The market still fears GLP-1 drugs will kill sleep apnea demand. The numbers say otherwise.
ResMed is showing a **confirmed positive inflection**, driven by margin expansion and earnings leverage — not hype.
📈 Inflection status: CONFIRMED POSITIVE
Margins and earnings are accelerating faster than revenue.
Atomic evidence:
• Revenue +9% YoY to $1.34B (Q1 FY26)
• Net income +12% YoY to $348.5M → clear operating leverage
• Gross margin expanded to 59.4% (+80bps YoY)
• Core Sleep & Breathing revenue +10% YoY ($1.17B)
• Dividend raised 13% YoY to $0.60
This directly contradicts the “terminal decline from GLP-1” narrative.
💰 Balance sheet strength:
• Cash $1.38B vs debt $668M → net cash optionality
• Efficiency gains not yet fully priced into valuation
⚠️ Bottleneck to watch:
• Residential Care SaaS growth slowed to +6% YoY
🎯 Kill-switch risks:
• Gross margin <57%
• Adverse litigation outcome
• Core sleep growth <5%
🧠 Verdict: Buy (6–12m).
This is a classic profitability inflection hiding behind sentiment noise.
🤖 AI-assisted analysis
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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