ResMed Projects Margin Expansion and Accelerates Capital Returns

ResMed (RMD) has signaled a strong outlook for the remainder of its fiscal year, projecting gross margins between 62% and 63% for FY 2026. This guidance comes on the heels of a robust third-quarter performance that underscores the company's operational efficiency. Financial results for the quarter showed headline revenue growth of 11%, which translates to 8% growth on a constant currency basis. The company's bottom line saw an even more pronounced lift, with non-GAAP earnings per share (EPS) increasing by 21%. In a move to return value to shareholders, management announced plans for share buybacks exceeding $175 million during the fourth quarter. This capital allocation strategy reflects confidence in the company's current valuation and cash flow generation. On the strategic front, ResMed is finalizing its acquisition of Noctrix in a deal valued at $340 million. The company expects the transaction to close by June 1, further expanding its footprint in the respiratory and sleep care markets. Overall, the combination of margin expansion, aggressive buybacks, and targeted M&A suggests a growth-oriented trajectory as the company moves toward the end of its fiscal cycle.