ResMed's Q2 2025 Earnings Call: Unpacking Contradictions on FX Impact, Patient Growth, and Margins

These are the key contradictions discussed in ResMed's latest 2025 Q2 earnings call, specifically including: FX impact on earnings, patient growth drivers, the impact of tariffs, and gross margin expectations:



Strong Financial Performance:
- ResMed reported global revenue growth of 10% in Q2, with device sales growing 11% and masks and other sales increasing by 11%.
- The growth was driven by strong market performance across the U.S., Europe, Asia, and other regions, along with the ongoing availability and launch of new products like the AirSense 11 platform.

Gross Margin Expansion:
- ResMed's non-GAAP gross margin increased by 230 basis points to 59.2% in the December quarter.
- This increase was mainly due to manufacturing and logistics efficiencies and component cost improvements.

Investment in R&D and Digital Health:
- ResMed continues to invest approximately 6% to 7% of revenues into R&D, focusing on creating advanced devices, masks, and software solutions.
- The ongoing development of digital health platforms, such as the myAir app and Dawn (a sleep health concierge platform), aims to enhance patient adherence and health outcomes.

Impact of Megatrends on Patient Flow:
- The convergence of consumer tech and med tech, with devices like the Apple Vision Pro, is expected to drive more potential patients to seek information regarding sleep health, which could benefit ResMed's patient funnel.
- ResMed is preparing infrastructure to capture and convert these potential patients into appropriate diagnosis and treatment pathways for sleep apnea.