Airbed maker Sleep Number Corp. had net sales of $285 million in the second quarter of fiscal 2020, down 20% compared with the second quarter of 2019. The company posted a net loss of $12.6 million, compared with earnings of $4.3 million in the prior-year quarter, and a net loss per diluted share of $0.45. This compares with net income per diluted share of $0.14 in the prior-year quarter.
Revenue and earnings beat Wall Street expectations (Zacks Investment Research) of a $0.76 loss per share and a revenue slip of 32% to $242 million.
Earnings per diluted share
The Minneapolis-based company said it experienced high single-digit demand growth in the final two months of the quarter, after being down 48% in April. At the start of the third quarter, it reported that 95% of its retail stores were open, compared with 53% open on average during the second quarter. Cash and liquidity available under its credit facility were $295 million at the end of the second quarter, a $129 million increase compared with the same period in 2019.
“The mission of Sleep Number has never been more important or more relevant than it is today,” said Shelly Ibach, president and chief executive officer. “The pandemic has heightened individuals’ concerns about their immunity and resilience, and there is increased understanding that sleep is vital for healthy living. Our increased relevance with consumers, combined with the significant competitive advantages of our integrated business model and the ingenuity of our purpose-driven team, drove our stronger-than-expected second quarter results.”
On March 23, Sleep Number withdrew its fiscal 2020 financial guidance due to COVID-19 and did not provide an update in its second-quarter results due to the continued uncertainty related to the pandemic. It expects to meet its liquidity needs from operating cash flows and its existing credit facility, while funding growth initiatives and other longer-term opportunities.