Overview



Management's discussion and analysis of financial condition and results of
operations ("MD&A") is intended to help the reader understand our results of
operations and financial condition. It is provided as a supplement to, and
should be read in conjunction with the selected financial data and consolidated
financial statements and notes included in this report.

We are a global leader in the development, manufacturing, distribution and
marketing of medical devices and cloud-based software applications that
diagnose, treat and manage respiratory disorders, including SDB, COPD,
neuromuscular disease and other chronic diseases. SDB includes obstructive sleep
apnea and other respiratory disorders that occur during sleep. Our products and
solutions are designed to improve patient quality of life, reduce the impact of
chronic disease and lower healthcare costs as global healthcare systems continue
to drive a shift in care from hospitals to the home and lower cost settings. Our
cloud-based digital health applications, along with our devices, are designed to
provide connected care to improve patient outcomes and efficiencies for our
customers.

Since the development of continuous positive airway pressure therapy, we have
expanded our business by developing or acquiring a number of products and
solutions for a broader range of respiratory disorders including technologies to
be applied in medical and consumer products, ventilation devices, diagnostic
products, mask systems for use in the hospital and home, headgear and other
accessories, dental devices, and cloud-based software informatics solutions to
manage patient outcomes and customer and provider business processes. Our growth
has been fueled by geographic expansion, our research and product development
efforts, acquisitions and an increasing awareness of SDB and other respiratory
conditions like chronic obstructive pulmonary disease as significant health
concerns.

We are committed to ongoing investment in research and development and product
enhancements. During fiscal year 2021, we invested $225.3 million on research
and development activities, which represents 7.0% of net revenues with a
continued focus on the development and commercialization of new, innovative
products and solutions that improve patient outcomes, create efficiencies for
our customers and help physicians and providers better manage chronic disease
and lower healthcare costs. During fiscal year 2021 we commenced a controlled
product launch of AirSense 11, which will be followed by a broader launch
throughout fiscal year 2022. AirSense 11 will introduce new features such as a
touch screen, algorithms for patients new to therapy and digital enhancements,
such as over-the-air update capabilities. Due to multiple acquisitions,
including Brightree in April 2016, HEALTHCAREfirst in July 2018 and MatrixCare
in November 2018, our operations now include out-of-hospital software platforms
designed to support the professionals and caregivers who help people stay
healthy in the home or care setting of their choice. These platforms comprise
our SaaS business. These products, our cloud-based remote monitoring and therapy
management system, and a robust product pipeline, should continue to provide us
with a strong platform for future growth.

We have determined that we have two operating segments, which are the sleep and
respiratory disorders sector of the medical device industry ("Sleep and
Respiratory Care") and the supply of business management software as a service
to out-of-hospital health providers ("SaaS").

Net revenue in fiscal year 2021 increased to $3,196.8 million, an increase of 8%
compared to fiscal year 2020. Gross profit increased for the year ended June 30,
2021 to $1,839.1 million, from $1,717.8 million for the year ended June 30,
2020, an increase $121.3 million or 7%. Our net income for the year ended
June 30, 2021 was $474.5 million or $3.24 per diluted share compared to net
income of $621.7 million or $4.27 per diluted share for the year ended June 30,
2020. Unrecognized tax benefits as described at note 14 - Income Taxes impacted
our diluted earnings per share by $1.70 for the year ended June 30, 2021.

Total operating cash flow for fiscal year 2021 was $736.7 million and at
June 30, 2021, our cash and cash equivalents totaled $295.3 million. At June 30,
2021, our total assets were $4.7 billion and our stockholders' equity was
$2.9 billion. We paid a quarterly dividend of $0.39 per share during fiscal 2021
with a total amount of $226.7 million paid to stockholders.

In order to provide a framework for assessing how our underlying businesses
performed, excluding the effect of foreign currency fluctuations, we provide
certain financial information on a "constant currency basis", which is in
addition to the actual financial information presented. In order to calculate
our constant currency information, we translate the current period financial
information using the foreign currency exchange rates that were in effect during
the previous comparable period. However, constant currency measures should not
be considered in isolation or as an alternative to U.S. dollar measures that
reflect current period exchange rates, or to other financial measures calculated
and presented in accordance with accounting principles generally accepted in the
United States ("GAAP").



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PART II Item 7




                          RESMED INC. AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of


                                   Operations



For discussion related to the results of operations and changes in financial
condition for the fiscal year ended June 30, 2020 compared to fiscal year June
30, 2019, please refer to Item 7 of Part II, "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in our Annual Report
for the Year Ended June 30, 2020, which was filed with the United States
Securities and Exchange Commission on August 13, 2020.

Impact of COVID-19



In March 2020, the World Health Organization declared the outbreak of a novel
strain of coronavirus ("COVID-19") as a pandemic. Our primary goal during the
COVID-19 pandemic is the preservation of life. We have prioritized protecting
the health and safety of our employees and continuing to use our employees'
talents and our resources to help society meet and overcome the challenges the
pandemic poses.

During the year ended June 30, 2021, we observed immaterial incremental demand
for our ventilator devices and masks associated with the COVID-19 pandemic.
Although there is still substantial uncertainty, we believe the global demand
for ventilators and other respiratory support devices used to treat COVID-19
patients has largely been met. As such, we do not expect material
COVID-19-generated demand for our ventilator products for the fiscal year ending
June 30, 2022.

Diagnostic pathways for sleep apnea treatment, including physician practices,
HME suppliers and sleep clinics, have been impacted and, in some instances, been
required, to temporarily close due to governments' "shelter-in-place" orders,
quarantines or similar orders or restrictions enacted to control the spread of
COVID-19. In some countries, new patients are prescribed sleep apnea treatment
through hospitals that are directing their resources to critical care, including
COVID-19 treatment. The impact on these diagnostic and prescription pathways has
resulted in a decrease in demand from new patients for our products designed to
treat sleep apnea. Although certain governments have begun to reduce or remove
COVID-19 restrictions and implement vaccination programs to varying degrees, we
are uncertain as to the duration and extent of the impact on demand for our
sleep devices. However, due to the nature of the installed base of existing
patients using our devices, we have not seen any significant adverse impact on
demand for re-supply of our masks.

Our SaaS business has also been affected by COVID-19 and measures taken to
control the spread of COVID-19. Some of our existing and potential SaaS
customers are HME distributors and have been impacted by the same temporary
business closures noted above. We also have existing and potential SaaS
customers that operate care facilities and are either receiving and treating
patients infected with COVID-19 or have implemented significant measures to
safeguard their facilities against a potential COVID-19 outbreak. Given these
challenging business conditions, businesses may be deterred from adopting new or
changing SaaS platforms, which may adversely impact our ability to engage new
customers for our SaaS businesses, or expand the services used by existing
customers.

Our ability to continue to operate without any significant negative impacts will
in part depend on our ability to protect our employees. We have endeavored and
continue to follow recommended actions of government and health authorities to
protect our employees worldwide, but since COVID-19 was declared a pandemic in
March 2020, we were able to broadly maintain our operations, and we are
beginning the slow and careful process of progressively returning to work in
some of our offices around the world. The pandemic has not negatively impacted
our liquidity position.



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PART II Item 7




                          RESMED INC. AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of


                                   Operations

Fiscal Year Ended June 30, 2021 Compared to Fiscal Year Ended June 30, 2020



Net Revenues.  Net revenue for the year ended June 30, 2021 increased to
$3,196.8 million from $2,957.0 million for the year ended June 30, 2020, an
increase of $239.8 million or 8% (a 6% increase on a constant currency basis).
The following table summarizes our net revenue disaggregated by segment, product
and region for the year ended June 30, 2021 compared to the year ended June 30,
2020 (in thousands):

                                                                  Year Ended June 30,
                                                                                             Constant
                                                    2021           2020       % Change       Currency*
U.S., Canada and Latin America
Devices                                         $   863,661    $   792,766          9  %
Masks and other                                     841,452        779,561

8


Total Sleep and Respiratory Care                $ 1,705,113    $ 1,572,327          8
Software as a Service                               373,590        354,632          5
Total                                           $ 2,078,703    $ 1,926,959          8
Combined Europe, Asia and other markets
Devices                                         $   746,379    $   715,056          4  %       (2)     %
Masks and other                                     371,743        314,998         18          11
Total Sleep and Respiratory Care                $ 1,118,122    $ 1,030,054          9           2
Global revenue
Devices                                         $ 1,610,040    $ 1,507,822          7  %        3      %
Masks and other                                   1,213,195      1,094,559         11           9
Total Sleep and Respiratory Care                $ 2,823,235    $ 2,602,381          8           6
Software as a Service                               373,590        354,632          5           5
Total                                           $ 3,196,825    $ 2,957,013          8           6

*Constant currency numbers exclude the impact of movements in international currencies.

Sleep and Respiratory Care



Net revenue from our Sleep and Respiratory Care business for the year ended
June 30, 2021 increased to $2,823.2 million from $2,602.4 million for the year
ended June 30, 2020, an increase of $220.9 million or 8%. Movements in
international currencies against the U.S. dollar positively impacted net
revenues by approximately $75.2 million for the year ended June 30, 2021.
Excluding the impact of currency movements, total net revenue from our Sleep and
Respiratory Care business for the year ended June 30, 2021 increased by 6%
compared to the year ended June 30, 2020. The increase in net revenue was
primarily attributable to an increase in unit sales of our devices and masks,
including recovery of core sleep patient flow that was previously impacted by
the pandemic and increased demand following a recent product recall by one of
our competitors, partially offset by decreased COVID-19 related demand for our
ventilators.

Net revenue from our Sleep and Respiratory Care business in the United States,
Canada and Latin America for the year ended June 30, 2021 increased to $1,705.1
million from $1,572.3 million for the year ended June 30, 2020, an increase of
$132.8 million or 8%. The increase was primarily due to an increase in unit
sales of our devices and masks, including recovery of core sleep patient flow
that was previously impacted by the pandemic and increased demand following a
recent product recall by one of our competitors, partially offset by decreased
COVID-19 related demand for our ventilators.

Net revenue from our Sleep and Respiratory Care business in combined Europe,
Asia and other markets increased for the year ended June 30, 2021 to $1,118.1
million from $1,030.1 million for the year ended June 30, 2020, an increase of
$88.1 million or 9% (an increase of 2% on a constant currency basis). The
constant currency increase in sales in combined Europe, Asia and other markets
predominantly reflects an increase in unit sales of our devices and masks,
including recovery of core sleep patient flow that was previously impacted by
the pandemic, partially offset by decreased COVID-19-related demand for our
ventilators.

Net revenue from devices for the year ended June 30, 2021 increased to $1,610.0
million from $1,507.8 million for the year ended June 30, 2020, an increase of
$102.2 million or 7%, including an increase of 9% in the United States, Canada
and Latin America and an increase of 4% in combined Europe, Asia and other
markets (a 2% decrease on a constant currency basis). Excluding the impact of
foreign currency movements, device sales for the year ended June 30, 2021
increased by 3%.

Net revenue from masks and other for the year ended June 30, 2021 increased to
$1,213.2 million from $1,094.6 million for the year ended June 30, 2020, an
increase of 11%, including an increase of 8% in the United States, Canada and
Latin America and an increase of 18% in combined Europe, Asia and other markets
(an 11% increase on a constant currency basis). Excluding the impact of foreign
currency movements, masks and other sales increased by 9%, compared to the year
ended June 30, 2020.



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PART II Item 7




                          RESMED INC. AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of


                                   Operations



Software as a Service

Net revenue from our SaaS business for the year ended June 30, 2021 was $373.6
million, compared to $354.6 million for the year ended June 30, 2020, an
increase of $19.0 million or 5%. The increase was predominantly due to continued
growth in resupply service offerings.

Gross Profit and Gross Margin.  Gross profit increased for the year ended
June 30, 2021 to $1,839.1 million from $1,717.8 million for the year ended
June 30, 2020, an increase of $121.3 million or 7%. Gross profit as a percentage
of net revenue was 57.5% for the year ended June 30, 2021, compared with the
58.1% for the year ended June 30, 2020. The decrease in gross margin was due
primarily to product mix changes, declines in average selling prices and
geographic mix changes, partially offset by lower amortization of acquired
intangibles.

Selling, General and Administrative Expenses.  Selling, general and
administrative expenses decreased for the year ended June 30, 2021 to $670.4
million from $676.7 million for the year ended June 30, 2020, a decrease of
$6.3 million or 1%. The selling, general and administrative expenses, as
reported in U.S. dollars, were unfavorably impacted by the movement of
international currencies against the U.S. dollar, which increased our expenses
by approximately $22.4 million. Excluding the impact of foreign currency
movements, selling, general and administrative expenses for the year ended
June 30, 2021 decreased by 4% compared to the year ended June 30, 2020. As a
percentage of net revenue, selling, general and administrative expenses for the
year ended June 30, 2021 improved to 21.0% compared to 22.9% for the year ended
June 30, 2020. The constant currency decrease in selling, general and
administrative expenses was primarily due to decreases in travel and
entertainment and bad debt expenses, partially offset by increases in
employee-related expenses.

Research and Development Expenses.  Research and development expenses increased
for the year ended June 30, 2021 to $225.3 million from $201.9 million for the
year ended June 30, 2020, an increase of $23.3 million or 12%. The research and
development expenses were unfavorably impacted by the movement of international
currencies against the U.S. dollar, which increased our expenses by
approximately $8.1 million, as reported in U.S. dollars. Excluding the impact of
foreign currency movements, research and development expenses for the year ended
June 30, 2021 increased by 8% compared to the year ended June 30, 2020. As a
percentage of net revenue, research and development expenses were 7.0% for the
year ended June 30, 2021 compared to 6.8% for the year ended June 30, 2020. The
constant currency increase in research and development expenses was primarily
due to increased investment in our digital health technologies and SaaS
solutions.

Amortization of Acquired Intangible Assets.  Amortization of acquired intangible
assets for the year ended June 30, 2021 totaled $31.1 million compared to $30.1
million for the year ended June 30, 2020.

Restructuring Expenses.  In November 2020, we closed our POC business, which was
part of the Sleep and Respiratory Care segment. During the year ended June 30,
2021, we recognized restructuring expenses of $13.9 million primarily related to
inventory write-downs of $5.2 million, accelerated amortization of acquired
intangible assets of $5.1 million, asset impairments of $2.3 million,
employee-related costs of $0.7 million and contract cancellation costs of $0.6
million. Of the total expense recognized during the year ended June 30, 2021,
the inventory write-down of $5.2 million is presented within cost of sales and
the remaining $8.7 million in restructuring costs is separately disclosed as
restructuring expenses on the consolidated statements of income. We do not
expect to incur additional expenses in connection with this activity in the
future.

Total Other Income (Loss), Net.  Total other income (loss), net for the year
ended June 30, 2021 was a loss of $20.0 million, compared to a loss of
$76.6 million for the year ended June 30, 2020. The decrease was partially due
to a decrease in interest expense to $24.0 million for the year ended June 30,
2021 compared to $40.3 million for the year ended June 30, 2020. Additionally,
we recognized an unrealized gain of $14.5 million on our marketable and
non-marketable securities for the year ended June 30, 2021, whereas during the
year ended June 30, 2020, we recorded an impairment of $14.5 million on our
non-marketable equity securities. We also recorded lower losses attributable to
equity method investments for the year ended June 30, 2021 of $11.2 million
compared to $25.1 million for the year ended June 30, 2020.

Income Taxes.  Our effective income tax rate increased to 46.3% for the year
ended June 30, 2021 from 15.2% for the year ended June 30, 2020. The increase in
our effective income tax rate was primarily the result of an increase in
unrecognized tax benefits as outlined below. Excluding the impact of the
unrecognized tax benefit, our effective income tax rate for the year ended
June 30, 2021 was 18.2%. The increase in our effective tax rate, excluding the
impact of the unrecognized tax benefit, was due to the geographic mix of
earnings and lower windfall tax benefits related to the vesting or settlement of
employee share-based awards, which reduced our income tax expense by $12.1
million for the year ended June 30, 2021, as compared to $24.8 million for the
year ended June 30, 2020.



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PART II Item 7




                          RESMED INC. AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of


                                   Operations



We are under audit by the Australian Taxation Office (the "ATO") for the years
2009 to 2018 (the "Audit Period"). The audits primarily involve a transfer
pricing dispute in which the ATO asserts we should have paid additional
Australian taxes on income derived from our Singapore operations. The ATO issued
Notices of Amended Assessments for the tax years 2009 to 2013 seeking a total of
$266.0 million, consisting of $151.7 million in additional income tax and $114.3
million in penalties and interest. The 2014 to 2018 periods are still under
audit and we have not yet received any Notices of Amended Assessments relative
to those periods. A total of $98.8 million in tax has been prepaid in relation
to the Audit Period, which is consistent with ATO procedural audit practice.

We are engaged in advanced discussions with the ATO to settle the dispute for
the entire Audit Period. Given the stage of those discussions, during the year
ended June 30, 2021, we recorded $395.3 million of gross unrecognized tax
benefits, including $47.5 million of accrued interest and penalties. This
translates to a net amount of $248.7 million of net unrecognized tax benefits
after taking into account tax credits and deductions of $146.6 million.

If the matter were to progress to litigation, we continue to believe we are more likely than not to be successful in defending our position. If we are not successful in litigation, we will be required to pay some or all of the additional income tax, accrued interest and penalties, including potential additional amounts relating to the 2014 to 2018 periods.



Our Singapore operations operate under certain tax holidays and tax incentive
programs that will expire in whole or in part at various dates through June 30,
2030. Also, as a result of the U.S. Tax Act, we treated all non-U.S. historical
earnings as taxable, effective as of the year ended June 30, 2018. Therefore,
future repatriation of cash held by our non-U.S. subsidiaries, if any, will
generally not be subject to U.S. federal tax.

Net Income and Earnings per Share.  As a result of the factors above, our net
income for the year ended June 30, 2021 was $474.5 million compared to net
income of $621.7 million for the year ended June 30, 2020. Our earnings per
diluted share for the year ended June 30, 2021 was $3.24 compared to $4.27 for
the year ended June 30, 2020, a decrease of 24%. Unrecognized tax benefits as
described at note 14 - Income Taxes reduced our diluted earnings per share for
the year ended June 30, 2021 by $1.70 per share.

Summary of Non-GAAP Financial Measures



In addition to financial information prepared in accordance with GAAP, our
management uses certain non-GAAP financial measures, such as non-GAAP revenue,
non-GAAP cost of sales, non-GAAP gross profit, non-GAAP gross margin, non-GAAP
income from operations, non-GAAP net income, and non-GAAP diluted earnings per
share, in evaluating the performance of our business. We believe that these
non-GAAP financial measures, when reviewed in conjunction with GAAP financial
measures, can provide investors better insight when evaluating our performance
from core operations and can provide more consistent financial reporting across
periods. For these reasons, we use non-GAAP information internally in planning,
forecasting, and evaluating the results of operations in the current period and
in comparing it to past periods. These non-GAAP financial measures should be
considered in addition to, and not superior to or as a substitute for, GAAP
financial measures. We strongly encourage investors and shareholders to review
our financial statements and publicly-filed reports in their entirety and not to
rely on any single financial measure. Non-GAAP financial measures as presented
herein may not be comparable to similarly titled measures used by other
companies.

The measure "non-GAAP revenue" is equal to GAAP net revenue once adjusted for
deferred revenue fair value adjustments applied in the purchase accounting for
previous business combinations. The measure "non-GAAP cost of sales" is equal to
GAAP cost of sales less amortization of acquired intangible assets relating to
cost of sales and restructuring expense associated with inventory write-downs
following the closure of the POC business. The measure "non-GAAP gross profit"
is the difference between non-GAAP revenue and non-GAAP cost of sales, and
"non-GAAP gross margin" is the ratio of non-GAAP gross profit to non-GAAP
revenue.



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PART II Item 7




                          RESMED INC. AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of


                                   Operations

These non-GAAP measures are reconciled to their most directly comparable GAAP financial measures below (in thousands, except percentages):



                                                        Year Ended June 30
                                                       2021            2020
GAAP Net revenue                                  $ 3,196,825     $

2,957,013


Add back: Deferred revenue fair value adjustment             -          2,102
Non-GAAP revenue                                  $ 3,196,825     $ 2,959,115

GAAP Cost of sales                                $ 1,357,725     $ 1,239,227
Less: Amortization of acquired intangibles            (45,127)

(49,603)


Less: Restructuring - cost of sales                    (5,232)               -
Non-GAAP cost of sales                            $ 1,307,366     $ 1,189,624

GAAP gross profit                                 $ 1,839,100     $ 1,717,786
GAAP gross margin                                        57.5  %         58.1  %
Non-GAAP gross profit                             $ 1,889,459     $ 1,769,491
Non-GAAP gross margin                                    59.1  %         59.8  %


The measure "non-GAAP income from operations" is equal to GAAP income from
operations once adjusted for amortization of acquired intangibles, restructuring
expense associated with the closure of the POC business, deferred revenue fair
value adjustments applied in the purchase accounting for previous business
combinations and litigation settlement expenses. Non-GAAP income from operations
is reconciled with GAAP income from operations below (in thousands):

                                                             Year Ended June 30
                                                              2021        2020
GAAP income from operations                                $ 903,678   $ 809,659
Amortization of acquired intangibles - cost of sales          45,127      49,603
Amortization of acquired intangibles - operating expenses     31,078      30,092
Restructuring - cost of sales                                  5,232

-


Restructuring - operating expenses                             8,673

-


Deferred revenue fair value adjustment                              -

2,102


Litigation settlement expenses                                      -

(600)


Non-GAAP income from operations                            $ 993,788   $

890,856




The measure "non-GAAP net income" is equal to GAAP net income once adjusted for
amortization of acquired intangibles (net of tax), reserve for disputed tax
positions, restructuring expense associated with the closure of the POC (net of
tax), (gain) loss on marketable equity securities, fair value adjustments
recognized on non-marketable equity securities, deferred revenue fair value
adjustments applied in the purchase accounting for previous business
combinations (net of tax) and litigation settlement expenses (net of tax). The
measure "non-GAAP diluted earnings per share" is the ratio of non-GAAP net
income to diluted shares outstanding. These non-GAAP measures are reconciled to
their most directly comparable GAAP financial measures below (in thousands,
except for per share amounts):

                                                              Year Ended June 30
                                                              2021          2020
GAAP net income (loss)                                     $  474,505    $  621,674

Amortization of acquired intangibles - cost of sales, 34,642

37,933


net of tax
Amortization of acquired intangibles - operating               23,857

23,012


expenses, net of tax
Reserve for disputed tax positions                            248,773

-


Restructuring - cost of sales, net of tax                       4,663

-


Restructuring - operating expenses, net of tax                  7,730

-


(Gain) loss on equity investments                             (13,549)

-


Fair value impairment of investment                                  -

9,100


Deferred revenue fair value adjustment, net of tax                   -

1,610


Litigation settlement expenses, net of tax                           -         (528)
Non-GAAP net income                                        $  780,621    $  692,801
Diluted shares outstanding                                    146,451       145,652
GAAP diluted earnings per share                            $     3.24    $

4.27


Non-GAAP diluted earnings per share                        $     5.33    $     4.76




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PART II Item 7




                          RESMED INC. AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of


                                   Operations

Liquidity and Capital Resources



As of June 30, 2021 and June 30, 2020, we had cash and cash equivalents of
$295.3 million and $463.2 million, respectively. Working capital was $663.0
million and $920.7 million, at June 30, 2021 and June 30, 2020, respectively. As
of June 30, 2021 we had $0.7 billion of borrowings under our revolving credit
facility, term credit facility and senior notes as compared to $1.2 billion at
June 30, 2020. As of June 30, 2021, we had $1.6 billion available for draw down
under the revolving credit facility and a combined total of $1.9 billion in cash
and available liquidity under the revolving credit facility. We believe that
cash generated from operations and available borrowings under our credit
facility will be sufficient to fund our operations, including expected capital
expenditures, for the next 12 months and beyond.

As of June 30, 2021 and June 30, 2020, our cash and cash equivalent balances
held within the United States amounted to $106.7 million and $158.8 million,
respectively. Our remaining cash and cash equivalent balances at June 30, 2021
and June 30, 2020, of $188.6 million and $304.4 million, respectively, were held
by our non-U.S. subsidiaries. Our cash and cash equivalent balances are held at
highly rated financial institutions.

We repatriated $560.1 million and $400.0 million to the United States during the
years ended June 30, 2021 and 2020, respectively, from earnings generated in
each of those years. The amount of the current year foreign earnings that we
have repatriated to the United States in the past has been determined, and the
amount that we expect to repatriate during fiscal year 2022 will be determined,
based on a variety of factors, including current year earnings of our foreign
subsidiaries, foreign investment needs and the cash flow needs we have in the
United States, such as for the repayment of debt, dividend distributions, and
other domestic obligations.

As a result of the U.S. Tax Act, we treated all non-U.S. historical earnings
prior to 2018 as taxable. Therefore, future repatriation of cash held by our
non-U.S. subsidiaries will generally not be subject to U.S. federal tax if
repatriated, except as discussed in Note 14 - Income Taxes of the Notes to the
Consolidated Financial Statements (Part II, Item 8).

Inventories at June 30, 2021 were $457.0 million, an increase of $40.1 or 10%
over the balance at June 30, 2020 of $416.9 million. The increase in inventories
was required to respond to the increase in unit volumes and the additional
complexity and elongation of our supply chain resulting from ongoing COVID-19
impacts.

Accounts receivable, net of allowance for doubtful accounts, at June 30, 2021
were $614.3 million, an increase of $139.6 million or 29% over the June 30, 2020
accounts receivable balance of $474.6 million. Accounts receivable days' sales
outstanding of 68 days at June 30, 2021 increased by 3 days compared to 65 days
at June 30, 2020. Our allowance for doubtful accounts as a percentage of total
accounts receivable at June 30, 2021 and 2020 was 5.0% and 5.7%, respectively.

We recognize right-of-use assets and lease liabilities on the balance sheet for
all operating leases except those that meet the definition of a short-term
lease. As of June 30, 2021 and 2020 our right-of-use assets were $128.6 million
and $118.3 million, respectively and our lease liabilities were $138.4 million
and $123.1 million, respectively.

During the year ended June 30, 2021, we generated cash of $736.7 million from
operations compared to $802.3 million for the year ended June 30, 2020. The
decrease in cash generated from operations during the year ended June 30, 2021
was primarily due to the increase in working capital balances and income tax
payments. Movements in foreign currency exchange rates during the year ended
June 30, 2021 had the effect of increasing our cash and cash equivalents by
$18.5 million, as reported in U.S. dollars.

During the year ended June 30, 2021, we paid $43.5 million associated with business acquisitions, net of cash acquired, compared to $27.9 million during the year ended June 30, 2020.



We have temporarily suspended our share repurchase program due to acquisitions,
and more recently, as a response to the COVID-19 pandemic. Accordingly, we did
not repurchase any shares during the years ended June 30, 2021 and 2020. In
addition, during fiscal years 2021 and 2020, we paid to holders of our common
stock dividends totaling $226.7 million and $225.1 million, respectively.



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PART II Item 7




                          RESMED INC. AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of


                                   Operations



Details of contractual obligations at June 30, 2021 are as follows (in
thousands):

                                                            Payments Due by June 30,
                          Total         2022         2023        2024       2025       2026      Thereafter
Debt                   $   658,000   $   12,000    $ 146,000   $      -   $      -   $      -   $    500,000
Interest on debt           116,400        19,779      19,178     16,725     16,725     16,725         27,269
Operating leases           135,399        29,600      25,573     17,553     12,537     10,916         39,220
Purchase obligations     1,100,839     1,099,419         994        426          -          -              -
Total                  $ 2,010,638   $ 1,160,798   $ 191,745   $ 34,704   $ 29,262   $ 27,641   $    566,489


Details of other commercial commitments at June 30, 2021 are as follows (in
thousands):

                                                     Amount of Commitment Expiration Per Period
                            Total        2022         2023       2024       2025        2026       Thereafter

Standby letter of credit   $ 17,116   $     3,791   $    527   $     12   $       -   $       -   $     12,786
Guarantees*                   3,837           205         74        102          20          52          3,384
Total                      $ 20,953   $     3,996   $    601   $    114   $      20   $      52   $     16,170


*These guarantees mainly relate to requirements under contractual obligations
with insurance companies transacting with our German subsidiaries and guarantees
provided under our facility leasing obligations.

Refer to Note 17 - Legal Actions, Contingencies and Commitments of the Notes to the Consolidated Financial Statements (Part II, Item 8) for details of our contingent obligations under recourse provisions.

Segment Information



We have determined that we have two operating segments, which are the Sleep and
Respiratory Care segment and the SaaS segment. See Note 15 - Segment Information
of the Notes to the Consolidated Financial Statements (Part II, Item 8) for
financial information regarding segment reporting. Financial information about
our revenues from and assets located in foreign countries is also included in
the notes to the consolidated financial statements included in this report.

Credit Facility



On April 17, 2018, we entered into an amended and restated credit agreement, or
the Revolving Credit Agreement, as borrower, with lenders MUFG Union Bank, N.A.,
as administrative agent, joint lead arranger, joint book runner, swing line
lender and letter of credit issuer, and Westpac Banking Corporation, as
syndication agent, joint lead arranger and joint book runner. The Revolving
Credit Agreement, among other things, provided a senior unsecured revolving
credit facility of $800.0 million, with an uncommitted option to increase the
revolving credit facility by an additional $300.0 million.

Additionally, on April 17, 2018, ResMed Limited entered into a syndicated
facility agreement, or the Term Credit Agreement, as borrower, with lenders MUFG
Union Bank, N.A., as administrative agent, joint lead arranger and joint book
runner, and Westpac Banking Corporation, as syndication agent, joint lead
arranger and joint book runner. The Term Credit Agreement, among other things,
provides ResMed Limited a senior unsecured term credit facility of $200.0
million.

On November 5, 2018, we entered into a first amendment to the Revolving Credit
Agreement to, among other things, increase the size of our senior unsecured
revolving credit facility from $800.0 million to $1.6 billion, with an
uncommitted option to increase the revolving credit facility by an additional
$300.0 million.

Our obligations under the Revolving Credit Agreement are guaranteed by certain
of our direct and indirect U.S. subsidiaries, and ResMed Limited's obligations
under the Term Credit Agreement are guaranteed by us and certain of our direct
and indirect U.S. subsidiaries. The Revolving Credit Agreement and Term Credit
Agreement contain customary covenants, including, in each case, a financial
covenant that requires that we maintain a maximum leverage ratio of funded debt
to EBITDA (as defined in the Revolving Credit Agreement and Term Credit
Agreement, as applicable). The entire principal amounts of the revolving credit
facility and term credit facility, and, in each case, any accrued but unpaid
interest may be declared immediately due and payable if an event of default
occurs, as defined in the Revolving Credit Agreement and the Term Credit
Agreement, as applicable. Events of default under the Revolving Credit Agreement
and the Term Credit Agreement include, in each case, failure to make payments
when due, the occurrence of a default in the performance of any covenants in the
respective agreements or related documents, or certain changes of control of us,
or the respective guarantors of the obligations borrowed under the Revolving
Credit Agreement and Term Credit Agreement.



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PART II Item 7




                          RESMED INC. AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of


                                   Operations



The Revolving Credit Agreement and Term Credit Agreement each terminate on April
17, 2023, when all unpaid principal and interest under the loans must be repaid.
Amounts borrowed under the Term Credit Agreement will also amortize on a
semi-annual basis, with a $6.0 million principal payment required on each such
semi-annual amortization date. The outstanding principal amounts will bear
interest at a rate equal to LIBOR plus 0.75% to 1.50% (depending on the
then-applicable leverage ratio) or the Base Rate (as defined in the Revolving
Credit Agreement and the Term Credit Agreement, as applicable) plus 0.0% to
0.50% (depending on the then-applicable leverage ratio). At June 30, 2021, the
interest rate that was being charged on the outstanding principal amounts was
0.9%. An applicable commitment fee of 0.100% to 0.175% (depending on the
then-applicable leverage ratio) applies on the unused portion of the revolving
credit facility. At June 30, 2021, we were in compliance with our debt covenants
and there was $158.0 million outstanding under the Revolving Credit Agreement
and Term Credit Agreement.

Senior Notes

On July 10, 2019, we entered into a Note Purchase Agreement with the purchasers
to that agreement, in connection with the issuance and sale of $250.0 million
principal amount of our 3.24% senior notes due July 10, 2026, and $250.0 million
principal amount of our 3.45% senior notes due July 10, 2029. Our obligations
under the Note Purchase Agreement and the Notes are unconditionally and
irrevocably guaranteed by certain of our direct and indirect U.S. subsidiaries,
including ResMed Corp., ResMed Motor Technologies Inc., Birdie Inc., Inova Labs,
Inc., Brightree LLC, Brightree Home Health & Hospice LLC, Brightree Patient
Collections LLC, ResMed Operations Inc., HEALTHCAREfirst Holding Company, HCF
Holdco Company, HEALTHCAREfirst, Inc., CareFacts Information Systems, LLC and
Lewis Computer Services, LLC, MatrixCare Holdings Inc., MatrixCare, Inc.,
Reciprocal Labs Corporation and ResMed SaaS Inc., under a Subsidiary Guaranty
Agreement dated as of July 10, 2019. The net proceeds from this transaction were
used to pay down borrowings on our Revolving Credit Agreement.

Under the terms of the Note Purchase Agreement, we agreed to customary covenants
including with respect to our corporate existence, transactions with affiliates,
and mergers and other extraordinary transactions. We also agreed that, subject
to limited exceptions, we will maintain a ratio of consolidated funded debt to
consolidated EBITDA (as defined in the Note Purchase Agreement) of no more than
3.50 to 1.00 as of the last day of any fiscal quarter, and will not at any time
permit the amount of all secured and unsecured debt of us and our subsidiaries
to exceed 10% of our consolidated tangible assets, determined as of the end of
our most recently ended fiscal quarter. This ratio is calculated at the end of
each reporting period for which the Note Purchase Agreement requires us to
deliver financial statements, using the results of the 12 consecutive month
period ending with such reporting period.

On June 30, 2021, we were in compliance with our debt covenants and there was a
total of $658.0 million outstanding under the Revolving Credit Agreement, Term
Credit Agreement and Senior Notes. We expect to satisfy all of our liquidity and
long-term debt requirements through a combination of cash on hand, cash
generated from operations and undrawn debt facilities.

Critical Accounting Principles and Estimates



The preparation of financial statements in conformity with U.S. GAAP requires us
to make estimates and judgments that affect our reported amounts of assets and
liabilities, revenues and expenses and related disclosures of contingent assets
and liabilities. On an ongoing basis we evaluate our estimates, including those
related to allowance for doubtful accounts, inventory reserves, warranty
obligations, goodwill, potentially impaired assets, intangible assets, income
taxes and contingencies.

We state these accounting policies in the notes to the financial statements and
at relevant sections in this discussion and analysis. The estimates are based on
the information that is currently available to us and on various other
assumptions that we believe to be reasonable under the circumstances. Actual
results could vary from those estimates under different assumptions or
conditions.

We believe that the following critical accounting policies affect the more significant judgments and estimates used in the preparation of our consolidated financial statements:





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                          RESMED INC. AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of


                                   Operations



(1) Valuation of Goodwill, Intangible and Other Long-Lived Assets.  We make
assumptions in establishing the carrying value, fair value and estimated lives
of our goodwill, intangibles and other long-lived assets. Our goodwill
impairment tests are performed at our reporting unit level, which is one level
below our operating segments. The criteria used for these evaluations include
management's estimate of the asset's continuing ability to generate positive
income from operations and positive cash flow in future periods compared to the
carrying value of the asset, as well as the strategic significance of any
identifiable intangible asset in our business objectives. If assets are
considered to be impaired, we recognize as impairment the amount by which the
carrying value of the assets exceeds their fair value, and for goodwill is
limited to the value of goodwill allocated to the impaired reporting unit, as
described in Step 1 below. Factors that would influence the likelihood of a
material change in our reported results include significant changes in the
asset's ability to generate positive cash flow, loss of legal ownership or title
to the asset, a significant decline in the economic and competitive environment
on which the asset depends, significant changes in our strategic business
objectives, utilization of the asset, and a significant change in the economic
and/or political conditions in certain countries.

We conduct an annual review for goodwill impairment at our reporting unit level based on the following steps:



Step 0 or Qualitative assessment - Evaluate qualitative factors to determine
whether it is more likely than not that the fair value of a reporting unit is
less than its carrying amount, including goodwill. The factors we consider
include, but are not limited to, macroeconomic conditions, industry and market
considerations, cost factors, overall financial performance or events-specific
to that reporting unit. If or when we determine it is more likely than not that
the fair value of a reporting unit is less than the carrying amount, including
goodwill, we would move to Step 1 of the quantitative method.

Step 1 - Compare the fair value for each reporting unit to its carrying value,
including goodwill. Fair value is determined based on estimated discounted cash
flows. A goodwill impairment charge is recognized for the amount that the
carrying amount of a reporting unit, including goodwill, exceeds its fair value,
limited to the total amount of goodwill allocated to that reporting unit. If a
reporting unit's fair value exceeds the carrying value, no further work is
performed and no impairment charge is necessary.

(2) Income Tax.  We assess our income tax positions and record tax benefits for
all years subject to audit based upon management's evaluation of the facts,
circumstances and information available at the reporting date.  If we determine
that it is not more likely than not that we would be able to realize all or part
of our net deferred tax assets in the future, an adjustment to the deferred tax
assets would be charged to income tax expense in the period such determination
is made. Alternatively, if we determine that it is more likely than not that the
net deferred tax assets would be realized, any previously provided valuation
allowance is reversed. These changes to the valuation allowance and resulting
increases or decreases in income tax expense may have a material effect on our
operating results.

Our income tax returns are based on calculations and assumptions subject to
audit by various tax authorities. In addition, the calculation of our tax
liabilities involves dealing with uncertainties in the application of complex
tax laws. We recognize liabilities for uncertain tax positions based on a
two-step process. The first step is to evaluate the tax position for recognition
by determining if the weight of available evidence indicates that it is more
likely than not that the position will be sustained on audit, including
resolution of related appeals or litigation processes, if any. The second step
is to measure the tax benefit as the largest amount that is more than 50% likely
of being realized upon settlement. While we believe we have appropriate support
for the positions taken on our tax returns, we regularly assess the potential
outcomes of examinations by tax authorities in determining the adequacy of our
provision for income taxes. Based on our regular assessment, we may adjust the
income tax provision and deferred taxes in the period in which the facts that
give rise to a revision become known.

We are under audit by the Australian Taxation Office (the "ATO") for the years
2009 to 2018 (the "Audit Period"). The audits primarily involve a transfer
pricing dispute in which the ATO asserts we should have paid additional
Australian taxes on income derived from our Singapore operations. The ATO issued
Notices of Amended Assessments for the tax years 2009 to 2013 seeking a total of
$266.0 million, consisting of $151.7 million in additional income tax and $114.3
million in penalties and interest. The 2014 to 2018 periods are still under
audit and we have not yet received any Notices of Amended Assessments relative
to those periods. A total of $98.8 million in tax has been prepaid in relation
to the Audit Period, which is consistent with ATO procedural audit practice.

We are engaged in advanced discussions with the ATO to settle the dispute for
the entire Audit Period. Given the stage of those discussions, during the year
ended June 30, 2021, we recorded $395.3 million of gross unrecognized tax
benefits, including $47.5 million of accrued interest and penalties. This amount
reflects our estimate of the potential tax liability and is subject to change.

Included in the balance of uncertain tax positions as of June 30, 2021 were $248.7 million of net unrecognized tax benefits that, if recognized, would reduce the effective income tax rate in future periods. This amount represents the $395.3 million of gross unrecognized tax, adjusted for tax credits and deductions of $146.6 million.





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PART II Item 7




                          RESMED INC. AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of


                                   Operations

If the matter were to progress to litigation, we continue to believe we are more likely than not to be successful in defending our position. If we are not successful in litigation, we will be required to pay some or all of the additional income tax, accrued interest and penalties, including potential additional amounts relating to the 2014 to 2018 periods.



The timing and resolution of the ATO audits are inherently uncertain, and the
amounts we might ultimately pay or receive in credits and deductions, if any,
upon resolution of issues raised by the ATO may differ materially from the
amounts accrued. Although it is expected that the amount of unrecognized tax
benefits may change in the next 12 months, an estimate of the range of the
possible change cannot be made.

Outside the ATO audit describe above, tax years 2017 to 2020 remain subject to
future examination by the major tax jurisdictions in which we are subject to
tax.

(3) Revenue Recognition.  We have determined that we have two operating
segments, which are the sleep and respiratory disorders sector of the medical
device industry ("Sleep and Respiratory Care") and the supply of business
management software as a service to out-of-hospital health providers ("SaaS").
For products in our Sleep and Respiratory Care business, we transfer control and
recognize a sale when products are shipped to the customer in accordance with
the contractual shipping terms. For our SaaS business, revenue associated with
professional services are recognized as they are provided. We defer the
recognition of a portion of the consideration received when performance
obligations are not yet satisfied. Consideration received from customers in
advance of revenue recognition is classified as deferred revenue. Performance
obligations resulting in deferred revenue in our Sleep and Respiratory Care
business relate primarily to extended warranties on our devices and the
provision of data for patient monitoring. Performance obligations resulting in
deferred revenue in our SaaS business relate primarily to the provision of
software access with maintenance and support over an agreed term and material
rights associated with future discounts upon renewal of some SaaS contracts.
Generally, deferred revenue will be recognized over a period of one to five
years. Our contracts do not contain significant financing components.

Revenue is measured as the amount of consideration we expect to receive in
exchange for transferring goods or providing services. In our Sleep and
Respiratory Care business, the amount of consideration received and revenue
recognized varies with changes in marketing incentives (e.g., rebates,
discounts, free goods) and returns offered to customers. In accounting for these
rebate programs, we reduce revenue ratably as sales occur over the rebate period
by the expected value of the rebates to be returned to the customer. We also
recognize discount on products as a reduction to revenue when control is
transferred. We adjust the estimate of revenue for the impact of returned items
at the earlier of when the most likely amount of consideration can be estimated,
the amount expected to be received changes, or when the consideration becomes
fixed. However, returns of products, excluding warranty-related returns, are
infrequent and insignificant.

When Sleep and Respiratory Care or SaaS contracts have multiple performance
obligations, we generally use an observable price to determine the stand-alone
selling price by reference to pricing and discounting practices for the specific
product or service when sold separately to similar customers. Revenue is then
allocated proportionately, based on the determined stand-alone selling price, to
each performance obligation. An allocation is not required for many of our Sleep
and Respiratory Care contracts that have a single performance obligation, which
is the shipment of our therapy-based equipment.

Recently Issued Accounting Pronouncements

See Note 3 - New Accounting Pronouncements of the Notes to Consolidated Financial Statements (Part II, Item 8) for a description of recently issued accounting pronouncements, including the expected dates of adoption and estimated effects on our results of operations, financial positions and cash flows.

Off-Balance Sheet Arrangements



As of June 30, 2021, we are not involved in any significant off-balance sheet
arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K promulgated by
the SEC.



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PART II Item 7A




                          RESMED INC. AND SUBSIDIARIES

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