ResMed Inc.'s ( RMD Quick Quote RMD - Free Report) adjusted earnings per share (EPS) in the fourth quarter of fiscal 2022 were $1.49, up 10.4% year over year. The metric also surpassed the Zacks Consensus Estimate by 0.7%. The adjustments include certain non-recurring expenses/benefits like amortization of acquired intangibles and restructuring costs, among others. Full-year adjusted EPS was $5.79, up 8.6%. The metric surpassed the Zacks Consensus Estimate by 0.7%. GAAP EPS in the reported quarter was $1.33, similar to the year-ago quarter’s EPS. Revenues Fiscal fourth-quarter revenues on a reported basis increased 4.4% year over year (up 8% at constant exchange rate or CER) to $914.7 million. However, the figure beat the Zacks Consensus Estimate by 0.3%. In fiscal 2022, revenues increased 11.9% to $3.58 billion. The metric was in line with Zacks Consensus Estimate. A Closer View of Q2 Top Line Total Sleep and Respiratory Care revenues in the United States, Canada and Latin America improved 11.9% from the prior-year period to $528.5 million. Total Sleep and Respiratory Care revenues in Europe, Asia and other markets fell 8.1% on a reported basis and rose 1% at CER to $283.1 million. Global revenues from total Sleep and Respiratory Care in the quarter under review were $811.6 million, up 4% on a reported basis and 8% at CER. Meanwhile, Software as a Service (SaaS) revenues grew 7.6% to $103.1 million. The revenue growth in the quarter was due to increased demand for ResMed’s sleep and respiratory care devices, driven by a steady recovery of markets and greater device demand in response to a competitor’s ongoing product recall. The upside in SaaS revenues resulted from continued growth across the company’s portfolio of verticals, including home medical equipment and facilities-based and home-based care settings. Margins Adjusted gross profit in the quarter under review rose 5.4% to $528.9 million despite a 3.1% uptick in the cost of sales (excluding expenses related to amortization of acquired intangibles and restructuring). Adjusted gross margin for the fiscal fourth quarter was 57.8%, reflecting a 55-basis point (bps) expansion, primarily owing to an improvement in average selling prices and favorable product mix changes. However, this was partially offset by higher freight and manufacturing costs and unfavorable geographic mix changes. Selling, general and administrative expenses rose 7.4% year over year to $194.9 million (up 12% at CER) predominantly on increases in employee-related expenses, professional service fees and travel expenses. Research and development expenses increased 7.4% to $64.3 million (up 11% at CER). Adjusted operating income was $269.7 million in the quarter under discussion, up 3.6% from the year-ago quarter. Adjusted operating margin contracted 24 bps year over year to 29.5%. Financial Updates ResMed exited the fourth quarter of fiscal 2022 with cash and cash equivalents of $201.8 million compared with $273.7 million at the end of the fiscal third quarter. Total debt (short and long-term) at the end of the fiscal fourth quarter was $775.2 million compared with $655.4 million a year ago. Cumulative net cash provided by operating activities at the end of the fiscal fourth quarter was $351.1million, compared with a cumulative net cash inflow of $736.7million in the year-ago quarter. The company paid out $61.5 million as dividends during the fiscal fourth quarter. Our Take ResMed exited the fourth quarter of fiscal 2022 with better-than-expected earnings and revenues. The company recorded robust sales performance in the quarter on increased demand for sleep and respiratory care devices. Robust revenue growth across several geographies is encouraging. The growing adoption of ResMed’s AirSense 11 and AirSense 10 platforms raises investors’ confidence. Expansion of gross margin seems promising. However, the company did not derive any incremental revenue from COVID-19-related demand in the fiscal fourth quarter compared with the year-ago period’s levels. Contraction of operating margin on escalating expenses is discouraging. The persistent supply chain constraints in a challenging freight environment are hampering ResMed’s ability to meet the growing device demand. Zacks Rank and Key Picks ResMed currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader medical space that have announced quarterly results are Quest Diagnostics Inc. ( DGX Quick Quote DGX - Free Report) , Molina Healthcare, Inc. ( MOH Quick Quote MOH - Free Report) and Merck & Co. ( MRK Quick Quote MRK - Free Report) . Quest Diagnostics, carrying a Zacks Rank #2 (Buy), reported second-quarter 2022 adjusted EPS of $2.36, which beat the Zacks Consensus Estimate by 9.8%. Revenues of $2.45 billion outpaced the consensus mark by 7.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Quest Diagnostics has an earnings yield of 6.9% compared with the industry’s 3.9%. DGX’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average being 12.1%. Molina Healthcare, having a Zacks Rank #2, reported second-quarter 2022 adjusted EPS of $4.55, which beat the Zacks Consensus Estimate by 4.8%. Revenues of $8.1 billion outpaced the consensus mark by 6.2%. Molina Healthcare has a long-term estimated growth rate of 16.4%. MOH’s earnings surpassed estimates in the trailing four quarters, the average being 3.2%. Merck reported second-quarter 2022 adjusted earnings of $1.87 per share, beating the Zacks Consensus Estimate of $1.67. Revenues of $14.6 billion surpassed the Zacks Consensus Estimate by 5.4%. It currently has a Zacks Rank #2. Merck has a long-term estimated growth rate of 10.1%. MRK’s earnings surpassed estimates in the trailing four quarters, the average surprise being 16.8%.