ResMed's Q3 Earnings Short Of Expectations, Profit Margins Contract - ResMed (NYSE:RMD)

ResMed Inc's RMD Q3 FY22 sales increased by 12% Y/Y (+14% on a constant currency basis) to $864.5 million, missing the consensus of $897 million.
The revenue growth was driven by increased demand for sleep and respiratory care devices and an increased demand following an ongoing recall of rival Koninklijke Philips N.V. PHG products.
ResMed generated $35 million - $45 million incremental device revenue due to the impact of competitors' recall.
The company expects to face supply chain challenges hampering its ability to increase the supply of devices.
ResMed expects a total incremental device revenue opportunity for FY22 of $200 million - $250 million, down from $300 million - $350 million.
Speaking on the earnings conference call, Chief executive Mick Farrell said that the patient backlog for sleep apnoea machines was between 12 and 18 months.
The adjusted gross margin decreased to 58.1% from 59.6%, mainly due to higher freight and manufacturing costs, partially offset by favorable product mix changes and an increase in average selling prices.
The adjusted EPS reached $1.32, compared to $1.30 a year ago and below the consensus of $1.42.
Dividend: ResMed declared a quarterly cash dividend of $0.42 per share, payable on June 16 and record date of May 12.
Price Action: RMD shares closed lower by 0.56% at $213.51 on Thursday.