Sleep Number Sales Strong, Earnings Miss

Sleep Number reported another strong quarter and high demand for its products. In its second quarter of fiscal 2021, ended July 3, net income rose 4.6% to $22.25 million on net sales of $484.3 million, with diluted earnings per share of $0.88. Net sales reflected a 70% increase when compared with the second quarter of fiscal 2020, and a 36% increase when compared with (prepandemic) second quarter of fiscal 2019. 

The Motley Fool reported the Minneapolis-based airbed maker’s earnings disappointed Wall Street analysts (MarketWatch), who had expected EPS of $1.10 in the second quarter. In an earnings conference call, Shelly Ibach, Sleep Number president and chief executive officer, attributed the earnings miss to continuing impacts from supply chain disruptions.  

The company, however, did raise its full-year EPS outlook to at least $7.25 versus its previous estimate of at least $6.50.

“Our differentiated sleep solutions have driven 18% average demand growth over the last 12 quarters, including further acceleration in the second quarter,” Ibach said in a news release. “Robust consumer demand for Sleep Number 360 smartbeds exceeded our expectations, while near-term supply constraints limited delivered net sales in June and July. We have made substantial progress in addressing temporary component shortages and expect strong delivery volumes the balance of the year.”