ResMed Inc.

Masks and accessories (~36% of FY2025 revenue) are recurring consumables with 3-6 month replacement cycles, and residential care software (~12%) generates contractual SaaS revenue. Combined recurring revenue (~48%) provides a solid base, but the ~52% device revenue lacks the backlog-driven visibility of a 70%-recurring model. ResMed reported $5.15B in FY2025 revenue with consistent quarterly growth across all four fiscal quarters.

ResMed's three product categories (devices ~52%, masks/accessories ~36%, software ~12%) place 88% of revenue within a single end market: sleep and respiratory health. The residential care software segment adds modest diversification through a different customer base (HME operators, long-term care facilities), but the largest revenue category (devices) exceeds 50% of total revenue.

The US, Canada, and Latin America generated approximately 58% of FY2025 revenue, with international markets (Europe, Asia, and other) contributing ~30% and the residential care software segment the remainder. Products are sold in 140+ countries, but the US market is dominant and Medicare and Medicaid reimbursement policy changes carry outsized revenue impact.

Gross margin expanded to 62.2% in Q3 FY2026 from 59.3% a year earlier, reflecting favorable product mix and operating leverage on fixed costs. The residential care software segment is highly asset-light, but the dominant hardware business ties significant revenue to manufacturing and supply chain costs. Positive operating leverage is visible across recent quarters without being structurally transformative.

Masks, accessories, and software (~48% of revenue combined) carry strong quality characteristics: insurance-reimbursed, clinically required, and low cancellation friction. Device revenue (~52%) is non-discretionary for diagnosed OSA patients, though with a longer replacement cycle. Coverage by Medicare, Medicaid, and private insurers in major markets insulates demand from discretionary spending cycles.