What Happened?
Shares of bedding manufacturer and retailer Sleep Number (NASDAQ: SNBR) fell 18.8% in the morning session after the company reported disappointing third-quarter 2025 financial results and lowered its full-year guidance, both of which missed Wall Street's expectations. Net sales fell by 19.6% year over year to $342.9 million. The company also posted a loss of $1.73 per share, a significant miss compared to analyst projections for a much smaller loss of $0.02 per share. This sales decline was driven by a 20% drop in same-store sales and a reduction in its store count. Compounding the bad news, Sleep Number cut its full-year revenue forecast to approximately $1.4 billion, signaling ongoing pressure on the business.
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What Is The Market Telling Us
Sleep Number’s shares are extremely volatile and have had 83 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.
The previous big move we wrote about was 23 days ago when the stock gained 5.6% on the news that markets rallied, fueled by signs of easing trade tensions between the U.S. and China. Investor confidence received a boost after conciliatory comments were made regarding trade negotiations, leading to a broad-based rally across equity markets. Major U.S. indices like the S&P 500 and the Nasdaq composite jumped significantly, recovering from previous session losses. The positive sentiment extended to European markets as well. The Consumer Discretionary sector, to which Sleep Number belongs, also benefited from the improved market mood. The move appeared tied to this widespread optimism rather than any company-specific announcements.
Sleep Number is down 66.5% since the beginning of the year, and at $5.02 per share, it is trading 75.4% 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 $72.39.
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