Shares of Sleep Number Corp. (SNBR) surged over 20% during after-hours trading on Thursday following the release of its quarterly sales results, which fell short of expectations. Additionally, the specialty retailer revised its guidance for the year.
Q2 Earnings and Sales Performance
Sleep Number reported earnings of $754 million, equivalent to 3 cents per share, for the quarter. This is compared to earnings of $35 million, or $1.54 per share, in the same quarter of the previous year. Sales saw a decline of 16% to $459 million, with demand experiencing a mid-single digit decrease. Although demand showed improvement over the second quarter, it fell slightly below the company’s initial expectations. Analysts, according to FactSet, had anticipated a loss of one cent per share on sales totaling $471 million.
Revised Guidance for Year 2023
“While we continue to navigate a challenging macro environment, our business remains well positioned for growth,” stated Chief Executive Shelly Ibach. Sleep Number revised its full-year 2023 earnings per share (EPS) outlook to a range of $1.25 to $1.75. It anticipates that sales will decline by low to mid-single digits compared to the prior year.
Market Response
Sleep Number Corp.’s shares closed the regular trading day with a 0.7% decrease. Nevertheless, after-hours trading saw a significant surge of over 20%, reflecting investor optimism despite the quarterly sales miss and revised guidance.