Sleep Number Q1 2024 Earnings Report
Key Takeaways
Sleep Number's first quarter 2024 results showed a net sales of $470 million and an adjusted EBITDA of $37 million, slightly above expectations. The company reduced operating expenses by $24 million year-over-year and increased free cash flow by $21 million compared to the prior year's first quarter. They reiterated their full-year 2024 adjusted EBITDA outlook of $125 million to $145 million.
Net sales reached $470 million, reflecting an 11% decline compared to the previous year, influenced by order backlog changes.
Adjusted EBITDA stood at $37 million, surpassing expectations due to increased operating model efficiencies.
Gross margin was 58.7%, showing a sequential improvement from the latter half of the prior year.
Free cash flow significantly increased year-over-year, and the company is prioritizing debt reduction and leverage.
Sleep Number
Sleep Number
Forward Guidance
The company reiterates its outlook for 2024 adjusted EBITDA of $125 million to $145 million. They continue to expect a mid-single digit net sales decline for the year on a low-single digit demand decline.
Positive Outlook
- Expect approximately 100 basis points of gross margin rate improvement.
- Expects to generate $60 million to $80 million of free cash flow.
Challenges Ahead
- Continue to expect a mid-single digit net sales decline for the year on a low-single digit demand decline.
- Expect $14 million of restructuring charges for the year.