ResMed (RMD) 25 Apr 242024 Q3 Earnings call transcript

Hello, and welcome to the Q3 Fiscal Year 2024 ResMed Earnings Conference Call. My name is Kevin, and I'll be your operator for today's call. [Operator Instructions] Please note that this conference call is being recorded.

I'll now turn the call over to Amy Wakeham, Chief Investor Relations Officer. Amy, you may begin.

Great. Kevin. you, Thank Hello, everyone. Fiscal Quarter XXXX Call. Third Earnings Year ResMed's to Welcome

call, replay Relations will We of are available the this webcasting today. later Investor live be and on corporate website our section the

are press earnings online release presentation Our both and now. available

supporting financial non-GAAP to or During believe in that reconcile for as schedules This is a provide today's be review to GAAP investors. we not for substitute numbers. measures intended with press discuss information. information considered earnings call, you release will non-GAAP information the we the the We several encourage useful reported in GAAP today's the isolation to measures

In discussion our future including, about forward-looking statements our but not financial and addition, will to, performance. expectations today limited operating include

We these make assumptions. statements based reasonable on

review Please our risk differ made differ. could SEC of for materially statements complete actual results actual that from our factors results a the today. cause discussion could our to forward-looking filings any However,

now Farrell. Chairman call to over like the ResMed's to turn I'd Mick CEO, and

you our Thanks, and shareholders all today. us thank Amy, joining for to of

quarter third line execution reflect in another resulting business, growth XXXX fiscal top results of line entire our strong solid double-digit across growth. and strong bottom period year Our

form for or of very call Our accessories Service address. health obstructive due uniquely ongoing global focus single-digit a ongoing worldwide by These business. from I were launch on keeping patient bottom excellent This devices XXXX and respiratory care of ResMed X sleep quarter our strong a masks in we apnea, performance, line conditions as billion chronic growth a pulmonary people disease on and sleep new prior given suffer annualizing positioned driving increased in delivering high growth chronic Over are results is our clear that global to recent epidemic our or exceptional operating is are neuromuscular across the of business year. The disease. trajectory growth. ResMed operating markets, suffocation, to that insomnia steady model growth demand Software driven our double-digit in our us insufficiency a and and what profitable leverage results

health a that security cost, believe home. in location and optimal that's person's delivered the lowest We at possible. own should In highest case, lowest care the comfort be

in well We market-leading global enterprise for this including epidemic nursing leader care, are providing medical for residential strategic therapies equipment the as and as software home beyond. home

XX.X in global XX is ResMed that medical digital in billion solutions cloud devices connectable worldwide. countries into data leader XXX been medical over have over the nights over million with health the cloud of XXX% and sold

in people We sleep are apnea, clear X of leader market a billion over the globally.

Our end can tech positioned the health markets bring care big ongoing to under-penetrated. remain pharma consumer care believe ResMed potentially advances We latest is of new and patients big numbers home. provide where at significantly incredible uniquely into the system, in

complex health opportunities myriad their hundreds lower of they and a value, the navigate add improve patient care supporting reduce millions to as improve software journey to global have system. the friction costs and beyond take We're care hospital leader We with to to strategic people health control of interoperability of the of world to outcomes.

X% pathway the benefit Many care. Sales need from long-term grew of on category-leading our better help health on the AirSense get to and more and devices, solutions, can globally. platforms on year-over-year the therapy growing people and market we're and laser-focused people a our better better including products they sleep, to

around that, sales so COVID-related points quarter right higher year, in Excluding X% XXX than ventilator growth. of devices the onetime last devices global about grew third global basis the

XX global We working AirSense regulatory by and supply XX securing to are of platforms, AirSense -- connectable the the of We're market-by-market of increase cloud the maintaining X platform XXX% clearances. market-leading availability AirSense XX. X

continue we AirCurveXX a bilevel with in platform following its launch and the path period U.S. are launched recently our ahead. noninvasive the similar in We as and beyond ventilator

the Our ResMed demonstrating are benefits clinical of portfolio. mask teams the successfully economic and commercial

business masks expanding above globally. achieved year-over-year, Our accessories category XX% at in growth and or a the competitive market

mask frame AirFit designed proprietary a introduced such even and cope new It U.S. maintain create During seal a FXX. into market a our the better features the we person It fully called with a moving silicon the FXX innovation latest sleep. leverages movement. frequently nocturnal frequent to facial The technology is AdaptiSeal. the call cushion quarter, when during we to flexible technology is that

and the soon. Mask offering partner and as their We ease with mask we ResMed. and our look directly respiratory full-face and recommendations physicians and on and with and from commercial and ongoing accessory to the prescriptions. the to its markets forward drive are its love Patients FXX continue U.S. patients an ongoing to other swiftly their wallets clinical important FXX teams fit needs providers therapists success therapy market resupply are in for globally. voting and therapists its global programs ResMed's voting bring physicians to with the is of to use. are patients smallest their Physicians, for programs resupply of the element comfort, It of patients. respiratory their very the serve

adherence clinical their In patient to and our shows the cash a markets, outcomes pay programs better number caregivers. resupply that for have better patients Research adopted established lead that long-term been we by and subscription of have consumers. programs

home the our physicians, are providers. U.S., programs health patients for powered Brightree AirView for by myAir digital ecosystem, including medical our resupply equipment and for In

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initiatives do We demand up just that. ramping our to generation are

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on individuals, As we digital our progress continue tracking hard this metrics. health journey concierge are with to for create we

starts new and care in also choose tracking includes new starts provider-based journey at X.X myAir, physician contains our looking personalized including now breathing. users. million myAir which to app in million patient are to ecosystem, consumer where now our and better AirView, more people than in participate We better of records. We're sleep patient a engagement patient health XX their population

will their our health worldwide over system. billion the people drive suffocation for sleep X more more We care of into help who need the and

our to tracking screen like support We ongoing a believe sleep will Samsung sleep wearables further the Watch, consumer tech FDA for apnea. global Galaxy megatrends has de specifically driven growth. clearance X by which Awareness novo

Google's from wearables tech, capabilities big the Fitbit. including Watch similar expect Apple from We other and

population that of believe will from of focus addressed find by issues care of health we wearable COMISA. will and the by they or health many sleep wellness maintaining these And sleep we big obesity believe sleep the addition, sleep breathing physicians, with impacts the into field system. this a -- one sleep the pathway biggest could have while on sleep issues of or from have of patients is of that high of be have therapies. We In out big pharma therapies quality the including volume being during This our called consumers consumer control if tech own tracking, population help state incredible post sleep. they apnea significant the clinically patients of patients ways is like technologies disease these will an discovering taking bring for that new and insomnia that other both best patients love megatrend, people the related health, the other as attention coming on on their they apnea

patient Ultimately, increased we to for this long-term awareness will sustainable and believe lead ResMed. growth that

[indiscernible] diet, to the their a care pathway goals true their weight focused bring believe treat obesity. of they people health increased of consumer obesity with sleep that Our exercise their We ultimately, And with goal tracking to ResMed, for health. loss their management sleep wearables diagnosis, is positions care health weight, activating treatment for improving believe health. breathing routines. see and are utilization call educate from to tracking. sleep other new many and losing and as move on and people primary care I we that strive sleep wellness they at from their health to We into as awareness medical care them health here GLP-Xs what ongoing to while will are screening, funnel, Their health these

those patients new chronic considered these may and their such pathways of as been have that chronic patients. diseases patients awareness including this apnea, diagnosis previously ultimately believe We other to being into their care knowledge for treated driving of physicians, up sleep open from will or diseases treatment primary not

this our our So we more into more not channel. will drive motivated channel, but believe patients patients just into also

adhering data patients pressure are line claims through analyzed, the are to an airway analysis. overlap our data latest been and impact equals third-party what XXX,XXX is of analysis bottom seeking presented subjects and previously. quarter impact N GLP-Xs numbers The The an using data. our are the now GLP-Xs we tracking having improvement a that has With another up data a of to from positive an of show patient positive therapy. that incredible we on in ResMed de-identified

propensity GLP-X patients latest data higher therapy a For show drug. medication, the the taking a to over XX.X% positive start airway not pressure those prescribed

care over motivated recognized research for on $X.X at months these absolute sleep percentage system. We've These gold gender outcomes With standard economics for X.X new patients and class digital then impact and XX% an over patients there. here clinical points studies of it including GLP-X these opportunity XXX patients very analysis data help ResMed. of positive a higher. stay I care health in included thorough There forward points It's can States, for patients pharmaceutical points market, billion entering X have weight. you follow into to anatomy, patients equals in people higher better T breathe more by craniofacial to therapy. look system on detailed the patients GLP-X and now, at resupply are at through patients XXX analytics get business. our so and of percent who positive and as incredible for our we the the information higher a our XX-plus health the review longer. the clearly biggest remains our absolute health data therapy percentage globally. the a prescription. the equals and care rate T many as teams and and the Existing more basis treating epidemiology, basis undiagnosed We longitudinally, more tailwind and show XX patients As is who is with is ResMed prescription. age motivated work that universally these on well airway actually deck, data and sleep our very apnea them show apnea. full investor bringing faster pressure encourage to planet care are who sleep more the points right basis have people And resupply undiagnosed XX rate factors health GLP-X our months, The subject, for United sleep That's billion of

best-in-class patients health our XX% published In alternative digital best-in-class days. sleep patients that can solutions. by of high still apnea, treatments through goal platforms, pressure XX% for global of demonstrating our with achieve volume patients masks terms we of have achieving and a over very need have combining airway this these And positive our adherent market-leading sleep Even of we peer-reviewed market-leading our good over tech breathing, good device therapies. technology coming evidence just with through of and we that

called Europe path Narval. adhere and in to pressure can't to just market-leading investing the therapies That's We're Europe. the where their we're ResMed to as working therapy on latest airway planet has XD therapies, Western who such Northern despite patients the printed dental sleep devices in help technology and dental for to positive device apnea find second-line alternative

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to now our leveraging de-identified our nights our data technology investments, about XXX billion XX.X cloud digital in ecosystem pivot of health and XXX% connectable across Let's medical there cloud devices are that in talk our countries. the XX

portfolio artificial as well intelligence-driven in customer-facing of AI We as products are investing capabilities our in a ecosystem.

about ecosystem, compliance last roll in that's our We such the I States. talked in out quarter, these products out AirView that to continue rolling as coach United

journey, are people now, across forward. AI to with help move this for is same people We'll health solutions in sleep seeking scaled many and Asia will their capability capabilities and revolutionary our medtech and business journey, health before we'll continue patients they and become scale tech their really the then their they our front our that patients. move peers rolling then along well we progress this of become And progressing breathing tech look share out on we're We're and the as also region forward. on and GenAI health that as to and ecosystem and developed to doing patients generative Pac

platforms. by our our ventilator Our to ventilator respiratory support sustained life health across business be and continues platforms activity supported noninvasive

clinical obstructive evidence, and We in chronic new generating trials This driving continue a and at is long-term options. invest HFT for reimbursement opportunity cost-effective developing that call to pulmonary we disease economic high-flow at treat home focused pathways therapy a on to rate.

We beyond have increase, treatments this due The in epidemic. HFT for these of to insufficiency are and care health as focused high prevalence of we neuromuscular home. continues treatment address respiratory COPD on at and efficacy as well driving technologies diseases, low-cost high-tech to and adoption to

XXXX. had plan Turning X%. our growth and organic we in throughout business the to a a plan our with care Service fiscal to another of to XXXX field Software business year on single-digit basis high we as the year strong Software double-digit maintain accelerate fiscal for in as growth of remainder growth quarter Service We residential of care residential year-over-year an to

home the customer-facing Brightree between are capabilities. We and and medical its seeing U.S. channel synergies equipment our resupply ongoing in offering our core

patients. good driving care both are residential our health thousands growth serving and We while and SaaS many across hundreds sleep our core of breathing health businesses, of

Our XXXX. ResMed's portfolio, will created that residential is to care to SaaS organic growth business basis we're fiscal double-digit achieve on growth excited a global throughout year and business integral have

and sleep for drive our health our breathing those the capabilities We include OpEx but go across that across not managing continue interoperability, into R&D also and DAN. cloud health to just SaaS privacy and directly And compute, Brightree, our leverage brands go-to-market core MEDIFOX businesses, MatrixCare cybersecurity, by synergies business.

and synergies the leverage, care engagement drives and that that's solutions tech these residential breathing capabilities And health ecosystem, as right market-leading core SaaS this and and synergies there sleep facilities myAir infrastructure are platform and And business highly health and development med AirView customer including business in like beyond. capability products complement beyond well. our our software

at respiratory residential care transforming medicine are We scale. and

our markets. health We applying adopting are leading and across in developing, digital technology industry the

very top XX%. we efficiencies net way line to efficiencies the operating and XX% continue profitability on The discipline delivered up this We operations. non-GAAP and on We're team good progress income revenue increased made the scale cost all to our income that bottom up to and focused in non-GAAP and drive focused line accelerate driving quarter. growth,

differentiated sustainable most created driving lead products long-term most customers value most our comfortable, have health solutions medtech the industry and for solutions. in for and digital We quietest, smallest, worldwide, technology shareholders. the We intelligent connected with

to sleep the breathe where a solution health health better complete care. a that mask XX right medical each provides care or improved lives delivering XXX a helped device they During patient over better, patient live. million have last personal patient, with person by software and a we We've system months, lives higher-quality best-in-class for to directly a live a digital

to want hard gratitude every perseverance you. the for more express I my ResMedians work day. closing, Thank sincere their to and and dedication In XX,XXX today than

call Brett open I'll Brett. hand entire we'll then and that, and Sydney remarks, With San to up his over Q&A to in Over the Diego. with the between Sydney for you, to team

of financial We Great. the in constant of for for noted, increase XXXX. Group overview resupply reflects year third impact terms. year strong during I'll quarter Revenue currency Unless foreign had a quarter fiscal Thanks, X% portfolio. my headline applicable. QX. in billion, remarks $X.X an product movements our all currencies the performance Year-over-year revenue Mick. and are and growth constant results provide terms, the positive comparisons and had where consistent X% the was a In across to quarter today, prior increase in negligible revenue March quarter. in March and contributions currency our a on

geographic revenue by America our Canada Looking markets business, other while increased increased Asia Globally, from increased U.S., XX%. and sales by and masks increased and at our and revenue as Service other a sales X%. by Sales distribution by X%, in sales device in Latin excluding Software X%. Europe,

new XX% supported other sales regional Latin Device Canada ongoing by in patient by America sales solid U.S., the down while it by increased patient diagnosis, and both areas. in Breaking reflecting growth setups. and new X%, and increased by mask resupply

constant sales Europe, the $XX revenue markets, moderated increased growth from year of incremental quarter currency In by due a demand. other prior million approximately in device on X% to Asia Year-over-year and COVID-related basis.

other on on X% basis. a a constant currency increased by sales, Excluding device Masks increased currency and X% constant the by COVID-related sales revenue basis.

by a quarter, MEDIFOX X% our from performance strong DAN revenue from HME increased vertical. the and in underpinned as by continued Service March growth Software

During commentary of the be will today, to rest numbers. referring I my non-GAAP

a of earnings release. We our non-GAAP have quarter reconciliation the in press provided full GAAP third numbers to

XXX increase to increased in quarter. device The increase by manufacturing favorable was by an driven improved average points the and product cost by improvements basis Sequential freight margin basis March points. expense, reductions selling margin XXX Gross in XX.X% in prices. gross mix

that XX to have Disruptions around times. from Red this margin costs in negatively East freight QX potential and lead shipping by increased the arise We estimate our Middle XX headwinds will continue to the Sea We could gross monitor impact basis points. conflict.

Moving X%. a percentage increased for XX.X% the improved SG&A reflects to revenue cost as of on XX.X% prior by actions SG&A expenses savings the quarter. undertaken expenses. third ongoing period December early in and following restructuring expenses in to quarter and operating to compared the year discipline

Looking movements, range fiscal SG&A to percentage balance of XXXX. be for to and we XX% the in to forward of year as expect revenue the a subject currency expenses of XX%

R&D revenue the the R&D expenses by currency quarter prior expenses X.X% on as in of year period. a was for a increased the X% compared percentage basis. constant to X.X%

and Looking X% modest be year the quarter and the expenses. in forward underpinned expansion to XXXX. Operating as revenue our increased fiscal in movements, operating expenses for R&D of for currency growth, subject to range profit by revenue to margin balance of a the we percentage X% expect of gross by XX%, growth

interest $XX for Our million. the was net expense quarter

interest expect of year XXXX. the Given levels, $X to our lower be to we in in range of the $X fiscal quarter million final million debt expense

with broadly the quarter. for year the rate XX.X%, tax quarter effective consistent was Our March prior

be the estimate XX% XX%. of in tax fiscal to XXXX year range rate continue to our We will effective for

earnings net non-GAAP XX%. income March for share also diluted increased by Our increased by XX% the quarter and per

cash underlying $XX capital the was for operations million, flow XX, in for for depreciation net in of Cash in working the and totaled quarter amortization $XX expenditure quarter XXX a gross with quarter March and solid million, our $XXX from billion $XXX reflecting position. Capital On $X third balance quarter ended we sorry, $XXX have debt earnings and was -- million. improvement million. We the debt. the million

of Board $XXX our facility, and liquidity billion Today, Directors of $X.X had million. $X.XX revolver On to our March maintain XX, quarterly dividend quarter, under we approximately our position. we per a declared share. a During we the by available reduced drawdown for continue debt solid

we consideration for program to of the more shares from We authorized XXX,XXX employees During our value approximately under the buyback year the equity million million. $XX fiscal any share purchased per during the purchase to quarter, the shares quarter will previously of to dilution XXXX. balance $XX vesting continue year. plan of than This of for offset to

for hand Going to will in that, and forward, reinvest pay call tuck-in outstanding capital we continue to back growth down with plan R&D, to debt through deploy Amy. the acquisitions. And further I

over the Mick. instructions let's ahead back turn you call Great. provide then call. to and the Thank of to Q&A go and Kevin, Brett. run you, the Thanks, portion the

question [Operator today Marquee. Dan from coming is MST Instructions] from Hurren first Our

Look, modest That whereas about think predictably. half. I I just recovery more gross to perhaps a had wanted sharp, the you is the in margin to talked second gross ask margin recovery pretty

that So is I to recovery into just quarter fourth want sustainable 'XX? ask how and into

term and and that It's our walk go good these a on better launch carefully and Yes. very through a launch AirSense moving FXX And Dan. XX point, cost over have ago, programs got call the the long platform, some we masks, programs to better is obviously, margin last short-term talked quarter Thanks, as are effects gross new long-term move of quarters very at up price a our the about which term. of a our long point, quarter that the X as we we've question. ago

higher Some system. from XX from costs faster through our chain the semiconductor the impacts ago were of that and crisis flowing the X, that XX, through we're freight working months do crisis inventory to are is the able supply X,

the look, upset not as when I'm over-performs here. team my they So expectations did

Red Sea XX, that. to of points of of Brett we'll [Technical -- about of I'm Brett I'm that moderation As impacts look, in more sort detail But said, basis Dan, XX excited tens some Difficulty] of give on points, very QX, basis see couple due what can

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the gross know and Brett margin, over don't up. Okay. on I Great. off do cut answer you. there, to then over to follow hand where got I'll -- you to Brett, I'll question I Well,

Yes, Yes. land mix, product where in mix, improvements Thanks, of of geographic to FX, in given predict -- bit. the that have hard terms Mick. it margin, cost timing a movements costs. gross Not we is freight sure

the had that improvement expense a we Stable no through through efficiencies costs that so freight component helped a through, mix pretty into also all headwind longer strong that's manufacturing on there. and lot. coming it's So means and

So in QX. term, I the margin of gross remains to improvement. impacts is FY goal gross that's there reflected as And think course our that all will in Mick some come said, freight short in 'XX. margin cost the the But Sea improve Red over through

Next Laura UBS. question from coming is from Sutcliffe

could margin, much gross with indication much margin of that gross of give was manufacturing? possibly in sticking improvement us freighting was core XXX how point basis how an and Just you

you Brett, answer that. can

product the and manufacturing far mix bit there, with significant, and Yes. saw manufacturing also year-on-year We out their biggest cost Yes, reduction little the the I reduction Mick. contributors cost too, Sure. most were there. some improvements significant Thanks, right the which and contributors in biggest of mean the the expense increases, ASP improvements. a or a for some by of cost basis that freight the freight benefit drivers but own terms playing favorable points, in were XXX

able you falls us cost and tell it Are how between manufacturing of freighting improvement? sort to

XXX I that components, of to points. but of own material right basis those their contributing the I'd into say of get of say -- both would I in each won't are drawn specifics

RBC. next coming Our question Craig from is from Wong-Pan

Just impact home rest the on wanted world markets was from And coming through seeing whether to activity to from the care backlog you're of if [indiscernible] of touch much see with any there. companies? benefit

Craig. question, there including really the Thanks playing -- mean, And see you competitors one whole we got mentioned. look, the masks. rest didn't a out Yes. many has for Asia, time field. we've world, of on the it's It full I Europe, been yes, no, And in

there's anyone coming So change leaving side. no the back to mask on or

that number. large were quarter side, comping XX% We huge impacts. this device had year, the device of we no comping. Europe, very growth a Rest Asia, On last a World, we're

had year-on-year would and had up XXX in it good a This last devices, you on been we X%. out comp out, of take provision have And in China. World purchase, at you that big XX growth Asia, plus Rest so basis ago, points. large China ventilator a if ventilation from And year take Europe, there growth a COVID impact the X% so time year,

So I XX we're maintaining on market leader device markets look, We're the side. against second the all share the XX is the with AirSense at it world best got growing competitors. way and look the or the our the in AirSense platform in we've platform of with platform all

And so really strongly.

all the the So out and no their very, had from in ramp and strong competitive impacts over there. and very team from we from period major activity, get terms it restocking no supply performance impacts last major I think a of to ability the up

care up -- an up then we're devices, take If they AirSense those to and of needs. for not customer an with AirSense and the fulfill able order And we're we XX much being customer have XXs, as as able we it is no with can order. remainder fill not to fill we

good our of and chain commercial our our out so quarter teams supply as teams execution And really delivery by well teams there. as

David from Next question is coming from Bailey Macquarie.

just I impacting a by then might touching be Obviously, moment you're labs coming at COVID the new around patient the how starts how sleep we on us constraints new trend and want patient focusing maybe as PSG sense on a just you people to devices. U.S., And closing if to give perhaps? a touch of the also into trends and of they system? followed home just then seeing versus bit the supply sleep impact versus some testing on around had Can starts, can. on

Yes. the same X David. great components there, question to

strong of Canada, of pretty in you the quarter, saw time on new Latin starts, was that achieved in In of and of devices patient XX%. comp, terms a America, growth as we year U.S., this X% last

demand gen, on So U.S., sort is growth that we we -- our digits what this grow the what say digits if around market and doesn't beat America that and the of Latin market masks. single at the at in enough -- Canada is and high mid-single will say on Obviously, ResMed devices with is I'd device is this do quarter X%.

to quarter So strong. tell patient it's up I new is And patient dip, steady rebound, a said and this covered new that through we're into minority. We've the starts steady are now chain COVID sort we And get steady. the the our starting patients. state. that flow at you of can of but there, [indiscernible] flow back channel supply last we're has some been rebound to perturbations supply of There gone the that chain

the good into really of seeing So U.S. flow patients

As those look drug. that above seeing on being their patients we to these a I the remarks, at, seeing think start that quite at we're the I And but a flow as I equal we come prepared good that who big patients, for actually term. only GLP-Xs, in it's think without looking will a XXX,XXX on that's we're cohort. XX.X% prescription are really N patients and propensity people be said a long

cohort the of S-curve there's these think to long that's going long I penetration coming into of or of channel. I patients the think period a be time, a GLP-Xs and

new patient on So really starts. good

Snap look, in on subscription and our But got pay really yet many subscription And models large cash markets Technologies yes, runway more pay in aren't resupply our many in aren't the we've capabilities in resupply program who terms a U.S., good patients on and Brightree appropriate cash around a Brightree our particularly the developed with markets There's patients lot and who of there's and world. resupply, and left. markets. there's yet and

and patient in lot demand terms new good, in So -- [indiscernible] runway is both left reestablishing of left accessories resupply. on say whether is Resupply, a masks runway I or and but very of solid. lot it's would gen flow of a

next coming Our Anthony Mizuho from question is from Group. Petrone

June in secondary and Congrats on? that or specific when in the here. topic, that Maybe as data anything the attention honing get in you're we to final are readout, really there on should be paying we endpoints on we look sub-analysis house strong focused just the just meeting, staying views GLP-X maybe quarter ADA there, SURMOUNT-OSA the on And to Mick, readout. the on

for from they at to patients SURMOUNT-OSA X-day the Anthony. that the Thanks -- end since that using the trial. really And least Yes. yes, that had headline question, study results on that CPAP. at the had And had be we the been clear, washout look, just certainly, study had saw

that coming washout X- X-day this to really with at that reduction drug on is of the out laser-focused look of sort sort of in if low was in somewhere average around XXs. their in a and it the the of AHI coming at period end, XX%, do it math AHI, trial the So to placebo. to showed and XX% is on AHI average XX% you And you what sort of comparing the

pressure suffocating X any at study, patients were have XX right? patients of sleep minutes end on this sleep really These or position the airway more were AHI treatment. require so treated And on drug, moderate by average, positive apnea. the So every treatment sleep the planet would of after with be and plus

important thing most the I think to that's front. say right So up

secondary a improvements. interested bit, that we like come that in see the pressure remodeling all might up the study. What at reductions be be higher as in look little look look on the the to period data. release heart have because blood so that analysis them. the interested time, on took over readout will investigators be CPAP will June and interesting primary in get we have a where these is AHI. washout to GLP-Xs a sub-analysis It full this the they plus and therapy I'd outcomes at a here it they when will I'd if you efficacy, things And had and like. plus, CPAP the of slightly would those other be more that higher and and diluted But there depend reduction things where cardiascular happen the combination

patients This class it, therapy care from my particular and more. others. see but just we're And vast not and All we and percentage this resupply combination this XX equal sleep." we're -- drugs these are data that a I that gen from at gen great. the adhere I'm I fact up been presenting up drug seeing this taking fact higher tech. seeing our basis from on XX-month from mean, this As tirzepatide "I've But funnel that real-world and and new not not resupply X absolute my patients real-world we're means the of only patients XXX,XXX the evidence, PAP. now at company, is semaglutide start patients. exercise XXX particular months we more, They these that come X.X%, diet, majority letters points, points the N included of my CPAP and get into a goes XXX drugs, now saying, GLP-X I'm anecdotally goes in more patients new new using just using points. the basis analysis in

but tailwind be media-driven tell pharma. this into to companies fact patients of doing do this future. can the are Google's of going you, our is it big and to now with a early and social there we somewhat funnel. going gen, Fitbit capital in think it business. advertising We tech at And to Watch, stages, net see be the the We've Apple I to will the trillions going be are is these dollars Samsung are patients Watch between the demand and big for that in we to very started our And bringing think drive own

So study, we'll this from be what that's for Anthony. looking

Next question from today from Kalia coming is Suraj Oppenheimer.

Mick, can all you me hear right?

throughout Hopefully, Suraj. answer. this and question our your phone can, and I good Yes, phone are

any than Mick, belaboring first on background the there gross soft. gross a for of quarter. margins margins this and if congratulations was were contribution, forgive in of Mick, a has Mick, me forgive couple is U.S. intrinsically And quarter. and margins, reasons if quarters nice lower specifically, a me So I one cited foremost, this OUS. the correctly, uptick noise. ago, which higher recall

has up key a here. ticked maybe those also, you aspect reconcile U.S. quarter can missing This you us help Can -- nicely, picked X? has contribution I'm up,

go But to at number look hand Brett were quarter. gross Suraj. as to Yes. positives detail. a a a I'll from such over Thanks have I'll I of for that question, number it factors the first, margin have for this and great my perspective, there were

had chain as teams goods was excellent The Not direct down. our sold our COGS by global supply on just getting work first one to well. that of but we cost O-COGS work

inventory -- the high-cost to some and we And some and done work stock of reengineering bring moved system so been to revalidation able market. new through the worked through inventory and that product of high verification work has we've

margin you AirSense ago the have XX like -- said earlier, XX businesses, growth in flow of and our a had U.S. ventilation very if at good our We platforms. Look, margin some I masks from world. certainly the issues, That it's we our had XX% as months around big impact lower America ago. flow on Canada, the other and and mean, we year software generators AirSense a Latin between as XX the has growth look than and in business I a

sort to of to our back well. get just business This in I to what able think quarter, masks our operational chain, all is is steady of those parts -- And XX-year a in core we're to to back double of after state to back growing growing we're where at single inventory, do COVID that history operating high We're the we're were digits ResMed and something done well. supply excellence is side. cost core and of really a have competency. able perturbations excellence ResMed We we in mid- digits accessories execution, our and has

such the any further So want to main gross detail? the that's margin Brett, quarter. what great factors in are do provide I'd us say you for achieving

Yes. would is the I the only Thanks, modest. to tends geographic mean pre mix Mick. add be thing impact I

is much than that, geographic more mix. -- but You do see example, impact product has usually for mix

fair, margin it's It's from of impact an So geographic substantial. but less mix. on our way either it's not

Kaczor from Andrew coming is Blair. William from question Margaret Next

period And efforts again, data what programs you on me the might demand to partnership the demand think I in time and those wrong, touch demand as Just of maybe and My invested guys call. drivers but you that that celebrity the can these global partnerships? is would that [indiscernible] that. comes more any make level sources, growth. sporadically one that demand on again, from create? it referenced Over understanding give market if be of news can details inform the kind gen -- I'm But drivers us impact on market wanted have helpful. mind earlier is gen, gen any you level, Podcasts, key you're you letters, can think to recollection trying local to help maybe I on tell the growth that

the from we're level learn It's taking yes, funnel next on how the Well, scaling to going and thanks, years it our Margaret. many of of getting question globally. into experience and patients a great to

know, in around Zealand, countries, and Singapore campaigns cash you others As we've pay had direct-to-consumer of the our New sort Australia, world.

the joint those said, and or let's We've onboard, assets Officer, Chief over venture, establish changes made Global of yes, as all was that in States United health One Officer. now many we health joint by the and capability learned business just bring XXXX marketing -- you whole to big own like us within really the -- in our metropolitan bringing Marketing function country in the across but years we've business whole that experiments be of Global in ResMed we across Chief area taken Officer, venture model also sleep said, like Product allow that to think and not where X did and way, property that Korea. we is to and going the breathing that intellectual country to we capability the of a our operating JV. do that okay, Australia I Global Revenue or another that X Singapore statistical a in or Chief And last

that at globally. ways we can scale Let's look

as where So analyze social directly we've but I at there. the when will be media can national, primarily go they be will hardcore and this going exactly we're media-driven it demand other will fiscal got this a the every and to we before local, it is platforms also And tell to social go we we're throughout do there, without before that it. that do you Look looking to how, be they'll And and from global. here Margaret. I done. signaling we're is this, The global gets and to campaign. going single at metrics, team measured, media is about believe public, it thing did to gen. what influencer gets as sponsorship driven One portfolio, XXXX, yes, going going different global. impact -- what in that here talk is we're scales, And be but ROI and campaign a going have year

then marketing impact will and that and cultural measuring of direct the spend. that will The be be we'll impacts ROI national be local

in you As the saw quarter, efficient very quarter. on this we were SG&A

this but SG&A. to state growing those better and at and growth, our And areas into below, back gen AI back well steady growth Not to go our on will go like generative core demand investments on of in go in up that. will AI. getting revenue, We course, R&D will

demand I Asia you helping gen work a in big that health patient well. digital Pacific, can tell on in AI be as that the generative our a will concierge part some of of channel through

you we'll initiatives. But there. So Margaret, a we great demand beyond gen update year and R&D combination SG&A and as move on our XXXX between and fiscal question, through

Janu from E&P. question Gretel from Our is next coming

now the gross more FY is we've that thinking about achieved about seen margin margin that the how a FY months? last into normalized kind we so lot in additional of improvement and trajectory into think 'XX? just you've to to from come the of 'XX, headwinds likely the should that gross be want go And going Just XX to where quantum the of back step-up to

Gretel. Yes. this you're quarter. Thanks supply finance performance from question, and with chain team, for questions Brett, getting all this the global great your the our

projections on you 'XX Gretel's margin answer for question. to to over gross So FY for

the that. that of But good part. Gretel, and we lot saw a project, much focused continuous if out to improvements on supply year-on-year really on big Mick. we the mentioned and some I I margin look cost ago we -- always a freight plays as have it's gross manufacturing of improvement yes, to efficiencies, mix, would product saw Yes, -- headwinds of cost improvements Yes. there's so running market. months there's increase facing and quite We're into We're played now or timing a sort and we're been an programs earlier, getting as increases you these that there, the also devices to in have there's cost Thanks, not do forward, XX obviously X the the mean, opportunity component the hard well. that

So improvement then stabilizes, an gives cost to now that us programs. as that opportunity work on

that. we're focusing on So

goal a probably goal we 'XX. without now is need the as continuous And but targets, a of fronts, think I our more being improve improvement on gradual or certainly, -- So FY program the specific which number we've is do through over got course 'XX. margin to FY around that gross of work to on improvement

Fishman Your is question next ] from Brett coming from [ KeyBanc.

especially I think seeing couple the really you're PAP of really the updates the for from [ with me what appreciate to increase of stood lot some data I pharma. out marketing type likely on And was that ] the the GLP XX%-plus isn't some front. even reflecting provided considering a activity in of last of then you And updates users? this the that guys rates have

ahead, maybe So diagnosed curious actually OSA? looking potentially we're go then driving where the factors you seeing under this number that think OSA with could some might And this with once correlation. be of that and indication prescribed an patients are

obviously analysis. subjects over in out a in are got physicians lot it's with across really it we question. and anecdotal new quite the through one, are XXX,XXX It's that the time. medications data Western and I we're These But way all get and Brett, countries. Europe good this network, information play positioned right XXX the following Yes, a strong quantitative that very U.S. from from we who our frontline primarily now. to involved research clinical folks focused on folks think of the a will complex We've

seen physician. or seeing in care watch is medtech. But this to to of who we've pressure we to their -- new obesity, here there. only some health GP weren't as care weren't diseases. other start now from previously frequently drive now this go PCP, but quite they peers now system treated XX.X% There GP in to that their higher and pharma we've not are But it's for our states biotech They that other therapy terms and not airway chronic that recently primary that disease propensity yes, as our They therapy. seen choosing into bringing is could extraordinary positive this people of their the hypothesis, level. innovations are in many from have factors that are And getting other

the beyond. are we're is And so and early closely. U.S., in very drugs Europe But days penetrated it as watching it Western those

I patients our them care learn more, big the of on on gen pharma through that didn't to them this the a own will airway these patients the prepared will and through lots question that get demand gen and seeing -- of remarks, of to they're on advertising worth trillions lots job dollars bring best in we'll then to And of into driven think our will days. help forward, coming one yes, tech. that how talked pressure find patients be and about seeing my do I keep updating be demand of as funnel. bring path we those will every capital big we'll go to we're these And think I quarter we're is our the taking how on funnel, early we we flow that positive the move And that best therapy. as and by the of we're best therapy therapy

people's maybe they're they're if oximetry, breathing looking of find think patients be tens there'll writs wearables not and of I millions at not well. at breathing out looking that sleep, helping fact sleeping looking nocturnal hundreds nocturnal the on of at well, millions,

pharma I forward, than Brett. actually that we'll we might that But watch big as wave think be move the higher for question, thanks tidal way. the a and tidal

Company. is Your coming from from Mike Needham Matson next & question

Yes.

So category? can an share is? And about that is the ventilation noninvasive so, with up to pick market some this how news in opportunity exiting do you is if the you big talk there market, that [indiscernible] ResMed for think maybe

point, life claim bilevel. -- to Yes. I will be this the Thanks support Mike. is competitor and for think the leaving mentioned coming ventilation. at CPAP, still They question, with back market U.S. the APAP for And you

of reach are that area noninvasive bilevels noninvasive they ventilation. an ventilation, So

So XXXX. we We XXXX, expect Look, the world just sales ago market. think there in there in the into them volume back there crisis, 'XX, XXXX, were COVID Obviously, ventilators. that we're large lapping into we was a a sold in where quarter ventilators I through large even saw very of China opportunities are year ventilation. talked in about of a

And so the like, high. the into you of ventilators if supply the I think market -- is quite

to immediate there's in So whatever no our customers needs are huge wherever whatever we care by they U.S. have. in our But they take sort and the leaving of are, support there they're country competitor opportunity ventilation of life

your the the noninvasive in growth XX of driving together these AirCurveXX. leads ventilation. APAP and is and of types STI question, has our the patients S, highest highest All around has us, material For and is our AirSense COPD the bilevels CPAP, respiratory really level an AirCurve of ventilation form ventilation at our to ST ASV, adaptive And AirCurve more it and AirCurveXX, with which terms AirCurve or of insufficiency. level, neuromuscular noninvasive that to set disease with treat AirCurve

there pop. in worldwide It's of do will to Many of better, sleep these future. for care opportunity. and And take platform there them AirCurve It's We neuromuscular it's the for opportunity. ResMed and them for ResMed a there a planet our best treat fantastic not long-term be a COPD the platform better And be and to us think respiratory insufficiency. long-term It's of patients the to a opportunity huge them. is has going in hundreds now, patients them growth growth help to millions breathe short-term is disease that. have

Our Lyanne Harrison from Bank of question is coming America. from next

are there, have can the data or also patients data, the data, what in do some percentage or loss mild back on But as a you trend we to for weight you should of on OSA lower whether then trend is severity of ceased to secondly, good resupply XXX there Mick. this therapy points. moderate come the patients, the result improvements a CPAP drugs? basis basis real-world separate the Obviously, might the categories? seeing sort set, XXX of I points who data and anything share And

Yes.

We the it's that set excellent. So real-world multiple is prescribed at I'll Lyanne, sort are It's parts to over future, which look, to good are really XXX,XXX and therapy slice airway look plus. GLP-X in patients of that on pressure and to XX dice with and yes, question, level, it positive address XX, by to a by look geography data to X and carefully. by out We'll we're cohort the data and can to by XX, it. been largest age, the a and gender, tracking slice is high XX and say, very there there others. to will AHI it dice laser-focused have it on

internal can marketing so after. that that drive and which to of lot work will we A for be our patients know social can best go media we

quit is are. men in more GLP-Xs adherent information people than GLP-X public rate they're more that the therapy is out than the The and instance, the For women that men, than are a there women. using lot men higher GLP-Xs to

time, it. we of we're will, tracking that over release information so publicly, a And lot and

seen Look, -- say, correlation a because information huge quitting we're all get of very in that. we just doesn't It's way it's that the proud to other It we've when compute of a our people people GLP-X. we a for we got. haven't data around see in. We XX% coming as tailwind at the PAP therapy adherence,

at really when their before the on a that have or there, or they a reasons their can't CPAP look condition where well they OSA. is to or as psychological mask For a then claustrophobia, don't treatment they in fact we it where even blame the it's insomnia insomnia as asleep it all have to parallel XX% of it the fall need why, get is and

to coming rest right for continue health to to And slice all world path by with we way the on best to looking AHI, to you can them journey. up our and challenge by help the the sure But that. But patients. types we'll we keep patients So best seeing make therapy. gender, a by of as digital trend that huge and and and is of we're look, at that get patients in, find scale great age, dice reasons more more the update we're motivated the do help now, find that of

from Next question is coming Steve from Wheen Jarden.

the rely kind you're that I just it XXX% platform pathway and had the the upon. being around a AirSense XX its availability and of to question

as for and year could into update you give how to of If an that the 'XX? just looks remainder us perhaps this

Yes. right Thanks for the that X with still the Steve. we're question, start product fact now. this China AirSense out selling I'll in

get to we've to balance And chance every XX there's we AirSense the right? then groups quickly. well is market to of the And awesome biggest XX becoming for already XXs. We as primary and useful the make markets the growing But do while nationals. global AirSense you fair you're and AirSense It's order the from so statewide to from talking to in has XXs. is a in a this our period AirSense it AirSense getting of think AirSense as XXs U.S. majority markets. to the tell in I wants large the so regionals into materiality of XXs And the rid technology can the primary got who will XX many to what already with the platform The small, a limit around great customers flow customer AirSense no long of because can't sure I get there's well rid where person completely, an because the cover getting ResMed time. sometimes AirSense XX world difference take is

the in majority already over U.S. we're the So

quickly XXs France, XXs the Japan, around U.K. AirSense they'll quickly majority the very at As big Germany, those beyond. -- world, the we ramping get are across other to look and areas. are The markets and ramping AirSense

As XX. at we countries the look top those more hundreds the more in of world companies, around

effort. job to the separate and as these time prep and is, paperwork the Our I get regulatory clearances, require some said remarks, of all countries in

so can can regions. get we we be see to used we clearances have with to if that working multiple are do across that. can And how quickly authorities And we analyze also

And your countries to so in hope we're that Steve, I all working to hard in AirSense majority XX very question. get the answers and countries. all

Capital. from coming Hadassin is question Saul from next Barrenjoey Your

it one third another Just for the I the quick of Brett. came since XXXX. end into has down the been, quarter. Brett, quite just at It's balance, lowest the looking inventory significantly inventory think,

think wondering Just to you where to Or sort demand? can here? you you value dollar it down drive product of need to you think inventory sort as think Do from of start further? relates rebuild that goes you

Yes.

have we I think that for I while -- teams yes, now. working mean had our hard been on a

and inventory, We're the sheet in balance the targets to close So getting which starting there great. to see you're results the our is inventory. in on pretty

gains It's say modest making supply now. reductions, could and there there. So modest around be demand there sure could balancing it's -- more I'd be

it's say now to inventory. I'd where the at kind pretty So targets close on for of we're

question final Our is coming today from Jefferies. from Matthew Taylor

based them? know Taylor. seeing It's where the thoughts you're But maintaining decree? are or share pricing returning. return Philips. the said on any they're or to Coming any discounts pressure Mike covering markets you when from you on U.S. growing they might consent for Toomey the pricing I in market significant to And Matt back

for has that and where markets trying competing value. that they're competitor new returned question, value, sort no, we're they with as X start Yes. on they in the with is the for compete to sort look, Mike. And and the what they're X% of Tier Thanks as seeing in the Tier primarily, they're And from come patients back of X share market, players. pricing

a So in in Asia, technology our global local share or market touching a and the Europe in leader space. this player global player and local as leader they're not

data, lowest efficacy, is that value. they myAir that that creates work to market physicians the and of ourselves the really do each out number ecosystem whole the been because the we've love entrench cost, were of love digital our with And to and we've years able these the technology patients got highest best engagement

the pricing in -- So have competing in we they really those seen Tier Tier players as markets. come X value for X, with and

from into U.S. reenter don't market, they'll new to patient I As know. when share the X%

your It inspectors a severe number of do on own normal sort one. is of has Xx very can decrees. a consent This inspectors. a the analysis You lot one of

But in do all that. that way look, and beat I We've a them compete whenever XXXX winning that. from back first were us got and players to and competition question. come them I they of market. from look back, constraints versus the to that X to come the we have We'll forward to there competitor taking to think after continue now. When competition. share Thanks XXXX, they'll the no, great XXXX. on and lot for from they X good with

like over the of We to have closing any I'd session. reached our question-and-answer back the to end comments. Mick turn for floor further

Well, and -- coming thanks to runway. and our us system. Great. front shareholders. we for XXX better, The to joining people to better healthier call, countries. more We into huge in and and help is over all Kevin, sleep incredible breathe ResMed This an health this largely It's opportunity of and stakeholders of untapped. the thanks, especially in will see benefit our them and lives better as live care help happier more

and call XX,XXX do you for listened to and back it today you hand also to call the shareholders day. With who can we out. this of Thank all every Amy that that, I'll many are close you and to ResMedians,

your your Mick, Great. appreciate do listening. Thank thanks, you, for We and time. everyone, and interest

directly. Conference have please to out. any Call. to don't Quarter additional turn you it concludes If hesitate you Third This Kevin, this XXXX reach close back out officially questions, ResMed's I'll to

Fiscal Thank XXXX Earnings Year you. This Webcast. Live ResMed's concludes Third Quarter

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