The .onExceptionResumeNext() operator resumes the Observable flow with a backup Observable, in case an exception is thrown somewhere upstream. The marble diagram for this operation can be seen here:

The last element on the first line represents an exception occurring in the Observable. However, the onExceptionResumeNext operator is provided with a backup Observable:

That will be used to resume the flow. That is what we can see in the resulting Observable--the first three marbles passed through normally, but the error is missing. The preceding Observable was filled in with its two elements instead of the exception, and the resulting Observable was allowed to complete normally.