Somnigroup International Inc. Reports Fourth Quarter and Full Year 2025 Results

Core Insights - Somnigroup International Inc. reported strong financial results for Q4 and full year 2025, with significant growth in net sales, operating income, and earnings per share (EPS) [1][2][3] Financial Performance - Q4 2025 net sales increased by 54.7% to $1,868.4 million compared to $1,207.9 million in Q4 2024, driven by the inclusion of Mattress Firm sales [1][2] - Net income for Q4 2025 rose 95.8% to $140.8 million from $71.9 million in Q4 2024, while adjusted net income increased 43.4% to $153.7 million [1][2] - Operating income surged 93.7% to $247.1 million in Q4 2025, with adjusted operating income up 59.8% to $267.8 million [1][2] - EPS grew 65.0% to $0.66 in Q4 2025, while adjusted EPS increased 20.0% to $0.72 [1][2] Business Segments - Mattress Firm generated net sales of $892.1 million in Q4 2025, with a gross margin of 30.8% [1][2] - Tempur Sealy North America experienced a decrease in net sales to $620.5 million due to the accounting elimination of sales to Mattress Firm [1][2] - Tempur Sealy International's net sales increased by 13.4% to $355.8 million, primarily due to expanded distribution [1][2] Gross and Operating Margins - Consolidated gross margin improved to 44.0% in Q4 2025 from 40.1% in Q4 2024, with adjusted gross margin at 44.9% [1][2] - North America gross margin rose to 59.0% from 36.4% in Q4 2024, while adjusted operating margin improved to 27.6% [1][2] Financial Guidance - For full year 2026, the company expects adjusted EPS to be between $3.00 and $3.40, indicating a projected increase of approximately 19% from 2025 [2][3] - The company anticipates continued growth in the bedding industry and plans for sales to grow at a compound annual rate of mid-single digits through 2028 [2][3] Dividend Announcement - The Board of Directors announced a 13% increase in the quarterly cash dividend to $0.17 per share, marking the sixth increase since 2021 [2][3]