Sleep Number files bankruptcy, sells for $415M

The Minneapolis-based smart-bed shaper filed for bankruptcy successful the Southern District of New York with astir $672.5 cardinal successful debt. Tariffs and ostentation were cardinal reasons for its fiscal troubles. Court filings cited by Reuters accidental that President Donald Trump's tariff policies disrupted the company's planetary proviso chain, accrued costs, and wounded profits.

In the archetypal 4th of 2026, the institution reported nett income of $319 cardinal and a nett nonaccomplishment of $50 million, according to a May SEC filing. Before filing for bankruptcy, the institution tried to amended its finances by refinancing debt, closing stores, and reducing its merchandise lineup, CNBC reported.

Under the agreement, Sleep Country Canada's wholly-owned subsidiary SNBR, Inc. volition service arsenic the "stalking horse" bidder successful a court-supervised merchantability process nether Section 363 of the Bankruptcy Code. The woody remains unfastened to higher bids, with an auction scheduled for July 13 if a competing connection emerges. The institution has acceptable a July 15 deadline for tribunal support of the merchantability and hopes to adjacent the transaction by July 31.

The Chapter 11 process is being funded by a debtor-in-possession financing bundle of up to $260 cardinal from the company's existent lenders. This includes $65 cardinal successful caller funds, according to the company.

Sleep Number President and CEO Linda Findley said successful a connection that portion the institution had made advancement connected its turnaround, "our superior operation remains unsustainable." Sleep Country Canada President and CEO Stewart Schaefer said the woody would grow Sleep Number's products into Canada and different markets.

With 572 U.S. retail locations and astir 2,920 employees, Sleep Number would articulation forces with Sleep Country Canada, which operates a web of much than 300 stores passim Canada. Together, the 2 companies said they would signifier a large North American subordinate successful the mattress and bedding industry.

Throughout the court-supervised restructuring, Sleep Number said customers tin proceed shopping, receiving deliveries, and utilizing their warranties and smart-bed services without interruption. Sleep Number has besides filed a question to cull leases connected 44 already-closed locations.

The institution warned that its communal shares are "significantly retired of the money" based connected the merchantability terms and are improbable to recover. Sleep Number expects its shares to beryllium delisted from the Nasdaq.