Why is the ResMed share price down 4.9% today?

Investors seem to have changed their minds on Resmed over the weekend.

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Key points
  • ResMed Inc (ASX: RMD) shares have fallen nearly 5% on Monday after initially spiking last week due to positive first-quarter financial results.
  • The company reported a 9% increase in revenue to US$1.3 billion last week and an 11% rise in net income to US$349 million, driven by heightened demand for sleep-focused medical devices.
  • Despite Friday's initial gains, investor sentiment turned negative over the weekend, affecting ResMed's US stocks and influencing ASX traders to reverse prior increases.

It's been a rather wild and woolly start to the trading week for the S&P/ASX 200 Index (ASX: XJO) this Monday so far. At the time of writing, the ASX 200 is down 0.17% after falling as much as 0.7% in morning trading earlier this session. But one ASX 200 stock is doing far worse than that. Let's discuss the current state of the ResMed Inc. (ASX: RMD) share price.

The ResMed share price is making the ASX's rough start to the week look pretty mild by comparison. This dual-listed healthcare stock ended last week at $39.53 a share. However, those same shares opened at just $37.85 this morning, before dropping to an intraday low of $37.58 soon after. That was a loss worth 4.93% at the time. The company is currently just a touch above that at the time of writing, down 4.2% at $37.87 a share.

So what's going on here?

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Image source: Getty Images

Why is the ResMed share price down almost 5% today?

This dramatic share price drop appears to be a collective pullback from the spike in the company's stock last Friday, 31 October.

As we covered at the time, that initial spike followed a well-received (at least initially) first-quarter update from ResMed. This update revealed that the company increased its revenues by 9% to US$1.3 billion for the quarter. This was largely due to higher demand, particularly in the United States, Canada, and Latin America, for its sleep-focused medical devices and accessories.

ResMed also revealed that its gross margin rose 2.9% over the period, due to improved efficiencies in manufacturing and logistics.

Despite ResMed's expenses rising by 7% on a constant currency basis, the company reported an 11% rise in net income to US$349 million for the period. That translates to a diluted earnings per share (EPS) of US$2.37.

ResMed CEO and chair Mick Farrell told investors that the rest of the 2026 financial year looks bright for shareholders as well, flagging "strong, sustainable, profitable growth".

On Friday, ResMed shares rose by 1.65% by market close after soaring more than 2% higher at one point in intra-day trading. However, US investors had a less rosy reaction on Friday night (our time), sending the company's US stock 2.13% lower. It seems ASX investors have taken their cues from this today and are reversing Friday's gains accordingly. Let's see which sentiment takes hold over the rest of the trading week.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended ResMed. The Motley Fool Australia has positions in and has recommended ResMed. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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