Resmed Q1 Revenue Rises 6%, FY27 Outlook Reiterated

Resmed Inc. (RMD) reported higher fiscal first-quarter revenue and non-GAAP earnings, supported by growth across its sleep device and mask businesses. Revenue increased 6% year over year to $1.4 billion, while non-GAAP diluted earnings per share rose 14% to $2.91. The company reiterated its fiscal 2027 revenue, earnings and margin outlooks.

Core constant-currency revenue grew 7% in the quarter ended September 30, 2026. That measure includes two months of MatrixCare revenue in both periods and excludes revenue from Nidra, the restless legs syndrome therapy acquired through Noctrix Health.

Non-GAAP gross margin expanded 50 basis points to 62.5%, reflecting operational improvements and the timing of supply-chain expansion investments. Non-GAAP operating margin declined 30 basis points to 35.8%. Free cash flow fell 10% to $374 million from $414 million a year earlier.

Sleep devices and masks drive growth

Revenue increased across Resmed’s major sleep device and mask categories. Americas sleep device revenue rose to $436 million from $405 million, while rest-of-world sleep device revenue reached $280 million, up from $250 million. Americas masks and other revenue increased to $397 million from $361 million, and the corresponding rest-of-world category rose to $143 million from $128 million.

Life-support device revenue contracted sharply. Americas revenue in the category fell to less than $1 million from $9 million, while rest-of-world revenue declined to $3 million from $17 million.

Residential Care Software revenue decreased to $155 million from $166 million following portfolio changes. Resmed said the remaining business, comprising Brightree and MEDIFOX Dan, grew 8% on a core constant-currency basis. The company completed the divestiture of MatrixCare and related operations on September 1 and said the transaction should improve the growth and profitability profile of the remaining software business.

Resmed also continued integrating Nidra, which it acquired through Noctrix Health in June. Management’s priorities include expanding the therapy’s commercial coverage and patient access.

Product investment and operating expansion

During the quarter, Resmed launched the AirTouch F40 fabric mask and AirCurve 11 ST and ST-A bilevel devices in the U.S. The company also highlighted its FDA-cleared Smart Comfort technology, which uses sleep data to adjust comfort settings, and updates to its myAir patient platform. Inquiries handled by the Dawn generative-AI coach exceeded 2.1 million, up 40%.

Resmed is expanding its U.S. operating footprint through AirSense 11 production in Atlanta and a new Indiana distribution center. The company continues to target annual double-digit basis-point gross-margin improvement through 2030, supported by a multi-year pipeline of productivity initiatives.

Fiscal 2027 outlook reiterated

Resmed maintained its fiscal 2027 headline revenue guidance of $5.75 billion to $5.85 billion and its forecast for core constant-currency revenue growth of 5% to 7%. The core growth outlook includes an estimated 130-basis-point, or roughly $75 million, headwind from Astral.

The headline revenue forecast includes two months of MatrixCare revenue and revenue from Nidra. It now assumes a foreign-exchange headwind of about 60 basis points, compared with approximately 50 basis points previously assumed.

Management continues to expect fiscal 2027 non-GAAP diluted EPS of $12.00 to $12.25, representing growth of 12% to 14%. The outlook incorporates approximately $1.5 billion of planned share repurchases. Resmed also expects low-double-digit basis-point expansion in non-GAAP gross margin and a slight increase in non-GAAP operating margin, driven by productivity and efficiency measures.

For the second quarter, preliminary trends indicate a mid-single-digit sequential increase in revenue, excluding Nidra and including two months of MatrixCare revenue in both periods. Non-GAAP gross margin is expected to be slightly lower sequentially, with research and development expenses roughly flat, selling and administrative expenses up by a low-single-digit percentage and net other income down by about $10 million.

Resmed returned more than $1 billion to shareholders during the first quarter, including approximately $936 million of share repurchases. It retained its fiscal 2027 capital-expenditure forecast of $160 million to $180 million and its quarterly dividend of $0.66 per share.

The guidance assumes continued global pricing actions and successful execution of marketing campaigns. Identified uncertainties include inflation, currency movements and pressure on rest-of-world sleep device revenue in the second half of fiscal 2027 as a fleet-renewal program in France concludes. The company also cautioned that actual results could differ from its forward-looking projections because of regulatory developments, litigation, macroeconomic conditions and execution risks involving products, acquisitions and strategic initiatives.