Installed base and utilisation
Systems shipped, retired and in use, and procedures.
By Surojit Chakraverti, founder of L3VLUP and an investor running a long-short healthcare and technology equities strategy.
On this subject: installed base and utilisation.Updated 2 October 2026
Part of healthcare financial models, with the models, labs and guides around it.
What it does
The stock a device company earns on. Systems shipped in the year are split between those sold outright and those placed under leases; a share of the opening base retires; the closing base rolls to next year. Because systems ship through the year, the average base drives everything that recurs, and procedures are that average times utilisation, the procedures each system performs a year. Growth in procedures, not in shipments, is what the recurring revenue follows.
Where it lives
The same schedule in each model that carries it, with the rows to open. Open a model in the browser, go to the sheet, and click the lines.
- Assumptions, rows 8–13: Sold systems installed at the end of FY0, Leased systems installed at the end of FY0, Systems shipped, Share of shipments placed under a lease…
- Installed Base, rows 6–9: Opening, Shipped and sold, Retired, Closing
- Installed Base, rows 12–15: Opening, Shipped and placed under a lease, Retired, Closing
- Installed Base, rows 18–23: Installed base, closing, Average sold base, Average leased base, Average installed base…
- Installed Base, rows 26–29: Procedures per system a year, Procedures (thousands): average base x utilisation, Procedure growth, Check: the base rolls (opening + shipped - retired = closing)
What a reviewer looks for
- Procedures on the closing base rather than the average.
- No retirements.
- Shipments counted once in the sold fleet and again in the leased one.
Learn it, then build it
Vocabulary: Installed Base, Razor-and-Blade Model.