What Happened?

Shares of bedding manufacturer and retailer Sleep Number (NASDAQ:SNBR) fell 39.5% in the afternoon session after the company reported disappointing fourth-quarter results, with EBITDA missing significantly and revenue falling short of Wall Street's estimates. Sales declined 12% year on year, due to a reduced store footprint and softer consumer demand. Earnings per share, however, came in above expectations, aided by cost reductions. Yet, Sleep Number withheld financial guidance for 2025, signaling continued uncertainty. This is also linked to the appointment of Linda Findley as the new CEO, as she likely needed some time settling into her role. Overall, this was a weaker quarter.

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What The Market Is Telling Us

Sleep Number’s shares are extremely volatile and have had 70 moves greater than 5% over the last year. But moves this big are rare even for Sleep Number and indicate this news significantly impacted the market’s perception of the business.

Sleep Number is down 47.4% since the beginning of the year, and at $7.87 per share, it is trading 61.4% below its 52-week high of $20.41 from December 2024. Investors who bought $1,000 worth of Sleep Number’s shares 5 years ago would now be looking at an investment worth $179.80.

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