ResMed CEO Mick Farrell had his own regrets about the quarter, saying that regulatory issues hindered U.S. sales but that the path ahead looks promising.
"While we are disappointed with the U.S. numbers, the 2 key issues, as we have previously noted, are market restructuring due to competitive bidding and increased competitor activity," Farrell said in prepared remarks. "Having said that, competitive bidding’s impact on volume in the U.S. market is beginning to moderate, and we are partnering with our U.S. customers to position for the growth that we see ahead. It’s important to note that we have a rich pipeline of products scheduled for introduction, and we remain optimistic about future growth in the U.S. market."
ResMed also just launched U.S. sales of its AirFit P10 nasal pillow system, a lighter, quieter sleep respiratory system that Farrell called "an exceptional mask."
The company reported a 2% increase in sales for the 3 months ended Dec. 31, 2013, as well as an 11% boost in earnings.
ResMed reported $86.6 million in profits, or 60¢ per diluted share, on sales of $385.3 million during its 2nd quarter 2014. That compared with profits of $77.9 million, or 53¢ per share, on sales of $376.5 million during the same period the previous year.
Analysts had estimated per-share earnings 3¢ higher than what ResMed reported. RMD shares dropped 6.5% today, trading at $43.85 as of about 3:45 p.m.