Financial Data and Key Metrics Changes - The company reported an 11% headline revenue growth and a 9% growth on a constant currency basis for the second quarter of fiscal year 2026, with GAAP EPS growth of 16% [4][28] - Gross margin increased by 110 basis points year-over-year and by 30 basis points sequentially, reaching 62%-63% for fiscal year 2026 [30][31] - Operating profits increased by 19%, with an operating margin improvement to 36.3% compared to 34% in the prior year [32] Business Line Data and Key Metrics Changes - Global devices revenue experienced high single-digit growth, while masks, accessories, and other revenue saw double-digit growth [4][5] - Residential care software revenue increased by 5% on a constant currency basis, driven by strong performance from the Medifox Dan software vertical [30] Market Data and Key Metrics Changes - Sales in the U.S., Canada, and Latin America increased by 11%, with a 6% increase on a constant currency basis [29] - In Europe, Asia, and other regions, device sales increased by 5% on a constant currency basis, while masks and other sales increased by 8% [29] Company Strategy and Development Direction - The company aims to build a leading digital health ecosystem encompassing sleep health, breathing health, and healthcare technology delivered in the home [8] - Continued focus on operational excellence and innovation, with a commitment to R&D investments of 6%-7% of revenues and SG&A investments of 19%-20% [26][31] - The company is expanding its digital sleep health concierge capabilities and enhancing its manufacturing footprint to improve delivery efficiency [10][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in re-accelerating growth in Europe, Asia, and the rest of the world, with expectations of sustainable high single-digit growth in the residential care software business by fiscal year 2027 [5][6] - The company is closely monitoring the global trade environment and regulatory landscape, with positive implications from recent developments in competitive bidding programs [21][23] Other Important Information - The company returned $263 million to shareholders through dividends and $175 million in share repurchases during the quarter, with plans to increase share repurchases to over $600 million for fiscal year 2026 [34][26] - The launch of new AI-enabled products, such as Comfort Match, is expected to enhance patient adherence to therapy [12][19] Q&A Session Summary Question: Strong US mask number and impact of Virtuox - Management confirmed that the strong growth in masks includes contributions from Virtuox, but even without it, there was solid double-digit growth in masks and accessories [36][38] Question: Update on GLP-1 landscape and its impact - Management noted a 10%-11% higher start rate for CPAP therapy among patients with GLP-1 prescriptions, indicating a motivated patient group [39][41] Question: SG&A growth ahead of revenue growth - Management explained that the SG&A growth includes impacts from the Virtuox acquisition and promotional activities, but underlying growth is tracking closely with revenue [43] Question: Impact on patient funnel stages - Management highlighted significant progress in the top of the funnel due to increased awareness from Big Pharma and tech, while focusing on scaling home sleep apnea testing [45][47] Question: Potential return of Philips to the US market - Management expressed confidence in competing effectively against Philips, noting that they have been performing well in various markets despite Philips' presence [60][62]

Core Insights - Resmed (RMD) is scheduled to announce its second-quarter fiscal 2026 results on January 29, with adjusted earnings per share (EPS) of $2.55 in the last quarter, exceeding the Zacks Consensus Estimate by 2.41% [1] Group 1: Q2 Estimates - The Zacks Consensus Estimate for Resmed's revenues in Q2 fiscal 2026 is $1.39 billion, reflecting an 8.3% increase from the previous year [2] - The EPS estimate for the same quarter suggests a 10.3% rise to $2.68 [2] Group 2: Estimate Revision Trend - Earnings estimates for Resmed's fiscal second-quarter have remained stable over the past 60 days, indicating consistent expectations leading up to the announcement [3] Group 3: Factors Influencing Q2 Results - Strong demand for Resmed's mask portfolio in the U.S., Canada, and Latin America is expected to drive growth, with additional contributions from the VirtuOx acquisition [4] - Recent product innovations in the mask portfolio, such as the AirTouch F30i Comfort and AirTouch F30i Clear, are anticipated to positively impact revenues [5] - The integration of machine learning, AI, and generative AI in digital health products, including the Dawn personal sleep health assistant, may enhance overall revenue [6] - Device sales are likely to benefit from the availability of AirSense 10 and AirSense 11 sleep devices, with a projected 6.3% revenue increase in the Sleep and Breathing Health segment [7] Group 4: Residential Care Software - The Residential Care Software division is crucial for supporting the core Sleep and Breathing Health business, with expected revenue growth of 7.1% in Q2 fiscal 2026 [10] - The company is focusing on high-growth, higher-margin areas while reducing exposure to lower-growth segments [9] Group 5: Earnings ESP and Zacks Rank - Resmed has an Earnings ESP of -0.81%, indicating a lower chance of beating estimates, while holding a Zacks Rank of 2 (Buy) [11]

Financial Data and Key Metrics Changes - The company reported a trailing 12-month top-line growth of 12% and a non-GAAP EPS growth of 14%, indicating strong financial performance and operational leverage [26][27]. Business Line Data and Key Metrics Changes - The company launched several new products, including a generative AI product called Dawn and a Compliance Predictor, enhancing its digital health offerings [22][23]. - The company has increased its gross margin by 200-300 basis points year on year, reflecting improved profitability [25]. Market Data and Key Metrics Changes - The company aims to help over 500 million people by 2030 through its healthcare technologies, indicating a strong market focus and growth potential [24]. Company Strategy and Development Direction - The company has restated its 2030 strategy, focusing on product-led, customer-centric, and brand-enhanced growth, with an emphasis on increasing product velocity and profitable growth [25]. - The company is investing 6-7% of its revenues back into technology and 19% into sales and marketing to drive demand generation [27]. Management's Comments on Operating Environment and Future Outlook - Management highlighted the role of artificial intelligence as a tailwind for the company, with ongoing experiments and product launches aimed at improving patient outcomes [21]. - The company has successfully completed acquisitions, including Ectosense and VirtuOx, to enhance its service offerings in sleep apnea testing [28][29]. Other Important Information - The company has increased its share repurchase program from $100 million to $150 million per quarter, with discussions on further increases [28]. Q&A Session Summary Question: How is artificial intelligence a tailwind for the company? - Management discussed the launch of AI-driven products like Dawn and Compliance Predictor, which enhance patient engagement and improve therapy adherence [21][22][23].

ResMed Conference Call Summary Company Overview - **Company**: ResMed (NYSE:RMD) - **Industry**: Digital health and medical devices, focusing on sleep health, breathing health, and healthcare technology delivered at home - **Headquarters**: San Diego, California - **Founded**: 1989 - **Market Presence**: Sold 30 million cloud-connectable medical devices in 140 countries, with 23 billion nights of respiratory medical data collected [5][6] Core Strategies and Goals - **ResMed 2030 Strategy**: Aims to improve 500 million lives by 2030 through innovative products and services [6][7] - **Recent Achievements**: Changed 154 million lives in the last 12 months with devices and software [7] - **Product Development**: Focus on creating the smallest, quietest, and most comfortable devices, with a strong emphasis on cloud connectivity and intelligence [7][10] Financial Performance - **Free Cash Flow**: Generated over $1.7 billion in free cash flow in the last 12 months [9] - **Gross Margin Improvement**: Achieved 230 basis points year-on-year gross margin accretion in Q4 and 150 basis points quarter-on-quarter [9][10] - **Net Operating Profit Margins**: Currently in the range of 33-34% [10] Innovation and Product Development - **New Products**: Launched innovative products like the AirTouch N30i and AirFit F40, incorporating fabric into patient interfaces [11] - **Acquisitions**: Acquired Ectosense for its home sleep testing technology and Virtuox for home sleep apnea testing [12][57] - **Research Utilization**: Leveraging 23 billion nights of data to improve products and contribute to peer-reviewed research [13][14] Market Dynamics and Competitive Landscape - **Tariff Relief**: ResMed products benefit from tariff relief under the Nairobi Protocol, ensuring no tariffs on products made in various locations [12] - **Competitor Landscape**: Competitors have been affected by recalls, but ResMed remains confident in its market position and growth potential [47][48] - **Market Growth**: The device market is expected to grow mid-single digits, with ResMed aiming to exceed this through demand generation efforts [58] Patient Engagement and Adherence - **Adherence Rates**: Connected devices have increased adherence from 50% to 73%, and with app usage, adherence can reach 87% [14][20] - **GLP-1 Drug Impact**: Patients on GLP-1 weight loss drugs are 11% more likely to start CPAP therapy and show higher resupply rates [24][25] - **Patient Empowerment**: Focus on educating patients about access to equipment and the importance of adherence to therapy [20][23] Research and Development - **Investment in R&D**: ResMed invests 6-7% of revenues back into research and development to drive innovation [55] - **Future Growth**: Aiming for double-digit basis point improvements in gross margins annually through supply chain optimization and product innovation [63][64] Conclusion - ResMed is positioned as a leader in the digital health space, with a strong focus on innovation, patient engagement, and financial performance. The company is actively working to expand its market presence and improve patient outcomes through its 2030 strategy and ongoing product development initiatives.

Core Insights - ResMed Inc. reported adjusted earnings per share (EPS) of $2.37 for Q3 fiscal 2025, reflecting an 11.3% year-over-year increase and surpassing the Zacks Consensus Estimate by 0.4% [1] - The company's revenues for the same quarter reached $1.29 billion, marking a 7.5% year-over-year growth and exceeding the Zacks Consensus Estimate by 0.5% [3] Financial Performance - Adjusted gross profit increased by 10.5% to $773.8 million, with an adjusted gross margin of 59.9%, up 138 basis points year over year [9] - Selling, general and administrative expenses rose 6.7% to $245.3 million, while research and development expenses increased by 8.9% to $83.9 million [10] - Adjusted operating income was $444.6 million, up 13% from the previous year, with an adjusted operating margin of 34.4%, expanding by 154 basis points [10] Revenue Breakdown - The Sleep and Breathing Health segment generated revenues of $1.13 billion, an 8% increase year over year, with global device sales totaling $676.2 million, up 6% [6] - In the Residential Care Software segment, revenues grew 9% year over year to $161.2 million, slightly below projections [8] Market Reaction - Following the earnings announcement, ResMed's shares rose by 2.6% in after-market trading [2] Strategic Developments - The company launched the NightOwl, an FDA-cleared home sleep apnea test, and introduced a brand evolution to unify its brand portfolio [15]

Company Overview - ResMed (RMD) shares increased by 3.8% to close at $213, following notable trading volume, despite a previous 11.7% loss over the past four weeks [1] - The company is set to release its fiscal 2025 third-quarter financial results on April 23, which has generated investor optimism [2] Financial Performance Expectations - ResMed is expected to report quarterly earnings of $2.36 per share, reflecting a year-over-year increase of 10.8%, with revenues projected at $1.28 billion, up 7.3% from the same quarter last year [3] - The consensus EPS estimate has been revised marginally lower over the last 30 days, indicating a potential negative trend in earnings estimate revisions [4] Market Position and Competitors - ResMed is part of the Zacks Medical - Products industry, where AdaptHealth Corp. (AHCO) also operates, closing 5.4% lower at $9.56, with a -3.6% return over the past month [4] - AdaptHealth's consensus EPS estimate remains unchanged at $0.01, representing a 50% decrease from the previous year [5]