The earnings call highlighted significant achievements in cost reductions and marketing efficiency improvements, which are offset by challenges in declining net sales and the need to address the company's capital structure and debt leverage. While the company is making strategic changes to reset the business, the current financial performance and debt concerns present notable challenges.

Company Guidance -

Q3 2025

During Sleep Number's Q2 2025 earnings call, CEO Linda Findley emphasized a strategic shift aimed at improving operational efficiency and profitability. The company reduced Q2 marketing spend by 30% year-over-year, which contributed to a 19.7% decline in net sales to $328 million. Despite this, the gross profit margin remained flat at 59.1% due to cost reductions and manufacturing efficiencies. Sleep Number aims to achieve over $130 million in operating expense savings in 2025, surpassing the initial target of $80-100 million. The company is also optimizing its product portfolio and considering new distribution channels to enhance market reach. Marketing efficiency improvements led to a 24% increase in conversion rates year-over-year during Q2. The guidance for the full year anticipates net sales of approximately $1.45 billion, representing a 14% decline, with a focus on maintaining compliance with debt covenants.

Significant Cost Reduction Achieved

The company has exceeded its cost reduction target, achieving over $130 million in operating expense reductions in 2025 compared to 2024, surpassing the original plan of $80 million to $100 million.

Marketing Efficiency Improvements

Implemented a 30% year-over-year cut in Q2 marketing spend, leading to improved efficiency and a 24% increase in conversion rates in Q2, with continued improvements into July.

Gross Profit Margin Stability

Despite a 19.7% decline in net sales, the gross profit margin remained stable at 59.1%, reflecting continued reduction in material costs and manufacturing efficiencies.

Sleep Number (SNBR) Earnings, Revenues Date & History

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SNBR Earnings History

Report Date	Fiscal Quarter	Forecast / EPS	Last Year's EPS	EPS YoY Change	Slides	Play Transcript
Oct 22, 2025	2025 (Q3)	0.20 / -	-0.14	―	―	―
Jul 30, 2025	2025 (Q2)	-0.11 / -1.09	-0.22	-395.45% (-0.87)	―
Apr 30, 2025	2025 (Q1)	-0.03 / -0.38	-0.33	-15.15% (-0.05)	―
Mar 05, 2025	2024 (Q4)	-0.23 / -0.21	-1.12	81.25% (+0.91)	―
Oct 30, 2024	2024 (Q3)	-0.20 / -0.14	-0.1	-40.00% (-0.04)	―
Jul 31, 2024	2024 (Q2)	-0.41 / -0.22	0.03	-833.33% (-0.25)	―
Apr 24, 2024	2024 (Q1)	-0.31 / -0.33	0.51	-164.71% (-0.84)	―
Feb 22, 2024	2023 (Q4)	-0.88 / -1.12	-0.24	-366.67% (-0.88)	―
Nov 07, 2023	2023 (Q3)	0.06 / -0.10	0.22	-145.45% (-0.32)	―
Jul 27, 2023	2023 (Q2)	-0.01 / 0.03	1.54	-98.05% (-1.51)	―

The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.

Beat

Missed

SNBR Earnings-Related Price Changes

Report Date	Price 1 Day Before	Price 1 Day After	Percentage Change
Jul 30, 2025	$8.16	$7.01	-14.09%
Apr 30, 2025	$7.79	$8.05	+3.34%
Mar 05, 2025	$12.89	$7.49	-41.89%
Oct 30, 2024	$13.23	$13.70	+3.55%

Earnings announcements can affect a stock’s price. This table shows the stock's price the day before and the day after recent earnings reports, including the percentage change.