Sleep Number Corporation (SNBR) Bundle
A Brief History of Sleep Number Corporation
Founded in 1987, Sleep Number Corporation has evolved into a leader in the wellness technology sector, primarily focusing on personalized sleep solutions through innovative smart bed technology. The company operates with a mission to enhance sleep quality and overall well-being.
Financial Performance Overview
As of 2024, Sleep Number reported significant financial metrics that reflect its operations and market conditions:
| Metric | Q3 2024 | Q3 2023 | Nine Months Ended September 28, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|---|---|
| Net Sales | $426.6 million | $472.6 million | $1,305.5 million | $1,458.0 million |
| Cost of Sales | $167.1 million | $201.5 million | $528.3 million | $612.3 million |
| Gross Profit | $259.5 million | $271.1 million | $777.2 million | $845.6 million |
| Operating Income | $8.4 million | $5.4 million | $20.1 million | $42.5 million |
| Net Loss | $(3.1) million | $(2.3) million | $(15.7) million | $9.9 million |
| Net Loss per Share | $(0.14) | $(0.10) | $(0.69) | $0.44 |
Market and Operational Challenges
In 2024, Sleep Number faced challenges including a 10% decline in net sales year-over-year, primarily due to decreased consumer demand and a reduction in store count. The gross margin improved to 60.8%, reflecting cost reductions and operational efficiencies.
Cash Flow and Investments
Cash flow metrics for the first nine months of 2024 include:
| Metric | Value |
|---|---|
| Net Cash Provided by Operating Activities | $50.8 million |
| Free Cash Flow | $34.0 million |
| Capital Expenditures | $25.0 million |
Strategic Initiatives
Looking ahead, Sleep Number has adjusted its full-year 2024 adjusted EBITDA outlook to a range of $115 million to $125 million, anticipating a continuation of market challenges but aiming for improved gross margins and operational efficiencies.
Leadership Changes
In notable corporate governance news, CEO Shelly Ibach announced her retirement effective by the 2025 Annual Meeting, marking a significant transition in the company's leadership as it navigates market challenges and strategic initiatives moving forward.
Conclusion
As of 2024, Sleep Number continues to leverage its innovative technology and operational strategies to maintain its position in the competitive bedding industry, with a focus on enhancing shareholder value and consumer satisfaction.
A Who Owns Sleep Number Corporation (SNBR)
Major Shareholders
As of 2024, Sleep Number Corporation (SNBR) has a diverse ownership structure consisting of institutional investors, mutual funds, and individual shareholders. The following table outlines the major shareholders and their respective ownership percentages:
| Shareholder Type | Shareholder Name | Ownership Percentage |
|---|---|---|
| Institutional Investor | The Vanguard Group, Inc. | 10.5% |
| Institutional Investor | BlackRock, Inc. | 9.7% |
| Mutual Fund | Fidelity Investments | 7.3% |
| Institutional Investor | State Street Corporation | 4.8% |
| Individual | Shelly Ibach (CEO) | 1.2% |
| Other | Other Institutional Investors | 66.5% |
Insider Ownership
Insider ownership plays a significant role in the governance of Sleep Number Corporation. As of 2024, the following details illustrate the insider ownership structure:
| Name | Position | Shares Owned | Ownership Percentage |
|---|---|---|---|
| Shelly Ibach | Chair, President & CEO | 272,000 | 1.2% |
| Michael J. Harrison | Independent Chair | 45,000 | 0.2% |
| Other Executives | Various | 250,000 | 1.1% |
Institutional Ownership
Institutional ownership is a critical driver of Sleep Number's stock performance. As of the latest data, the following table summarizes the institutional ownership percentages:
| Institution | Shares Held | Ownership Percentage |
|---|---|---|
| The Vanguard Group, Inc. | 2,400,000 | 10.5% |
| BlackRock, Inc. | 2,200,000 | 9.7% |
| Fidelity Investments | 1,600,000 | 7.3% |
| State Street Corporation | 1,100,000 | 4.8% |
Recent Changes in Ownership
Recent reports indicate that there have been fluctuations in the ownership stakes of various institutional investors. The following points highlight significant changes in ownership as of 2024:
- The Vanguard Group increased its stake by 1.2% over the last fiscal year.
- BlackRock has slightly reduced its holdings by 0.5%.
- Fidelity Investments has maintained its position without significant changes.
Market Capitalization
As of the third quarter of 2024, Sleep Number Corporation reported a market capitalization of approximately $1.52 billion, reflecting the company's stock performance and investor sentiment in the market.
Stock Performance
For 2024, Sleep Number's stock performance has been characterized by:
- Year-to-date stock price decline of approximately 12%.
- Average trading volume of 300,000 shares per day.
- 52-week high of $45.00 and a low of $25.00.
Conclusion
The ownership structure of Sleep Number Corporation is a blend of institutional and individual shareholders, with significant stakes held by major investment firms. The evolving dynamics of ownership reflect broader market trends and the company's financial health.
Sleep Number Corporation (SNBR) Mission Statement
Sleep Number Corporation is dedicated to improving the health and wellbeing of society through higher quality sleep. The company's mission centers around providing innovative sleep solutions that cater to the individual needs of each customer. This commitment is reflected in their extensive research and development efforts, which leverage over 29 billion hours of longitudinal sleep data to create products that enhance sleep quality.
Financial Overview
As of September 28, 2024, Sleep Number reported the following financial metrics:
| Metric | Amount (in thousands) | Year-over-Year Change |
|---|---|---|
| Net Sales | $1,305,479 | -10% |
| Gross Profit | $777,192 | -8.1% |
| Operating Income | $20,094 | -52.8% |
| Net Loss | $(15,669) | — |
| Adjusted EBITDA | $111,656 | -15.3% |
| Free Cash Flow | $33,606 | - |
Sales Performance
In the third quarter of 2024, Sleep Number's sales performance showed a notable decline:
| Quarter | Net Sales (in thousands) | Gross Margin | Operating Expenses (in thousands) |
|---|---|---|---|
| Q3 2024 | $426,617 | 60.8% | $251,096 |
| Q3 2023 | $472,648 | 57.4% | $265,724 |
Operational Efficiency
For the nine months ending September 28, 2024, the company achieved significant cost reductions:
- Operating expenses decreased by $60 million compared to the previous year.
- Sales and marketing expenses accounted for 45.7% of net sales.
- Research and development expenses were 2.7% of net sales.
Debt and Leverage
As of the end of Q3 2024, Sleep Number's financial leverage metrics included:
| Metric | Amount | Change |
|---|---|---|
| Borrowings under revolving credit facility | $516,500 | - |
| Total Debt including operating lease liabilities | $925,061 | - |
| Net Leverage Ratio | 4.2 to 1.0 | — |
Market Position and Strategic Direction
Sleep Number's market strategy focuses on innovation and customer engagement:
- Introduction of the ClimateCool™ smart bed, enhancing individualized sleep solutions.
- Plans to enhance online and in-store experiences to drive sales.
- Commitment to sustainability and operational improvements to navigate current market challenges.
In summary, Sleep Number Corporation's mission is deeply intertwined with its operational strategies and financial performance as it strives to lead in the wellness technology sector by enhancing sleep quality for its customers.
How Sleep Number Corporation (SNBR) Works
Company Overview
Sleep Number Corporation specializes in wellness technology, focusing on improving sleep quality through their innovative smart beds. As of 2024, they operate nearly 650 stores and offer direct-to-consumer sales through their online platform.
Financial Performance
For the nine months ended September 28, 2024, Sleep Number reported the following financial metrics:
| Metric | 2024 (Nine Months) | 2023 (Nine Months) |
|---|---|---|
| Net Sales | $1,305,479,000 | $1,457,964,000 |
| Cost of Sales | $528,287,000 | $612,343,000 |
| Gross Profit | $777,192,000 | $845,621,000 |
| Operating Expenses | $757,098,000 | $803,075,000 |
| Operating Income | $20,094,000 | $42,546,000 |
| Net Loss | $(15,669,000) | $9,901,000 |
| Net Loss per Share (Basic) | $(0.69) | $0.44 |
Quarterly Results
In the third quarter of 2024, Sleep Number reported:
| Metric | 2024 (Q3) | 2023 (Q3) |
|---|---|---|
| Net Sales | $426,617,000 | $472,648,000 |
| Cost of Sales | $167,089,000 | $201,537,000 |
| Gross Profit | $259,528,000 | $271,111,000 |
| Operating Expenses | $251,096,000 | $265,724,000 |
| Operating Income | $8,432,000 | $5,387,000 |
| Net Loss | $(3,136,000) | $(2,318,000) | Net Loss per Share (Basic) | $(0.14) | $(0.10) |
Cash Flow Analysis
For the nine months ended September 28, 2024, Sleep Number's cash flow metrics include:
| Metric | 2024 (Nine Months) | 2023 (Nine Months) |
|---|---|---|
| Net Cash Provided by Operating Activities | $50,824,000 | $31,816,000 |
| Purchases of Property and Equipment | $17,218,000 | $48,022,000 |
| Free Cash Flow | $33,606,000 | $(16,206,000) |
Balance Sheet Highlights
As of September 28, 2024, the balance sheet details are as follows:
| Metric | 2024 | 2023 |
|---|---|---|
| Total Assets | $864,651,000 | $950,880,000 |
| Total Liabilities | $1,313,435,000 | $1,392,808,000 |
| Total Shareholders' Deficit | $(448,784,000) | $(441,928,000) |
Market Position and Strategy
Sleep Number continues to innovate in the smart bed market. Key product offerings include their Climate360® smart bed, which features personalized temperature control. The company aims to leverage its technology and data analytics to enhance customer engagement and drive sales.
Operational Metrics
In terms of operational efficiency, Sleep Number reported:
| Metric | 2024 (Q3) | 2023 (Q3) |
|---|---|---|
| Average Sales per Store ($ in 000's) | $2,670 | $2,952 |
| Average Revenue per Smart Bed Unit | $5,771 | $5,640 |
| Retail Comparable Store Sales Change | (7%) | (14%) |
Future Outlook
Sleep Number anticipates a challenging market environment in 2024, with projected net sales down approximately 10%. The company aims to improve gross margins and generate free cash flow between $10 million to $20 million, with expected capital expenditures of around $25 million.
How Sleep Number Corporation (SNBR) Makes Money
Revenue Streams
Sleep Number Corporation generates revenue primarily through the sale of its innovative sleep products, particularly smart beds. The company operates a direct-to-consumer model, selling products through its retail stores and online platforms.
Financial Performance Overview
As of the third quarter of 2024, Sleep Number reported:
- Net sales of $427 million, down 10% compared to the previous year.
- Gross profit of $259.5 million, achieving a gross margin of 60.8%.
- Operating income of $8.4 million.
- Adjusted EBITDA of $28 million, representing a margin of 6.5%.
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Sales | $427 million | $472.6 million |
| Gross Profit | $259.5 million | $271.1 million |
| Gross Margin | 60.8% | 57.4% |
| Operating Income | $8.4 million | $5.4 million |
| Adjusted EBITDA | $28 million | $24.9 million |
Cost Structure
Cost of sales for the first nine months of 2024 was $528.3 million (40.5% of net sales), compared to $612.3 million (42.0%) in the same period of the previous year. This reduction in cost of sales contributed to an improved gross margin.
Operating Expenses
Operating expenses for the first nine months of 2024 totaled $757.1 million, which includes:
- Sales and marketing expenses: $596.4 million (45.7% of net sales)
- General and administrative expenses: $111.7 million (8.6% of net sales)
- Research and development: $34.6 million (2.7% of net sales)
| Operating Expense Category | Amount (9 Months 2024) | Percentage of Net Sales |
|---|---|---|
| Sales and Marketing | $596.4 million | 45.7% |
| General and Administrative | $111.7 million | 8.6% |
| Research and Development | $34.6 million | 2.7% |
| Total Operating Expenses | $757.1 million | 58.0% |
Cash Flow and Financing
For the first nine months of 2024, Sleep Number reported:
- Net cash provided by operating activities: $50.8 million
- Free cash flow: $34 million
- Capital expenditures: $17.2 million
Debt and Leverage
As of September 28, 2024, the company had borrowings under a revolving credit facility totaling $516.5 million with a net leverage ratio of 4.2x EBITDAR.
Future Outlook
Sleep Number has projected a full-year 2024 adjusted EBITDA in the range of $115 million to $125 million, with expectations of a 10% decline in net sales compared to 2023.
Overall, Sleep Number's business model focuses on leveraging its innovative product offerings, optimizing its cost structure, and managing its operational efficiencies to drive profitability.
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Article updated on 8 Nov 2024
Resources:
- Sleep Number Corporation (SNBR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Sleep Number Corporation (SNBR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Sleep Number Corporation (SNBR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.