- ResMed Inc's (NYSE:RMD) Q3 FY22 sales increased by 12% Y/Y (+14% on a constant currency basis) to $864.5 million, missing the consensus of $897 million.
- The revenue growth was driven by increased demand for sleep and respiratory care devices and an increased demand following an ongoing recall of rival Koninklijke Philips N.V. (NYSE:PHG) products.
- ResMed generated $35 million - $45 million incremental device revenue due to the impact of competitors' recall.
- The company expects to face supply chain challenges hampering its ability to increase the supply of devices.
- ResMed expects a total incremental device revenue opportunity for FY22 of $200 million - $250 million, down from $300 million - $350 million.
- Speaking on the earnings conference call, Chief executive Mick Farrell said that the patient backlog for sleep apnoea machines was between 12 and 18 months.
- The adjusted gross margin decreased to 58.1% from 59.6%, mainly due to higher freight and manufacturing costs, partially offset by favorable product mix changes and an increase in average selling prices.
- The adjusted EPS reached $1.32, compared to $1.30 a year ago and below the consensus of $1.42.
- Dividend: ResMed declared a quarterly cash dividend of $0.42 per share, payable on June 16 and record date of May 12.
- Price Action: RMD shares closed lower by 0.56% at $213.51 on Thursday.
