What powered ResMed’s Q2 earnings despite supply chain challenges

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What powered ResMed’s Q2 earnings despite supply chain challenges

 What powered ResMed’s Q2 earnings despite supply chain challenges
Image source: Ipopba | Megapixl.com

Highlights

  • ResMed recorded robust top line growth across all its operations during the second quarter.
  • The company’s revenue increased 12% to US$894.9 million.
  • The net income was also up 12% to US$201.8 million.

ResMed Inc (ASX:RMD) on Friday reported a double-digit topline revenue growth, due to high demand for the sleep and respiratory care products, and solid growth in the software-as-a-service segment in the three months ended 31 December.

The company is also expected to have benefitted from a major product recall by one of its largest competitors. The firm’s major rival Philips is currently dealing with a major 5 million plus CPAP device recall.

Despite falling short of market expectations, the company recorded robust top line growth across all its operations.

Highlights of sleep treatment focused medical device company’s second quarter (FY22) update:

  • Revenue increased 12% (13% in constant currency) to US$894.9 million
  • Gross margin shrank by 230 basis points to 57.6%
  • Net income up 12% to US$201.8 million
  • Diluted earnings per share up 11% to US$1.37

What did the company’s management say?

The company said that it performed well during the given period despite the supply chain challenges that limited additional access to critical electronic components. 

“Our second-quarter results reflect continued strong performance across our business resulting in double-digit topline revenue growth, driven by ongoing high demand for our sleep and respiratory care products, and solid growth in our software-as-a-service business,” said ResMed CEO Mick Farrell.

“We are investing in medical device research and development, as well as digital health innovation that will unlock value across the healthcare system,” he added.

Meanwhile, ResMed share price last closed flat at AU$31.40.

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