ResMed Inc. — First Quarter Fiscal Year 2027 Earnings Summary

Financial Performance:

• Revenue increased 6% year-over-year to $1.415 billion; core constant currency revenue growth was 7%.
• GAAP diluted earnings per share (EPS) rose 23% to $2.92; non-GAAP diluted EPS increased 14% to $2.91.
• GAAP gross margin was 61.5% (up 30 basis points); non-GAAP gross margin was 62.5% (up 50 basis points).
• GAAP operating margin was 32.0% (down 140 basis points); non-GAAP operating margin was 35.8% (down 30 basis points).
• Net income increased 20% to $418 million; non-GAAP net income rose 12% to $418 million.
• Operating cash flow was $422 million (down 8%); free cash flow was $374 million (down 10%).
• Research and development expenses increased 15% to $103 million (GAAP) and 16% to $102 million (non-GAAP).
• Selling, general, and administrative expenses increased 12% to $315 million (GAAP) and 6% to $276 million (non-GAAP).
• Deferred revenue increased to $345.9 million total ($171.6 million current, $174.2 million non-current) from $333.9 million previously.
• Short-term debt decreased to $159.975 million from $259.95 million; long-term debt decreased to $249.629 million from $399.415 million.

Guidance and Future Outlook:

• Fiscal Year 2027 revenue guidance remains unchanged at $5.75–$5.85 billion (reported) and 5–7% growth (core constant currency).
• Fiscal Year 2027 non-GAAP diluted EPS guidance remains unchanged at $12.00–$12.25.
• Management intends to continue building core sleep and breathing health businesses by extending the digital health ecosystem.
• Future goals include connecting more people worldwide needing care with life-saving treatment delivered in their homes.

Business Segments and Product Lines:

• Americas Sleep and Breathing Health revenue grew 7% on a core constant currency basis.
• Rest of World Sleep and Breathing Health revenue grew 8% on a core constant currency basis.
• Residential Care Software revenue increased 5% on a core constant currency basis (excluding divested MatrixCare, remaining businesses grew 8%).
• Total Sleep Devices revenue grew 9% to $716 million; Masks and other revenue grew 10% to $540 million.
• Life Support Devices revenue declined 84% to $4 million due to the divestiture of MatrixCare.
• Announced the U.S. launch of the AirTouch F40, a new fabric CPAP mask.
• Closed the previously announced divestiture of the MatrixCare business.

Market and Competitive Landscape:

• Strong global demand for sleep and breathing health solutions drove revenue growth across all regions.
• The company operates in 140 countries with AI-powered digital health solutions and cloud-connected devices.
• No specific market share data or direct competitor comparisons were provided in the release.

Risks and Challenges:

• Forward-looking statements are subject to risks including macroeconomic conditions, supply chain issues, regulatory developments, litigation, and tax outlook.
• Actual results may differ materially from projections due to uncertainties in new product development, acquisition integration, and strategic initiatives.
• Foreign currency fluctuations impact reported results, though core constant currency measures are provided to exclude these effects.

Management Commentary and Tone:

• Chairman and CEO Mick Farrell described the quarter as a "strong first quarter" driven by global demand and ongoing execution.
• Management highlighted strong free cash flow and proceeds from the MatrixCare divestiture as enablers for both innovation investment and shareholder returns.
• The tone was confident, emphasizing continued growth in core businesses and the expansion of the digital health ecosystem.

Other Key Points:

• Returned more than $1.0 billion to shareholders through share repurchases and dividends during the quarter.
• Board declared a quarterly cash dividend of $0.66 per share, payable December 17, 2026, with a record date of November 12, 2026.
• Appointed Carol Burt as Lead Director effective November 15, 2026, following the retirement of Ron Taylor.
• Partnered with Eight Sleep to integrate technology with ResMed sleep insights in the U.S. and Australia.
• Partnered with NASCAR driver Tyler Reddick to raise awareness regarding sleep apnea diagnosis and treatment.
• Revised presentation of restructuring expenses and amortization of acquired intangibles, reclassifying them within cost of sales and operating expenses.