Sleep Number(SNBR)

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Here's What Key Metrics Tell Us About Sleep Number (SNBR) Q3 Earnings
ZACKS· 2024-11-06 00:30
Core Insights - Sleep Number (SNBR) reported a revenue of $426.62 million for the quarter ended September 2024, reflecting a year-over-year decline of 9.7% [1] - The company's EPS for the same period was -$0.14, compared to -$0.10 a year ago, indicating a worsening in earnings performance [1] - The reported revenue fell short of the Zacks Consensus Estimate of $444.33 million, resulting in a surprise of -3.99% [1] - EPS exceeded expectations with a surprise of +30.00%, as the consensus EPS estimate was -$0.20 [1] Financial Performance Metrics - Total company sales change rate was -10%, compared to an estimated -3.8% by analysts [3] - The number of stores at the end of the period was 643, slightly above the estimated 642 by analysts [3] - Net sales from retail stores were reported at $374.59 million, below the average estimate of $414.64 million, representing a year-over-year decline of 8.5% [3] Stock Performance - Over the past month, shares of Sleep Number have returned -21.1%, contrasting with the Zacks S&P 500 composite's change of -0.5% [4] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [4]
Sleep Number(SNBR) - 2024 Q3 - Earnings Call Transcript
2024-10-31 01:31
Financial Data and Key Metrics Changes - Third quarter net sales were $427 million, down 10% year-over-year and five points below expectations [24] - Adjusted EBITDA for Q3 was $28 million, in line with expectations, representing an 11% increase year-over-year [27] - Gross margin rate improved to 60.8%, up 340 basis points from the prior year, with year-to-date gross margin at 59.5%, up 150 basis points [11][25] - Full year adjusted EBITDA guidance lowered to a range of $115 million to $125 million, down from a previous range of $125 million to $145 million [31] Business Line Data and Key Metrics Changes - Operating expenses decreased by $17 million year-over-year in Q3, with year-to-date reductions totaling $60 million [12][26] - The company expects full year operating expenses to be down approximately $75 million versus the prior year [14] Market Data and Key Metrics Changes - Consumer spending in the bedding category remains weak, with a high single-digit demand decline noted [15] - The company experienced low single-digit growth during key holiday weekends, indicating concentrated consumer activity [16] Company Strategy and Development Direction - The company is focusing on brand differentiation and innovation, particularly with the introduction of the ClimateCool smart bed [19][21] - Strategic initiatives include deepening audience segmentation in marketing and enhancing operational efficiencies [13][18] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing challenges in consumer demand and a cautious shopping behavior among consumers [17] - The company does not expect significant improvement in demand for the fourth quarter, reflecting broader economic uncertainties [10][31] Other Important Information - Shelly Ibach announced her retirement as CEO, with plans to serve as a strategic advisor through the end of 2025 [6][7] - The company is implementing a succession plan to ensure a smooth transition [7][8] Q&A Session Summary Question: Insights on the quarter's performance and October trends - Management noted low single-digit growth during holiday weekends but overall weak consumer activity outside those periods [39][40] Question: Store portfolio changes and performance - Management confirmed a healthy retail portfolio with successful store closures and transfer rates exceeding expectations [43][44] Question: Gross margin improvement and future expectations - Management indicated ongoing initiatives for gross margin improvement, with expectations for continued benefits in 2025 [46][47] Question: Consumer behavior and promotional strategies - Management highlighted the need for tailored marketing strategies and efficient media spending due to cautious consumer behavior [50][51] Question: Impact of tariffs and supply chain issues - Management stated minimal exposure to potential tariffs from China, but acknowledged that even small issues can create pressure [54]
Sleep Number (SNBR) Reports Q3 Loss, Lags Revenue Estimates
ZACKS· 2024-10-30 22:26
Company Performance - Sleep Number reported a quarterly loss of $0.14 per share, better than the Zacks Consensus Estimate of a loss of $0.20, but worse than a loss of $0.10 per share a year ago, representing an earnings surprise of 30% [1] - The company posted revenues of $426.62 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 3.99% and down from $472.65 million year-over-year [2] - Over the last four quarters, Sleep Number has surpassed consensus EPS estimates four times but has topped consensus revenue estimates only once [2] Stock Outlook - Sleep Number shares have lost about 10% since the beginning of the year, while the S&P 500 has gained 22.3% [3] - The company's earnings outlook will be crucial for future stock performance, with current consensus EPS estimate for the coming quarter at $0.06 on revenues of $429.67 million, and for the current fiscal year at -$0.61 on revenues of $1.75 billion [7] Industry Context - The Furniture industry, to which Sleep Number belongs, is currently in the bottom 29% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Sleep Number's stock performance [5][6]
Sleep Number(SNBR) - 2024 Q3 - Quarterly Results
2024-10-30 20:08
Financial Performance - Reported third quarter net sales of $427 million, down 10% year-over-year, with a gross margin rate of 60.8%, up 340 basis points from the previous year[2][4] - Achieved adjusted EBITDA of $28 million for the quarter, consistent with expectations, representing an 11% increase compared to the prior year[2][4] - Updated full-year 2024 adjusted EBITDA outlook to a revised range of $115 million to $125 million, with expected net sales down approximately 10%[2][6] - Adjusted EBITDA for the three months ended September 28, 2024, was $27,686 thousand, compared to $24,861 thousand for the same period in 2023, an increase of approximately 11.5%[16] - Adjusted EBITDA for the trailing twelve months ended September 28, 2024, was $111,656 thousand, down from $131,798 thousand for the same period in 2023[19] Cost Management - Reduced operating expenses by $17 million for the third quarter and $60 million year-to-date, leading to improved financial flexibility[2][4] - The company anticipates at least 150 basis points of gross margin rate improvement for the year, driven by cost efficiencies and favorable product mix[2][6] Cash Flow and Liquidity - Increased year-to-date free cash flow by $50 million compared to the same period last year, totaling $34 million for the first nine months[2][5] - Free cash flow for the nine months ended September 28, 2024, was $33,606 thousand, compared to a negative $16,206 thousand for the same period in 2023[17] - Net cash provided by operating activities increased to $50,824 thousand for the nine months ended September 28, 2024, compared to $31,816 thousand for the same period in 2023, an increase of approximately 59.7%[14] Store Performance - Retail comparable-store sales decreased by 9% in the third quarter of 2024, compared to a 14% decrease in the same quarter of 2023[15] - Average sales per store decreased from $2,952 thousand in Q3 2023 to $2,670 thousand in Q3 2024, a decline of approximately 9.5%[15] - The company closed 4 stores in the third quarter of 2024, resulting in a total of 643 stores at the end of the period, down from 678 stores a year earlier[15] Debt and Leverage - The leverage ratio at the end of the third quarter was 4.2x EBITDAR, below the covenant maximum of 5.0x[5] - Consolidated funded indebtedness increased to $523,908 thousand as of September 28, 2024, from $495,485 thousand as of September 30, 2023[19] - The net leverage ratio under the revolving credit facility increased to 4.2 to 1.0 as of September 28, 2024, compared to 3.8 to 1.0 as of September 30, 2023[19] - Total debt including operating lease liabilities decreased slightly to $925,061 thousand as of September 28, 2024, from $935,207 thousand as of September 30, 2023[19] Net Income and Loss - Net loss for the nine months ended September 28, 2024, was $15,669 thousand, compared to a net income of $9,901 thousand for the same period in 2023[14] - The company reported a basic net loss per share of $0.69 for the nine months ended September 28, 2024, compared to a basic net income per share of $0.44 for the same period in 2023[24] - Operating income for the nine months ended September 28, 2024, was reported at $20,094 thousand, down from $42,546 thousand for the same period in 2023[24] Asset Management - Total assets decreased from $950,880 thousand as of December 30, 2023, to $864,651 thousand as of September 28, 2024, representing a decline of approximately 9.1%[13] - Total current liabilities decreased from $936,071 thousand as of December 30, 2023, to $894,042 thousand as of September 28, 2024, a reduction of approximately 4.5%[13] Innovation and Product Development - Introduced the new ClimateCool™ smart bed as part of ongoing innovation efforts to enhance customer sleep solutions[3] - Sleep Number has improved nearly 16 million lives through its wellness technology platform, which includes over 29 billion hours of longitudinal sleep data[9] Restructuring and Management Changes - The company plans to appoint Michael J. Harrison as independent Chair of the Board following the retirement of CEO Shelly Ibach[7] - The company incurred restructuring costs of $14,382 thousand during the nine months ended September 28, 2024[24] Return on Investment - Adjusted ROIC decreased to 4.5% for the trailing twelve months ended September 28, 2024, down from 14.9% for the same period in 2023[22]
Analysts Estimate Sleep Number (SNBR) to Report a Decline in Earnings: What to Look Out for
ZACKS· 2024-07-24 15:07
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. While management's discussion of business conditions on the earnings call wil ...
Strength Seen in Sleep Number (SNBR): Can Its 19.1% Jump Turn into More Strength?
ZACKS· 2024-07-17 19:11
Sleep Number (SNBR) shares soared 19.1% in the last trading session to close at $10.28. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 28.6% loss over the past four weeks. The stock might have got a boost on the expectation of potential interest rate cut in September, per the CME FedWatch tool. This seller of beds, mattresses and bedding products is expected to post quarterly loss of $0.44 per share in its upcoming report, which ...
Are Investors Undervaluing Sleep Number (SNBR) Right Now?
ZACKS· 2024-06-17 14:46
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies. In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks wi ...
Is Sleep Number (SNBR) Stock Undervalued Right Now?
ZACKS· 2024-05-30 14:46
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers. Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by th ...
Sleep Number(SNBR) - 2024 Q1 - Earnings Call Transcript
2024-04-25 01:30
Company Participants Conference Call Participants Peter Keith - Piper Sandler Robert Griffin - Raymond James Seth Basham - Wedbush Dan Silverstein - UBS Bradley Thomas - KeyBanc Operator The primary purpose of this call is to discuss the results of the fiscal period just ended. However, our commentary and responses to your questions may include certain forward-looking statements. These forwardlooking statements are subject to a number of risks and uncertainties outlined in our earnings news release and disc ...
Sleep Number(SNBR) - 2024 Q1 - Quarterly Results
2024-04-24 20:13
Exhibit 99.1 FOR IMMEDIATE RELEASE SLEEP NUMBER ANNOUNCES FIRST QUARTER 2024 RESULTS MINNEAPOLIS – (April 24, 2024) – Sleep Number Corporation (Nasdaq: SNBR) today reported results for the quarter ended March 30, 2024. "Our actions to increase operating model efficiencies drove first quarter adjusted EBITDA and gross margin rate ahead of our expectations. We also generated a significant year-over-year increase in free cash flow, as planned, and continue to prioritize paying down debt and reducing leverage," ...