- ResMed reported a strong first quarter of fiscal 2025, with revenue of $1.2245 billion, up 11% year over year, and a gross margin of 59.2%, up 320 basis points from the prior year. Operating income rose to $387.3 million (operating margin ~31.6%), and net income reached $311.4 million (net margin ~25.4%), delivering GAAP EPS of $2.12 and non‑GAAP diluted EPS of $2.11. Cash flow from operations was $325.5 million, with free cash flow of $305.9 million, supporting a cash balance of $426.4 million and net debt of $0.251 billion after a $30 million debt repayment. The company also announced a quarterly dividend of $0.53 per share and a buyback of $50 million in the quarter, with a plan to run about $75 million per quarter going forward. This highlights resilient profitability and substantial capital return capability even as the company accelerates a longer‑term digital health agenda.
- Management attributed the margin expansion to manufacturing efficiencies, component cost improvements, and higher average selling prices, while continuing to monitor freight and currency headwinds. They guided gross margins to remain in the 59–60% range for fiscal 2025 and reiterated ongoing investments in SG&A efficiency, R&D intensity, and a disciplined approach to tuck‑in acquisitions and buybacks.
- Strategic catalysts highlighted by management include the ramp of the AirSense 11 platform, strong performance in masks and accessories via ReSupply, and a growing corporate focus on digital health ecosystems (AirView, myAir, Brightree, MatrixCare, Somnoware, and NightOwl). The company also discussed favorable macro tailwinds from GLP‑1 therapies and consumer wearables, which they believe will drive demand for sleep health and breathing health solutions, as well as the potential to expand diagnostic reach via NightOwl integration with myAir and the ongoing Dawn AI consumer product.
- Looking ahead, ResMed outlined a three‑pillar 2030 growth framework: (1) differentiating and expanding core sleep/breathing health leadership, (2) expanding into adjacent spaces, and (3) leveraging digital health leadership to improve outcomes and lower costs. The investment thesis rests on continued revenue growth, margin resilience, expanding cash flow and ROIC, and a disciplined capital allocation framework focused on R&D, tuck‑in acquisitions, and buybacks.