Sleep Number(US:SNBR) Yahoo Finance·2025-11-06 01:14Core Insights - The company is optimistic about turning around its top line by 2026 through new product initiatives and improved marketing strategies [1][4][12] - A comprehensive turnaround plan is in place, focusing on cost reductions, financial flexibility, and commercial strategies to stabilize sales and drive growth [3][11][18] Financial Performance - Q3 net sales were $343 million, down 19.6% year-over-year, attributed to reduced marketing spend and competitive pressures [12][13] - Adjusted EBITDA for Q3 was $13.3 million, down $14.4 million from the previous year, driven by lower sales and gross profit margin compression [14] - The company expects full-year net sales to be approximately $1.4 billion, with a gross profit margin of around 60% [16] Cost Management - The company has reduced operating expenses by $115 million since the beginning of the year, exceeding its $130 million cost-out target [10] - Fixed cost reductions will continue into 2026, with a focus on consolidating real estate and optimizing the store footprint [18][36] Marketing and Sales Strategy - A new marketing strategy is being deployed to drive traffic to stores and digital channels, with a focus on efficiency and higher returns [5][30] - The company plans to increase marketing spend slightly in 2026 compared to 2025, while still reducing overall operating expenses [6][50] Product Development - The company is working on a product lineup refresh aimed at appealing to a broader consumer base, emphasizing comfort, durability, and value [12][40] - New product offerings are expected to launch in early 2026, focusing on price point moderation while maintaining premium quality [39][51] Distribution Strategy - The company is exploring new distribution channels, including partnerships and digital expansions, to enhance market reach [5][27] - A test show on HSN is planned as part of the strategy to expand distribution while retaining the strength of its vertical model [6][26]