Good morning, everyone. My name is David Bailey, part of the healthcare team at Morgan Stanley, joined today by Mick Farrell and Aaron Bloomer from ResMed. Welcome to you both. Great to have you here. Before we begin, there are some disclosures. Please see the Morgan Stanley research disclosure website at morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative. Thanks very much again for coming today. Great to see you in person. Topics wise, we might go through growth, competition, GLP-1s, margins, and strategy as broad topics. We will see how we go in 35 minutes.
Yeah.
Maybe just to begin, as we look back over the past five years, Mick, very strong growth across the business from a revenue perspective. U.S. devices, I did the calculation this morning, 15% per annum growth over fiscal 2021 to 2026. I think it would be good just to understand a little bit what you are seeing from a volume perspective in terms of patients coming into the system, some of the drivers that you are observing as to either pulling people into the funnel and?
Well, it is good to start on growth because we are a growth company. We are a growth story. What we are seeing in the market is very strong and steady growth. We talked about in our earnings call a couple of weeks ago, and we actually gave guidance for the first time. We have listened to you, our investors, and you asked for that, and we talked about 5%-7% growth across the business, including removal of $75 million for Astral. If you added that back in, that would imply a sort of organic growth. It was around 130 basis points of Astral, that $75 million. It would be 6.3%-8.3% growth guidance on the top line. We also gave bottom-line guidance that implies some pretty strong leverage through the P&L down to EPS in the low double digits.
Yeah, when we think about growth, we think about patients, right? What is our total addressable market? It is 1 billion people worldwide who suffocate every night. That is the prevalence of our core obstructive sleep apnea market. We also add on 800 million who have insomnia, and we add on 400 million now who have restless legs syndrome. We will talk later about M&A, but we acquired Noctrix, a company that makes the world-leading restless legs syndrome treatment, non-invasive, completely reversible, drug-free therapy as well. The other part of our TAM is 480 million of chronic obstructive pulmonary disease patients. You add that all together, that is 2.7 billion people worldwide who have a sleep health or breathing health disorder and need our solutions, our healthcare technology at home solutions.
With that as our TAM, our goal is to, that is one in four people on the planet, to continue to grow steadily. We have talked about growth of devices, America's sleep devices in the mid-single digits, and growth of the masks and accessories and other part of our business in the high single digits. Our goal is to meet and beat that every quarter through demand gen, demand capture, demand curation. There are some pretty big mega trends that are actually supporting growth, to your question around growth, from Big Pharma bringing people into primary care like never before for the GLP-1s. They are coming into PCPs, and we are educating those PCPs on if they have obstructive sleep apnea, you have to write a script for the gold standard, which is CPAP, APAP, and bilevel therapy. We are seeing that come through.
The other big trend on growth is consumer tech. We talked two years ago here at this conference, I think, about Apple just came out with sleep apnea detection on their Apple Watch two years ago, following Samsung on their Galaxy Watch. The rumor is that Samsung's Galaxy Ring will have sleep apnea detection before the end of this calendar year. We have formed a strategic alliance with Oura, who is a major player in the wearable space on the ring side. Before their IPO, I think in their S1 document, ResMed was mentioned as a partner around sleep health. Growth is strong. Mid-single digits on America's devices, high single digits on America's masks and other, and pretty strong growth in rest of world as well.
Mm-hmm. We think through some of the part of the pathway from patient diagnosis to therapy. We have noted an increased proportion of home sleep testing, which makes things a little bit easier. I am sort of wondering if there is anything else that ResMed is sort of focusing on converting patients from that diagnosis into therapy, either through internal initiatives and/or acquisitions, helping support that patient pathway, making it a bit easier to get through the funnel on the treatment.
Yeah, no, it is a really good question, David, because we think about the whole sort of value chain from sleep concerned consumer, part of that 2.7 billion total addressable market, all the way through to screening, diagnosis, treatment, management, and being on therapy for life, which is where ResMed focuses our time. To your point, this is not just us going out there and advocating for work. We have done some internal development work, but also some acquisitions. I will talk about three of them. We acquired a company called Ectosense, and they make a fingertip-sized home sleep apnea test called NightOwl. It just fits around your finger, think like a Band-Aid size around it, Bluetooth to your phone, and the data go to the cloud and go to the sleep doctor. So Ectosense and the product NightOwl.
We also made an acquisition of a company called Somnoware, which is software for the pulmonary physician to have seamless workflows for them. The third acquisition or partnership that we created is to understand that whole value chain and put all the part pieces together is tying into our Brightree model and tying into our overall ecosystem and creating a smooth pathway for the patients. As we see those acquisitions happen, we have actually got to form partnerships and understand the channel better. I talked earlier about primary care physicians seeing a whole lot more patients coming in. We are now educating, and we have had interactions with 95,000 primary care physician continuous medical educational CME episodes with 55,000 unique clinicians. Most of them are primary care physicians.
That is re-educating, if you like, those people around gold standard treatment, writing prescriptions for CPAP, but making it really easy. How do you make it easy? That leads to the third acquisition. We bought a company called VirtuOx, which runs a home sleep apnea testing protocol. The goal there is to create the Amazon one-click for that primary care physician because they are dealing with everything from headaches to tinea, head to toe. When they identify sleep apnea, they need the one click. With VirtuOx, we have that. They can refer them to the number one home sleep apnea testing protocol, which is VirtuOx. They can get screened, diagnosed, get an independent diagnostic and testing facility approach with the numbers. If it is positive, they can refer to a board-certified sleep doctor within that state to write a prescription. It can be virtual or in-person.
Then the patient can be sent to an HME and be taken care of. As you think about that demand generation from Big Pharma or big tech that I talked about earlier, our job is to do the curation and conversion all the way to a prescription for gold standard therapy, CPAP, APAP, bilevel, then making sure they get to a good DME that can get them on therapy. Our goal then is to keep them on therapy for life and make sure they have masks and accessories and are well taken care of.
I think just adding onto that, two of the biggest growth opportunities I see for ResMed over the next mid to long term is, one is that middle of the funnel. Mick just talked about all these new patients that are coming in, whether it is through primary care, through the consumer tech companies. How do we help convert them and partner with our HME partners in a country like the U.S. here. But making it more of a consumer-like experience, like the Apple, the Amazon experience that Mick talked about, that makes it easy for that patient to be able to go on and start and then stay on therapy. The second big thing is we have got millions of people around the world that are loyal ResMed users every single night helping them sleep.
How do we make sure that we're getting them the latest up-to-date masks when they need it every couple of months? The latest up-to-date devices. We've had AirSense 11 now in market for over five years. How do we make sure all the patients around the world who are eligible can get an AirSense 11? Eventually when we launch our new platform as well. How do we just make sure that all of the loyal users that are using our devices are taking advantage of all the opportunities for them to use it as often as possible?
Some follow-up questions here. All those initiatives sound great. I suppose the question is how far progressed are you in those initiatives? Thinking through the acquisitions, where do you see opportunity for PCP education, all that sort of stuff? Will it support incremental growth over and above that mid-single digits? That's probably one question. Just following on the mask and accessories piece, is there further opportunity for resupply from where we are now?
Yeah, well, look, as I said, our goal is to meet or beat that mid-single digits every quarter. I think what we are seeing, if you look at just last quarter we reported, we had 8% growth in sleep devices in the Americas. If it's mid-single digit growth, take the middle of that 5%, that's 300 basis points of extra growth that we're able to drive. Our goal is to meet or beat that mid-single digits every quarter. It's an ongoing game, and it's not done. There are so many patients coming in, and if they come in because of an ad with Shaquille O'Neal or Eli Lilly saying, "Don't sleep on OSA," they come in with a goal there to the primary care physician. Our education is to make sure that primary care physician does the right thing and writes that script.
You can't guarantee that that person does go and get that set up for CPAP, APAP, bilevel. We did very well in Q4. Our goal is to do that in Q1, Q2, Q3, Q4, in and out every time. To the question around growth on resupply. We're not done with that. We're fighting all the time. On the resupply and engagement, if you like, as Aaron was talking about with our installed base, which is a huge part of our business on masks and accessories. 80% + we've talked about in the past is around getting that patient motivated to come in and get a fresh new mask every three months or a new tubing or a new tub for the humidifier. We're doing very well with Brightree resupply. We've added Snap technology, which is an automated resupply approach.
And we actually launched Snap Light, which is a resupply approach for HMEs who do not use Brightree, which is our sort of management system, our Oracle or SAP, if you like, for the HMEs. But for those who are not on Brightree, Snap Light is able to drive resupply. All that together, David, means that I think we can meet and beat that high single-digit growth on masks. We beat it in Q4 on masks, and we beat it in Q4 on devices, but it is an ongoing game of fighting for that referral, making sure they come through, and then contacting the patient. One last thing I will say on the resupply is we are now over 10 million users on our app, our portable app called myAir. So 10 million users have downloaded ResMed myAir. Many, many millions of them every day will check their myAir score.
And you would not think that these people would be that engaged. We are not like Meta, where we make them addicts to their approach on Facebook or Instagram. But we are gamifying that, and it is quite interesting when you look at that. We added on to myAir our generative AI products that we call Dawn. Project Dawn is like dawn, the sun rising, not a person. But it is generative AI that has 37 years of respiratory medical knowledge. So all of ResMed's knowledge is in this generative AI, all the published and peer-reviewed public literature around sleep and respiratory medicine, and all the tips that you have about what good sleep comes from. So, drinking five glasses of water a day actually helps you sleep better. Cardiovascular exercise of 30+ minutes, three to five times a week, actually helps you sleep better.
Those types of general sleep health tips are in that. We put Dawn, which had just been on resmed.com and available for anybody, we call it the digital sleep health concierge to help people work through that screening, diagnosis, treatment pathway. We put it on myAir, which is sort of like where the sleep nerds are checking their data every day. And we thought, well, just an experiment. Let us see how many times people engage with this generative AI, very knowledgeable sleep expert. We only put it in, what? Quarter or two ago. Quarter and a bit. 1.5 million inquiries to date. These are people on therapy engaging. So to your question around resupply, is there more to do to engage the installed base? There is a lot more we can do, and we are going to track that because little changes such as that probably drive up adherence.
We have got peer-reviewed published evidence that just reaching out to a patient to talk to them about resupply, whether or not they get a resupply new mask, increases adherence. So engagement with the installed base and driving that, we are not done with it, and I think this new tech, particularly generative AI, is going to engage consumers like never before. And I look forward to peer-reviewed published evidence that shows that engaging like that actually drives up adherence clinically as well. But we are early days in that journey.
Very good. Maybe just to round off the revenue piece, so guidance for the first time top line, maybe just thinking through the volume versus price equation to the extent we can, just comments there.
As Mick said earlier, we guided for the first time. We guided to 5%-7% on a core constant currency revenue basis. But, as Mick alluded to earlier, we do have about 130 basis point headwind coming from the field safety notice of Astral. So you strip that out, you're almost at 6.5%, 8.5%, so squarely within that high single-digit growth that we've talked about. ResMed's philosophy has and will continue to be that we're gonna get the vast majority of our growth coming from volume. We believe that volume is the way to drive sustainable, durable revenue growth over time. We do that through a lot of the initiatives Mick talked about. We do that through product innovation that we continue to bring to our customers and to our patients.
Pricing in times of an inflationary environment like we're in right now is a lever that we can and will pull, but it's a small portion to the overall growth that we're seeing from a volume perspective.
Yep. Maybe we'll just jump to margins if we can.
Sure
to ask. Then I will jump to the most frequent questions I get around competition and GLP-1s.
Sure
Maybe just on the margin piece, what are you seeing? Where is the inflation coming from? So oil linkages is one thing, potentially around plastics and resins, that type of thing. But the other part might be on more the component side, the printed circuit board. Can you maybe talk a little bit where the pressure points are coming from a cost of goods sold perspective?
Well, first I would just take a step back, and I think it is important to recognize just the tremendous work that the supply chain team at ResMed has done over the last three years. We have expanded our gross margins more than 500 basis points over that time period. So just tremendous work. The productivity pipeline that they have, and I have seen firsthand, we have operating reviews and cadences around this every single month. It is really, really impressive to see. But we are not immune. We are seeing inflation in two key areas that we are seeing inflation. One is just on freight, fuel, and logistics. So obviously everything that is happening with the Iran conflict is having a material impact on how we distribute products around the world.
We are doing things like, for example, by moving more of our distribution network and manufacturing here in the United States, as well, that will help mitigate that over time, but it is an over time type of thing, right? So that is one big area. Then the second is just on electromechanical components. So again, the medical technology community is a very small purchaser of these components, and a company like ResMed, no different, right? So we do not have the same purchasing power of some of these consumer electronic companies or AI and tech companies do. And particularly on some of our older devices, like on AirSense 10, which has been out now for more than a decade, we are seeing pretty dramatic cost increases that we are having to incur.
We are doing everything we can to offset them, but we are passing on a very modest price increase to help offset some of that.
Just on that component piece, do you think it is a cyclical element, or is it something more structural around certain technologies being stepped away from? Is it demand for AI taking away from? I suppose the question is it more of a cyclical thing, or is it potentially a bit more structural as well?
I think it is both. I think it is definitely more acute right now, just given the supply constraints that exist. I also just think, again, with more and more of the demand going to the AI companies, I definitely think that we are going to have a smaller purchasing power. It is, again, why we are so focused on our productivity pipeline, driving margin expansion, making sure that we are driving cost savings initiatives with our supplier base as well, doing things like Kaizen events and having cost out initiatives and expectations with our suppliers on an ongoing basis. These are all levers that we have that we can pull to be able to help offset some of that.
Yep.
The net of all of that is that we are going to see low double-digit basis points improvements in ResMed's gross margin every fiscal year through 2030. We are remaining with that guidance. We are going to deal with all these headwinds on freight and components, very modest price increases. As Aaron talked about, the supply chain team we have is very sophisticated and has a productivity pipeline.
We've always had a really strong product pipeline, and we still do. Smallest, quietest, most comfortable, most cloud connected, most intelligent devices. We've now got a productivity pipeline in our supply chain to be able to overcome these other aspects. We'll be able to achieve that gross margin accretion on an annualized basis.
As I look through my model, I think you said first quarter could be a bit below the [inaudible]. So 62.0%, 1Q 2026, little bit below, but then you're guiding for double digit for the full-year. So progressive increases over the year. I suppose the question would be, is part of that price as a productivity as well, just so getting through to gradual gross margin improvement over the year. Is it a combination of those two things getting you to the double digit increase for full-year 2027?
Spot on. When you think about a productivity pipeline, it builds quarter on quarter on quarter. The inflationary impact that we have, and we saw it exiting Q4, and we saw slight sequential decline quarter-over-quarter Q3 to Q4, in our margins as an example, as a result of that. That's one, and then two, pricing. We just started to implement price increases here in Q1, and so there's almost no impact on top line revenue or gross margin from a pricing perspective in 1Q. That'll build as we go into Q2, Q3, and then in Q4.
Yep. One of the things you did touch on is maybe a bit more promotional activity.
Getting out there and sort of raising awareness to a degree, but also promoting the ResMed brand. We see bits and pieces in Australia with rugby teams and things like that. Maybe can you talk a little bit about the sales and marketing focus? Is there a cost associated with that, I suppose? The other part is that you've mentioned the gross margin's been a fantastic driver of growth over the past few years. Before that, the sales and marketing, the operating leverage was extraordinary. The question is, where to from here on those lines, those operating cost lines? Are you going to be spending a bit more to pull people into the system?
It's a good question. Look, the goal isn't to change actually our profile on that. We have freed up some money to our marketing function. You've seen that in promotions on normalizing or destigmatizing CPAP therapy and showing not only is it normal and appropriate to have good breathing and good sleep, it's actually life-changing. It could save your job. It could save your marriage. It could save your life. Those were the statements of the first patient. The reason ResMed exists is the first patient said that to my dad 37 years ago, and he said, "Wow, I think we can make this device better than the one this person's using." We're finding examples of that. Our latest approach on this is we have a NASCAR driver who maybe you aren't followers of NASCAR. His name is Tyler Reddick.
He was middle of the pack last season, wasn't performing. His wife identified his sleep apnea through snoring and the stopping of breathing. By the way, a spousal bed partner witnessing you stopping breathing is the number one sign and symptom. Don't wait till your Apple Watch or your Oura Ring tells you, people. Trust that bed partner. You don't need the objective data from your Oura Ring or your Apple Watch, but if you do, then it'll just confirm what they said. He listened to her eventually, and he's doing this whole podcast around how he won the first three races, Daytona 500 and the other, the next three, because of the treatment he got. They actually approached us and said, "We want to promote this therapy. It's life-changing." We're engaging with that.
That spend around marketing is really around destigmatizing and normalizing CPAP and showing that this is a normal part of life and actually life-changing, literally changing someone's career in how they perform in their job. The other part, some people are motivated by that, sort of the carrot. Some are motivated by the stick, which is untreated sleep apnea leads to a heart attack or a stroke or untreated sleep apnea can lead to a 6 x increase in solid cell tumor cancer. We've got data now around dementia, Alzheimer's, and Parkinson's that's peer-reviewed and published that this repetitive hypoxia can lead to that. Some people are motivated by each. Getting that message appropriately to primary care, but also to sleep-concerned consumers is out there.
To your question about how does it hit the finances, we are actually freeing up that money for marketing from other parts of our SG&A. Everyone is talking about AI productivity and what we can do with that. Do you really need full stack marketing teams in every country in Western Northern Europe and throughout Asia? No. We are working with the teams to say, well, how do we appropriately use Gen AI and other just simple off-the-shelf marketing tools to do that, to free up the cash to be able to invest in marketing programs like this. Our job is to get that demand generation capture and curation without fundamentally changing the P&L. We have got to keep that money for R&D. That is how we keep ahead of the competition and keep the digital, the device, and the mask systems right on the forefront.
One of the innovations we had there on the mask side, I actually consider this as important maybe as heated humidification was 15 years ago in driving adherence, is we have for the first time put fabric on these liquid silicone rubber LSR medical-grade masks. It took us seven years of research to be able to get the fabrics engineering on these high temperature, high pressure, multi-cavity tools producing these masks. We are able to infuse fabric on them so that for the patient it feels like their bedsheets. It feels natural to have the mask touching their face with fabric. You watch innovations like that from R&D. You combine it with the marketing to make sure a patient is coming into primary care, and we will get that set up. That is how we get a patient on.
When they start those first 90 days, we get that adherence rate. We are up to 87% adherence with all our technologies in the first 90 days. Keeping them on therapy for life is the goal from there. I do not know if you have got anything to add there on our demand gen and marketing work.
I would just say that we are committed to continuing to grow double-digit earnings as well, right?
Yeah.
We are doing all of that. But look, we are a growth company, like Mick started off with. We need to make sure that we are making the appropriate investments to create the demand, the generation, to nurture that patient through the journey, as Mick was talking about. That is going to require some incremental marketing investments. We have got KPIs around it. It is very disciplined, and we are going to make sure that that is driving top-line growth. The great thing about managing a business is that we can get productivity and leverage elsewhere, in lines of the P&L, to be able to self-fund that, still deliver 12%-14% core EPS growth this year, in support of our top line.
Okay. That is great. Thank you. We might move on to the two most frequently discussed topics. The first one would be the GLP-1. Maybe just starting with your observations in terms of the impacts of GLP-1s. We have talked about the demand generation, but maybe some of the data that you presented, maybe just start with that, and I will get to a couple of follow-ups after that.
Yeah, David. We are up to 2.5 million de-identified patients that we are following that have both a prescription for CPAP, our therapy, and a prescription for a GLP-1 latest generation. Like the Zepbound that has an indication for use to treat or half-treat sleep apnea. What we are finding is these patients, as they come into the primary care physician, are incredibly motivated. It is a younger cohort and it is a more female cohort of patients than typically would show up at the primary care physician and talk about sleep apnea. They are definitely brought in by Big Pharma doing this advertising. It is very interesting to track 2.5 million. We track three data points. What percent of them, after they get that prescription for CPAP, show up to the DME, to the HME, or a virtual setup and start therapy?
We are comparing the general population to this GLP-1 prescribed population. What we see is an 11 absolute percentage points higher start rate on CPAP, APAP, and bilevel therapy for the GLP-1 cohort versus a control group. Then you say, well, maybe they just start it more. They are motivated just over the short term. So we are tracking them at one year and now at three years post-prescription startup. We track not only are they adherent, and our cloud-connected system can tell if they are using the device, we go to, did they purchase something in that period, in that 12-month period? What we are finding is at one year, there is a 300 basis points higher resupply rate amongst the combo script, GLP-1 plus CPAP patient group versus just CPAP group. Then you would say, well, maybe it is just a one-year thing. Does it last?
At three years, the curves actually separate further. It's 6%, 600 basis points higher resupply rate amongst the combination script of GLP-1s plus CPAP versus the control group. Very interesting that I think three years ago, we would've been here at this Morgan Stanley conference saying the world thinks GLP-1s are a headwind for med tech. Actually, now, particularly in respiratory med tech, I can say we've got 2.5 million reasons that it's a tailwind. High start rate, high resupply at one year, and even higher than that resupply at three years. We're tracking this cohort very closely. It's an exciting development for bringing people into the funnel. As you said, it's not going to double our growth rate of America's sleep devices, but can it get it up like 50, 75, 100, 125 basis points above what it would've been otherwise? Our data say, yes, it can.
Our goal is to achieve that.
The extension to that is, I suppose, we've got the initiation of therapy are motivated. After 12 months or after a year, what happens to those people? I suppose the question is adherence or continuation after one year of GLP-1 as well. Is there any observations around that or data that you've observed around if, because you've got the people that are continuing to use it, right?
Yeah.
There might be some people that potentially stop.
Yeah.
That's the biggest question we get.
Yeah.
Do you have any views or data around the continuation of CPAP therapy after a period of time?
Yeah. Well, we see that in those resupply data because if they were stopping therapy, we'd see those resupply rates go down because they wouldn't be using the therapy. So, the baseline is covered in those one and three-year data. We're watching this with absolute productive paranoia, and I can tell you there is no downside of someone having a GLP-1 prescription. I actually talked to a board-certified sleep physician around why. Why do you think that there's an increase in the adherence rate? Not a decrease, but an increase in the adherence rate for people who have the combined script. This was a sleep physician who said, "Well, actually, maybe with some of the weight loss, it's lowering the Pcrit, the critical pressure to keep the tongue off the uvula." We have auto-setting devices. Our APAP devices change the pressure on a breath-by-breath basis.
A slightly lower pressure might actually lead to more comfort. There's some observation in the literature that maybe these will lead to a higher adherence because of a lower Pcrit, a lower max pressure, a lower mean pressure for the patient if they're using an APAP device, which the vast majority of people do. We don't actually know the causality. We just know the correlation that a patient who gets a script for both is more adherent to our therapy at the start, one year and three year. No increased drop-off, actually increased adherence. The question is, how much increase in adherence will they be? Do they stick with the other medicine as well? Do they stick with the GLP-1, and does that change, and then the pressure goes back?
We're tracking that cohort and seeing over the whole group, 2.5 million patients, solid start rate, solid resupply at one in three years, no increased dropout, actually, increased adherence.
Okay. That's very good. Thank you. Competition. You've obviously done a pretty good, obviously great job being able to supply most of the market. But one of the questions we do get quite regularly is your expectations for Philips' reentry. Just your thoughts there, and is anything explicitly captured within your 2027 guidance for a reentry of Philips into the U.S. market?
Well, it's interesting. That competitor has never left this market for masks and accessories. Look at our performance the last five years, the last 20 quarters, in Americas, in masks and accessories. We've done very well competing with them, and that's all their sales team could sell was the masks and accessories. We compete in 140 countries worldwide with that competitor, and they're back in devices in 139 of them. Every time they've come back, they've had to earn their position from five to four to three, and sometimes they're not even number two yet, after two years in some of those markets, including their home markets, in Western Europe, their home country. So, I want them back in the U.S. It's like in Event Horizon. I want them to come back because they're going to have to earn that number three or number two position.
They've now moved their manufacturing, I believe, to Mainland China, so they're going to have a Chinese import product to sell into the U.S. The number two player right now is a Chinese import player through Florida, a private company. I think that's where they're going to have to go for share. In every country they've come, they've kept price at a quite high level and tried to compete on value. They've had to compete in Europe and Asia to achieve that number three or number two position. So we look forward to them coming back. As to any impact on our guidance, absolutely not. We don't look back. We look forward in terms of our growth and where we're going.
And timing? No real sense as to when?
I would be happy Monday morning.
Maybe just to finish off, portfolio management. So there has been some acquisitions, obviously, additive to FY 2027, moving into new areas. But you have also got a recall there for Astral. But maybe just a comment on portfolio management.
I will try to do it in two minutes that we got here. So portfolio management, I will talk about the M&A side first. I talked earlier, we invested $340 million into Noctrix, a great acquisition for restless legs syndrome. It is 400 million people worldwide who have it. Just here in the Americas, in the U.S. particularly, 17 million people have restless legs syndrome, where they are kicking all night, waking themselves up, and literally waking up their bed partner physically.
We are very excited about that. We talked about, it is around $20 million in revenue. When I go to Stanford Biodesign, which is where this came from, and meet that team, it feels like ResMed circa 1990, 1992, which is this huge market, an amazing team with a non-invasive, drug-free, completely reversible device, that scripts are written by sleep doctors and distributed through DMEs, HMEs, and the VA.
A very exciting market. I like to see that grow. At the same time, we did portfolio management, and we divested from our MatrixCare business and got $490 million from Frazier Partners and exited the slower growth software-as-a-service market for nursing homes, hospice, and senior living. On the product side, we have also done some portfolio management and we talked about our field safety notice and took a $42 million charge for Astral on our global field safety notice there. One thing that we talked about was there will be no new sales in FY 2027, and here today, I am going to announce that we actually have started to talk to customers just yesterday, that we are going to sunset the Astral platform. So after 15 years, we will be sunsetting that platform. No new sales of that device.
What we are going to do is prioritize every single PCBA for a patient who is part of that field safety notification. So every patient is taken care of. Where we are pivoting in our ventilation is actually to the AirCurve, which is on the Air11 platform, the AirCurve S, ST, and ST-A. These are non-invasive ventilators for COPD and overlap syndrome, and it sits on our very low-cost, high-quality Air11 platform. So the same one as the AirSense 11 is now the AirCurve 11 S, ST, and ST-A. We just launched that into the U.S. this last quarter, and we are expecting great growth from it.
Pretty close to time there. Just anything on Stellar as well? Is Stellar still being-
No announcements around Stellar.
Okay, great. We are pretty much on time, so thank you both very much for joining us today. Some really great insights there, and we will catch up with you again soon.
Yeah. Thanks, David.