The ResMed Inc (ASX: RMD) share price is avoiding the market selloff and racing higher on Friday.
In early trade, the sleep disorder treatment company's shares are up an impressive 10% to $31.50.
This compares favourably to a 0.8% decline by the ASX 200 index this morning.
Why is the ResMed share price jumping?
Investors have been fighting to get hold of the company's shares this morning following the release of its third-quarter update.
According to the release, ResMed reported a 7% increase in revenue to US$1.2 billion for the three months ended 31 March. This was driven by increased demand for sleep devices, as well as strong growth across its mask product portfolio.
United States, Canada, and Latin America revenue grew by 9%, Europe, Asia, and other markets revenue rose 3%, and software-as-a-service revenue increased by 8%.
Another big positive was the company's gross margin, which improved 260 basis points to 57.9% on a GAAP basis and 240 basis points to 58.5% on a non-GAAP basis. This was ahead of the consensus estimate for a gross margin of 57.6%.
This led to income from operations increasing 25% for the quarter to US$374.6 million and diluted earnings per share lifting 29% to US$2.04 per share.
A quarterly dividend of US$0.48 per share was declared. Though, it is worth noting that this equates to 4.8 US cents for ResMed's ASX-listed shares.
Management commentary
ResMed's chairman and CEO, Mick Farrell, was rightfully pleased with the company's performance during the quarter. He said:
ResMed's strong third-quarter fiscal year 2024 results reflect robust patient and customer demand for our products and software solutions, leading to double-digit mask and accessories revenue growth along with ongoing operational efficiencies to drive margin improvement and increased profitability, resulting in double-digit growth in both operating profit and earnings per share.
Farrell also spoke positively about the company's long-term outlook, highlighting its huge market opportunity. It said:
Over 2 billion people worldwide can benefit from a ResMed solution to help them sleep better, breathe better, and receive best-in-class healthcare right where they live. We remain laser-focused on bringing market-leading innovation to customers, including our latest AirCurve11 range of non-invasive ventilators and our recently launched AirFit F40 mask system, combined with our entire portfolio of products, software, and solutions, allowing us to continue to deliver value for all our stakeholders.
Following this gain, the ResMed share price is now up almost 24% in 2024.
