Hello, and welcome to ResMed's Fourth Quarter Fiscal Year 2023 Earnings Conference Call and Webcast. [Operator Instructions]. A question-and-answer session will follow the formal presentation. [Operator Instructions]. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Amy Wakeham, Chief Communications and Investor Relations Officer. Please go ahead, Amy.

Great. Thank you so much, Kevin. Hi, everyone, and welcome to ResMed's fourth quarter fiscal year 2023 earnings call. This call is being webcast live and a replay will be available on the Investor Relations section of our corporate website later today along with the copy of the earnings press release and the presentation both of which are available now. On the call today are Chief Executive Officer, Mick Farrell; and Chief Financial Officer, Brett Sandercock. Following our prepared remarks, Mick and Brett will be joined by Rob Douglas, President and Chief Operating Officer; and Lucile Blaise, President of our Sleep & Respiratory Care Business for the Q&A portion of the call. During today's call, we will discuss several non-GAAP measures. Please review the supporting schedules in today's earnings press release for a reconciliation of the non-GAAP measures to our GAAP reported numbers. Our discussion today will also include forward-looking statements, including but not limited to expectations about our future financial and operating performance. We believe these statements are based on reasonable assumptions. However our actual results could differ. Please review our SEC filings for a complete discussion of the Risk Factors that could cause our actual results to differ materially from any forward-looking statements made today. I'd like to now turn the call over to Mick.

Thanks, Amy, and thank you to all our shareholders for joining us today as we review the results of our June quarter, the last quarter of our fiscal year 2023. Our results reflect incredible growth across our entire business with double-digit growth in our devices, masks, and software businesses. Unconstrained availability of our market leading cloud connected flow generator platforms has enabled us to continue to offer access to 100% cloud connectable AirSense 10 flow generated devices in all of our major global markets and beyond. In parallel, we are ramping up and improving the availability of our best-in-class AirSense 11 platform, which will gain further geographic regulatory approvals throughout the fiscal year and steadily increasing supply also throughout the fiscal year 2024 and beyond. Although challenges within the post-COVID supply chain haven't completely been mitigated yet, we expect ongoing steady improvement in component and end product supply in the quarters ahead using a combination of AirSense 10 and AirSense 11 platforms. While we remain focused on scaling production and global availability of the AirSense 11 platform, we remain on allocation for the Air 11 platform for the next few quarters. But I want to be clear on this point. With combined availability of the unconstrained Air 10 platform, we have enough devices to meet all of the customer needs that we see in major markets and globally. With the powerful combination of the Air 10 and the Air 11 platforms, we have the two best device platforms on the market. Our strong double-digit 23% year-over-year growth in the devices category demonstrates that customers are choosing ResMed and we are delivering. Our masks and accessories business also performed at a very strong 18% growth in constant currency this quarter. Patient demand continues to drive increased adoption and utilization of our…

Great. Thanks, Mick. In my remarks today, I'll provide an overview of our results for the fourth quarter of fiscal year 2023. Unless noted, all comparisons are to the prior year quarter. We had strong financial performance in Q4. Group revenue for the June quarter was $1.12 billion, an increase of 23% on a headline basis and in constant currency terms. Revenue growth reflected the ongoing combined availability of cloud connected AirSense 10 and AirSense 11 sleep devices to support strong underlying global demand, as well as solid growth across our broader product portfolio. Year-on-year movements in foreign currencies negatively impacted revenue by approximately $3 million in the June quarter. Looking at our geographic revenue distribution, excluding revenue from our Software-as-a-Service business, sales in U.S., Canada, and Latin America countries increased by 25%. In constant currency terms, sales in Europe, Asia and other markets increased by 14%. Globally in constant currency terms, device sales increased by 24% while masks and other sales increased by 18%. Breaking it down by regional areas, device sales in the U.S., Canada, and Latin America increased by 30% as we benefited from strong demand. And as previously mentioned, our continued ability to fully supply the market with combined availability of AS 10 and AS 11 cloud connected devices. Masks and other sales increased by 19%, reflecting growth in resupply and new patient setups. Europe, Asia, and other markets, device sales increased by 15% in constant currency terms, again reflecting strong demand and improving availability of cloud connected devices. Masks and other sales increased by 14% in constant currency terms, reflecting increased patient setups. Software-as-a-Service revenue increased by 34% in the June quarter, reflecting the contribution from our MEDIFOX DAN acquisition and continued strong performance from our HME vertical. Excluding our MEDIFOX DAN acquisition, SaaS revenue…

Great. Thank you, Brett, and thank you, Mick. Kevin, I'd like to go ahead and turn the call back over to you to provide the instructions and run the Q&A portion of our call.

Certainly. We'll now be conducting a question-and-answer session. [Operator Instructions]. Our first question today is coming from Matthew Mishan from KeyBanc Capital Markets. Your line is now live.

Hey, good afternoon, and thank you for taking the questions. Hey Mick, with the devices number sort of steady sequentially around this $600 million mark, is this where the number would kind of base out if you are supplying the majority of the market? And from here, are we looking at just saying $600 million and then add on some percentage of what the underlying fleet market is kind of growing at?

Yes. Thanks for the question, Matthew. And it's a good one. It's hard to predict because there are so many factors involved that that are going on in the market right now. But yes, as you said, a very, very solid number, $602 million in global devices in the quarter and 30% growth in U.S., Canada, Latin America, 15% growth in Europe, Asia, and rest of world. Look, we're seeing a strong sort of mid-single-digits level of patient flow into the channel. We're seeing in addition to that -- like in terms of new patients, we're seeing in addition to that resupply of patients at that five-year point for most U.S. reimbursement and various points in the other 139 countries where people make their own decisions or insurance has other criteria to drive that. So it's new patient setups, it's resupply setups and there's of course the impact of a competitor recall, which is -- was supposed to be over in June 30 and now has no definitive date. And so as we look to that with all those unknown factors, it's very hard for me to say, Matthew, that it's just stop and steady growth from here. It might be stronger growth from here. And that makes it hard to predict gross margins because as we grow those CPAP and APAP numbers so well in the U.S. geography, it's incredible great revenue and cloud connected and links us with the patient for life, but it is lower gross margin than our group. And so it's great gross profit dollars, but has an impact on our gross margin as you saw that steady apart from FX moving it down 30 basis points. So a complex equation but I'd say it's at minimum, it stays where it is and grows with the market but it could potentially grow above that as we continue to take share and solidify that share through our digital ecosystem. Thanks for the question, Matthew.

Thank you. Our next question today is coming from Margaret Kaczor from William Blair. Your line is now live.

Hey, good afternoon, and good morning, everyone. I wanted to follow-up first on the competitive dynamic to the extent that you'll -- you see anything maybe into the -- in the marketplace. So whether your key competitor is coming back either approaching or maybe hiring processes, marketing campaigns, anything that maybe they're gearing up for that you're seeing or is demand relatively similar to what you've seen in the past, no real changes. Thank you.

Yes. Thanks, Margaret, and welcome back. Yes. I think it's difficult to predict exactly where they're at from those sort of the early emerging signs, as you say. Look, we have regional competitors in Europe that we are fighting with every day there. We have regional competitors in Asia that we're fighting with every day and regional competitors in the Americas that we're fighting with every day. When Philips comes back, they'll have to start at position number four, if you like, in new patient setups. We are -- they are back and we are competing with them in some countries in Europe, like in Spain, they never went away because they never had a phone device there. So they've been there the whole time through this recall, and we've been beating them handsomely there. And as other markets in Europe where they've started to come back, we are competing and winning and maintaining share and growing share. I think the reputation here and the time to market is going to be a very slow progress for them country by country whether or not they get a consent decree in the largest geography. And so we look at it going forward and say, look, do we have enough supply to take care of all the market demands between us and the other regional players? And we finally got there where I can say that this quarter that we're there and we can take care of it. So it's almost irrelevant to us how and when in terms of what that looks like because we're able to take care of all the market growth. So for us, it sort of takes away that uncertainty and allows us to push forward. But yes, we're competing head-to-head with them in some many countries in Asia and some countries in Europe. And it's like -- it wasn't 2019 where our smaller, quieter, more comfortable, more connected and more digital solutions are taking share and holding share. And it's an ongoing competitive game. And as I said, we're launching some of these AI driven products on top of this ecosystem. It's an exponential game when you think about digital and we're well ahead. We've had two or three years here to sprint ahead. We were ahead before that. And I think it's a long-term game won't get -- we'll keep productively paranoid, but we are improving outcomes, we're lowering costs and the physicians like the workflow efficiencies and patients like the increased adherence and payers like the fact that there's an ROI in lowering total healthcare costs.

Thank you. Next question is coming from Anthony Petrone from Mizuho Group. Your line is now live.

Great. Thank you. Congrats on a shrunk top-line here, share gains. Maybe two part question. Mick, one would be just on the amount of resupply that's now coming in as it relates to the share gains that you've seen over the past two years, is the resupply number we're seeing now where we actually starting to see consumables come off of the new sockets that you gained. So that would be question one. And then question two, there's obviously the debate out there on GLP-1s, maybe from the perspective of ResMed, how do you see the GLP-1 phenomenon playing out in the sleep space, specifically do you expect to gain more patients from GLP-1s versus maybe certain patients that would fall out of the funnel? Thanks again.

Yes. Thanks, Anthony, and welcome back to you too to the ResMed following us here. I'll take yes, both of your question and your follow-up in order. So firstly on resupply, as you know, you've been following us for a number of years. It's not a lock and key. You can use our mask on other devices and you can use other masks on our devices. The way that we've won market share and nobody's been on a major in terms of not being able to sell recall out there on this. And so we've had head-to-head competition with all the top five players in masks, these last three years and we've gained really good share with that. So I think it's just the smallest, the quietest, the most comfortable, the minimalist size ones, the ones that have full freedom and the ones that have the ability to for the front sleepers and side sleepers to provide that, that capability. And so that's how we've gained share in the mask side and maintained that share. So I -- there is a better together in that when you have an AirSense 10 or an AirSense 11, the mask leak data are more accurate. The interoperability of an AHI calculation or a leak calculation are more accurate. So we certainly push that angle and we do get some extra share for through the device, but it's not as material as the fact that the masks themselves are just excellent, which I think speaks to the sustainability there. So that strong resupply, as you said, 19% growth in the U.S., 14% growth in Europe, Asia and beyond, where we don't have that sort of automated resupply that we have with Brightree ReSupply Solutions in the U.S. that's been from hard work from our…

Thank you. [Operator Instructions]. Our next question is coming from Suraj Kalia from Oppenheimer. Your line is now live.

Hi, this is Shaymus on for Suraj. So we saw gross margin set down a little bit. I know you said there was some reasonings for it, but I just looking forward kind of in the future, maybe you can walk us through the temporary and more structurally permanent changes we should think through as far as GM outlook is concerned.

Yes. Thanks for the question and you look and it's a good one. Lots of factors going on gross margin, actually, the major one that as you noticed sequentially on the 30 basis points was foreign exchange and that was on inventory as it flowed through our funnel as we sold those CPAPs, APAPs we had, FX that had impacted them, six, nine months ago, but they're flowing through inventory that we sold during the June quarter. That was the headwind of 30 basis points from Q3 to Q4. We -- look, I think there's so many moving parts, but when you add it up and you look at geography mix and the upside opportunity for us to grow our business in Europe, Asia, particularly Japan, which has some chance for acceleration over the coming years, product mix, I mentioned in the prep remarks, particularly on bi-level and our non-invasive ventilator growth. So think AirCurve ST, FTI, AirCurve ASV, these are in -- and our masks side, particularly the full face, but any of the masks, all of those are gross margin accretive to our group. And I see opportunities for strong growth in all those categories. And also our software solutions have gross margin accretive capabilities and as we go on an organic basis from single-digits to high-single-digits to low doubles there on the software SaaS side of the business, I think that's margin accretive. So I feel good about that. I also know that we are working through the sort of higher inventory costs that we had in that supply chain crisis, we had to spend more on chips, parts and pieces and those contracts and get more expensive components for the cloud connective chip and beyond. And those freight costs that we invested in and everyone's talking…

Thank you. Next question is coming from Laura Sutcliffe from UBS. Your line is now live.

Hello, thank you. I was just wondering if you could talk about how your position to increase your mask supply in the event that the consent decree over at the competition impacts their ability to provide those, for example, if they end up constrained at a facility level. Thanks.

Yes. Look, we have run all sorts of scenario analyses around that. I think one of the differences if you think in terms of ResMed's ability to work with suppliers in the core device side, where in terms of chip sets, the whole med-tech sector as a group, and I serve on the Board of AdvaMed and we were advocating for more semiconductor chips for the whole industry. When we were going to Intel, TI and all these companies and sort of begging for semiconductor chips 12, 18 months ago, all together we were less than 1% of the supply of chips. And it was very difficult. We did get some, and as you saw, we did have to pay a little more, but we were able to get those contracts with other players and get long-term contracts and get that supply. In the field of medical grade silicon rubber, we are one of the top users in the world for this. As you know, we sell tens of millions of mask products per year. And we are an incredibly large part of that supply chain. So if a competitor was not able to sell masks, their demand for that LSR would go down and those or similar suppliers would then want to keep their factories operating and be looking for other suppliers. And we would be running the game theory and the analysis of where we go and how we go to ramp that production up. So it would be a good problem to have for the business. I think it'd be bad problem to have for patients, but I think the probability of that is relatively low, but if it does happen, we're ready. But Rob, do you have any thoughts on that? Rob Douglas, our President and COO.

Yes. Hi, just one other minor comment on that. And we've said this before, because of the relatively low CapEx of our supply chain and the equipment that we need, we generally run with quite a lot of those capacity supply. And so our ability to rapidly increase volumes as needed is really strong.

Thanks for the question.

Thank you. Next question is coming from Sean Laaman from Morgan Stanley. Your line is now live.

Good afternoon. Mick, hope you're well. Mick, I'm wondering if you could characterize for us some of the price dynamics that might have been present during the quarter.

Yes, thanks for the question, Sean. Yes, a simple question, very complex answer across the 140 countries and all the dynamics. I think one thing that I'm comfortable to say though on this is that if you look over the last four quarters, our commercial teams have done an incredible job of partnering up with our customers to say, look, inflation is up, costs are up. How do we share some of the pain, if you like, of these increased costs? And we were able to increase some prices on some mask systems and components and some devices where we could, it's tough because customers often don't get much relief from the payers. They did in the Medicare side in the U.S. market where there was an inflation adjustment up of around 5% January 1. And so that was a benefit for our providers, and so we could share some of the pain there in terms of increased pricing. But we've also had some surcharges on our products in terms of freight. And although, as I said in the prep remarks, we've seen all the news media that freight costs are all down. Well, yes, okay, they are on a spot price, but 12 months ago or nine months ago, as that works through our inventory, that freight charge is still there and is still impacting our costs. And inflation, although coming down is still high. But I think our commercial teams have done a really good job of partnering up with our customers, walking them through the situation, the reality that costs are up, inflation's up, freights up, inventory costs are up. We need to work on appropriate pricing to make that happen. And we've had some appreciation in average selling price over these last 12 months. And we'll look to do over the next 12 months to do an appropriate pricing with customers on a per customer per contract basis to sort of share some of the pain of the increased cost that our industry is having. But at the same time, we're laser-focused on driving that growth. And so it's a really strong sort of price elasticity, it's a question of how do we make sure we get that balance right? But it's a competitive game. Some of our competitors are out there saying the same thing publicly, that costs are up. And so we need to move prices appropriately. And we are out there working with customers to make sure that we as an industry take care of patients in a sustainable economic way, and that that involves both quantity, price, and supply over the long-term.

Thank you. Next question is coming from Lyanne Harrison from Bank of America. Your line is now live.

Yes. Good morning, Mick. Can I ask a question about outlook? So through the earlier -- early quarters you mentioned that we were going to see sequential revenue growth through 2023, and we have seen that, and that's been fabulous. But with your competitor -- key competitor out of the market, do you still expect to grow revenue sequentially into first quarter, second quarter 2024 or for however long as they remain out of the market?

Yes. So great question, Lyanne. And yes, 12 months ago, when it was pretty clear that we had a strong runway there on the devices side, and we -- it was really, we were constrained by our own production. I was able to very strongly say, look, I am confident that our supply chain team has got access to this re-engineering, redesign, and redeployment of key components, particularly electronic components, particularly semiconductors. And we did that and we grew device revenue every quarter throughout fiscal year 2023, as you noted. I was really excited with the team on that. As we look forward to fiscal year 2024, we don't give guidance really on the top-line. Brett's given some really solid guidance on our SG&A, our R&D, our effective tax rate and how we're looking in those parts of the business that are very controllable. As I said in some of the earlier questions, Lyanne, there's so many moving factors in overall demand in the market. But look, I'm confident because new patients continue to come into the funnel, right? That's happening across the world, and it's not happening randomly. We're driving demand gen programs; we're driving them in Australia, New Zealand with our Awaken Your Best campaign. We're driving them through our German teams, our India teams, social media programs in our China team, this really strong social media demand gen. And so we're getting new patients in the funnel. And there was a lot of patients who couldn't get a replenishment device when their device hit three years or five years or whatever time their insurance allows, or they as a consumer decide that they want to get to the next-gen product. And I think the AirSense 11 and all its features, it's engagement with the patient, with compliance…

Thank you. Next question is coming from Chris Cooper from Goldman Sachs. Your line is now live.

Good morning -- afternoon. Thank you. So Mick on AirSense 11, you sort of emphasized its importance for gross margin. You also said at the start of the call, you sort of expect this to remain on allocation for a few more quarters yet, I know this timeframe was probably a bit longer than you'd hoped. I just wanted to confirm whether that's entirely a function of supply chain at this point, or I guess whether there's any sort of strategic consideration to manage volumes during such an unusual competitive dynamic.

Yes, Chris, thanks for the question. We've really been focused on that patient and making sure no one's left behind. As I said in an earlier question, and although the AirSense 11 is better margin for us, and it's better innovation and it has a higher engagement on the myAir app, which drives engagement, adherence, mass resupply and everything. Our view is that if there's a patient available and we have the parts and pieces and the ability to make an AirSense 10 take care of that demand now while we ramp AirSense 11, we're going to do it and we're going to take care of that patient. By the way, there's some really strong upside for that patient in that the alternative is a competitor device, which would not be as small, quite, comfortable and connected. And so they'd have a much worse experience than the AirSense 10 with a competitive one. So it's better for the patient. It is slightly low margin for us, but we get that patient on therapy, and there is the better together with ResMed that it's more likely, hopefully, that they get a ResMed mask and that they use that mask for the rest of their life. And so I think there's an overlap there, if you like of altruism and the profit motive to do the right thing on a gross profit, cash flow driven environment. And we're not going to manage just to a GM line and say, well, let's not do that and make those products. And so it's less I mean, it's strategic in this way that our brand is about patient care. Our brand is about taking care of someone who's suffocating and getting them out of hospital and doing that. And if we have to do it with an AirSense 10, which is an amazing seven-year old platform, then we're going to do it. If we can do it with the brand new AirSense 11 platform, we're going to do it. And look, nothing's slowing us down. Our quality and regulatory teams are going geography by geography to get the AirSense 11 approved in each of the regulatory environments. So as soon as that is, we can start selling the products. But the ramp up on AirSense 11 is probably not as fast as it would be in a market where you had all five major competitors competing there because of that excess demand we're covering a lot of that with the AirSense 10. So that's sort of how we're thinking about it. Patient-centric, patient demand, take care of that patient now, get them on our ecosystem, and then ramp as fast as we can AirSense 11, and we're doing that. Nothing's slowing down. The accelerator is firmly pedal to the floor on AirSense 11. And so everyone we make, we sell but it will be on allocation just given the huge demand that we see in the market right now, Chris. Thanks for the question.

Thank you. Next question is coming from Dan Hurren from MST. Your line is now live.

Hi, good morning, and thanks very much. Mick, at the third quarter result, you seem to be very confident about gross margin. In fact, I think at the time we know that it was probably the most positive gross margin commentary we'd heard out of ResMed in recent memory. So I know you've spoken to component cost and why you don't manage the gross margin, but what else changed since the time you gave that, that commentary to the result?

Yes. Thanks for the question. And I think actually if you go back and look, the all the factors that I talked about 90 days ago, we're talking about today, but in addition, the AirSense 11 ramp that we're putting together there. What happened in these 90 days that was unpredicted was -- there was more demand. What we thought a competitor may be back, and there was more demand for CPAPs and APAPs and we didn't -- I know the exact number of how we could have slowed down our AirSense 10 generation to get gross margin to be plus 30 basis points from QtoQ, but we didn't engineer it and reverse engineer it that way. We said, there's demand out there, let's go take care of those patients. That was the unexpected factor. It was U.S. CPAP and APAP demand. And I mean, you look through the numbers, you'll see that it was incredibly strong on gross profit generation, cash flow generation, incredibly strong during the quarter. And we did think about it. Oh gosh, do we follow through and saying, oh, we want to get accretive GM, 90-day to 90-day point or do we say take care of that patient? And we said, no, we're going to do the right thing. We're going to take care of the patient. So we're thinking about the long-term here. But no, I'm still bullish over this fiscal year for sure. I -- you never can know what demand's going to look like and where it's at and we are not going to not take care of a patient. But as those higher inventory costs work their way through our system there's opportunity for gross margin improvement as we go forward. There's also the impact of if you looked at the…

Thank you. Next question is coming from David Low from J.P. Morgan. Your line is now live.

Thanks very much. Mick, could I get to comment a little on what you saw in the ex-U.S. market? Obviously last quarter we saw the big event sale ventilator sales into China. Just wondering if there's any countries you'd call out or any items we should be aware of, please.

Yes, David, that's a good point. We didn't really see anything of material context in this quarter in terms of exacerbation of COVID that that led to hospital based or life support ventilator sales. And so we're back to I would say some steady growth that we see in our neuromuscular disease, our COPD and other sort of respiratory insufficiency parts of our business for life support vents. On the non-invasive vents and adaptive server vents and bi-levels, we're back to steady market growth and actually we saw strong double-digit growth as those post-COVID, we're starting to see the clinics open up and patient flows start to come back. Rob, any thoughts on ventilators?

No. Not on ventilators, because I'm just going to comment on masks.

Yes.

So the masks in all these other markets were really strong and really it's showing underlying strength of the market not affected by recall dynamics or anything like that. So really the whole patient diagnostic systems are working in order and everything's going strongly.

Thank you. Next question is coming from Steve Wheen from Jarden. Your line is now line.

Yes. Thanks very much. I just wanted to ask Brett about the working capital position. Again, last quarter we were -- you were thinking that you'd be able to make some inroads into those -- into the inventory balances that you had such that we might see a bit of more of the release of cash, but obviously inventory stepped up again as has the receivables. Is that just building more to the demand that you see? Or could you just help put that into a bit more context as why it didn't quite play out the way you thought?

Yes. Hi, Steve. It's Brett. The inventory actually came down a little bit sequentially, so that, that's sort of tracking down how we're expecting. We expect that inventory balance should decline over the course of FY024 as well. The receivables you're right was up a little bit, but that's really driven by the revenues. I think overall in the working capital, we're in pretty good shape. It was up a little bit this quarter. When you look at that, we -- it's really the timing around tax payments this quarter. So we paid higher tax this quarter than we would typically do each quarter. So that's that drive, if you like, a little bit of negative working capital. But again, that's just a timing element. So we're expecting pretty robust cash flow generation through each of the quarters in FY2024. And we'll continue to work hard on the working capital and bringing that down. A big driver of that will obviously be the inventory and working that down progressively over the fiscal year.

Thank you. Next question is coming from Mike Matson from Needham and Company. Your line is now live.

Hi guys, this is Joseph on for Mike. Could you maybe talk about the new patient and REPAP backlog internationally? I guess the way that I understand it is it's fully worked through in the U.S. but there's still work to do internationally. I don't know if you -- if that's the case and if you could size that at all.

Yes. Look, I don't think we've fully worked through the backlog of patients in the U.S. in terms of patients who want to get whose insurance has got to the five-year point if their Medicare or three, four, five depending on which private payer they're under. And so I do think our competitors' actions slowed down that, that particularly if they're on a competitive device and the demand limitation and the physician saying, look, I've got to take care of new patients. They weren't as prone to write prescriptions or to allocate REPAP, if you like, for patients. So I actually think there's some runways still left on REPAP within the U.S. geography, and I think that's even more so in other markets. As Rob just noted and as we talked about the engagement with consumers and patients in different geographies is driving mass growth and any quarter that have 14% revenue growth in masks in Europe, Asia, rest of the world would be incredible. And that's not driven by any recall dynamics whatsoever from a competitor. Everybody's been competing in masks globally. And so I think that speaks to our ability to hopefully have a sustainable approach to REPAP not only in the U.S. where we have incredibly strong relationships with Brightree and myAir directly to patients, directly to providers but the ecosystems that we are generating in some of our other sort of omni-channel markets around the world. So I think the opportunity for REPAP in the U.S. is still there over this fiscal year and beyond, and to make it a rhythm, right? So it becomes a steady part of the growth of the devices and to drive it. I think there's even more opportunity in the other parts of the world leveraging the work we've done on the mask side to then remind patients and track them when they're at that three, four, five-year time period to pull forward. Now I want to be there with the appropriate supply, so I'm not jumping ahead of ourselves, but we do have the programs and capabilities to do that, but I think the demand is there inherently.

Thank you. Our final question today is coming from Saul Hadassin from Barrenjoey Capital. Your line is now live.

Good morning, Mick, and good day, Brett and Rob. Just wondering on masks, it's been a while since we've seen some new product coming out from ResMed. Just wondering how much has the recall -- better recall impacted on your ability to continue to focus on new product development and new product launch? And I guess on the mask side, should we expect anything for near-term in terms of a refresh of the mask portfolio? Thanks.

Yes. So it's a great question and yes, our R&D team, have obviously been incredibly focused on the re-engineering, the resupply and the redesign on our core device platforms, and we're able to do that, right? So we're able to get the supply back of Air 10s, as you saw, and Air 11s. But yet, look, I -- we had the whole board down in Sydney last quarter, and we were looking through the pipeline of devices and masks and it's incredible. It's really exciting. I don't like to get ahead of my commercial teams, and one of them is at the table with me now telling me to keep quiet. But I can tell you I'm very excited about the pipeline. There will be new innovation, new masks from ResMed as we go through this fiscal year. And as a personal user of these products, I try every new mask that comes out and this new one, which has a great project name that I'm not able to say, but it's a beautiful island that you can travel to by boats. I have tried that that mask and it's incredible and I can't wait for that to come to the market. But yes, look, we do have masks that are coming in the pipeline that are working their way through regulatory and then of course, commercial ramp up to make sure that when we deliver, it's ResMed quality, ResMed capability, first time fit, incredible adherence, and to drive through the channel. And so you'll see those come through our major markets and then globally throughout the fiscal year. So I'm excited about that pipeline. The one that I can talk about is the digital side, where we've launched an AI product and I'm really excited as those get more traction, we'll talk about how the digital products and the mass products throughout the year are going to impact and keep our incredibly strong double-digit growth that we saw this quarter.

Thank you. We've reached the end of our question-and-answer session. I'd like to turn the floor back over to Mick for any further or closing comments.

Yes. Thanks, Kevin. And thanks to all of our stakeholders for joining us this last hour as we talked through our results. And we'll talk to you again in 90 days. In closing, I want to thank the 10,000 ResMedians. Many of you are shareholders and listen to these calls as well, thanks for your dedication and hard work, helping people sleep better, breathe better, live better lives in 140 countries. These results are yours, incredible double-digit growth. Thanks for all that you do. I'll hand the call back to you Amy to close this out.

Awesome. Thank you, Mick, and thanks, everyone. We do appreciate your interest and your time. If you have any additional questions, please don't hesitate to reach out directly. This does conclude our ResMed's fourth quarter 2023 conference call. Kevin, I'll turn it back to you to close the call.

Thank you. You may now disconnect. We do thank you for your participation today.