration of certain statutes of limitations in multiple jurisdictions, partially offset by increases during the first nine months of 2013 related to other uncertain tax positions. Of the total gross unrecognized tax benefits, $76.0 million as of September 30, 2013, if recognized, would reduce the effective tax rate in the period of recognition. Gross interest related to unrecognized tax benefit accrued was approximately $1.9 million and $3.2 million as of September 30, 2013 and December 31, 2012, respectively, representing a decrease of $1.3 million as a result of the expiration of statutes of limitations, partially offset by increases related to other unrecognized tax positions. | |
The Company files federal, state and foreign income tax returns in many jurisdictions in the U.S. and internationally. Generally, years before 2010 are closed for most significant jurisdictions except for California, for which all years since inception remain open due to utilization in open years of net operating losses and R&D credit carryovers or longer statutes of limitations. Certain of the Company’s unrecognized tax benefits could reverse based on the normal expiration of various statutes of limitations, which could affect the Company’s effective tax rate in the period in which they reverse. | |
The Company is subject to the examination of its income tax returns by the Internal Revenue Service and other tax authorities. The outcome of these audits cannot be predicted with certainty. Management regularly assesses the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of the Company’s provision for income taxes. If any issues addressed in the Company’s tax audits are resolved in a manner not consistent with management’s expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. |
NET_INCOME_PER_SHARE
NET INCOME PER SHARE | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||
NET INCOME PER SHARE | NET INCOME PER SHARE | |||||||||||||||
The following table presents the computation of basic and diluted net income per share for the three and nine months ended September 30, 2013 and 2012 (in millions, except per share amounts): | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Numerator: | ||||||||||||||||
Net income | $ | 156.8 | $ | 183.3 | $ | 504.8 | $ | 481.7 | ||||||||
Denominator: | ||||||||||||||||
Weighted-average shares outstanding used in basic calculation | 38.6 | 39.9 | 39.6 | 39.8 | ||||||||||||
Add: Dilutive effect of potential common shares | 0.7 | 1.2 | 0.9 | 1.3 | ||||||||||||
Weighted-average shares used in computing diluted net income per share | 39.3 | 41.1 | 40.5 | 41.1 | ||||||||||||
Net income per share: | ||||||||||||||||
Basic | $ | 4.06 | $ | 4.59 | $ | 12.75 | $ | 12.1 | ||||||||
Diluted | $ | 3.99 | $ | 4.46 | $ | 12.46 | $ | 11.72 | ||||||||
Employee stock options to purchase approximately 2.6 million and 1.1 million weighted-average shares for the three months ended September 30, 2013 and 2012, respectively, and approximately 2.1 million and 0.8 million weighted-average shares for the nine months ended September 30, 2013 and 2012, respectively, were outstanding, but were not included in the computation of diluted net income per share because the effect of including such shares would have been anti-dilutive. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation |
In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements (“financial statements”) of Intuitive Surgical, Inc. and its wholly-owned subsidiaries have been prepared on a consistent basis with the audited Consolidated Financial Statements for the fiscal year ended December 31, 2012 and include all adjustments, consisting of only normal recurring adjustments, necessary to fairly state the information set forth herein. The financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”), and, therefore, omit certain information and footnote disclosure necessary to present the financial statements in accordance with United States (“U.S.”) generally accepted accounting principles (“U.S. GAAP”). These financial statements should be read in conjunction with the audited Consolidated Financial Statements and Notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, which was filed on February 4, 2013. The results of operations for the first nine months of fiscal 2013 are not necessarily indicative of the results to be expected for the entire fiscal year or any future periods. | |
New Accounting Standards Recently Adopted | New Accounting Standards Recently Adopted |
Effective January 1, 2013, the Company adopted the accounting guidance which requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. The Company elected to present the information in the notes to the Company’s financial statements. | |
In June 2013, the Financial Accounting Standards Board determined that an unrecognized tax benefit should be presented as a reduction of a deferred tax asset for a net operating loss (“NOL”) carryforward or other tax credit carryforward when settlement in this manner is available under applicable tax law. This guidance is effective for the Company’s interim and annual periods beginning January 1, 2014. The Company does not believe the adoption of this guidance will have a material impact on its consolidated financial statements. |
FINANCIAL_INSTRUMENTS_Tables
FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended | |||||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||||
Investments, All Other Investments [Abstract] | ||||||||||||||||||||||||||||
Summary of Cash and Available-For-Sale Securities | The following tables summarize the amortized cost, gross unrealized gains, gross unrealized losses, and fair value of the Company’s cash and available-for-sale securities by investment category that are recorded as cash and cash equivalents, or short-term or long-term investments as of September 30, 2013 and December 31, 2012 (in millions): | |||||||||||||||||||||||||||
Amortized | Gross | Gross | Fair | Cash and | Short- | Long- | ||||||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Cash | term | term | ||||||||||||||||||||||
Gains | Losses | Equivalents | Investments | Investments | ||||||||||||||||||||||||
30-Sep-13 | ||||||||||||||||||||||||||||
Cash | $ | 183.1 | $ | — | $ | — | $ | 183.1 | $ | 183.1 | $ | — | $ | — | ||||||||||||||
Level 1: | ||||||||||||||||||||||||||||
Money market funds | 368.5 | — | — | 368.5 | 368.5 | — | — | |||||||||||||||||||||
U.S. Treasuries | 84 | — | (0.4 | ) | 83.6 | — | 33.7 | 49.9 | ||||||||||||||||||||
Subtotal | 452.5 | — | (0.4 | ) | 452.1 | 368.5 | 33.7 | 49.9 | ||||||||||||||||||||
Level 2: | ||||||||||||||||||||||||||||
Commercial paper | 121.9 | — | — | 121.9 | 33.2 | 88.7 | — | |||||||||||||||||||||
Corporate securities | 758.7 | 2.8 | (1.7 | ) | 759.8 | — | 235.8 | 524 | ||||||||||||||||||||
U.S. government agencies | 425 | 1 | (0.8 | ) | 425.2 | 2 | 103.3 | 319.9 | ||||||||||||||||||||
Non-U.S. government securities | 68 | 0.3 | (0.2 | ) | 68.1 | — | 41.4 | 26.7 | ||||||||||||||||||||
Municipal securities | 513.8 | 1.2 | (0.3 | ) | 514.7 | — | 123.2 | 391.5 | ||||||||||||||||||||
Subtotal | 1,887.40 | 5.3 | (3.0 | ) | 1,889.70 | 35.2 | 592.4 | 1,262.10 | ||||||||||||||||||||
Level 3: | ||||||||||||||||||||||||||||
Municipal securities | 8 | — | (0.6 | ) | 7.4 | — | — | 7.4 | ||||||||||||||||||||
Subtotal | 8 | — | (0.6 | ) | 7.4 | — | — | 7.4 | ||||||||||||||||||||
Total assets measured at fair value | $ | 2,531.00 | $ | 5.3 | $ | (4.0 | ) | $ | 2,532.30 | $ | 586.8 | $ | 626.1 | $ | 1,319.40 | |||||||||||||
Amortized | Gross | Gross | Fair | Cash and | Short- | Long- | ||||||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Cash | term | term | ||||||||||||||||||||||
Gains | Losses | Equivalents | Investments | Investments | ||||||||||||||||||||||||
31-Dec-12 | ||||||||||||||||||||||||||||
Cash | $ | 89.7 | $ | — | $ | — | $ | 89.7 | $ | 89.7 | $ | — | $ | — | ||||||||||||||
Level 1: | ||||||||||||||||||||||||||||
Money market funds | 388.1 | — | — | 388.1 | 388.1 | — | — | |||||||||||||||||||||
U.S. Treasuries & corporate equity securities | 179.2 | 0.2 | — | 179.4 | — | 155.4 | 24 | |||||||||||||||||||||
Subtotal | 567.3 | 0.2 | — | 567.5 | 388.1 | 155.4 | 24 | |||||||||||||||||||||
Level 2: | ||||||||||||||||||||||||||||
Commercial paper | 157.4 | — | — | 157.4 | 75.9 | 81.5 | — | |||||||||||||||||||||
Corporate securities | 952.1 | 5.8 | (0.4 | ) | 957.5 | — | 274.6 | 682.9 | ||||||||||||||||||||
U.S. government agencies | 636.9 | 2.6 | — | 639.5 | — | 133.6 | 505.9 | |||||||||||||||||||||
Non-U.S. government securities | 90.8 | 0.5 | — | 91.3 | — | 21.8 | 69.5 | |||||||||||||||||||||
Municipal securities | 409.3 | 1.1 | (0.2 | ) | 410.2 | — | 103.8 | 306.4 | ||||||||||||||||||||
Subtotal | 2,246.50 | 10 | (0.6 | ) | 2,255.90 | 75.9 | 615.3 | 1,564.70 | ||||||||||||||||||||
Level 3: | ||||||||||||||||||||||||||||
Municipal securities | 8 | — | (0.6 | ) | 7.4 | — | — | 7.4 | ||||||||||||||||||||
Subtotal | 8 | — | (0.6 | ) | 7.4 | — | — | 7.4 | ||||||||||||||||||||
Total assets measured at fair value | $ | 2,911.50 | $ | 10.2 | $ | (1.2 | ) | $ | 2,920.50 | $ | 553.7 | $ | 770.7 | $ | 1,596.10 | |||||||||||||
Summary of Contractual Maturities of Cash Equivalents and Available-For-Sale Investments | The following table summarizes the contractual maturities of the Company’s cash equivalents and available-for-sale securities, excluding corporate equity securities, at September 30, 2013 (in millions): | |||||||||||||||||||||||||||
Amortized | Fair | |||||||||||||||||||||||||||
Cost | Value | |||||||||||||||||||||||||||
Mature in less than one year | $ | 1,028.60 | $ | 1,029.80 | ||||||||||||||||||||||||
Mature in one to five years | 1,311.30 | 1,312.00 | ||||||||||||||||||||||||||
Mature in after five years | 8 | 7.4 | ||||||||||||||||||||||||||
Total | $ | 2,347.90 | $ | 2,349.20 | ||||||||||||||||||||||||
Derivative Instruments Used to Hedge against Balance Sheet Foreign Currency Exposures | Derivative instruments used to hedge against balance sheet foreign currency exposures at the end of each period were as follows (in millions): | |||||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||||
Recognized gains (losses) in interest and other income, net | $ | (2.6 | ) | $ | — | $ | (1.8 | ) | $ | 0.6 | ||||||||||||||||||
Foreign exchange gains (losses) related to re-measurement | $ | 2.4 | $ | 0.2 | $ | 1 | $ | (0.4 | ) | |||||||||||||||||||
Gross Notional Amounts for Outstanding Derivatives | Total gross notional amounts (in local currency) for derivatives (recorded at fair value) outstanding at the end of each period were as follows (in millions): | |||||||||||||||||||||||||||
September 30, | December 31, | |||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||
European Euro | 31.6 | 37.6 | ||||||||||||||||||||||||||
Korean Won | 12,204.20 | 4,600.00 | ||||||||||||||||||||||||||
British Pound | 7 | 5.4 | ||||||||||||||||||||||||||
Swiss Franc | — | 1 | ||||||||||||||||||||||||||
Japanese Yen | 70 | — | ||||||||||||||||||||||||||
BALANCE_SHEET_DETAILS_Tables
BALANCE SHEET DETAILS (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||
Inventory Details | The following table summarizes the Company’s inventories as of September 30, 2013 and December 31, 2012 (in millions): | |||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Inventories: | ||||||||
Raw materials | $ | 59.1 | $ | 41.2 | ||||
Work-in-process | 6.8 | 4.4 | ||||||
Finished goods | 134.2 | 75.9 | ||||||
Total inventories | $ | 200.1 | $ | 121.5 | ||||
STOCKHOLDERS_EQUITY_Tables
STOCKHOLDERS' EQUITY (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Equity [Abstract] | ||||||||||||||||
Schedule of Stock Repurchase Activities | The following table provides the share repurchase activities during the three and nine months ended September 30, 2013 and 2012 (in millions, except per share amounts): | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Shares repurchased | 1.8 | 0.3 | 2.6 | 0.4 | ||||||||||||
Average price per share | $ | 398.87 | $ | 495.09 | $ | 429.09 | $ | 497.28 | ||||||||
Value of shares repurchased | $ | 693.8 | $ | 169.8 | $ | 1,109.20 | $ | 185.1 | ||||||||
Components of Accumulated Other Comprehensive Income, Net of Tax | The components of accumulated other comprehensive income, net of tax, for the three and nine months ended September 30, 2013 and 2012 are as follows (in millions): | |||||||||||||||
Three Months Ended September 30, 2013 | ||||||||||||||||
Gains (Losses) | Unrealized Gains | Foreign | Total | |||||||||||||
on Hedge | (Losses) on | Currency | ||||||||||||||
Instruments | Available-for- | Translation | ||||||||||||||
Sale Securities | Gains (Losses) | |||||||||||||||
Beginning balance | $ | 0.6 | $ | (2.8 | ) | $ | 0.1 | $ | (2.1 | ) | ||||||
Other comprehensive income before reclassifications | (3.0 | ) | 3.9 | 0.5 | 1.4 | |||||||||||
Reclassified from accumulated other comprehensive income | 0.5 | 0.6 | — | 1.1 | ||||||||||||
Net current-period other comprehensive income | (2.5 | ) | 4.5 | 0.5 | 2.5 | |||||||||||
Ending balance | $ | (1.9 | ) | $ | 1.7 | $ | 0.6 | $ | 0.4 | |||||||
Three Months Ended September 30, 2012 | ||||||||||||||||
Gains (Losses) | Unrealized Gains | Foreign | Total | |||||||||||||
on Hedge | (Losses) on | Currency | ||||||||||||||
Instruments | Available-for- | Translation | ||||||||||||||
Sale Securities | Gains (Losses) | |||||||||||||||
Beginning balance | $ | 0.3 | $ | 3.3 | $ | — | $ | 3.6 | ||||||||
Other comprehensive income before reclassifications | (1.7 | ) | 3.5 | 0.1 | 1.9 | |||||||||||
Reclassified from accumulated other comprehensive income | 0.2 | 0.1 | — | 0.3 | ||||||||||||
Net current-period other comprehensive income | (1.5 | ) | 3.6 | 0.1 | 2.2 | |||||||||||
Ending balance | $ | (1.2 | ) | $ | 6.9 | $ | 0.1 | $ | 5.8 | |||||||
Nine Months Ended September 30, 2013 | ||||||||||||||||
Gains (Losses) | Unrealized Gains | Foreign | Total | |||||||||||||
on Hedge | (Losses) on | Currency | ||||||||||||||
Instruments | Available-for- | Translation | ||||||||||||||
Sale Securities | Gains (Losses) | |||||||||||||||
Beginning balance | $ | — | $ | 6.2 | $ | 0.4 | $ | 6.6 | ||||||||
Other comprehensive income before reclassifications | (1.4 | ) | (5.4 | ) | 0.2 | (6.6 | ) | |||||||||
Reclassified from accumulated other comprehensive income | (0.5 | ) | 0.9 | — | 0.4 | |||||||||||
Net current-period other comprehensive income | (1.9 | ) | (4.5 | ) | 0.2 | (6.2 | ) | |||||||||
Ending balance | $ | (1.9 | ) | $ | 1.7 | $ | 0.6 | $ | 0.4 | |||||||
Nine Months Ended September 30, 2012 | ||||||||||||||||
Gains (Losses) | Unrealized Gains | Foreign | Total | |||||||||||||
on Hedge | (Losses) on | Currency | ||||||||||||||
Instruments | Available-for- | Translation | ||||||||||||||
Sale Securities | Gains (Losses) | |||||||||||||||
Beginning balance | $ | — | $ | 1.1 | $ | (0.2 | ) | $ | 0.9 | |||||||
Other comprehensive income before reclassifications | (1.0 | ) | 5.5 | 0.3 | 4.8 | |||||||||||
Reclassified from accumulated other comprehensive income | (0.2 | ) | 0.3 | — | 0.1 | |||||||||||
Net current-period other comprehensive income | (1.2 | ) | 5.8 | 0.3 | 4.9 | |||||||||||
Ending balance | $ | (1.2 | ) | $ | 6.9 | $ | 0.1 | $ | 5.8 | |||||||
SHAREBASED_COMPENSATION_Tables
SHARE-BASED COMPENSATION (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||
Summary of Stock Option Activity Under All Stock Plans | A summary of stock option activity under all stock plans for the nine months ended September 30, 2013 is presented as follows (in millions, except per share amounts): | |||||||||||||||
Stock Options Outstanding | ||||||||||||||||
Shares | Number | Weighted Average | ||||||||||||||
Available | Outstanding | Exercise Price Per | ||||||||||||||
for Grant | Share | |||||||||||||||
Balance at December 31, 2012 | 1.7 | 4.8 | $ | 340.83 | ||||||||||||
Options authorized | 1.6 | — | — | |||||||||||||
Options granted | (1.5 | ) | 1.5 | 473.68 | ||||||||||||
Options exercised | — | (0.4 | ) | 253.53 | ||||||||||||
Options forfeited/expired | 0.1 | (0.2 | ) | 456.31 | ||||||||||||
Balance at September 30, 2013 | 1.9 | 5.7 | $ | 379.15 | ||||||||||||
Summary of Share-Based Compensation Expense | The following table summarizes share-based compensation expense for the three and nine months ended September 30, 2013 and 2012 (in millions): | |||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Cost of sales - products | $ | 5.2 | $ | 4.3 | $ | 13.2 | $ | 10.6 | ||||||||
Cost of sales - services | 3.6 | 4.1 | 9.5 | 9.6 | ||||||||||||
Total cost of sales | 8.8 | 8.4 | 22.7 | 20.2 | ||||||||||||
Selling, general and administrative | 30.6 | 28.2 | 76.6 | 69.7 | ||||||||||||
Research and development | 11 | 10.7 | 28 | 25.1 | ||||||||||||
Share-based compensation expense before income taxes | 50.4 | 47.3 | 127.3 | 115 | ||||||||||||
Income tax benefit | 16.5 | 14.9 | 41.1 | 36 | ||||||||||||
Share-based compensation expense after income taxes | $ | 33.9 | $ | 32.4 | $ | 86.2 | $ | 79 | ||||||||
Schedule of Estimated Fair Value of the Option Using Black-Scholes Option Pricing Model, Weighted Average Assumptions | The fair value of each option grant and the fair value of the option component of the ESPP shares were estimated at the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions, assuming no expected dividends: | |||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Stock Options | ||||||||||||||||
Average risk free interest rate | 1.5 | % | 0.8 | % | 1.2 | % | 0.8 | % | ||||||||
Average expected term (in years) | 4.5 | 4.1 | 4.5 | 4.3 | ||||||||||||
Average expected volatility | 31 | % | 35 | % | 30 | % | 33 | % | ||||||||
Weighted average fair value at grant date | $ | 110.81 | $ | 148.05 | $ | 126.87 | $ | 145.6 | ||||||||
ESPP | ||||||||||||||||
Average risk free interest rate | 0.2 | % | 0.2 | % | 0.2 | % | 0.2 | % | ||||||||
Average expected term (in years) | 1.3 | 1.3 | 1.3 | 1.3 | ||||||||||||
Average expected volatility | 35 | % | 32 | % | 34 | % | 32 | % | ||||||||
Weighted average fair value at grant date | $ | 115.84 | $ | 143.36 | $ | 153.33 | $ | 138.61 | ||||||||
NET_INCOME_PER_SHARE_Tables
NET INCOME PER SHARE (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||
Computation of Basic and Diluted Net Income Per Share | The following table presents the computation of basic and diluted net income per share for the three and nine months ended September 30, 2013 and 2012 (in millions, except per share amounts): | |||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Numerator: | ||||||||||||||||
Net income | $ | 156.8 | $ | 183.3 | $ | 504.8 | $ | 481.7 | ||||||||
Denominator: | ||||||||||||||||
Weighted-average shares outstanding used in basic calculation | 38.6 | 39.9 | 39.6 | 39.8 | ||||||||||||
Add: Dilutive effect of potential common shares | 0.7 | 1.2 | 0.9 | 1.3 | ||||||||||||
Weighted-average shares used in computing diluted net income per share | 39.3 | 41.1 | 40.5 | 41.1 | ||||||||||||
Net income per share: | ||||||||||||||||
Basic | $ | 4.06 | $ | 4.59 | $ | 12.75 | $ | 12.1 | ||||||||
Diluted | $ | 3.99 | $ | 4.46 | $ | 12.46 | $ | 11.72 | ||||||||
FINANCIAL_INSTRUMENTS_Summary_
FINANCIAL INSTRUMENTS - Summary of Cash and Available-For-Sale Securities (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2011 |
In Millions, unless otherwise specified | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | $2,531 | $2,911.50 | ||
Gross Unrealized Gains | 5.3 | 10.2 | ||
Gross Unrealized Losses | -4 | -1.2 | ||
Fair Value | 2,532.30 | 2,920.50 | ||
Cash and Cash Equivalents | 586.8 | 553.7 | 396.2 | 465.8 |
Short- term Investments | 626.1 | 770.7 | ||
Long- term Investments | 1,319.40 | 1,596.10 | ||
Cash | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 183.1 | 89.7 | ||
Fair Value | 183.1 | 89.7 | ||
Cash and Cash Equivalents | 183.1 | 89.7 | ||
Level 1 | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 452.5 | 567.3 | ||
Gross Unrealized Gains | 0 | 0.2 | ||
Gross Unrealized Losses | -0.4 | 0 | ||
Fair Value | 452.1 | 567.5 | ||
Cash and Cash Equivalents | 368.5 | 388.1 | ||
Short- term Investments | 33.7 | 155.4 | ||
Long- term Investments | 49.9 | 24 | ||
Level 1 | Money market funds | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 368.5 | 388.1 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | 0 | 0 | ||
Fair Value | 368.5 | 388.1 | ||
Cash and Cash Equivalents | 368.5 | 388.1 | ||
Level 1 | U.S. Treasuries | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 84 | |||
Gross Unrealized Gains | 0 | |||
Gross Unrealized Losses | -0.4 | |||
Fair Value | 83.6 | |||
Cash and Cash Equivalents | 0 | |||
Short- term Investments | 33.7 | |||
Long- term Investments | 49.9 | |||
Level 1 | U.S. Treasuries & corporate equity securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 179.2 | |||
Gross Unrealized Gains | 0.2 | |||
Gross Unrealized Losses | 0 | |||
Fair Value | 179.4 | |||
Cash and Cash Equivalents | 0 | |||
Short- term Investments | 155.4 | |||
Long- term Investments | 24 | |||
Level 2 | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 1,887.40 | 2,246.50 | ||
Gross Unrealized Gains | 5.3 | 10 | ||
Gross Unrealized Losses | -3 | -0.6 | ||
Fair Value | 1,889.70 | 2,255.90 | ||
Cash and Cash Equivalents | 35.2 | 75.9 | ||
Short- term Investments | 592.4 | 615.3 | ||
Long- term Investments | 1,262.10 | 1,564.70 | ||
Level 2 | Commercial paper | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 121.9 | 157.4 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | 0 | 0 | ||
Fair Value | 121.9 | 157.4 | ||
Cash and Cash Equivalents | 33.2 | 75.9 | ||
Short- term Investments | 88.7 | 81.5 | ||
Long- term Investments | 0 | 0 | ||
Level 2 | Corporate securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 758.7 | 952.1 | ||
Gross Unrealized Gains | 2.8 | 5.8 | ||
Gross Unrealized Losses | -1.7 | -0.4 | ||
Fair Value | 759.8 | 957.5 | ||
Cash and Cash Equivalents | 0 | 0 | ||
Short- term Investments | 235.8 | 274.6 | ||
Long- term Investments | 524 | 682.9 | ||
Level 2 | U.S. government agencies | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 425 | 636.9 | ||
Gross Unrealized Gains | 1 | 2.6 | ||
Gross Unrealized Losses | -0.8 | 0 | ||
Fair Value | 425.2 | 639.5 | ||
Cash and Cash Equivalents | 2 | 0 | ||
Short- term Investments | 103.3 | 133.6 | ||
Long- term Investments | 319.9 | 505.9 | ||
Level 2 | Non-U.S. government securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 68 | 90.8 | ||
Gross Unrealized Gains | 0.3 | 0.5 | ||
Gross Unrealized Losses | -0.2 | 0 | ||
Fair Value | 68.1 | 91.3 | ||
Cash and Cash Equivalents | 0 | 0 | ||
Short- term Investments | 41.4 | 21.8 | ||
Long- term Investments | 26.7 | 69.5 | ||
Level 2 | Municipal securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 513.8 | 409.3 | ||
Gross Unrealized Gains | 1.2 | 1.1 | ||
Gross Unrealized Losses | -0.3 | -0.2 | ||
Fair Value | 514.7 | 410.2 | ||
Cash and Cash Equivalents | 0 | 0 | ||
Short- term Investments | 123.2 | 103.8 | ||
Long- term Investments | 391.5 | 306.4 | ||
Level 3 | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 8 | 8 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | -0.6 | -0.6 | ||
Fair Value | 7.4 | 7.4 | ||
Cash and Cash Equivalents | 0 | 0 | ||
Short- term Investments | 0 | 0 | ||
Long- term Investments | 7.4 | 7.4 | ||
Level 3 | Municipal securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 8 | 8 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | -0.6 | -0.6 | ||
Fair Value | 7.4 | 7.4 | ||
Cash and Cash Equivalents | 0 | 0 | ||
Short- term Investments | 0 | 0 | ||
Long- term Investments | $7.40 | $7.40 |
FINANCIAL_INSTRUMENTS_Summary_1
FINANCIAL INSTRUMENTS - Summary of Contractual Maturities of Cash Equivalents and Available-For-Sale Investments (Detail) (USD $) | Sep. 30, 2013 |
In Millions, unless otherwise specified | |
Amortized Cost | |
Mature in less than one year, Amortized Cost | $1,028.60 |
Mature in one to five years, Amortized Cost | 1,311.30 |
Mature in after five years, Amortized Cost | 8 |
Total, Amortized Cost | 2,347.90 |
Fair Value | |
Mature in less than one year, Fair Value | 1,029.80 |
Mature in one to five years, Fair Value | 1,312 |
Mature in after five years, Fair Value | 7.4 |
Total, Fair Value | $2,349.20 |
FINANCIAL_INSTRUMENTS_Derivati
FINANCIAL INSTRUMENTS - Derivative Instruments Used to Hedge against Balance Sheet Foreign Currency Exposures (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Foreign exchange gains (losses) related to re-measurement | $2.40 | $0.20 | $1 | ($0.40) |
Foreign Exchange Forward | Interest and other income (expense), net | Not Designated As Hedging Instrument | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Recognized gains (losses) in interest and other income, net | ($2.60) | $0 | ($1.80) | $0.60 |
FINANCIAL_INSTRUMENTS_Gross_No
FINANCIAL INSTRUMENTS - Gross Notional Amounts for Outstanding Derivatives (Detail) | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 |
In Millions, unless otherwise specified | EUR (€) | KRW | EUR (€) | KRW | Foreign Exchange Forward | Foreign Exchange Forward | Foreign Exchange Forward | Foreign Exchange Forward | Foreign Exchange Forward | Foreign Exchange Forward | Foreign Exchange Forward | Foreign Exchange Forward | Foreign Exchange Forward | Foreign Exchange Forward |
Not Designated As Hedging Instrument | Not Designated As Hedging Instrument | Not Designated As Hedging Instrument | Not Designated As Hedging Instrument | Not Designated As Hedging Instrument | Not Designated As Hedging Instrument | Not Designated As Hedging Instrument | Not Designated As Hedging Instrument | Not Designated As Hedging Instrument | Not Designated As Hedging Instrument | |||||
CHF | EUR (€) | GBP (£) | JPY (¥) | KRW | CHF | EUR (€) | GBP (£) | JPY (¥) | KRW | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||||||||
Notional amounts of outstanding currency forward contracts | € 36.90 | 1,800 | € 20 | 4,400 | 0 | € 31.60 | £ 7 | ¥ 70 | 12,204.20 | 1 | € 37.60 | £ 5.4 | ¥ 0 | 4,600 |
FINANCIAL_INSTRUMENTS_Addition
FINANCIAL INSTRUMENTS - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||||||||||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Jun. 30, 2012 | Dec. 31, 2011 |
USD ($) | USD ($) | USD ($) | USD ($) | EUR (€) | KRW | USD ($) | USD ($) | EUR (€) | KRW | USD ($) | USD ($) | |
Investments, All Other Investments [Abstract] | ||||||||||||
Net realized gains recognized on the sale of investments | $0.60 | $0.70 | ||||||||||
Net realized losses recognized on the sale of investments | 0.2 | 1.7 | ||||||||||
Accumulated other comprehensive income, net unrealized gains (losses) on investments, net of tax | 1.7 | 6.9 | 1.7 | 6.9 | -2.8 | 6.2 | 3.3 | 1.1 | ||||
Derivative liabilities | -3 | -3 | -2.7 | |||||||||
Notional amounts of outstanding currency forward contracts | € 36.90 | 1,800 | € 20 | 4,400 |
BALANCE_SHEET_DETAILS_Details_
BALANCE SHEET DETAILS - Details of Selected Balance Sheet Items (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Inventories: | ||
Raw materials | $59.10 | $41.20 |
Work-in-process | 6.8 | 4.4 |
Finished goods | 134.2 | 75.9 |
Total inventories | $200.10 | $121.50 |
CONTINGENCIES_Additional_Infor
CONTINGENCIES - Additional Information (Detail) | 0 Months Ended | 9 Months Ended | 0 Months Ended | |||
Aug. 10, 2011 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Aug. 19, 2010 | Sep. 15, 2010 | |
Plaintiff | Minimum | Maximum | Himmel v. Smith et al. | Applebaum v. Guthart et al. | ||
Defendant | Defendant | |||||
Commitments and Contingencies [Line Items] | ||||||
Time limit given to plaintiffs for filing amended complaint, days | 30 days | |||||
Number of individual defendants involved in lawsuit | 14 | 15 | ||||
Number of individual plaintiffs involved in product liability lawsuits | 50 | |||||
Statute of limitation period | 3 months | 6 months |
STOCKHOLDERS_EQUITY_Schedule_o
STOCKHOLDERS' EQUITY - Schedule of Stock Repurchase Activities (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Equity [Abstract] | ||||
Shares repurchased | 1.8 | 0.3 | 2.6 | 0.4 |
Average price per share | $398.87 | $495.09 | $429.09 | $497.28 |
Value of shares repurchased | $693.80 | $169.80 | $1,109.20 | $185.10 |
STOCKHOLDERS_EQUITY_Components
STOCKHOLDERS' EQUITY - Components of Accumulated Other Comprehensive Income, Net of Tax (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Gains (Losses) on Hedge Instruments | ||||
Beginning balance | $0.60 | $0.30 | $0 | $0 |
Other comprehensive income before reclassifications | -3 | -1.7 | -1.4 | -1 |
Reclassified from accumulated other comprehensive income | 0.5 | 0.2 | -0.5 | -0.2 |
Net current-period other comprehensive income | -2.5 | -1.5 | -1.9 | -1.2 |
Ending balance | -1.9 | -1.2 | -1.9 | -1.2 |
Unrealized Gains (Losses) on Available-for- Sale Securities | ||||
Beginning balance | -2.8 | 3.3 | 6.2 | 1.1 |
Other comprehensive income before reclassifications | 3.9 | 3.5 | -5.4 | 5.5 |
Reclassified from accumulated other comprehensive income | 0.6 | 0.1 | 0.9 | 0.3 |
Net current-period other comprehensive income | 4.5 | 3.6 | -4.5 | 5.8 |
Ending balance | 1.7 | 6.9 | 1.7 | 6.9 |
Foreign Currency Translation Gains (Losses) | ||||
Beginning balance | 0.1 | 0 | 0.4 | -0.2 |
Other comprehensive income before reclassifications | 0.5 | 0.1 | 0.2 | 0.3 |
Reclassified from accumulated other comprehensive income | 0 | 0 | 0 | 0 |
Net current-period other comprehensive income | 0.5 | 0.1 | 0.2 | 0.3 |
Ending balance | 0.6 | 0.1 | 0.6 | 0.1 |
Total | ||||
Beginning balance | -2.1 | 3.6 | 6.6 | 0.9 |
Other comprehensive income before reclassifications | 1.4 | 1.9 | -6.6 | 4.8 |
Reclassified from accumulated other comprehensive income | 1.1 | 0.3 | 0.4 | 0.1 |
Net current-period other comprehensive income | 2.5 | 2.2 | -6.2 | 4.9 |
Ending balance | $0.40 | $5.80 | $0.40 | $5.80 |
STOCKHOLDERS_EQUITY_Additional
STOCKHOLDERS' EQUITY - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 0 Months Ended | 1 Months Ended | 3 Months Ended | ||||||
Share data in Millions, except Per Share data, unless otherwise specified | Jul. 25, 2013 | Mar. 20, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 16, 2013 | Jul. 29, 2013 | Sep. 11, 2013 | Sep. 16, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
Common Stock | Common Stock | Common Stock | Common Stock | Common Stock | Common Stock and APIC | Retained Earnings | |||||||
Open Market Stock Repurchase 2013 | Goldman, Sachs & CO. | Goldman, Sachs & CO. | Goldman, Sachs & CO. | Goldman, Sachs & CO. | |||||||||
ASR Program 2013 | ASR Program 2013 | ASR Program 2013 | ASR Program 2013 | ||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||||
Stock repurchase program, authorized amount | $779,000,000 | $1,000,000,000 | $500,000,000 | ||||||||||
Remaining authorized amount of stock repurchases | 1,000,000,000 | ||||||||||||
Payments for stock repurchase | 693,800,000 | 169,800,000 | 1,109,200,000 | 185,100,000 | 500,000,000 | ||||||||
Shares of common stock repurchased | 1.8 | 0.3 | 2.6 | 0.4 | 0.5 | 0.1 | 1.2 | 1.3 | |||||
Stock repurchase. settlement price per share | $385.16 | ||||||||||||
Decrease of equity due to stock repurchased and retired | $57,400,000 | $636,400,000 |
SHAREBASED_COMPENSATION_Summar
SHARE-BASED COMPENSATION - Summary Of Stock Option Activity Under All Stock Plans (Detail) (USD $) | 9 Months Ended |
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2013 |
Shares Available for Grant | |
Beginning balance, Shares Available for Grant | 1.7 |
Options authorized, Shares Available for Grant | 1.6 |
Options granted, Shares Available for Grant | -1.5 |
Options exercised , Shares Available for Grant | 0 |
Options forfeited/expired, Shares Available for Grant | 0.1 |
Ending balance, Shares Available for Grant | 1.9 |
Number Outstanding | |
Beginning balance, Number Outstanding | 4.8 |
Options authorized, Number Outstanding | 0 |
Options granted, Number Outstanding | 1.5 |
Options exercised, Number Outstanding | -0.4 |
Options forfeited/expired, Number Outstanding | -0.2 |
Ending balance, Number Outstanding | 5.7 |
Weighted Average Exercise Price Per Share | |
Beginning balance, Weighted Average Exercise Price Per Share | $340.83 |
Options authorized, Weighted Average Exercise Price Per Share | $0 |
Options granted, Weighted Average Exercise Price Per Share | $473.68 |
Options exercised, Weighted Average Exercise Price Per Share | $253.53 |
Options forfeited/expired, Weighted Average Exercise Price Per Share | $456.31 |
Ending balance, Weighted Average Exercise Price Per Share | $379.15 |
SHAREBASED_COMPENSATION_StockB
SHARE-BASED COMPENSATION - Stock-Based Compensation Expense (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | $50.40 | $47.30 | $127.30 | $115 |
Income tax benefit | 16.5 | 14.9 | 41.1 | 36 |
Share-based compensation expense after income taxes | 33.9 | 32.4 | 86.2 | 79 |
Total cost of sales | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | 8.8 | 8.4 | 22.7 | 20.2 |
Total cost of sales | Cost of sales - products | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | 5.2 | 4.3 | 13.2 | 10.6 |
Total cost of sales | Cost of sales - services | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | 3.6 | 4.1 | 9.5 | 9.6 |
Selling, general and administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | 30.6 | 28.2 | 76.6 | 69.7 |
Research and development | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | $11 | $10.70 | $28 | $25.10 |
SHAREBASED_COMPENSATION_Schedu
SHARE-BASED COMPENSATION - Schedule Of Estimated Fair Value Of Option Using Black-Scholes Option Pricing Model, Weighted Average Assumptions (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected dividend rate | 0.00% | 0.00% | 0.00% | 0.00% |
Average risk free interest rate | 1.50% | 0.80% | 1.20% | 0.80% |
Average expected term (in years) | 4 years 6 months | 4 years 1 month 6 days | 4 years 6 months | 4 years 3 months 18 days |
Average expected volatility | 31.00% | 35.00% | 30.00% | 33.00% |
Weighted average fair value at grant date | $110.81 | $148.05 | $126.87 | $145.60 |
Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected dividend rate | 0.00% | 0.00% | 0.00% | 0.00% |
Average risk free interest rate | 0.20% | 0.20% | 0.20% | 0.20% |
Average expected term (in years) | 1 year 3 months | 1 year 3 months | 1 year 3 months | 1 year 3 months |
Average expected volatility | 35.00% | 32.00% | 34.00% | 32.00% |
Weighted average fair value at grant date | $115.84 | $143.36 | $153.33 | $138.61 |
SHAREBASED_COMPENSATION_Additi
SHARE-BASED COMPENSATION - Additional Information (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | 31-May-13 | Jan. 31, 2013 | Dec. 31, 2012 | Apr. 25, 2013 | Mar. 31, 2013 |
In Millions, except Share data, unless otherwise specified | Employee Stock Purchase Plan | Employee Stock Purchase Plan | Employee Stock Purchase Plan | Employee Stock Purchase Plan | Amended and Restated 2009 Employment Commencement Incentive Plan | Amended and Restated 2009 Employment Commencement Incentive Plan | Amended and Restated 2009 Employment Commencement Incentive Plan | Amended and Restated 2010 Incentive Award Plan | Amended and Restated 2010 Incentive Award Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares of common stock authorized | 1,155,000 | 855,000 | 730,000 | 4,850,000 | 3,650,000 | |||||
Options exercisable, number of shares | 3,100,000 | |||||||||
Options exercisable, weighted-average exercise price per share | $312.11 | |||||||||
Employee Stock Purchase Plan, shares purchased by employees | 37,700 | 47,600 | 92,200 | 96,800 | ||||||
Employee Stock Purchase Plan, value of shares purchased by employees | $12.40 | $13.90 | $28.80 | $27.80 |
INCOME_TAXES_Additional_Inform
INCOME TAXES - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | |||||
Income tax expense | $21.30 | $32.40 | $151.60 | $160.40 | |
Income tax expense, percentage of pre-tax income | 12.00% | 15.00% | 23.10% | 25.00% | |
Federal statutory tax rate | 35.00% | 35.00% | 35.00% | ||
Discrete benefit related to previously unrecognized tax benefits | 26.2 | 35.1 | |||
Discrete net benefit related to 2012 federal research and development | 7.5 | ||||
Total gross unrecognized tax benefits | 77.6 | 77.6 | 88 | ||
Unrecognized tax benefits, period increase (decrease) | 10.4 | ||||
Unrecognized tax benefits, if recognized, would reduce the Company's effective tax rate | 76 | 76 | |||
Gross interest related to unrecognized tax benefit accrued | 1.9 | 1.9 | 3.2 | ||
Unrecognized tax benefits increase in accrued interest | $1.30 |
NET_INCOME_PER_SHARE_Computati
NET INCOME PER SHARE - Computation of Basic and Diluted Net Income Per Share (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Earnings Per Share, Basic and Diluted [Abstract] | ||||
Net income | $156.80 | $183.30 | $504.80 | $481.70 |
Weighted-average shares outstanding used in basic calculation | 38.6 | 39.9 | 39.6 | 39.8 |
Add: Dilutive effect of potential common shares | 0.7 | 1.2 | 0.9 | 1.3 |
Weighted-average shares used in computing diluted net income per share | 39.3 | 41.1 | 40.5 | 41.1 |
Net income per share: | ||||
Basic (in dollars per share) | $4.06 | $4.59 | $12.75 | $12.10 |
Diluted (in dollars per share) | $3.99 | $4.46 | $12.46 | $11.72 |
NET_INCOME_PER_SHARE_Additiona
NET INCOME PER SHARE - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Earnings Per Share [Abstract] | ||||
Employee stock options excluded from computation of diluted net income per share | 2.6 | 1.1 | 2.1 | 0.8 |