10-Q: Quarterly report [Sections 13 or 15(d)]
Published on
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
______________________________________________________________________________________________
FORM 10-Q
______________________________________________________________________________________________
(Mark One)
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended September 30, 2026
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from _______to _______
Commission File Number: 001-15317
______________________________________________________________________________________________
(Exact name of registrant as specified in its charter)
______________________________________________________________________________________________
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
(Address of principal executive offices, including zip code)
(858 ) 836-5000
(Registrant’s telephone number, including area code)
______________________________________________________________________________________________
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| x | Accelerated Filer | o | ||||||||||||
| Non-Accelerated Filer | o | Smaller Reporting Company | ||||||||||||
| Emerging Growth Company | ||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
At October 26, 2026 there were 140,657,071 shares of Common Stock ($0.004 par value) outstanding. This number excludes 50,441,545 shares held by the registrant as treasury shares.
RESMED INC. AND SUBSIDIARIES
INDEX
Part I | ||||||||
Item 1 | ||||||||
2
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
Item 1. Financial Statements
RESMED INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Unaudited)
(In US$ and in thousands, except share and per share data)
| September 30, 2026 | June 30, 2026 | ||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net of allowances of $ | |||||||||||
| Inventories | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Assets held for sale | |||||||||||
| Total current assets | |||||||||||
| Non-current assets: | |||||||||||
| Property, plant and equipment, net | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Goodwill | |||||||||||
| Other intangible assets, net | |||||||||||
| Deferred income taxes | |||||||||||
| Prepaid taxes and other non-current assets | |||||||||||
| Total non-current assets | |||||||||||
| Total assets | $ | $ | |||||||||
| Liabilities and Stockholders’ Equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued expenses | |||||||||||
| Operating lease liabilities, current | |||||||||||
| Deferred revenue | |||||||||||
| Income taxes payable | |||||||||||
| Short-term debt, net | |||||||||||
| Liabilities held for sale | |||||||||||
| Total current liabilities | |||||||||||
| Non-current liabilities: | |||||||||||
| Deferred revenue | |||||||||||
| Deferred income taxes | |||||||||||
| Operating lease liabilities, non-current | |||||||||||
| Other long-term liabilities | |||||||||||
| Long-term debt, net | |||||||||||
| Total non-current liabilities | |||||||||||
| Total liabilities | |||||||||||
| Commitments and contingencies (Note 10) | |||||||||||
| Stockholders’ equity: | |||||||||||
Preferred stock, $ | |||||||||||
Common stock, $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Retained earnings | |||||||||||
Treasury stock, at cost, | ( | ( | |||||||||
| Accumulated other comprehensive loss | ( | ( | |||||||||
| Total stockholders’ equity | |||||||||||
| Total liabilities and stockholders’ equity | $ | $ | |||||||||
See the accompanying notes to the unaudited condensed consolidated financial statements.
3
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations (Unaudited)
(In US$ and in thousands, except per share data)
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
Net revenue - Sleep and Breathing Health products | $ | $ | |||||||||
Net revenue - Residential Care Software | |||||||||||
| Net revenue | |||||||||||
Cost of sales - Sleep and Breathing Health products | |||||||||||
Cost of sales - Residential Care Software | |||||||||||
| Total cost of sales | |||||||||||
| Gross profit | |||||||||||
| Operating expenses: | |||||||||||
| Research and development | |||||||||||
| Selling, general, and administrative | |||||||||||
| Total operating expenses | |||||||||||
| Income from operations | |||||||||||
| Other income (loss), net: | |||||||||||
| Interest income | |||||||||||
| Interest expense | ( | ( | |||||||||
| Gain (loss) attributable to equity method investments | |||||||||||
| Gain (loss) on equity investments | ( | ||||||||||
| Gain on divestment of subsidiaries | |||||||||||
| Other, net | ( | ||||||||||
| Total other income (loss), net | |||||||||||
| Income before income taxes | |||||||||||
| Income taxes | |||||||||||
| Net income | $ | $ | |||||||||
| Basic earnings per share | $ | $ | |||||||||
| Diluted earnings per share | $ | $ | |||||||||
| Basic shares outstanding (000's) | |||||||||||
| Diluted shares outstanding (000's) | |||||||||||
See the accompanying notes to the unaudited condensed consolidated financial statements.
4
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Comprehensive Income (Unaudited)
(In US$ and in thousands)
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Net income | $ | $ | |||||||||
| Other comprehensive income (loss), net of taxes: | |||||||||||
| Unrealized gains (losses) on designated hedging instruments | ( | ||||||||||
| Foreign currency translation gain (loss) adjustments | |||||||||||
| Comprehensive income | $ | $ | |||||||||
See the accompanying notes to the unaudited condensed consolidated financial statements.
5
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Changes in Equity (Unaudited)
(In US$ and in thousands)
| Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||||||||||||
Balance, June 30, 2026 | $ | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||
Common stock issued on exercise of options | — | — | — | — | ||||||||||||||||||||||
| Common stock issued on vesting of restricted stock units, net of shares withheld for tax | — | ( | — | — | — | — | ( | |||||||||||||||||||
| Treasury stock purchases | — | — | ( | ( | ( | — | — | ( | ||||||||||||||||||
| Stock-based compensation costs | — | — | — | — | — | — | ||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | — | — | ( | ( | ||||||||||||||||||
| Net income | — | — | — | — | — | — | ||||||||||||||||||||
Dividends declared ($ | — | — | — | — | — | ( | — | ( | ||||||||||||||||||
Balance, September 30, 2026 | $ | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||
See the accompanying notes to the unaudited condensed consolidated financial statements.
6
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Changes in Equity (Unaudited)
(In US$ and in thousands)
| Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||||||||||||
Balance, June 30, 2025 | $ | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||
Common stock issued on exercise of options | — | — | — | — | ||||||||||||||||||||||
| Common stock issued on vesting of restricted stock units, net of shares withheld for tax | — | ( | — | — | — | — | ( | |||||||||||||||||||
Treasury stock purchases | — | — | — | ( | ( | — | — | ( | ||||||||||||||||||
| Stock-based compensation costs | — | — | — | — | — | — | ||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | — | — | ||||||||||||||||||||
| Net income | — | — | — | — | — | — | ||||||||||||||||||||
Dividends declared ($ | — | — | — | — | — | ( | — | ( | ||||||||||||||||||
Balance, September 30, 2025 | $ | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||
See the accompanying notes to the unaudited condensed consolidated financial statements.
7
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In US$ and in thousands)
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | $ | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Amortization of right-of-use assets | |||||||||||
| Stock-based compensation costs | |||||||||||
| (Gain) loss attributable to equity method investments | ( | ( | |||||||||
| (Gain) loss on equity investments | ( | ||||||||||
| (Gain) loss on divestment of subsidiaries | ( | ||||||||||
| Non-cash restructuring expenses | |||||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable, net | |||||||||||
| Inventories | ( | ( | |||||||||
| Prepaid expenses, net deferred income taxes and other current assets | ( | ||||||||||
| Accounts payable, accrued expenses, income taxes payable and other | |||||||||||
Net cash provided by (used in) operating activities | |||||||||||
| Cash flows from investing activities: | |||||||||||
| Purchases of property, plant and equipment | ( | ( | |||||||||
| Patent registration and acquisition costs | ( | ( | |||||||||
| Business acquisitions, net of cash acquired | ( | ( | |||||||||
| Purchases of investments | ( | ( | |||||||||
| Proceeds from divestment of subsidiaries, net of cash divested | |||||||||||
| Proceeds (payments) on maturity of foreign currency contracts | ( | ||||||||||
Net cash provided by (used in) investing activities | ( | ||||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from issuance of common stock, net | |||||||||||
| Taxes paid related to net share settlement of equity awards | ( | ( | |||||||||
| Purchases of treasury stock | ( | ( | |||||||||
| Repayment of borrowings | ( | ||||||||||
| Dividends paid | ( | ( | |||||||||
Net cash provided by (used in) financing activities | ( | ( | |||||||||
| Effect of exchange rate changes on cash | ( | ||||||||||
Net increase (decrease) in cash and cash equivalents | ( | ||||||||||
| Cash and cash equivalents at beginning of period | |||||||||||
| Cash and cash equivalents at end of period | $ | $ | |||||||||
| Supplemental disclosure of cash flow information: | |||||||||||
| Income taxes paid, net of refunds | $ | $ | |||||||||
| Interest paid | $ | $ | |||||||||
| Fair value of assets acquired, excluding cash | $ | $ | ( | ||||||||
| Liabilities assumed | ( | ||||||||||
| Goodwill on acquisition | |||||||||||
| Cash paid for acquisitions | $ | $ | |||||||||
See the accompanying notes to the unaudited condensed consolidated financial statements.
8
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
(1) Summary of Significant Accounting Policies
Organization and Basis of Presentation
ResMed Inc. (referred to herein as "Resmed", “we”, “us”, “our” or the “Company”) is a Delaware corporation formed in March 1994 as a holding company for the Resmed Group. Through our subsidiaries, we design, manufacture and market equipment for the diagnosis and treatment of a broad range of sleep and related breathing health disorders, including obstructive sleep apnea. Our manufacturing operations are located in Australia, Singapore, Malaysia, France, China and the United States, or the U.S., and our major distribution and sales sites are located in the U.S., Germany, France, the United Kingdom, Switzerland, Australia, Japan, China, Finland, Norway and Sweden. We also operate a software as a service, or SaaS, business in the U.S. and Germany that includes residential care software platforms designed to support the professionals and caregivers who help people stay healthy in the home or care setting of their choice.
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP, for interim financial information and with the instructions to Form 10-Q and the rules of the U.S. Securities and Exchange Commission, or the SEC. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all necessary adjustments, which consisted only of normal recurring items, have been included in the accompanying financial statements to state fairly the results of the interim periods. The results of operations for the interim periods presented are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2027.
The condensed consolidated financial statements for the three months ended September 30, 2026 and September 30, 2025 are unaudited and should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K, or Form 10-K, for the year ended June 30, 2026.
Reclassification of Prior-period Amounts
During the first quarter of fiscal year 2027, we revised the presentation of restructuring expenses and amortization of acquired intangibles in our condensed consolidated statements of operations. Restructuring expenses, which were previously presented as a separate line item within operating expenses, are now classified within cost of sales, research and development expenses, and selling, general and administrative expenses based on the function of the associated costs. In connection with this change, we renamed "restructuring expenses" as "restructuring and business transformation expenses" to reflect the broader nature of the costs included within this category. Amortization of acquired intangibles relating to cost of sales is no longer presented as a separate line item within cost of sales. Amortization of acquired intangibles relating to operating expenses are now classified within selling, general and administrative expenses.
9
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Three Months Ended September 30, 2025 | |||||||||||||||||||||||
| As previously reported | Restructuring and business transformation expenses | Amortization of acquired intangibles | As reclassified | ||||||||||||||||||||
Cost of sales - Sleep and Breathing Health products | $ | $ | $ | $ | |||||||||||||||||||
Cost of sales - Residential Care Software | |||||||||||||||||||||||
| Cost of sales (exclusive of amortization shown separately below) | $ | $ | $ | $ | |||||||||||||||||||
| Amortization of acquired intangible assets - Sleep and Breathing Health products | ( | ||||||||||||||||||||||
| Amortization of acquired intangible assets - Residential Care Software | ( | ||||||||||||||||||||||
| Amortization of acquired intangible assets | $ | $ | $ | ( | $ | ||||||||||||||||||
| Total cost of sales | $ | $ | $ | $ | |||||||||||||||||||
| Gross profit | $ | $ | ( | $ | $ | ||||||||||||||||||
| Research and development | |||||||||||||||||||||||
| Selling, general, and administrative | |||||||||||||||||||||||
| Amortization of acquired intangible assets | ( | ||||||||||||||||||||||
| Restructuring expenses | ( | ||||||||||||||||||||||
| Total operating expenses | $ | $ | ( | $ | $ | ||||||||||||||||||
| Income from operations | $ | $ | $ | $ | |||||||||||||||||||
Revenue Recognition
In accordance with Accounting Standards Codification, or ASC, Topic 606, “Revenue from Contracts with Customers”, we account for a contract with a customer when there is a legally enforceable contract, the rights of the parties are identified, the contract has commercial substance, and collectability of the contract consideration is probable. We have determined that we have two operating segments, which are the sleep and respiratory disorders sector of the medical device industry, or Sleep and Breathing Health, and the supply of business management SaaS to residential care providers, or Residential Care Software. Our Sleep and Breathing Health revenue relates primarily to the sale of our products that are therapy-based equipment. Some contracts include additional performance obligations such as the provision of extended warranties and provision of data for patient monitoring. Our Residential Care Software revenue relates to the provision of software access with ongoing support and maintenance services as well as professional services such as training and consulting.
10
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Disaggregation of revenue
The following table summarizes our net revenue disaggregated by segment, product and region (in thousands):
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
Americas | |||||||||||
| Devices | $ | $ | |||||||||
| Masks and other | |||||||||||
Total Americas | $ | $ | |||||||||
Rest of World | |||||||||||
| Devices | $ | $ | |||||||||
| Masks and other | |||||||||||
Total Rest of World | $ | $ | |||||||||
| Global revenue | |||||||||||
Devices | $ | $ | |||||||||
Masks and other | |||||||||||
Total Sleep and Breathing Health | $ | $ | |||||||||
Residential Care Software | |||||||||||
| Total | $ | $ | |||||||||
Performance obligations and contract balances
Revenue is recognized when performance obligations under the terms of a contract with a customer are satisfied; generally, this occurs with the transfer of risk and/or control of our products at a point in time. For products in our Sleep and Breathing Health business, we transfer control and recognize a sale when products are shipped to the customer in accordance with the contractual shipping terms. For our Residential Care Software business, revenue associated with cloud-hosted services are recognized as they are provided. The timing of revenue recognition may differ from the timing of invoicing to customers. Unbilled receivables arise when revenue is recognized upon the completion of performance obligations, but in advance of customer billing schedules. Unbilled receivables primarily reflect products shipped prior to invoicing under the terms of our customer agreements and timing differences related to our SaaS billing cycles. We defer the recognition of a portion of the consideration received when performance obligations are not yet satisfied. Consideration received from customers in advance of revenue recognition is classified as deferred revenue. Performance obligations resulting in deferred revenue in our Sleep and Breathing Health business relate primarily to extended warranties on our devices and the provision of data for patient monitoring. Performance obligations resulting in deferred revenue in our Residential Care Software business relate primarily to the provision of software access with maintenance and support over an agreed term and material rights associated with future discounts upon renewal of some SaaS contracts. Generally, deferred revenue will be recognized over a period of one year to five years . Our contracts do not contain significant financing components.
The following table summarizes our contract balances (in thousands):
| September 30, 2026 | June 30, 2026 | Balance sheet caption | |||||||||||||||
| Contract assets | |||||||||||||||||
| Accounts receivable, net | $ | $ | Accounts receivable, net | ||||||||||||||
Unbilled receivables, current | $ | $ | Prepaid expenses and other current assets | ||||||||||||||
Unbilled receivables, non-current | $ | $ | Prepaid taxes and other non-current assets | ||||||||||||||
| Contract liabilities | |||||||||||||||||
| Deferred revenue, current | $ | ( | $ | ( | Deferred revenue (current liabilities) | ||||||||||||
| Deferred revenue, non-current | $ | ( | $ | ( | Deferred revenue (non-current liabilities) | ||||||||||||
11
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
As of September 30, 2026, the aggregate amount of the transaction price allocated to remaining performance obligations was $386 million. As of September 30, 2026, we expected to recognize 46 % of our remaining performance obligations as revenue over the next 12 months with the remainder recognized thereafter.
Transaction price determination
Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. In our Sleep and Breathing Health segment, the amount of consideration received and revenue recognized varies with changes in marketing incentives (e.g. rebates, discounts, free goods) and returns by our customers and their customers. When we give customers the right to return eligible products and receive credit, returns are estimated based on an analysis of our historical experience. Returns of products, excluding warranty-related returns, have historically been infrequent and insignificant. We estimate variable consideration using the expected value method at the time of the initial sale and update our estimates as additional information becomes available or the consideration becomes fixed.
We offer our Sleep and Breathing Health customers cash or product rebates based on volume or sales targets measured over quarterly or annual periods. We estimate rebates based on each customer’s expected achievement of its targets. In accounting for these rebate programs, we reduce revenue ratably as sales occur over the rebate period by the expected value of the rebates to be returned to the customer. Rebates measured over a quarterly period are updated based on actual sales results and, therefore, no estimation is required to determine the reduction to revenue. For rebates measured over annual periods, we update our estimates each quarter based on actual sales results and updated forecasts for the remaining rebate periods.
We participate in programs where we issue credits to our Sleep and Breathing Health distributors when they are required to sell our products below negotiated list prices if we have preexisting contracts with the distributors' customers. We reduce revenue for future credits at the time of sale to the distributor, which we estimate based on historical experience using the expected value method.
We also offer discounts to both our Sleep and Breathing Health as well as our Residential Care Software customers as part of normal business practice and these are deducted from revenue when the sale occurs.
When Sleep and Breathing Health or Residential Care Software contracts have multiple performance obligations, we generally use an observable price to determine the stand-alone selling price by reference to pricing and discounting practices for the specific product or service when sold separately to similar customers. Revenue is then allocated proportionately, based on the determined stand-alone selling price, to each performance obligation. An allocation is not required for many of our Sleep and Breathing Health contracts that have a single performance obligation, which is the shipment of our therapy-based equipment.
Accounting and practical expedient elections
We have elected to account for shipping and handling activities associated with our Sleep and Breathing Health segment as a fulfillment cost within cost of sales, and record shipping and handling costs collected from customers in net revenue. We have also elected for all taxes assessed by government authorities that are imposed on and concurrent with revenue-producing transactions, such as sales and value added taxes, to be excluded from revenue and presented on a net basis. We have adopted two practical expedients including the “right to invoice” practical expedient, which is relevant for some of our Residential Care Software contracts as it allows us to recognize revenue in the amount of the invoice when it corresponds directly with the value of performance completed to date. The second practical expedient adopted permits relief from considering a significant financing component when the payment for the good or service is expected to be one year or less.
Lease Revenue
12
| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Cash and Cash Equivalents
Recently Issued Accounting Standards Not Yet Adopted
ASU 2025-11 Interim Reporting (Topic 270): Narrow-Scope Improvements
In December 2025, the Financial Accounting Standards Board, or FASB, issued ASU No. 2025-11, "Interim Reporting (Topic 270): Narrow-Scope Improvements," to improve the navigability of the guidance in ASC Topic 270 and clarify when the guidance applies, including the form and content of interim financial statements and the interim disclosures required under GAAP, and establishes a principle under which an entity must disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for us beginning in the first quarter of the fiscal year ending June 30, 2029. Early adoption is permitted and the amendments may be applied prospectively to financial statements issued for reporting periods after the effective date of the amendment or retrospectively to all prior periods presented. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements and disclosures.
ASU 2025-10 Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities
In December 2025, the FASB issued ASU No. 2025-10, "Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities," to establish authoritative guidance in GAAP on the recognition, measurement, presentation, and disclosure for government grants received by business entities. This ASU defines a government grant, establishes when and how a grant related to an asset or income is recognized and measured, and includes presentation and disclosure requirements. ASU 2025-10 is effective for us beginning in the first quarter of the fiscal year ending June 30, 2030. Early adoption is permitted and the amendments may be applied using a modified prospective, modified retrospective or full retrospective transition method. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements and disclosures.
ASU 2025-09 Derivatives and Hedging (Topic 815): Hedge Accounting Improvements
In November 2025, the FASB issued ASU No. 2025-09, "Derivatives and Hedging (Topic 815): Hedge Accounting Improvements," which amends existing guidance to clarify and enhance the hedge accounting guidance in ASC Topic 815 and better align hedge accounting with the economics of an entity’s risk management strategies. ASU 2025-09 is effective for us beginning in the first quarter of the fiscal year ending June 30, 2028. Early adoption is permitted and the amendments should be applied prospectively. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements and disclosures.
ASU 2025-06 Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software
In September 2025, the FASB issued ASU No. 2025-06, "Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software," which modernizes the recognition and disclosure framework for internal-use software costs, removing all references to software development project stages and introducing a more judgment-based approach. ASU 2025-06 is effective for us beginning in the first quarter of the fiscal year ending June 30, 2029. Early adoption is permitted and the amendments may either be applied prospectively to financial statements issued for reporting periods after the effective date of the amendment, retrospectively to all prior periods presented, or using a modified transition approach. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements and disclosures.
ASU 2024-03 Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU No. 2024-03, "Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses," which requires disclosure in the notes to the financial statements of specified information about certain costs and expenses, including amounts of purchases of inventory, employee compensation, depreciation, and intangible asset amortization included in each relevant expense caption, as well as a qualitative description of amounts remaining in relevant expense captions that
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| PART I – FINANCIAL INFORMATION | Item 1 | ||||
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Notes to the Condensed Consolidated Financial Statements
(Unaudited)
are not separately disaggregated quantitatively. ASU No. 2024-03 also requires disclosure of the total amount of selling expenses and, in annual periods, an entity's definition of selling expenses. This ASU is applicable to our Annual Report on Form 10-K for the fiscal year ended June 30, 2028, and subsequent interim periods. Early adoption is permitted and the amendments may be either applied prospectively to financial statements issued for reporting periods after the effective date of the amendment or retrospectively to all prior periods presented. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements and disclosures.
Recently Adopted Accounting Standards
ASU 2025-05 Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets
In July 2025, the FASB issued ASU No. 2025-05, "Financial Instruments – Credit Losses (Topic 326) – Measurement of Credit Losses for Accounts Receivable and Contract Assets," providing entities with a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. ASU 2025-05 became effective for us in the first quarter of the fiscal year ending June 30, 2027. We evaluated the impact of this ASU on our consolidated financial statements and disclosures, and determined it was not material.
(2) Segment Information
We have quantitatively and qualitatively determined that we operate in two
The identification of operating segments is based on our internal organizational structure and the information regularly reviewed by our Chief Executive Officer, who is our Chief Operating Decision Maker (CODM). Our CODM evaluates segment performance and makes resource allocation decisions based on segment net revenue and segment net operating profit, which is the primary measure of segment profit or loss. Impacts to segment net operating profit are referenced by our CODM when deciding to enter new markets, launch new products, reinvest profits, acquire or otherwise invest in other companies, and for monitoring actual results against forecasts. The accounting policies of the segments are the same as those described in Note 2 of our consolidated financial statements included in our Form 10-K for the fiscal year ended June 30, 2026. Segment net revenues and segment net operating profit do not include inter-segment profits and revenue is allocated to a geographic area based on where the products are shipped to or where the services are performed.
Certain items are maintained at the corporate level and are not allocated to the segments. The non-allocated items include corporate headquarters costs, stock-based compensation, costs to fulfill and income from transition service agreements, or TSAs, amortization expense from acquired intangibles, restructuring and business transformation expenses, acquisition and divestment-related expenses, interest income, interest expense, gains and losses attributable to equity method investments, gains and losses on equity investments, gains on divestments of subsidiaries, and other, net. We neither discretely allocate assets to our operating segments, nor does our Chief Operating Decision Maker evaluate the operating segments using discrete asset information.
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Notes to the Condensed Consolidated Financial Statements
(Unaudited)
The table below presents a reconciliation of net revenues and net operating profit by reportable segments (in thousands):
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Net revenue by segment | |||||||||||
| Sleep and Breathing Health | $ | $ | |||||||||
| Residential Care Software | |||||||||||
| Total | $ | $ | |||||||||
Significant segment expenses | |||||||||||
| Cost of sales | |||||||||||
| Sleep and Breathing Health | $ | $ | |||||||||
| Residential Care Software | |||||||||||
| Total | $ | $ | |||||||||
Selling, general, and administrative | |||||||||||
| Sleep and Breathing Health | $ | $ | |||||||||
| Residential Care Software | |||||||||||
| Total | $ | $ | |||||||||
Research and development | |||||||||||
| Sleep and Breathing Health | $ | $ | |||||||||
| Residential Care Software | |||||||||||
| Total | $ | $ | |||||||||
| Net operating profit by segment | |||||||||||
Sleep and Breathing Health | $ | $ | |||||||||
Residential Care Software | |||||||||||
| Total | $ | $ | |||||||||
| Reconciling items | |||||||||||
| Corporate costs | $ | $ | |||||||||
| Amortization of acquired intangible assets | |||||||||||
| Restructuring and business transformation expenses | |||||||||||
Acquisition and divestment-related expenses | |||||||||||
Interest income | ( | ( | |||||||||
Interest expense | |||||||||||
(Gain) Loss attributable to equity method investments | ( | ( | |||||||||
(Gain) Loss on equity investments | ( | ||||||||||
Gain on divestment of subsidiaries | ( | ||||||||||
| Other, net | ( | ||||||||||
| Income before income taxes | $ | $ | |||||||||
| Depreciation and amortization by segment | |||||||||||
| Sleep and Breathing Health | $ | $ | |||||||||
| Residential Care Software | |||||||||||
| Amortization of acquired intangible assets and corporate assets | |||||||||||
| Total | $ | $ | |||||||||
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| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Concentration of Credit Risk and Significant Customers
(3) Supplemental Balance Sheet Information
Components of selected captions in the condensed consolidated balance sheets consisted of the following (in thousands):
| Inventories | September 30, 2026 | June 30, 2026 | |||||||||
| Raw materials | $ | $ | |||||||||
| Work in progress | |||||||||||
| Finished goods | |||||||||||
| Total inventories | $ | $ | |||||||||
| Prepaid expenses and other current assets | September 30, 2026 | June 30, 2026 | |||||||||
| Prepaid taxes | $ | $ | |||||||||
| Prepaid inventories | |||||||||||
| Unbilled receivables | |||||||||||
| Prepaid expenses | |||||||||||
| Other current assets | |||||||||||
| Total prepaid expenses and other current assets | $ | $ | |||||||||
| Property, Plant and Equipment | September 30, 2026 | June 30, 2026 | |||||||||
| Property, plant and equipment, at cost | $ | $ | |||||||||
| Accumulated depreciation and amortization | ( | ( | |||||||||
| Property, plant and equipment, net | $ | $ | |||||||||
| Other Intangible Assets | September 30, 2026 | June 30, 2026 | |||||||||
| Developed/core product technology | $ | $ | |||||||||
| Accumulated amortization | ( | ( | |||||||||
| Developed/core product technology, net | |||||||||||
| Customer relationships | |||||||||||
| Accumulated amortization | ( | ( | |||||||||
| Customer relationships, net | |||||||||||
| Other intangibles | |||||||||||
| Accumulated amortization | ( | ( | |||||||||
| Other intangibles, net | |||||||||||
| Total other intangibles, net | $ | $ | |||||||||
Intangible assets consist of developed/core product technology, trade names, non-compete agreements, customer relationships, and patents, which we amortize over the estimated useful life of the assets, generally between two years to fifteen years . There are no expected residual values related to these intangible assets.
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Notes to the Condensed Consolidated Financial Statements
(Unaudited)
(4) Goodwill
A reconciliation of changes in our goodwill by reportable segment is as follows (in thousands):
| Three Months Ended September 30, 2026 | |||||||||||||||||
Sleep and Breathing Health | Residential Care Software | Total | |||||||||||||||
| Balance at the beginning of the period | $ | $ | $ | ||||||||||||||
| Business acquisitions | |||||||||||||||||
Adjustment to fair values of preliminary purchase price allocations | |||||||||||||||||
| Foreign currency translation adjustments | ( | ( | ( | ||||||||||||||
| Balance at the end of the period | $ | $ | $ | ||||||||||||||
(5) Investments
We have equity investments in privately and publicly held companies that are unconsolidated entities. The following discusses our investments in marketable equity securities, non-marketable equity securities, and investments accounted for under the equity method.
Our marketable equity securities are publicly traded stocks measured at fair value and classified within Level 1 in the fair value hierarchy because we use quoted prices for identical assets in active markets. Marketable equity securities are recorded in prepaid expenses and other current assets on the condensed consolidated balance sheets.
Non-marketable equity securities consist of investments in privately held companies without readily determinable fair values and are recorded in prepaid taxes and other non-current assets on the condensed consolidated balance sheets. We account for these investments using the measurement alternative, under which they are measured and reported at cost, minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. We assess non-marketable equity securities at least quarterly for impairment and consider qualitative and quantitative factors including the investee's financial metrics, product and commercial outlook and cash usage. All gains and losses on marketable and non-marketable equity securities, realized and unrealized, are recognized in gain (loss) on equity investments as a component of other income (loss), net on the condensed consolidated statements of operations.
Equity investments whereby we have significant influence, but not control over the investee and are not the primary beneficiary of the investee’s activities, are accounted for under the equity method and are recorded in prepaid taxes and other non-current assets on the condensed consolidated balance sheets. Under this method, we record our share of gains or losses attributable to equity method investments as a component of other income (loss), net on the condensed consolidated statements of operations.
Equity investments by measurement category were as follows (in thousands):
| Measurement category | September 30, 2026 | June 30, 2026 | |||||||||
| Fair value | $ | $ | |||||||||
| Measurement alternative | |||||||||||
| Equity method | |||||||||||
| Total | $ | $ | |||||||||
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| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
The following tables show a reconciliation of the changes in our equity investments (in thousands):
| Three Months Ended September 30, 2026 | |||||||||||||||||||||||
| Non-marketable securities | Marketable securities | Equity method investments | Total | ||||||||||||||||||||
| Balance at the beginning of the period | $ | $ | $ | $ | |||||||||||||||||||
| Additions to investments | |||||||||||||||||||||||
| Reclassification to marketable securities | ( | ||||||||||||||||||||||
| Unrealized gains (losses) on marketable equity securities | |||||||||||||||||||||||
Gain attributable to equity method investments | |||||||||||||||||||||||
| Foreign currency translation adjustments | ( | ( | ( | ||||||||||||||||||||
| Carrying value at the end of the period | $ | $ | $ | $ | |||||||||||||||||||
| Three Months Ended September 30, 2025 | |||||||||||||||||||||||
| Non-marketable securities | Marketable securities | Equity method investments | Total | ||||||||||||||||||||
| Balance at the beginning of the period | $ | $ | $ | $ | |||||||||||||||||||
Additions to investments | |||||||||||||||||||||||
Impairment of investments | ( | ( | |||||||||||||||||||||
Unrealized gains (losses) on marketable equity securities | ( | ( | |||||||||||||||||||||
Gain attributable to equity method investments | |||||||||||||||||||||||
Foreign currency translation adjustments | ( | ( | ( | ||||||||||||||||||||
| Carrying value at the end of the period | $ | $ | $ | $ | |||||||||||||||||||
(6) Income Taxes
In accordance with ASC Topic 740, "Income Taxes", or ASC 740, each interim reporting period is considered integral to the annual period, and tax expense is measured using an estimated annual effective tax rate. An entity is required to record income tax expense each quarter based on its annual effective tax rate estimated for the full fiscal year and use that rate to provide for income taxes on a current year-to-date basis, adjusted for discrete taxable events that occur during the interim period.
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| PART I – FINANCIAL INFORMATION | Item 1 | ||||
RESMED INC. AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
(7) Debt
Debt consisted of the following (in thousands):
| September 30, 2026 | June 30, 2026 | ||||||||||
| Short-term debt | $ | $ | |||||||||
| Deferred borrowing costs | ( | ( | |||||||||
| Short-term debt, net | $ | $ | |||||||||
| Long-term debt | $ | $ | |||||||||
| Deferred borrowing costs | ( | ( | |||||||||
| Long-term debt, net | $ | $ | |||||||||
| Total debt | $ | $ | |||||||||
Credit Facility
On June 29, 2022, we entered into a second amended and restated credit agreement, or the Revolving Credit Agreement, as borrower, with lenders MUFG Union Bank, N.A., as administrative agent, joint lead arranger, sole book runner, swing line lender and letter of credit issuer, Westpac Banking Corporation, as syndication agent and joint lead arranger, HSBC Bank USA, National Association, as syndication agent and joint lead arranger, and Wells Fargo Bank, National Association, as documentation agent. The Revolving Credit Agreement, among other things, provided a senior unsecured revolving credit facility of $1,500 million, with an uncommitted option to increase the revolving credit facility by an additional amount equal to the greater of $1,000 million or 1.0 times the EBITDA (as defined in the Revolving Credit Agreement) for the trailing twelve-month measurement period. The Revolving Credit Agreement amends and restates that certain Amended and Restated Credit Agreement, dated as of April 17, 2018, among Resmed, MUFG Union Bank, N.A., Westpac Banking Corporation and the lenders party thereto.
Additionally, on June 29, 2022, ResMed Pty Limited entered into a Second Amendment to the Syndicated Facility Agreement and First Amendment to Unconditional Guaranty Agreement, or the Term Credit Agreement, as borrower, with lenders MUFG Union Bank, N.A., as administrative agent, joint lead arranger and joint book runner, and Westpac Banking Corporation, as syndication agent, joint lead arranger and joint book runner, which amends that certain Syndicated Facility Agreement dated as of April 17, 2018. The Term Credit Agreement, among other things, provides ResMed Pty Limited a senior unsecured term credit facility of $200 million.
Our obligations under the Revolving Credit Agreement are guaranteed by certain of our direct and indirect U.S. subsidiaries, and ResMed Pty Limited’s obligations under the Term Credit Agreement are guaranteed by us and certain of our direct and indirect U.S. subsidiaries. The Revolving Credit Agreement and Term Credit Agreement contain customary covenants, including, in each case, a financial covenant that requires that we maintain a maximum leverage ratio of funded debt to EBITDA (as defined in the Revolving Credit Agreement and Term Credit Agreement, as applicable). The entire principal amounts of the revolving credit facility and term credit facility, and, in each case, any accrued but unpaid interest may be declared immediately due and payable if an event of default occurs, as defined in the Revolving Credit Agreement and the Term Credit Agreement, as applicable. Events of default under the Revolving Credit Agreement and the Term Credit Agreement include, in each case, failure to make payments when due, the occurrence of a default in the performance of any covenants in the respective agreements or related documents, or certain changes of control of us, or the respective guarantors of the obligations borrowed under the Revolving Credit Agreement and Term Credit Agreement.
The Revolving Credit Agreement and Term Credit Agreement each terminate on June 29, 2027, when all unpaid principal and interest under the loans must be repaid. Amounts borrowed under the Term Credit Agreement will also amortize on a semi-annual basis, with a $5 million principal payment required on each such semi-annual amortization date. The outstanding principal amounts will bear interest at a rate equal to the Adjusted Term SOFR (as defined in the Revolving Credit Agreement) plus 0.75 % to 1.50 % (depending on the then-applicable leverage ratio) or the Base Rate (as defined in the Revolving Credit Agreement and the Term Credit Agreement, as applicable) plus 0.0 % to 0.50 % (depending on the then-applicable leverage ratio). At September 30, 2026, the interest rate that was being charged on the outstanding principal amounts was 4.92 %. An applicable commitment fee of 0.075 % to 0.150 % (depending on the then-applicable leverage
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Notes to the Condensed Consolidated Financial Statements
(Unaudited)
ratio) applies on the unused portion of the revolving credit facility. As of September 30, 2026, we had $1,500 million available for draw down under the revolving credit facility.
We are required to disclose the fair value of financial instruments for which it is practicable to estimate the value, even though these instruments are not recognized at fair value in the consolidated balance sheets. As the Revolving Credit and Term Credit Agreements bear interest at variable rates based on Adjusted Term SOFR plus the spreads described above, we have determined that the carrying amount approximates its fair value, which was $160
Senior Notes
On July 10, 2019, we entered into a Note Purchase Agreement with the purchasers to that agreement, in connection with the issuance and sale of $500 million aggregate principal amount of senior notes, consisting of $250 million principal amount of our 3.24 % senior notes and $250 million principal amount of our 3.45 % senior notes, collectively referred to as the Senior Notes. The 3.24 % senior notes were repaid in full on July 10, 2026. The 3.45 % senior notes are due July 10, 2029. Our obligations under the Note Purchase Agreement and the Senior Notes are unconditionally and irrevocably guaranteed by certain of our direct and indirect U.S. subsidiaries. The net proceeds from this transaction were used to pay down borrowings on our Revolving Credit Agreement.
Under the terms of the Note Purchase Agreement, we agreed to customary covenants including with respect to our corporate existence, transactions with affiliates, and mergers and other extraordinary transactions. We also agreed that, subject to limited exceptions, we will maintain a ratio of consolidated funded debt to consolidated EBITDA (as defined in the Note Purchase Agreement) of no more than 3.50 to 1.00 as of the last day of any fiscal quarter, and will not at any time permit the amount of all priority secured and unsecured debt of us and our subsidiaries to exceed 10 % of our consolidated tangible assets, determined as of the end of our most recently ended fiscal quarter. This ratio is calculated at the end of each reporting period for which the Note Purchase Agreement requires us to deliver financial statements, using the results of the 12 consecutive month period ending with such reporting period.
We are required to disclose the fair value of financial instruments for which it is practicable to estimate the value, even though these instruments are not recognized at fair value in the consolidated balance sheets. As of September 30, 2026 and June 30, 2026, the Senior Notes had carrying amounts excluding deferred borrowing costs of $250 million and $500 million, respectively, and estimated fair values of $232 million and $484 million, respectively. Quoted market prices in active markets for similar liabilities based inputs (Level 2) were used to estimate fair value.
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Notes to the Condensed Consolidated Financial Statements
(Unaudited)
(8) Treasury Stock
On August 31, 2026, pursuant to our existing share repurchase program, we entered into an accelerated share repurchase agreement, or the ASR Agreement, to repurchase $450 million of our common stock. Pursuant to the ASR Agreement, we paid $450 million and received an initial delivery of 1.6 million shares during the three months ended September 30, 2026, representing an estimated 80 percent of the shares to be purchased under the ASR Agreement based on the $230.87 closing price of our common stock on September 2, 2026. Final settlement of the ASR Agreement is expected to occur no later than December 29, 2026, and will be based on a discount to the volume-weighted average price per share of our common stock over the term of the ASR Agreement. The maximum number of shares that could be required to settle the ASR Agreement is 72.1 million.
The ASR Agreement was accounted for as two separate transactions. The initial delivery of shares was recorded as treasury stock transaction, resulting in a $360 million increase in treasury stock. The remaining $90 million was accounted for as a forward contract indexed to our own common stock and initially recorded as a reduction of additional paid-in capital. Upon settlement, the amount recorded to additional paid-in capital will be reclassified to treasury stock. We determined that the forward contract indexed to our own common stock met all the applicable criteria for equity classification and, therefore, was not accounted for as a derivative instrument. The delivery of the 1.6 million shares reduced the outstanding shares used to determine our weighted average shares outstanding for purposes of calculating basic and diluted EPS for the three months ended September 30, 2026. The remaining shares expected to be delivered under the forward contract were excluded from the computation of diluted earnings per share because their effect would be anti-dilutive.
During the three months ended September 30, 2026, we repurchased a total of 3.6 million shares, including the 1.6 million shares under the ASR Agreement, at a cost of $855 million, including commissions and other incremental transaction costs. During the three months ended September 30, 2025, we repurchased a total of 0.5 million shares at a cost of $150 million, including commissions and other incremental costs. At September 30, 2026, 4.3 million additional shares remain available for us to repurchase under the approved share repurchase program.
(9) Earnings Per Share
Basic earnings per share is computed by dividing the net income available to common stockholders by the weighted average number of shares of common stock outstanding. For purposes of calculating diluted earnings per share, the denominator includes both the weighted average number of shares of common stock outstanding and the number of dilutive common stock equivalents such as stock options and restricted stock units.
The weighted average number of outstanding stock options and restricted stock units not included in the computation of diluted earnings per share were 199,581 and 33,990 for the three months ended September 30, 2026 and 2025, respectively, as the effect would have been anti-dilutive.
Basic and diluted earnings per share are calculated as follows (in thousands except per share data):
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Numerator: | |||||||||||
| Net income | $ | $ | |||||||||
| Denominator: | |||||||||||
| Basic weighted-average common shares outstanding | |||||||||||
| Effect of dilutive securities: | |||||||||||
| Stock options and restricted stock units | |||||||||||
| Diluted weighted average shares | |||||||||||
| Basic earnings per share | $ | $ | |||||||||
| Diluted earnings per share | $ | $ | |||||||||
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Notes to the Condensed Consolidated Financial Statements
(Unaudited)
(10) Legal Actions, Contingencies and Commitments
Litigation
In the normal course of business, we are subject to routine litigation incidental to our business. While the results of this litigation cannot be predicted with certainty, we believe that their outcome will not, individually or in aggregate, have a material adverse effect on our consolidated financial statements taken as a whole.
On June 16, 2022, Cleveland Medical Devices Inc., or Cleveland Medical, filed suit for patent infringement against Resmed in the United States District Court for the District of Delaware, case no. 1:22-cv-00794. Cleveland Medical asserts that numerous Resmed connected devices, when combined with certain Resmed data platforms and/or software, including AirView and ResScan, infringe one or more of seven Cleveland Medical patents, including U.S. Patent Nos. 10,076,269; 10,426,399; 10,925,535; 11,064,937; 10,028,698; 11,202,603; and 11,234,637. On March 22, 2023, ResMed Corp. filed a petition with the Patent Trial and Appeal Board, or PTAB, of the Patent and Trademark Office seeking review of the validity of U.S. Patent No. 10,076,269. On June 21, 2024, the District Court of Delaware granted Resmed's motion to stay the case until the PTAB issues its final written decision in the Inter Partes Review, or IPR, proceeding. On May 2, 2025, the PTAB issued its decision finding all claims of U.S. Patent No. 10,076,269 unpatentable. On August 27, 2025, Cleveland Medical appealed the PTAB's ruling on U.S. Patent No. 10,076,269 to the United States Court of Appeals for the Federal Circuit. The appeal is pending.
On March 20, 2023, ResMed Corp. filed suit in the United States District Court for the Southern District of California, case no. 23-cv-00500-TWR-JLB, seeking a declaration that it does not infringe U.S. Patent No. 11,602,284 issued to Cleveland Medical. In November 2023, the case was transferred to the Northern District of Ohio. Cleveland Medical answered the complaint and filed a counterclaim asserting that ResMed Corp. infringes three additional patents, U.S. Patent Nos. 11,375,921; 11,690,512; and 11,786,680. On April 9, 2024, Cleveland Medical asserted infringement of two additional patents, U.S. Patent Nos. 11,857,333 and 11,872,029.
In October 2024, ResMed Corp. filed requests for ex parte reexamination of U.S. Patent Nos. 11,375,921 and 11,786,680. The United States Patent and Trademark Office, or the Patent Office, has ordered reexamination of both patents. Between November 15, 2024, and January 10, 2025, ResMed Corp. filed petitions with the PTAB seeking Inter Partes Review of the validity of all six patents asserted. On March 7, 2025, the District Court granted ResMed Corp.'s motion to stay the case pending the conclusion of all Patent Office proceedings. On June 10, 2025, the PTAB denied institution of Inter Partes Review directed to U.S. Patent No. 11,602,284. In May and June 2026, the PTAB issued decisions finding the challenged claims of U.S. Patent Nos. 11,375,921, 11,690,512, 11,786,680 and 11,872,029 patentable, while finding the challenged claim of U.S. Patent No. 11,857,333 unpatentable. In August and September 2026, Resmed filed notices of appeal to the PTAB’s rulings on U.S. Patent Nos. 11,375,921, 11,690,512, 11,786,680 and 11,872,029 to the United States Court of Appeals for the Federal Circuit. Cleveland Medical did not appeal the PTAB’s ruling on U.S. Patent No. 11,857,333 and the ruling is now final. On October 12, 2026, ResMed Corp. filed a request for ex parte reexamination of U.S. Patent No. 11,602,284.
On November 5, 2025, Cleveland Medical filed suit for patent infringement against ResMed Inc. in the United States District Court for the District of Delaware, case no. 1:25-cv-1351. Cleveland Medical asserts that the ApneaLink Air device, in combination with the AirView Cloud Platform and ApneaLink software, and the Philips Respironics’ Alice NightOne device, in combination with our subsidiary VirtuOx’s software platform Sleepifi, infringe one or more of six Cleveland Medical patents, including U.S. Patent Nos. 10,426,399; 10,925,535; 11,064,937; 10,028,698; 11,202,603; and 11,234,637. The complaint is centered on VirtuOx’s use and sales of the above-listed accused products. On January 15, 2026, we filed a motion to dismiss the new Delaware action. On April 24, 2026, ResMed Inc. filed a request for ex parte reexamination of U.S. Patent No. 11,064,937, and on June 3, 2026, the Patent Office ordered reexamination of the patent. On June 18, 2026, we moved to stay the new Delaware case pending resolution of the motion to dismiss. Both motions remain pending before the court. Between September 2026 and October 2026, ResMed Inc. filed requests for ex parte reexamination of U.S. Patent Nos. 11,202,603; 10,028,698; 10,925,535; 11,234,637; and 10,426,399.
On October 9, 2025, Fractus, S.A., or Fractus, filed suit for patent infringement against ResMed Corp. and ResMed Inc. in the United States District Court for the Southern District of California, case no. 3:25-cv-02680. Fractus asserts that Resmed’s AirSense 10, AirSense 11, AirCurve 10 and AirCurve 11, as well as the Resmed Connectivity Module used on its Astral and Stellar Ventilators, infringe one or more of five Fractus patents relating to antenna technology, including U.S.
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Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Patent Nos. 8,362,960; 8,456,365; 8,593,349; 8,674,887; and 11,031,677. The complaint seeks monetary damages, a permanent injunction, and attorneys’ fees. On January 2, 2026, we filed a petition with the PTAB seeking IPR of U.S. Patent No. 11,031,677. In January 2026, Fractus voluntarily dismissed ResMed Inc. from the suit. On June 2, 2026, the PTAB instituted the IPR proceeding for U.S. Patent No. 11,031,677. On June 15, 2026, ResMed Corp. filed a petition with the PTAB seeking Inter Partes Review of U.S. Patent No. 8,362,960. On September 2, 2026, Fractus filed an Amended Complaint, dropping U.S. Patent No. 11,031,677 and asserting U.S. Patent No. 8,810,458. On September 16, 2026, Resmed moved to dismiss the entire action.
Based on currently available information, we are unable to make a reasonable estimate of loss or range of losses, if any, arising from matters that remain open.
Contingent Obligations Under Recourse Provisions
We use independent financing institutions to offer some of our customers financing for the payment of outstanding accounts receivable. Under these arrangements, if the customer qualifies under the financing institutions’ credit criteria and finances the transaction, the financing institution pays us for the outstanding accounts receivable less a fee, and the customers repay the financing institution on a fixed payment plan. The customer’s receivable balance is with limited recourse whereby we are responsible for repaying the financing company should the customer default under a loss pool arrangement. We record a contingent provision, which is estimated based on historical default rates. This is applied to receivables sold with limited recourse and is recorded in accrued expenses. There are no arrangements with full recourse.
As of September 30, 2026, the maximum loss pool exposure on outstanding receivables sold with limited recourse and the associated contingent provision were $26 million and $1 million, respectively. As of June 30, 2026, the maximum loss pool exposure on outstanding receivables sold with limited recourse and the associated contingent provision were $34 million and $1 million, respectively.
(11) Derivative Instruments and Hedging Activities
We may use derivative financial instruments, specifically foreign cross-currency swaps, purchased foreign currency call options, collars and forward contracts to mitigate exposure from certain foreign currency risk. No derivatives are used for trading or speculative purposes. We do not require or are not required to pledge collateral for the derivative instruments.
Fair Value and Net Investment Hedging
We enter into foreign cross-currency swaps as net investment hedges and fair value hedges in designated hedging relationships with either the foreign denominated net asset balances or the foreign denominated intercompany loans as the hedged items. All derivatives are recorded at fair value as either an asset or liability. Cash flows associated with derivative instruments are presented in the same category on the consolidated statements of cash flows as the hedged item.
The purpose of the cross-currency swaps for the fair value hedge is to mitigate foreign currency risk associated with changes in spot rates on foreign denominated intercompany debt between USD and EUR. For these hedges, we excluded certain components from the assessment of hedge effectiveness that are not related to spot rates. For fair value hedges that qualify and are designated for hedge accounting, the change in fair value of the derivative is recorded in the same line item as the hedged item, other, net, in the condensed consolidated statements of operations. The initial fair value of hedge components excluded from the assessment of effectiveness is recognized in the statements of operations under a systematic and rational method over the life of the hedging instrument and is presented in interest income or interest expense, as applicable. Any difference between the change in the fair value of the hedge components excluded from the assessment of effectiveness and the amounts recognized in earnings is recorded as a component of other comprehensive income.
The purpose of the cross-currency swaps for net investment hedges is to mitigate foreign currency risk associated with changes in spot rates on the net asset balances of our foreign functional subsidiaries. For net investment hedges that qualify and are designated for hedge accounting, the change in fair value of the derivative is recorded in cumulative translation adjustment within other comprehensive loss and reclassified into earnings when the hedged net investment is either sold or substantially liquidated. The initial fair value of components excluded from the assessment of hedge effectiveness will be recognized in interest income or interest expense, as applicable.
The notional value of outstanding foreign cross-currency swaps was $3,436 million and $3,412 million at September 30, 2026 and June 30, 2026, respectively. These contracts mature at various dates prior to January 31, 2036.
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Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Non-Designated Hedges
We transact business in various foreign currencies, including a number of major European currencies as well as the Australian and Singapore dollars. We have foreign currency exposure through both our Australian and Singapore manufacturing activities, and international sales operations. We have established a foreign currency hedging program using purchased foreign currency call options, collars and forward contracts to hedge foreign-currency-denominated financial assets, liabilities and manufacturing cash flows. The terms of such foreign currency hedging contracts generally do not exceed three years . The purpose of this hedging program is to economically manage the financial impact of foreign currency exposures denominated mainly in Euros, and Australian and Singapore dollars. Under this program, increases or decreases in our foreign currency denominated financial assets, liabilities, and firm commitments are partially offset by gains and losses on the hedging instruments. We do not designate these foreign currency contracts as hedges. All movements in the fair value of the foreign currency instruments are recorded within other, net in our condensed consolidated statements of operations.
The notional value of the outstanding non-designated hedges was $1,346 million and $1,285 million at September 30, 2026 and June 30, 2026, respectively. These contracts mature at various dates prior to September 15, 2027.
Fair Values of Derivative Instruments
The following table presents our assets and liabilities related to derivative instruments on a gross basis within the condensed consolidated balance sheets (in thousands):
| September 30, 2026 | June 30, 2026 | Balance Sheet Caption | |||||||||||||||
| Not Designated as Hedging Instruments | |||||||||||||||||
| Foreign currency hedging instruments | $ | $ | Prepaid expenses and other current assets | ||||||||||||||
| Foreign currency hedging instruments | Prepaid taxes and other non-current assets | ||||||||||||||||
| Total derivative assets | $ | $ | |||||||||||||||
| Designated as Hedging Instruments | |||||||||||||||||
| Foreign cross-currency swaps – Fair Value Hedge | $ | $ | Other long-term liabilities | ||||||||||||||
| Foreign cross-currency swaps – Net Investment Hedge | Other long-term liabilities | ||||||||||||||||
| Not Designated as Hedging Instruments | |||||||||||||||||
| Foreign currency hedging instruments | Accrued expenses | ||||||||||||||||
| Foreign currency hedging instruments | Other long-term liabilities | ||||||||||||||||
| Total derivative liabilities | $ | $ | |||||||||||||||
Fair Value Hedge Gains (Losses)
We recognized the following gains (losses) on the foreign cross currency swaps designated as fair value hedges (in thousands):
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Gain (loss) recognized in other comprehensive income (loss) | $ | ( | $ | ( | |||||||
| Gain (loss) recognized on cross-currency swap in interest (expense) income (amount excluded from effectiveness testing) | $ | $ | |||||||||
| Gain (loss) recognized on cross-currency swap in other, net | $ | $ | |||||||||
| Gain (loss) recognized on intercompany debt in other, net | $ | ( | $ | ( | |||||||
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Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Net Investment Hedge Gains (Losses)
We recognized the following gains (losses) on the foreign cross currency swaps designated as net investment hedges (in thousands):
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Gain (loss) recognized in cumulative translation adjustment within other comprehensive income (loss) | $ | ( | $ | ||||||||
| Gain (loss) recognized from the excluded components in interest (expense) income | $ | $ | |||||||||
Non-designated Derivative Gains (Losses)
We recognized the following gains (losses) in the condensed consolidated statements of operations on derivatives not designated as hedging instruments (in thousands):
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Gain (loss) recognized on foreign currency hedging instruments in other, net | $ | $ | ( | ||||||||
| Gain (loss) recognized on other foreign-currency-denominated transactions in other, net | ( | ||||||||||
| Total | $ | ( | $ | ( | |||||||
We classified the fair values of all hedging instruments as Level 2 measurements within the fair value hierarchy.
(12) Restructuring Expenses
Restructuring costs are classified within cost of sales, research and development expenses, and selling, general and administrative expenses within the condensed consolidated statements of operations based on the function of the associated costs. Although the costs associated with the restructuring plans have not been allocated to our business segments' results in Note 2 – Segment Information, the below restructuring plans impacted both our Sleep and Breathing Health and Residential Care Software segments.
During the three months ended September 30, 2026, we recorded $19 million of restructuring related charges, comprised of employee severance and one-time termination benefits, impairment of non-strategic internal-use software assets, and other immaterial restructuring-related costs. Charges of approximately $1 million, $1 million, and $17 million were included in cost of sales, research and development expenses, and selling, general, and administrative expenses, respectively, within the condensed consolidated statements of operations for three months ended September 30, 2026. This action consists of costs incurred in connection with certain growth and transformation initiatives, in addition to ongoing workforce planning activities. We do not expect any remaining expense under existing one-time termination benefit arrangements to be material. As of September 30, 2026, we had $12 million of remaining restructuring liabilities presented as accrued expenses within our condensed consolidated balance sheet.
(13) Business Combinations and Divestitures
During the three months ended September 30, 2026, we completed acquisitions that were not material to our condensed consolidated financial statements, either individually or in the aggregate.
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Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Noctrix Health, LLC business combination
During the three months ended September 30, 2026, we recorded immaterial measurement period adjustments to the preliminary fair values of certain assets acquired, with corresponding adjustments to goodwill. Measurement period adjustments may arise upon the availability of further information regarding events or circumstances that existed at the acquisition date and will be recorded in the period in which they are determined, as if they had been completed at the acquisition date. The finalization of our purchase accounting assessment could result in changes in the valuation of assets acquired and liabilities assumed, though we do not expect these changes will materially modify the preliminary purchase price allocation. The final determination of the fair value of certain assets and liabilities will be completed within the measurement period as required by ASC Topic 805.
MatrixCare business divestiture
On September 1, 2026, we completed the sale of our MatrixCare business. Net cash proceeds received at closing were $470 million and $8 million was placed in escrow in connection with the post-closing purchase price adjustment process and is recorded within prepaid expenses and other current assets within our condensed consolidated balance sheet as of September 30, 2026. Proceeds net of cash divested were $451 million, which are reflected within investing activities in our condensed consolidated statements of cash flows for the three months ended September 30, 2026.
The transaction included MatrixCare and related software offerings historically sold under the MatrixCare brand, including Healthcare First, Citus Health, and home health and hospice solutions, collectively defined as the "MatrixCare business”. As of June 30, 2026, we determined that the MatrixCare business met the criteria for classification as held for sale. The divestment does not represent a strategic shift that has a major effect on our operations or financial results, and, therefore, is not presented as a discontinued operation. Accordingly, the results of the MatrixCare business through the date of disposition and the associated gain on divestiture are presented within continuing operations. The operating results of the MatrixCare business through the date of disposition are also included within the Residential Care Software segment in Note 2 – Segment Information. Upon closing, we derecognized net assets of $416 million and recognized a pre-tax gain on the divestiture of $62 million in other income (loss), net in our condensed consolidated statements of operations for the three months ended September 30, 2026. The gain is preliminary and remains subject to adjustment based on finalization of customary post-closing purchase price adjustments.
We do not anticipate having significant continuing involvement with the MatrixCare business with the exception of TSAs under which we will provide certain services for a limited period following the closing of the transaction to facilitate an orderly transition of systems, processes, tools, and day-to-day operations.
We incurred divestment-related costs associated with the MatrixCare divestiture of $10 million during the three months ended September 30, 2026 which are expensed as incurred and recorded within selling, general, and administrative expenses on our consolidated statements of operations. We did not incur divestment-related costs during the three months ended September 30, 2025.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
.
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Special Note Regarding Forward-Looking Statements
This report contains or may contain certain forward-looking statements and information that are based on the beliefs of our management as well as estimates and assumptions made by, and information currently available to, our management. All statements other than statements regarding historical facts are forward-looking statements. The words “believe,” “expect,” “intend,” “anticipate,” “will continue,” “will,” “estimate,” “plan,” “future” and other similar expressions, and negative statements of such expressions, generally identify forward-looking statements, including, in particular, statements regarding expectations of future revenue or earnings, expenses, results of operations, new product development, new product launches, new markets for our products, the integration of acquisitions and success of strategic initiatives, including divestitures, our supply chain, domestic and international regulatory developments, litigation, tax outlook, and the expected impact of macroeconomic conditions on our business. These forward-looking statements are made in accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on these forward-looking statements. Forward-looking statements reflect the views of our management at the time the statements are made and are subject to a number of risks, uncertainties, estimates and assumptions, including, without limitation, and in addition to those identified in the text surrounding such statements, those identified in our Annual Report on Form 10-K for the fiscal year ended June 30, 2026 and elsewhere in this report. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances reflected in this information. Unless otherwise expressly stated, we obtained this industry, business, market, and other data from reports, research surveys, studies, and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data, and similar sources.
In addition, important factors to consider in evaluating such forward-looking statements include changes or developments in healthcare reform, social, macroeconomic, market, legal or regulatory circumstances, including the impact of public health crises; changes in our business or growth strategy or an inability to execute our strategy due to changes in our industry or the economy generally, the emergence of new or growing competitors, disruptions and delays in the supply chain, the actions or omissions of third parties, including suppliers, customers, competitors and governmental authorities, geopolitical and economic conditions in foreign jurisdictions impacting our business, including the direct or indirect effect of new or increased tariffs, the indirect costs associated with global trade disruption and various other factors. If any one or more of these risks or uncertainties materialize, or underlying estimates or assumptions prove incorrect, actual results may vary significantly from those expressed in our forward-looking statements, and there can be no assurance that the forward-looking statements contained in this report will in fact occur.
Before deciding to purchase, hold or sell our common stock, you should carefully consider the risks described in our Annual Report on Form 10-K for the fiscal year ended June 30, 2026, in addition to the other cautionary statements and risks described elsewhere in this report and in our other filings with the Securities and Exchange Commission, or the SEC, including our subsequent reports on Forms 10-Q and 8-K. These risks and uncertainties are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also affect our business. If any of these known or unknown risks or uncertainties actually occurs with material adverse effects on us, our business, financial condition and results of operations could be seriously harmed. In that event, the market price for our common stock will likely decline and you may lose all or part of your investment.
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| PART I – FINANCIAL INFORMATION | Item 2 | ||||
RESMED INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Overview
The following is an overview of our results of operations for the three months ended September 30, 2026. Management’s discussion and analysis of financial condition and results of operations, or the MD&A, is intended to help the reader understand our results of operations and financial condition. It is provided as a supplement to, and should be read in conjunction with, the condensed consolidated financial statements and notes included in this report.
We are a global leader in digital health and cloud-connected medical devices. We design innovative technology with the intention to empower people to live happier, healthier lives. Our artificial intelligence, or AI, powered digital health solutions, cloud-connected devices and intelligent software are designed to make home healthcare more personalized, accessible and effective. By enabling better care, our products seek to improve quality of life, reduce the impact of chronic disease, and lower costs for consumers and healthcare systems.
Since the development of continuous positive airway pressure therapy, we have expanded our business by developing or acquiring a number of innovative products and solutions for a broad range of sleep and related breathing health disorders including technologies to be applied in medical and consumer products, life support and ventilation devices, diagnostic products, mask systems for use in the hospital and home, headgear and other accessories, and dental devices. In addition, we are a leading provider of cloud-based health applications, software and devices designed to provide connected care, enabling clinicians to manage more patients efficiently and effectively, as well as enabling and encouraging patients’ long-term adherence to and satisfaction with their therapy. Our growth has been fueled by geographic expansion, our research and product development efforts, acquisitions and an increasing awareness of sleep and related breathing health conditions, like chronic obstructive pulmonary disease, as significant health concerns.
We are committed to ongoing investment in research and development and product enhancements. During the three months ended September 30, 2026, we invested $103 million on research and development activities, which represents 7.3% of net revenues, with a continued focus on the development and commercialization of new, innovative products and solutions that improve patient outcomes, create efficiencies for our customers and help physicians and providers better manage chronic disease and lower healthcare costs. For example, our newest device, AirSense 11, introduced new features such as a touch screen, algorithms for patients new to therapy, digital enhancements, and over-the-air update capabilities. Our operations include residential care software platforms designed to support the professionals and caregivers who help people stay healthy in the home or care setting of their choice. These platforms, together with our cloud-based remote monitoring and therapy management system and robust product pipeline, should continue to provide a strong foundation for future growth.
We have determined that we have two operating segments, which are the sleep and respiratory disorders sector of the medical device industry, or Sleep and Breathing Health, and the supply of business management software as a service to residential healthcare providers, or Residential Care Software.
On September 1, 2026, we completed the previously announced sale of our MatrixCare business. The transaction was undertaken as part of our portfolio optimization strategy to increase focus on our core growth areas of sleep, breathing, and connected home-based healthcare. The transaction does not represent a strategic shift that has a major effect on our operations or financial results. Accordingly, the results of the MatrixCare business through the date of disposition and the associated gain on divestiture are presented within continuing operations. The operating results of the MatrixCare business through the date of disposition are also included within the Residential Care Software segment. See Note 13 to the unaudited condensed consolidated financial statements for additional information.
During the first quarter of fiscal year 2027, we revised the presentation of restructuring expenses and amortization of acquired intangibles in our condensed consolidated statements of operations. Restructuring expenses, which were previously presented as a separate line item within operating expenses, are now classified within cost of sales, research and development expenses, and selling, general and administrative expenses based on the function of the associated costs. Amortization of acquired intangibles relating to cost of sales is no longer presented as a separate line item within cost of sales. Amortization of acquired intangibles relating to operating expenses are now classified within selling, general and administrative expenses. Prior-period amounts have been reclassified to conform to the current-period presentation. The reclassifications had no effect on previously reported income from operations, income before income taxes, net income, earnings per share or cash flows. See Note 1 to the unaudited condensed consolidated financial statements for additional information.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
Net revenue for the three months ended September 30, 2026 was $1.4 billion, an increase of 6% compared to the three months ended September 30, 2025. Gross margin was 61.5% for the three months ended September 30, 2026 compared to 61.2% for the three months ended September 30, 2025. Diluted earnings per share was $2.92 for the three months ended September 30, 2026, compared to diluted earnings per share of $2.37 for the three months ended September 30, 2025.
At September 30, 2026, our cash and cash equivalents totaled $1.0 billion, our total assets were $8.2 billion and our stockholders’ equity was $5.9 billion.
In order to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency fluctuations, we provide certain financial information on a “constant currency” basis, which is in addition to the actual financial information presented. In order to calculate our constant currency information, we translate the current period financial information using the foreign currency exchange rates that were in effect during the previous comparable period. However, constant currency measures should not be considered in isolation or as an alternative to U.S. dollar measures that reflect current period exchange rates, or to other financial measures calculated and presented in accordance with accounting principles generally accepted in the United States, or GAAP.
Results of Operations
Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
Net Revenue
Net revenue for the three months ended September 30, 2026 increased to $1,415 million from $1,336 million for the three months ended September 30, 2025, an increase of $79 million or 6% (a 6% increase on a constant currency basis and a 7% increase on a core constant currency basis). The following table summarizes our net revenue disaggregated by segment, product and region (in thousands):
| Three Months Ended September 30, | % Change | Constant Currency(1) | Core Constant Currency(2) | ||||||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||||||||
| Americas | |||||||||||||||||||||||||||||
| Devices | $ | 436,438 | $ | 413,438 | 6 | % | 6 | % | 4 | % | |||||||||||||||||||
| Masks and other | 396,981 | 361,316 | 10 | 10 | 10 | ||||||||||||||||||||||||
| Total Americas | $ | 833,419 | $ | 774,754 | 8 | % | 8 | % | 7 | % | |||||||||||||||||||
| Rest of World | |||||||||||||||||||||||||||||
| Devices | $ | 283,854 | $ | 266,872 | 6 | % | 6 | % | 6 | % | |||||||||||||||||||
| Masks and other | 142,529 | 127,820 | 12 | 11 | 11 | ||||||||||||||||||||||||
| Total Rest of World | $ | 426,383 | $ | 394,692 | 8 | % | 8 | % | 8 | % | |||||||||||||||||||
| Global revenue | |||||||||||||||||||||||||||||
| Devices | $ | 720,292 | $ | 680,310 | 6 | % | 6 | % | 5 | % | |||||||||||||||||||
| Masks and other | 539,510 | 489,136 | 10 | 10 | 10 | ||||||||||||||||||||||||
Total Sleep and Breathing Health | $ | 1,259,802 | $ | 1,169,446 | 8 | % | 8 | % | 7 | % | |||||||||||||||||||
Residential Care Software | 155,012 | 166,136 | (7) | % | (6) | % | 5 | % | |||||||||||||||||||||
| Total | $ | 1,414,814 | $ | 1,335,582 | 6 | % | 6 | % | 7 | % | |||||||||||||||||||
1.Constant currency numbers exclude the impact of movements in international currencies.
2.Core constant currency numbers exclude the impact of movements in international currencies and the impact of acquisitions and divestitures. See Summary of Non-GAAP Financial Measures below.
Sleep and Breathing Health
Net revenue from our Sleep and Breathing Health business for the three months ended September 30, 2026 was $1,260 million, an increase of 8% compared to net revenue for the three months ended September 30, 2025. Movements in international currencies against the U.S. dollar had a negligible impact on net revenue for the three months ended September 30, 2026. Excluding the impact of currency movements, total Sleep and Breathing Health net revenue for the
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
three months ended September 30, 2026 increased by 8% compared to the three months ended September 30, 2025. The increase in net revenue associated with our devices and masks was primarily attributable to increased demand and unit sales across our sleep health portfolio, partially offset by lower unit sales of our life support devices primarily reflecting the planned discontinuation of our Astral device.
Net revenue from our Sleep and Breathing Health business in the Americas for the three months ended September 30, 2026 increased to $833 million from $775 million for the three months ended September 30, 2025, an increase of $59 million or 8%. The increase in net revenue associated with our devices and masks was primarily attributable to increased demand and unit sales.
Net revenue from our Sleep and Breathing Health business in Rest of World increased for the three months ended September 30, 2026 to $426 million from $395 million for the three months ended September 30, 2025, an increase of $32 million or 8% (an 8% increase on a constant currency basis). The constant currency increase in device and mask sales in Rest of World was primarily attributable to increased demand and unit sales across our sleep health portfolio including the impact of device fleet renewals in France, partially offset by lower unit sales of our life support devices primarily reflecting the planned discontinuation of our Astral device.
Net revenue from devices for the three months ended September 30, 2026 increased to $720 million from $680 million for the three months ended September 30, 2025, an increase of $40 million or 6%, including an increase of 6% in the Americas and an increase of 6% in Rest of World (a 6% increase on a constant currency basis). Excluding the impact of foreign currency movements, device sales for the three months ended September 30, 2026 increased by 6%.
Net revenue from masks and other for the three months ended September 30, 2026 increased to $540 million from $489 million for the three months ended September 30, 2025, an increase of $50 million or 10%, including an increase of 10% in the Americas and an increase of 12% in Rest of World (an 11% increase on a constant currency basis). Excluding the impact of foreign currency movements, masks and other sales for the three months ended September 30, 2026 increased by 10%.
Residential Care Software
Net revenue from our Residential Care Software business for the three months ended September 30, 2026 decreased to $155 million from $166 million for the three months ended September 30, 2025, a decrease of $11 million or 7%. Movements in international currencies against the U.S. dollar negatively impacted net revenue by approximately $1 million for the three months ended September 30, 2026. Excluding the impact of foreign currency movements, net revenue from our Residential Care Software business for the three months ended September 30, 2026 decreased by 6% compared to the three months ended September 30, 2025. The decrease was predominantly due to the sale of our MatrixCare business, which closed on September 1, 2026, partially offset by growth in our MEDIFOX DAN and Brightree verticals.
Gross Profit and Gross Margin
Gross profit increased for the three months ended September 30, 2026 to $871 million from $818 million for the three months ended September 30, 2025, an increase of $53 million or 6%. Gross margin, which is gross profit as a percentage of net revenue, for the three months ended September 30, 2026 was 61.5% compared to 61.2% for the three months ended September 30, 2025.
The increase in gross margin for the three months ended September 30, 2026 compared to the three months ended September 30, 2025 was due primarily to manufacturing and logistics efficiencies, component cost improvements, and lower amortization of acquired intangible assets following the sale of our MatrixCare business, partially offset by higher restructuring and business transformation costs. These costs were $8 million during the three months ended September 30, 2026, primarily associated with professional fees related to supply chain processes and systems transformation initiatives, compared to $3 million during the three months ended September 30, 2025 associated with workforce planning activities. We continue to experience inflationary pressure on our manufacturing inputs, particularly electronic components, and expect these pressures to continue through the remainder of fiscal year 2027. Additionally, we are strategically expanding parts of our supply chain, which may result in fluctuations in our gross margin as we activate new sites or expand existing sites.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
Operating Expenses
The following table summarizes our operating expenses (in thousands):
| Three Months Ended September 30, | Change | % Change | Constant Currency | ||||||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||||||||
| Research and development | $ | 102,860 | $ | 89,479 | $ | 13,381 | 15 | % | 13 | % | |||||||||||||||||||
| as a % of net revenue | 7.3 | % | 6.7 | % | |||||||||||||||||||||||||
| Selling, general, and administrative | $ | 314,723 | $ | 281,648 | $ | 33,075 | 12 | % | 11 | % | |||||||||||||||||||
| as a % of net revenue | 22.2 | % | 21.1 | % | |||||||||||||||||||||||||
Research and Development Expenses
Research and development expenses increased for the three months ended September 30, 2026 to $103 million from $89 million for the three months ended September 30, 2025, an increase of $13 million or 15%. Research and development expenses were unfavorably impacted by the movement of international currencies against the U.S. dollar, which increased our expenses by approximately $2 million for the three months ended September 30, 2026, as reported in U.S. dollars. Excluding the impact of foreign currency movements, research and development expenses increased by 13% compared to the three months ended September 30, 2025. As a percentage of net revenue, research and development expenses were 7.3% for the three months ended September 30, 2026 and 6.7% for the three months ended September 30, 2025.
The increase in research and development expenses during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 was primarily due to increases in employee-related costs.
Selling, General, and Administrative Expenses
Selling, general, and administrative expenses increased for the three months ended September 30, 2026 to $315 million from $282 million for the three months ended September 30, 2025, an increase of $33 million or 12%. Selling, general, and administrative expenses were unfavorably impacted by the movement of international currencies against the U.S. dollar, which increased our expenses by approximately $2 million, as reported in U.S. dollars. Excluding the impact of foreign currency movements, selling, general, and administrative expenses for the three months ended September 30, 2026 increased by 11% compared to the three months ended September 30, 2025. As a percentage of net revenue, selling, general, and administrative expenses were 22.2% for the three months ended September 30, 2026, compared to 21.1% for the three months ended September 30, 2025.
The constant currency increase in selling, general, and administrative expenses during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 was partially due to additional expenses associated with our acquisition of Noctrix, employee-related costs, and marketing investments. We also initiated several growth and transformation initiatives resulting in restructuring and business transformation costs of $20 million during the three months ended September 30, 2026, compared to $10 million associated with workforce planning activities during the three months ended September 30, 2025. Additionally, during the three months ended September 30, 2026, we recorded $10 million of acquisition and divestment-related expenses primarily associated with the sale of the MatrixCare business. We did not incur acquisition and divestment-related expenses during the three months ended September 30, 2025. These increases were partially offset by a decrease in amortization of acquired intangibles of $3.6 million related to the cessation of amortization for intangible assets associated with the MatrixCare business upon its classification as held for sale on June 30, 2026, as well as certain intangible assets reaching the end of their useful lives and becoming fully amortized.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
Total Other Income (Loss), Net
The following table summarizes our other income (loss) (in thousands):
| Three Months Ended September 30, | |||||||||||||||||
| 2026 | 2025 | Change | |||||||||||||||
| Interest income | $ | 21,198 | $ | 15,914 | $ | 5,284 | |||||||||||
| Interest expense | (4,814) | (7,121) | 2,307 | ||||||||||||||
| Gain (loss) attributable to equity method investments | 1,884 | 1,489 | 395 | ||||||||||||||
| Gain (loss) on equity investments | 5,719 | (6,190) | 11,909 | ||||||||||||||
| Gain on divestment of subsidiaries | 61,784 | — | 61,784 | ||||||||||||||
| Other, net | 400 | (3,836) | 4,236 | ||||||||||||||
| Total other income (loss), net | $ | 86,171 | $ | 256 | $ | 85,915 | |||||||||||
Total other income (loss), net for the three months ended September 30, 2026 was income of $86 million compared to income of $0.3 million for the three months ended September 30, 2025. The increase was primarily due to a $62 million gain recognized upon the divestment of the MatrixCare business on September 1, 2026. In addition, interest income increased to $21 million for the three months ended September 30, 2026 compared to $16 million for the three months ended September 30, 2025 due to gains recognized on cross-currency swaps associated with our fair value and net investment hedges. Interest expense decreased to $5 million for the three months ended September 30, 2026 compared to $7 million for the three months ended September 30, 2025 due to lower debt levels following repayments on our term credit facility and senior notes. We also recognized a gain associated with our equity investments of $6 million for the three months ended September 30, 2026 compared to a loss of $6 million for the three months ended September 30, 2025.
Income Taxes
Our effective income tax rate for the three months ended September 30, 2026 was 22.4% as compared to 22.0% for the three months ended September 30, 2025. Our effective rate of 22.4% for the three months ended September 30, 2026 differs from the statutory rate of 21.0% primarily due to foreign operations, research credits and discrete tax adjustments. The increase in our effective tax rate for the three months ended September 30, 2026 was primarily due to the impact of global minimum taxes implemented in accordance with Pillar Two and discrete tax adjustments.
Our Singapore operations operate under certain tax holidays and tax incentive programs that will expire in whole or in part at various dates through June 30, 2030. As a result of the U.S. Tax Cuts and Jobs Act of 2017, we treated all non-U.S. historical earnings as taxable during the year ended June 30, 2018. Therefore, future repatriation of cash held by our non-U.S. subsidiaries will generally not be subject to U.S. federal tax, if repatriated.
The Organization of Economic Co-operation and Development, or the OECD, and the G20 Inclusive Framework on Base Erosion and Profit Shifting, or the Inclusive Framework, has put forth two proposals—Pillar One and Pillar Two—that (i) revise the existing profit allocation and nexus rules and (ii) ensure a minimal level of taxation, respectively. Effective in our fiscal year beginning July 1, 2024, various jurisdictions in which we operate began implementing the global minimum tax prescribed under Pillar Two. Pillar Two legislation in effect as of September 30, 2026 has been incorporated into our condensed consolidated financial statements.
On January 1, 2026, the OECD released the Side-by-Side, or SbS, Package, which exempts U.S.-headquartered multinational enterprises from Pillar Two’s income inclusion and undertaxed profits rules for tax years beginning on or after January 1, 2026. The remaining OECD countries are in the process of implementing the SbS Package in local legislation to align with the OECD framework. We are continuing to evaluate the potential impacts of the Inclusive Framework for future periods.
Net Income and Earnings per Share
As a result of the factors above, our net income for the three months ended September 30, 2026 was $418 million compared to $349 million for the three months ended September 30, 2025, an increase of $70 million or 20%.
32
| PART I – FINANCIAL INFORMATION | Item 2 | ||||
RESMED INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Our diluted earnings per share for the three months ended September 30, 2026 was $2.92 per diluted share compared to $2.37 for the three months ended September 30, 2025, an increase of $0.55 or 23%.
Summary of Non-GAAP Financial Measures
In addition to financial information prepared in accordance with GAAP, our management uses certain non-GAAP financial measures, such as non-GAAP core constant currency basis, non-GAAP gross profit, non-GAAP gross margin, non-GAAP income from operations, non-GAAP operating margin, non-GAAP net income, and non-GAAP diluted earnings per share, in evaluating the performance of our business. We believe that these non-GAAP financial measures, when reviewed in conjunction with GAAP financial measures, can provide investors better insight when evaluating our performance from core operations and can provide more consistent financial reporting across periods. For these reasons, we use non-GAAP information internally in planning, forecasting, and evaluating the results of operations in the current period and in comparing it to past periods. These non-GAAP financial measures should be considered in addition to, and not superior to or as a substitute for, GAAP financial measures. We strongly encourage investors and shareholders to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. Non-GAAP financial measures as presented herein may not be comparable to similarly titled measures used by other companies.
We adjust for the following items when calculating our non-GAAP measures:
•Acquisitions and divestitures: Revenue associated with acquisitions that have not been owned for a full year or revenue associated with subsidiaries that have been divested in the current fiscal year have been excluded when calculating revenue on a core constant currency basis.
•Amortization of acquired intangibles: Amortization of acquired intangible assets has been excluded from cost of sales, operating expenses and related non-GAAP measures.
•Restructuring and business transformation costs: Restructuring charges primarily include employee severance and one-time termination costs in connection with certain growth and transformation initiatives, in addition to ongoing workforce planning activities. Business transformation costs represent non-recurring expenses for strategic projects with anticipated long-term benefits that do not meet the definition of restructuring charges.
•Acquisition and divestment-related expenses: These expenses include transaction, consultancy and professional fees associated with the acquisition or divestiture of subsidiaries.
•Gain on divestment of subsidiaries: This reflects the non-recurring gain recognized upon the divestiture of our MatrixCare business.
•Income tax effect of interest income on tax penalties: This reflects the net impact of non-recurring interest and penalties refunded from the IRS due to amended returns.
•The tax effects of all non-tax adjustments above.
Non-GAAP measures are reconciled to their most directly comparable GAAP financial measures below (in thousands, except percentages and per share amounts):
| Three Months Ended | |||||||||||
| September 30, 2026 | September 30, 2025 | ||||||||||
| GAAP total revenue growth | 6 | % | 9 | % | |||||||
| Impact of: | |||||||||||
| Acquisitions/divestitures | 1 | — | |||||||||
Effect of foreign currency fluctuations | — | (1) | |||||||||
| Non-GAAP core constant currency total revenue growth | 7 | % | 8 | % | |||||||
33
| PART I – FINANCIAL INFORMATION | Item 2 | ||||
RESMED INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition and Results of Operations
| Three Months Ended September 30, 2026 | ||||||||||||||||||||||||||
| Gross profit | Research and development expenses | Selling, general, and administrative expenses | Income from operations | Total other income (loss), net | Income tax expense | Net income | Diluted earnings per share | |||||||||||||||||||
| GAAP | $ | 870,567 | $ | 102,860 | $ | 314,723 | $ | 452,984 | $ | 86,171 | $ | 120,742 | $ | 418,413 | $ | 2.92 | ||||||||||
| Amortization of acquired intangibles | 5,221 | — | (8,317) | 13,538 | — | 3,833 | 9,705 | 0.07 | ||||||||||||||||||
| Restructuring and business transformation expenses | 7,800 | (1,330) | (20,327) | 29,457 | — | 7,029 | 22,428 | 0.16 | ||||||||||||||||||
| Acquisition and divestment related expenses | — | — | (10,198) | 10,198 | — | — | 10,198 | 0.07 | ||||||||||||||||||
| Gain on divestment of subsidiary | — | — | — | — | (61,784) | (6,863) | (54,921) | (0.38) | ||||||||||||||||||
| Income tax effect of interest income on tax refunds | — | — | — | — | — | (12,187) | 12,187 | 0.07 | ||||||||||||||||||
| Non-GAAP | $ | 883,588 | $ | 101,530 | $ | 275,881 | $ | 506,177 | $ | 24,387 | $ | 112,554 | $ | 418,010 | $ | 2.91 | ||||||||||
| Three Months Ended September 30, 2025 | ||||||||||||||||||||||||||
| Gross profit | Research and development expenses | Selling, general, and administrative expenses | Income from operations | Total other income (loss), net | Income tax expense | Net income | Diluted earnings per share | |||||||||||||||||||
| GAAP | $ | 817,664 | $ | 89,479 | $ | 281,648 | $ | 446,537 | $ | 256 | $ | 98,257 | $ | 348,536 | $ | 2.37 | ||||||||||
| Amortization of acquired intangibles | 7,821 | — | (11,956) | 19,777 | — | 5,210 | 14,567 | 0.10 | ||||||||||||||||||
| Restructuring and business transformation expenses | 3,156 | (2,156) | (10,498) | 15,810 | — | 4,038 | 11,772 | 0.08 | ||||||||||||||||||
| Non-GAAP | $ | 828,641 | $ | 87,323 | $ | 259,194 | $ | 482,124 | $ | 256 | $ | 107,505 | $ | 374,875 | $ | 2.55 | ||||||||||
Liquidity and Capital Resources
Our principal sources of liquidity are our existing cash and cash equivalents, cash generated from operations and access to our revolving credit facility. Our primary uses of cash have been for research and development activities, selling and marketing activities, capital expenditures, strategic acquisitions and investments, share repurchases, dividend payments and repayment of debt obligations. We expect that cash provided by operating activities may fluctuate in future periods as a result of several factors, including fluctuations in our operating results, which include supply chain disruptions, working capital requirements and capital deployment decisions.
Our future capital requirements will depend on many factors including our growth rate in net revenue, third-party reimbursement of our products for our customers, the timing and extent of spending to support research development efforts, the expansion of selling, general and administrative activities, the timing of introductions of new products, the expenditures associated with possible future acquisitions and divestitures, investments or other business combination transactions. As we assess inorganic growth strategies, we may need to supplement our internally generated cash flow with outside sources. If we are required to access the debt market, we believe that we will be able to secure reasonable borrowing rates. As part of our liquidity strategy, we will continue to monitor our current level of earnings and cash flow generation as well as our ability to access the market considering those earning levels.
34
| PART I – FINANCIAL INFORMATION | Item 2 | ||||
RESMED INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition and Results of Operations
As of September 30, 2026 and June 30, 2026, we had cash and cash equivalents of $1.0 billion and $1.5 billion, respectively. Our cash and cash equivalents held within the U.S. at September 30, 2026 and June 30, 2026 were $278 million and $732 million, respectively. Our remaining cash and cash equivalent balances at September 30, 2026 and June 30, 2026, were $733 million and $737 million, respectively. Our cash and cash equivalent balances are held at highly rated financial institutions.
As a result of the U.S. Tax Cuts and Jobs Act of 2017, we treated all non-U.S. historical earnings as taxable, which resulted in additional tax expense of $92 million. The related tax liability, which was payable in installments over eight years, has been fully repaid. Accordingly, future repatriation of cash held by our non-U.S. subsidiaries will generally not be subject to U.S. federal tax if repatriated.
On August 31, 2026, we entered into an accelerated share repurchase agreement, or the ASR Agreement, to repurchase $450 million of our common stock. Pursuant to the ASR Agreement, we paid $450 million and received an initial delivery of 1.6 million shares during the three months ended September 30, 2026, representing an estimated 80 percent of the shares to be purchased under the ASR Agreement based on the $230.87 closing price of our common stock on September 2, 2026. Final settlement of the ASR Agreement is expected to occur no later than December 29, 2026, and will be based on a discount to the volume-weighted average price per share of our common stock over the term of the ASR Agreement. We used a portion of the net proceeds from the sale of the MatrixCare business to fund the payment due under the ASR Agreement.
As of September 30, 2026, we had $1,500 million available for draw down under the revolving credit facility and a combined total of $2,511 million in cash and available liquidity under the revolving credit facility.
We believe that our current sources of liquidity will be sufficient to fund our operations, including expected capital expenditures, for the next 12 months and beyond.
Revolving Credit Agreement, Term Credit Agreement and Senior Notes
On June 29, 2022, we entered into a second amended and restated credit agreement, or as amended from time to time, the Revolving Credit Agreement. The Revolving Credit Agreement, among other things, provided a senior unsecured revolving credit facility of $1,500 million, with an uncommitted option to increase the revolving credit facility by an additional amount equal to the greater of $1,000 million or 1.00 times the EBITDA for the trailing twelve-month measurement period. Additionally, on June 29, 2022, ResMed Pty Limited entered into a Second Amendment to the Syndicated Facility Agreement, or the Term Credit Agreement. The Term Credit Agreement, among other things, provides ResMed Pty Limited a senior unsecured term credit facility of $200 million. The Revolving Credit Agreement and Term Credit Agreement each terminate on June 29, 2027, when all unpaid principal and interest under the loans must be repaid. As of September 30, 2026, we had $1,500 million available for draw down under the revolving credit facility.
On July 10, 2019, we entered into a Note Purchase Agreement with the purchasers to that agreement, in connection with the issuance and sale of $500 million aggregate principal amount of senior notes, consisting of $250 million principal amount of our 3.24% senior notes and $250 million principal amount of our 3.45% senior notes, or collectively referred to as the Senior Notes. The 3.24% senior notes were repaid in full on July 10, 2026. The 3.45% senior notes are due July 10, 2029.
On September 30, 2026, there was a total of $410 million outstanding under the Revolving Credit Agreement, Term Credit Agreement and Senior Notes and we were in compliance with our debt covenants. We expect to satisfy all of our liquidity and remaining long-term debt requirements through a combination of cash on hand, cash generated from operations and debt facilities.
35
| PART I – FINANCIAL INFORMATION | Item 2 | ||||
RESMED INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Cash Flow Summary
The following table summarizes our cash flow activity (in thousands):
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
Net cash provided by (used in) operating activities | $ | 422,422 | $ | 457,321 | |||||||
Net cash provided by (used in) investing activities | 392,055 | (52,578) | |||||||||
Net cash provided by (used in) financing activities | (1,278,003) | (230,274) | |||||||||
| Effect of exchange rate changes on cash | 5,034 | (71) | |||||||||
Net increase (decrease) in cash and cash equivalents | $ | (458,492) | $ | 174,398 | |||||||
Operating Activities
Cash provided by operating activities was $422 million for the three months ended September 30, 2026, compared to cash provided of $457 million for the three months ended September 30, 2025. The $35 million decrease was primarily due to higher working capital requirements, including higher inventory levels partially related to the expansion of our supply chain, during the three months ended September 30, 2026 compared to the three months ended September 30, 2025.
Investing Activities
Cash provided by investing activities was $392 million for the three months ended September 30, 2026, compared to cash used of $53 million for the three months ended September 30, 2025. The $445 million increase was primarily due to proceeds from the divestment of the MatrixCare business and proceeds from the maturity of foreign currency contracts, partially offset by increased purchases of property, plant and equipment and cash used to acquire businesses during the three months ended September 30, 2026.
Financing Activities
Cash used in financing activities was $1,278 million for the three months ended September 30, 2026, compared to cash used of $230 million for the three months ended September 30, 2025. The $1,048 million increase was primarily due to $936 million of treasury stock repurchases during the three months ended September 30, 2026 compared to repurchases of $150 million during the three months ended September 30, 2025. In addition, we repaid $250 million of our Senior Notes during three months ended September 30, 2026, compared to no repayments of debt during the three months ended September 30, 2025.
Dividends
During the three months ended September 30, 2026, we paid cash dividends of $0.66 per common share totaling $95 million. On October 29, 2026, our board of directors declared a cash dividend of $0.66 per common share, to be paid on December 17, 2026, to shareholders of record as of the close of business on November 12, 2026. Future dividends are subject to approval by our board of directors.
Common Stock
On February 21, 2014, our board of directors approved our current share repurchase program, authorizing us to acquire up to an aggregate of 20 million shares of our common stock. Since approval of the share repurchase program in 2014 through September 30, 2026, we have repurchased a total of 15.7 million shares under this repurchase program for an aggregate of $2.4 billion. During the three months ended September 30, 2026, we repurchased 3.6 million shares at a cost of $855 million, including commissions and other incremental transaction costs. Shares that are repurchased are classified as treasury stock and reduce the number of shares of common stock outstanding used in calculating earnings (loss) per share. The share repurchase program may be accelerated, suspended, delayed or discontinued at any time at the discretion of our board of directors. At September 30, 2026, 4.3 million additional shares remain available for us to repurchase under the approved share repurchase program.
36
| PART I – FINANCIAL INFORMATION | Item 2 | ||||
RESMED INC. AND SUBSIDIARIES
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Critical Accounting Principles and Estimates
The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect our reported amounts of assets and liabilities, revenues and expenses and related disclosures of contingent assets and liabilities. On an ongoing basis we evaluate our estimates, including those related to allowance for doubtful accounts, inventory reserves, warranty obligations, goodwill, potentially impaired assets, intangible assets, income taxes and contingencies.
We state these accounting policies in the notes to the financial statements and at relevant sections in this discussion and analysis. The estimates are based on the information that is currently available to us and on various other assumptions that we believe to be reasonable under the circumstances. Actual results could vary from those estimates under different assumptions or conditions.
For a full discussion of our critical accounting policies, see our Annual Report on Form 10-K for the fiscal year ended June 30, 2026.
Recently Issued Accounting Pronouncements
See Note 1 to the unaudited condensed consolidated financial statements for a description of recently issued accounting pronouncements, including the expected dates of adoption and estimated effects on our results of operations, financial position and cash flows.
Contractual Obligations and Commitments
Other than the repayment of our Senior Notes disclosed above, there have been no material changes outside the ordinary course of business in our outstanding contractual obligations from those disclosed within “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended June 30, 2026.
Off-Balance Sheet Arrangements
As of September 30, 2026, we are not involved in any significant off-balance sheet arrangements, as described in Instruction 8 to Item 303(b) of Regulation S-K promulgated by the SEC.
37
| PART I – FINANCIAL INFORMATION | Item 3 | ||||
RESMED INC. AND SUBSIDIARIES
Quantitative and Qualitative Disclosures About Market Risk
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Foreign Currency Market Risk
Our reporting currency is the U.S. dollar, although the financial statements of our non-U.S. subsidiaries are maintained in their respective local currencies. We transact business in various foreign currencies, including a number of major European currencies as well as the Australian and Singapore dollars. We have significant foreign currency exposure through our Australian and Singapore manufacturing activities and our international sales operations.
Net Investment and Fair Value Hedging
We enter into foreign cross-currency swaps as net investment hedges and fair value hedges in designated hedging relationships with either the foreign denominated net asset balances or the foreign denominated intercompany loans as the hedged items. All derivatives are recorded at fair value as either an asset or liability. Cash flows associated with derivative instruments are presented in the same category on the consolidated statements of cash flows as the hedged item.
The purpose of the cross-currency swaps for the fair value hedge is to mitigate foreign currency risk associated with changes in spot rates on foreign denominated intercompany debt between USD and EUR. For these hedges, we excluded certain components from the assessment of hedge effectiveness that are not related to spot rates. For fair value hedges that qualify and are designated for hedge accounting, the change in fair value of the derivative is recorded in the same line item as the hedged item, Other, net, in the condensed consolidated statements of operations. The initial fair value of hedge components excluded from the assessment of effectiveness is recognized in the statements of operations under a systematic and rational method over the life of the hedging instrument and is presented in interest income or interest expense, as applicable. Any difference between the change in the fair value of the hedge components excluded from the assessment of effectiveness and the amounts recognized in earnings is recorded as a component of other comprehensive income.
The purpose of the cross-currency swaps for net investment hedges is to mitigate foreign currency risk associated with changes in spot rates on the net asset balances of our foreign functional subsidiaries. For net investment hedges that qualify and are designated for hedge accounting, the change in fair value of the derivative is recorded in cumulative translation adjustment within other comprehensive loss and reclassified into earnings when the hedged net investment is either sold or substantially liquidated. The initial fair value of components excluded from the assessment of hedge effectiveness will be recognized in interest income or interest expense, as applicable.
The notional value of outstanding foreign cross-currency swaps was $3.4 billion at both September 30, 2026 and June 30, 2026. These contracts mature at various dates prior to January 31, 2036.
Non-Designated Hedges
We transact business in various foreign currencies, including a number of major European currencies as well as the Australian and Singapore dollars. We have foreign currency exposure through both our Australian and Singapore manufacturing activities, and international sales operations. We have established a foreign currency hedging program using purchased foreign currency call options, collars and forward contracts to hedge foreign-currency-denominated financial assets, liabilities and manufacturing cash flows. The terms of such foreign currency hedging contracts generally do not exceed three years. The purpose of this hedging program is to economically manage the financial impact of foreign currency exposures denominated mainly in Euros, and Australian and Singapore dollars. Under this program, increases or decreases in our foreign currency denominated financial assets, liabilities, and firm commitments are partially offset by gains and losses on the hedging instruments. We do not designate these foreign currency contracts as hedges. All movements in the fair value of the foreign currency instruments are recorded within other, net in our condensed consolidated statements of operations.
The notional value of the outstanding non-designated hedges was $1.3 billion at both September 30, 2026 and June 30, 2026. These contracts mature at various dates prior to September 15, 2027.
38
| PART I – FINANCIAL INFORMATION | Item 3 | ||||
RESMED INC. AND SUBSIDIARIES
Quantitative and Qualitative Disclosures About Market Risk
Fair Values of Derivative Instruments
The table below provides information (in U.S. dollars) on our foreign currency denominated operating assets and liabilities and after considering our foreign currency hedging activities as of September 30, 2026 (in thousands):
| U.S. Dollar (USD) | Euro (EUR) | Canadian Dollar (CAD) | Chinese Yuan (CNY) | Korean Won (KRW) | |||||||||||||||||||||||||
| AUD Functional: | |||||||||||||||||||||||||||||
| Net Assets/(Liabilities) | 374,226 | (121,155) | (144) | 64,545 | 20,901 | ||||||||||||||||||||||||
| Foreign Currency Hedges | (365,000) | 147,468 | — | (44,741) | (29,499) | ||||||||||||||||||||||||
| Net Total | 9,226 | 26,313 | (144) | 19,804 | (8,598) | ||||||||||||||||||||||||
| USD Functional: | |||||||||||||||||||||||||||||
| Net Assets/(Liabilities) | — | 315,092 | 32,649 | — | — | ||||||||||||||||||||||||
| Foreign Currency Hedges | — | (317,623) | (35,182) | — | — | ||||||||||||||||||||||||
| Net Total | — | (2,531) | (2,533) | — | — | ||||||||||||||||||||||||
| EURO Functional: | |||||||||||||||||||||||||||||
| Net Assets/(Liabilities) | 4,463 | — | — | — | — | ||||||||||||||||||||||||
| Foreign Currency Hedges | — | — | — | — | — | ||||||||||||||||||||||||
| Net Total | 4,463 | — | — | — | — | ||||||||||||||||||||||||
| SGD Functional: | |||||||||||||||||||||||||||||
| Net Assets/(Liabilities) | 363,807 | 263,084 | — | 7,204 | — | ||||||||||||||||||||||||
| Foreign Currency Hedges | (395,000) | (283,592) | — | — | — | ||||||||||||||||||||||||
| Net Total | (31,193) | (20,508) | — | 7,204 | — | ||||||||||||||||||||||||
39
| PART I – FINANCIAL INFORMATION | Item 3 | ||||
RESMED INC. AND SUBSIDIARIES
Quantitative and Qualitative Disclosures About Market Risk
The table below provides information about our material foreign currency derivative financial instruments and presents the information in U.S. dollar equivalents. The table summarizes information on instruments and transactions that are sensitive to foreign currency exchange rates, including foreign currency call options, collars, forward contracts and cross-currency swaps held at September 30, 2026. The table presents the notional amounts and weighted average exchange rates by contractual maturity dates for our foreign currency derivative financial instruments, including the forward contracts used to hedge our foreign currency denominated assets and liabilities. These notional amounts generally are used to calculate payments to be exchanged under the contracts (in thousands, except exchange rates).
| Fair Value Assets / (Liabilities) | |||||||||||||||||
| Total | September 30, 2026 | June 30, 2026 | |||||||||||||||
| AUD/USD | |||||||||||||||||
| Contract amount | 365,000 | (8,117) | (10,551) | ||||||||||||||
| Ave. contractual exchange rate | AUD 1 = USD 0.7104 | ||||||||||||||||
| AUD/EUR | |||||||||||||||||
| Contract amount | 192,843 | (351) | 2,177 | ||||||||||||||
| Ave. contractual exchange rate | AUD 1 = EUR 0.6016 | ||||||||||||||||
| SGD/EUR | |||||||||||||||||
| Contract amount | 283,592 | 4,868 | 1,701 | ||||||||||||||
| Ave. contractual exchange rate | SGD 1 = EUR 0.6795 | ||||||||||||||||
| SGD/USD | |||||||||||||||||
| Contract amount | 395,000 | (2,682) | (4,856) | ||||||||||||||
| Ave. contractual exchange rate | SGD 1 = USD 0.7910 | ||||||||||||||||
| AUD/CNY | |||||||||||||||||
| Contract amount | 44,741 | (822) | (1,099) | ||||||||||||||
| Ave. contractual exchange rate | AUD 1 = CNY 4.7203 | ||||||||||||||||
| AUD/KRW | |||||||||||||||||
| Contract amount | 29,499 | (1,739) | 313 | ||||||||||||||
| Ave. contractual exchange rate | AUD 1 = KRW 1,000.7974 | ||||||||||||||||
| USD/EUR | |||||||||||||||||
| Contract amount | 1,087,401 | (89,768) | (96,601) | ||||||||||||||
| Ave. contractual exchange rate | USD 1 = EUR 1.0406 | ||||||||||||||||
USD/SGD | |||||||||||||||||
| Contract amount | 2,348,108 | (182,127) | (104,564) | ||||||||||||||
| Ave. contractual exchange rate | USD 1 = SGD 0.7847 | ||||||||||||||||
| USD/CAD | |||||||||||||||||
| Contract amount | 35,182 | 903 | 889 | ||||||||||||||
| Ave. contractual exchange rate | CAD 1 = USD 0.7217 | ||||||||||||||||
Interest Rate Risk
We are exposed to risk associated with changes in interest rates affecting the return on our cash and cash equivalents and debt. At September 30, 2026, we held cash and cash equivalents of $1 billion, principally comprised of bank term deposits, at-call accounts, and money market accounts, and are invested at both short-term fixed interest rates and variable interest rates. At September 30, 2026, there was $160 million outstanding under the Revolving Credit Agreement and Term Credit Agreement, which are subject to variable interest rates. A hypothetical 10% change in interest rates during the three months ended September 30, 2026, would not have had a material impact on pretax income. We have no interest rate hedging agreements.
Inflation
Inflationary factors such as increases in the cost of our products, freight, overhead costs or wage rates may adversely affect our operating results. Sustained inflationary pressures in the future may have an adverse effect on our ability to maintain
40
| PART I – FINANCIAL INFORMATION | Item 3 | ||||
RESMED INC. AND SUBSIDIARIES
Quantitative and Qualitative Disclosures About Market Risk
current levels of gross margin and operating expenses as a percentage of net revenue if we are unable to offset such higher costs through price increases.
41
Item 4 Controls and Procedures
We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in our reports made pursuant to the Securities Exchange Act of 1934, as amended, or the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and in reaching a reasonable level of assurance management necessarily was required to apply its judgment in evaluating the cost benefit relationship of possible controls and procedures.
As required by Rule 13a-15(b) of the Exchange Act, we carried out an evaluation, under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of September 30, 2026.
There has been no change in our internal control over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
42
PART II. OTHER INFORMATION
Item 1 Legal Proceedings
We are involved in various legal proceedings, claims, investigations and litigation that arise in the ordinary course of our business. We investigate these matters as they arise, and accrue estimates for resolution of legal and other contingencies in accordance with Accounting Standards Codification Topic 450, “Contingencies”. See Note 10 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.
Litigation is inherently uncertain. Accordingly, we cannot predict with certainty the outcome of these matters; however, we do not expect the outcome of these matters to have a material adverse effect on our consolidated financial statements when taken as a whole.
Item 1A Risk Factors
The discussion of our business and operations should be read together with the risk factors contained in our Annual Report on Form 10-K for the fiscal year ended June 30, 2026, or the Annual Report, which was filed with the SEC and describe various material risks and uncertainties to which we are or may become subject. As of September 30, 2026, there have been no material changes to such risk factors.
Item 2 Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities
Purchases of equity securities. The following table summarizes our purchases of common stock for the three months ended September 30, 2026:
| Period | Total Number of Shares Purchased(1) | Average Price Paid per Share (USD) | Total Number of Shares Purchased as Part of Publicly Announced Programs(2) | Maximum Number of Shares that May Yet Be Purchased Under the Program | ||||||||||||||||||||||
| July 1 - 31, 2026 | — | $ | — | 46,798,043 | 7,917,970 | |||||||||||||||||||||
| August 1 - 31, 2026 | 1,834,183 | 232.40 | 48,632,226 | 6,083,787 | ||||||||||||||||||||||
| September 1 - 30, 2026 | 1,809,319 | 232.17 | 50,441,545 | 4,274,468 | ||||||||||||||||||||||
| Total | 3,643,502 | $ | 232.29 | 50,441,545 | 4,274,468 | |||||||||||||||||||||
1.No shares during the period were repurchased other than pursuant to a publicly announced plan or program.
2.Represents the aggregate number of shares purchased under our 2014 Program, under which 20.0 million shares have been approved for repurchase.
On February 21, 2014, our board of directors approved our current share repurchase program, authorizing us to acquire up to an aggregate of 20 million shares of our common stock. The program allows us to repurchase shares of our common stock from time to time for cash in the open market, or in negotiated or block transactions, as market and business conditions warrant and subject to applicable legal requirements. The share repurchase program may be accelerated, suspended, delayed or discontinued at any time at the discretion of our board of directors. All share repurchases after February 21, 2014 have been executed under this program. Since approval of the share repurchase program in 2014 through September 30, 2026, we have repurchased approximately 15.7 million shares under this repurchase program for an aggregate of $2.4 billion.
On August 31, 2026, we entered into an accelerated share repurchase agreement, or the ASR Agreement, to repurchase $450 million of our common stock. Pursuant to the ASR Agreement, we paid $450 million and received an initial delivery of 1.6 million shares during the three months ended September 30, 2026, representing an estimated 80 percent of the shares to be purchased under the ASR Agreement based on the $230.87 closing price of our common stock on September 2, 2026. Final settlement of the ASR Agreement is expected to occur no later than December 29, 2026, and will be based on a discount to the volume-weighted average price per share of our common stock over the term of the ASR Agreement.
Item 3 Defaults Upon Senior Securities
None
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Item 4 Mine Safety Disclosures
None
Item 5 Other Information
Rule 10b5-1 Trading Plans of Directors and Executive Officers
Our directors and executive officers may purchase or sell shares of our common stock in the market from time to time, including pursuant to equity trading plans adopted in accordance with Rule 10b5-1 under the Exchange Act and in compliance with guidelines specified by our insider trading policy. In accordance with Rule 10b5-1 and our insider trading policy, directors, officers and certain employees who, at such time, are not in possession of material non-public information are permitted to enter into written plans that pre-establish amounts, prices and dates (or formula for determining the amounts, prices and dates) of future purchases or sales of our stock, including shares acquired pursuant to our equity incentive plans. Under a Rule 10b5-1 trading plan, a broker executes trades pursuant to parameters established by the director or executive officer when entering into the plan, without further direction from them. The use of these trading plans permits asset diversification as well as personal financial and tax planning. Our directors and executive officers also may buy or sell additional shares outside of a Rule 10b5-1 plan when they are not in possession of material nonpublic information, subject to compliance with SEC rules, the terms of our insider trading policy and certain minimum holding requirements. Other than as set forth below, no other plans were adopted or terminated
The following table describes any contracts, instructions or written plans for the sale or purchase of the Company’s securities and intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act that were adopted by our directors and executive officers during the quarterly period ended September 30, 2026:
| Name and Title | Plan Action | Plan Adoption Date | Scheduled Expiration Date of Rule 10b5-1 Trading Plan(1) | Aggregate Number of Securities to Be Purchased or Sold (Up To) | ||||||||||||||||||||||
(1) A trading plan may also expire on such earlier date that all transactions under the trading plan are completed.
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Item 6 Exhibits
Exhibits (numbered in accordance with Item 601 of Regulation S-K)
| 3.1 | ||||||||
| 3.2 | ||||||||
| 10.1* | ||||||||
| 31.1 | ||||||||
| 31.2 | ||||||||
| 32** | ||||||||
| 101 | The following financial statements from ResMed Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2026, filed on October 29, 2026, formatted in Inline XBRL: (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Comprehensive Income, (iv) Condensed Consolidated Statements of Changes in Equity, (v) Condensed Consolidated Statements of Cash Flows, (vi) the Notes to the Condensed Consolidated Financial Statements. | |||||||
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). | |||||||
| * | Management contract or compensatory plan or arrangement | ||||
| ** | In accordance with Item 601(b)(32)(ii) of Regulation S-K and SEC Release No. 33-8238 and 34-47986, Final Rule: Management’s Reports on Internal Control Over Financial Reporting and Certification of Disclosure in Exchange Act Periodic Reports, the certifications furnished in Exhibit 32 hereto are deemed to accompany this Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Exchange Act. Such certifications will not be deemed to be incorporated by reference into any filings under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference. | ||||
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
October 29, 2026
| ResMed Inc. | |||||
/s/ MICHAEL J. FARRELL | |||||
| Michael J. Farrell | |||||
| Chief Executive Officer | |||||
| (Principal Executive Officer) | |||||
| /s/ AARON BLOOMER | |||||
| Aaron Bloomer | |||||
| Chief Financial Officer | |||||
| (Principal Financial Officer) | |||||
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