SNBR - Earnings call transcript Q3 2020 | Sleep Number Corporation

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Operator

Welcome to Sleep Number's Third Quarter 2020 Earnings Conference Call. [Operator Instructions] Today's call is being recorded. [Operator Instructions] I would like to introduce Dave Schwantes, Vice President of Finance and Investor Relations. Thank you.

You may begin.

Dave Schwantes

to call. Number welcome XXXX third and conference earnings afternoon, the Corporation's Sleep quarter Good for us. you Thank joining I am Dave Investor Relations. Schwantes, Vice President of Finance and and With President Financial Shelly are David CEO; Officer. me Chief Callen, Ibach, our today and our telephone available our be website and on conference is sleepnumber.com. This recorded will being at to refer Please release the replay. in details the to news our access be information also discussed or financial measures non-GAAP refer of reconciliation certain release call. to Please this news supplemental on our included financial a that the news may release for in and of primary the The ended. is results of this purpose call to the just discuss fiscal period

and over However, and annual filings to are for results may detail certain subject report commentary in discussed our and periodic SEC. company's questions now statements forward-looking number XX-K a may will in to of risks call some our I include Form on and turn responses actual other to uncertainties The our the forward-looking Shelly vary release future statements. the news These with outlined your comments. in her materially. earnings

Shelly Ibach

dedication And and earnings is of thank innovation, at the and quarter delivering XXXX life-changing power third of sleep was this My improve Number night. SleepIQ joining benefit. our score to relentless lives. our focus afternoon, you XX team's has mission for our last Good to Sleep call. our Quality because on the forefront

helping and to team's for purpose-driven this XX the they company Together, on time care improved our is ingenuity caused am and now experience face in nearly the the ambiguity have our beloved lives with sleep individuality Sleep based important our unparalleled the and million another stress and of I brand smart a life. an beds. built tenacity, one well-being. we achieve customers. extreme a grateful Number by and day every our XXX is and in significant have of We In This customers everyone's counting. particularly team pandemic, disruption show

prioritizing superior and our health to ability strategic investments have challenges. pacing to years deliver simultaneous despite economic performance Our of contributed and

and value growth profitable continued for significant well-positioned creation. are shareholder We

undeniable resilience all the model XXXX. strategy strength, Our quarter smart built sustainability to transitioning beds and XXXX the performance provides consumer third in of evidence innovation since efficient XXX business we differentiated of have and

XX% the earnings our reflect growth million, million operating $XXX XX% including quarter XX%; XX%; $XXX net this net cash of third year, prior partners million business third XX% of of an For a was year $XXX than ability demand debt sales meaningful per financial were versus consecutive team, XX% $X.XX, were sales, growth, results for Record include create million, $XX double-digit an to flows our prior our year-to-date to customers, increase up value share results These shareholders. quarter and clearly lower gain; year demonstrate ago. year. or net up versus net and date; was XX% comp with year the results third profit up net

third exceptional media are strategic this while doing term performance and important and advancing efficient the our during times first, performance. robust so and challenging more including, our Several contributed quarter factors long both also effective initiatives. We short in significantly to

accelerated We our customer the we ago into acquisition dynamic a improve leaning each since our multi-platform have We and strategy. began. ROI continue pandemic as to advance began rapidly year digital media our capabilities

proprietary of own in XXXX, points basis through we delivered all already highest-value the the consumers and We automation, in learning our surpassed data. has Digital finding of traffic quarter. machine media are and our leverage spending XX

performance and shop, seamlessly online per evident Results customer We've strong agile phone. unit traffic. sustainable sell-from-anywhere and in building our are conversion wants with our relationships or productive leverages revenue store, customer go-to-market approach in increased model. highly of to our average developed sleep professionals' Second, aligns in our that an skills unit and digital how and by

third phone and sales the their continued even store triple-digit During growth. online as our recovered, sales quarter,

competitive exclusive direct-to-consumer advantage. our Third,

promotions, financing, and environment. mX beds, are for margins new approach media featuring comfort, and fourth, iXX integrated temperature-balancing exceeding our And Our and and XXX selling a proprietary to process, to technologies in innovations disruptive expectations. increase enabling sales smart are us layers greater

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initiatives growth-driving coming capital, to quarters. efficiency these and of efficient Through improved the our in our smart continue will operational strengthened of All have we progress competitive and use advantages.

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the were In addition customer-centric transformation, having we chain to of as digital designs. metrics most supply one superior highlighted our from

outcomes. have the improvements during excited am on learnings our seven about most long-term I team's what months, come, to our is yet continued Given impact past will the

foresight immediate profitability to Our sales the this secured began strategic we actions long-term crisis financial by capital-preservation aided pivot by our and took our planning and deliver and quarter. ability when in horizon exceptional flexibility the and swiftly operational afforded and

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health sleep Here are and wellness. highlights of our linking overall strategic advancements in to

quality the by beds proven connected health loyalty The effortlessly our demand. experience to core advocacy customer engagement Sleep In smart innovations sleep, deepens brand. data and sleep customer economy. turn, increasing our insiders, of intensifying value deliver for delivered daily the SleepIQ our the in is pursue health by greater and and business profitable created affinity inspires opportunities new new driving It's meaningful Number these and providing customers. XXX scale This growth. strong us with our adjacencies individualized Our vibrant drives expanding of is foundation the referrals

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As the momentum strong. quarter, remains our we fourth enter business

For more growth This five-year XXXX's five-year the greater full-year addition our of to expect to we a $X.XX. compared of in reflect return EPS of XXXX, XX% at shareholder $X, least than total culture CAGR EPS by delivering than forward individuality moving and by superior life-changing and flexibility, of XXX%. capital stakeholders. our mission, long-term our we society sleep all creating competitive advantages, of Driven experiences for our are accelerating would value

outlook. will details provide David quarter and our financial quarter fourth third Now performance on additional

David Callen

the the Both demonstrated Shelly. structure initiatives. Throughout in maximum our enabled flexibility. for been year and in XX% early several prior QX quickly creation. performance-driving versus on of in date, our actions capital initiatives. shareholder an value this QX generation while have to for years. exceptional building and Those tremendous oriented pandemic to our decisive and cash delivered advancing you, record teams performance the impacts These deployment of outcome are urgency cash focus and performance, record led us are $XXX cost we generation the P&L The pandemic, across results Securing the year operating million date, to capital up controls liquidity and execution superior structure Thank COVID. to of agility despite

retired with the Along one-year also in the credit taken six uncertainties facility. due In the recessionary While and as our floor of $XX performance our reflects remain, possible insurance we with consumers share election distracted related $XXX possible including our million pressures, our from loan months pandemic. early repurchase macro deployment term profile. out in improvement days the priorities, the restrictions loan million COVID dramatic capital presidential repayment, and the accordance early revolving removed we resurgence, to a risk LIBOR

$XX and to are million. leaning into our be approximately We XXXX full-year our expect CapEx now initiatives

Third year. quarter the versus prior of million $XXX sales grew net XX%

than with year. units shopping normalized while largely expected, in drove XX stores our of prior the open all healthy average. preferences growth quarter of greater XX% in $XX QX generating the $X,XXX on points As ARU, a Consumer

and of expanded QX, twice brand XX% sizable stores of Our sales reach transacted up our norm. XX% point. leading online. about sales both were XX% online, to X growth growth, in new net Comp made historic stores while QX in in our demand added our QX,

and multiple sales Our time. comp approach employs or unique stores, sources levels per more. store have traditional note, net advantages XX% of QX milestone with average mattress three Remember another or online, including now ARU that year business $X eclipse through are powerful times created prior productivity we increase in more four-wall retailers, with important the expect to average X sales our go-to-market units be the from or quarter. sales profit Also or online, average to expect the growth milestone from Further, this extra model. our over points of week XX% growing of retailers. Whether per at exceed of the we flexibility including new sales in-store over year, the We to to the expected store, than end mattress stores. traditional highlighting would million impressive our average these of of of by stores or sales the XXX

temporary. expansion is actions slowed this COVID but our Our delay this year, store portfolio

X% our to We while in growing through and expect portfolio expansion continue annual sales. XXXX X% store to of phone average online

expenses prioritization benefited QX in growth spending We costs. operating media investing comp points XXX basis while from incentive broad QX Our control. participation to support and R&D and and accruing higher-than-expected P&L leveraged in total

driving in QX expanding to confidently initiatives, growth across and support especially We the spending business programs up reach. are our customer ramping innovations

V-shaped points up XX% was year $XX XX%. stressed improvement was partnerships net operations. supply demand or diligently operating Double-digit delivered as net to resilient to top an QX the and They manufacturing ahead profit teams prior drivers. XX-basis-point gross This our tribute suppliers, the rate the exceptional versus QX. Our despite million efforts controls, a globally our margin is difficult restart. year. in fulfillment partners flow-through in of deliver our Strong were of operating stretching certainly and XX.X% expectations. spending performance improvement sequential QX QX record to since a XX.X% COVID efficiencies and capacity, by QX basis XXX-basis-point hyper a team Incremental sales execution fulfillment volume XXX across profit home and our delivery operations line results and The freight has carriers, superior prior our chains affected very key tremendous worked growth, over recovery struggle and to members benefits conditions significantly of

meaningful While customers the tight, experience third in supplies for did not our we quarter. are disruption

year the the EPS versus of third nine-month record date up This to performance brings EPS Our due to reflecting QX despite quarter $X.XX XX% this is shutdowns. prior COVID prior XX% $X.XX a loss year to $X.XX, the increase our QX year. over

and a mean last performance EPS on XX% EPS exceeds performance XX% power least We to net more velocity to sales compelling year-over-year exclude or growth share from per EPS and levers. XX% of the our QX year net $X.XX, the XXrd value-creating excluding earnings demonstrates also $X. EPS XXrd EPS expect and This now We've on using X% approximately of years X% $X.XX business is XX% earned EPS XXXX our including by in XXXX. our than that This Our of for growth. full-year implies week been year-to-date of in XXXX business. year about EPS $X.XX sales would growth the the growth delivering entire since XXXX. benefit. the week investing compounded annual This in the to several strong all for $X.XX Adjusting growth, of at top

in and of momentum performance value breakthrough the the confidence compelling to of pursuit our creation provide yet initiatives Our come.

ROIC is direct returns and points the up generation months. our XX.X% These versus of actions. basis a XX-month XXX are prior trailing of QX cash XX through capital outcome Our deployment outsized

Sleep We stock productive capital to the and years. have last $XXX million than in highly Number in work invested projects million put more $XXX six approximately

accelerate our bullish path business. the forward innovations our and investments are expect across in to We on

liquidity have our maintaining ended target We of to from also stock resume in a We here bias the we while plan for quarter. EBITDAR. return X.X with value time, repurchase in operating $XXX our program to expect our see Over QX tremendous to preservation. currently ratio our times our leverage We times share authorization X.X three board. fourth leverage remaining million to of and

with continue balance orientation momentum carry risks with and This We commitment pace our coming this to business actively sustain rebound to advantage the into us our near-term strategy. to to enabled quarters.

leadership during stakeholders. to, breakthrough Our I'd partners creation these science Number value like challenging times. team all business delivering Sleep thank for our Sleep sleep is and again, Number

this Your the passion Well performance. done. to improve open at is driving exceptional a questions. clarifying Chantal, for line making lives difference while please point,

Operator

Instructions] [Operator Piper Keith with Our Peter question first from comes Sandler.

Your line open. is

Peter Keith

get call, million just late any $XX didn't in meaningful there QX. of little on be on I the a from shifts the insight revenue call to that disruptions. I you or to the were shift Day, shifts Labor wanted thought saying consumer experience know more the might recognition QX but demand you last you from

now QX still bigger better $XX is million visibility? shift have we or So a number add in that that you we're

David Callen

question. It is Yes. bigger. Hi, the Peter, thanks for

about explosive growth that the the certainly demand into quarter, a of Our quarter. the in XX% coming led but we of end to bit the benefit at it's a had higher quarter, offsetting the backlog

Peter Keith

The $XX gets million coming benefit fully in right. of sort the offset? All

David Callen

Right.

Peter Keith

a product want I new question then the to launches. on And ask broader

really the the that noted although you those products new with growth. of technology, ARU So have the you're at are pleased temperature-balancing and high end price the spectrum, much didn't year-on-year your show

maybe the will weren't third quarter, there if launches show fourth product some potentially if that I'm higher-end was the sales recognized now maybe in fully of up wondering quarter. so and from offset And or higher these Internet an in

Shelly Ibach

thanks such advantages, On basis, and of is our Peter, is strategy always an And shifts. you and our metrics. both have units we the to business unique that at drive question. to This important area ARU. quarterly model ability our we as annual an competitive know, look these for

October models older the and as smart mX of in iX. Number it new the quarter, just and from We the in introduction the introduced new. the beds then represents well the both closeout introduced here quarter our in Sleep some So as recently iXX,

$XX. for driving up when we case our quarter, about growth the in So were at ARU look we this

driving the by So revenue promotions deliver per in XX% a combination growth process units average our designed really selling represented all innovations, the our benefit. while that customer forth, driven unit quarter. also of is put the very to big the in with ARU XX% But the we that delivering happy we're of and a utmost

And contribute of to sales ways at lots to go repeat that, we different of have this. too. So course,

levers last with, years to these and have to have work growth ARU to in confidence many of unit and we number drive into have we to certainly our future. expect the ongoing and we both continue as So ability high

David Callen

strong well. to of margin and add. is ARU ARU XX-basis-point certainly drive that a generating our margin aspect volume Peter, while $X,XXX of gross a That solid gross quarter. both, the XX% One and And case. our able in improvement the as year-over-year this rate, unit pretty I'd other that is correlation there generally, part growth between We is, in wasn't rate velocity were

Shelly Ibach

right. - absolutely is times in Peter, was prior question I lower which ARU results answer about penetration, growth. regarding you're did one a and was part not year, the XX% of sales, online on two your

some you a can triple-digit see growth And certainly at impact and very our with online our sales. there's the in and there. So well along grew phone stores same performed time,

Peter Keith

And if new last very past products, - intrigued with ClimateXXX, products January question. this I one year. announced had the want in guys to you ask Sticking on

on you getting any actually available As timing when and XXXX, market? that be closer we're do the sense to have might in

Shelly Ibach

as the Peter, QX, in introduction the the pandemic, onset just launch quarter. our of know, instead started smart we you of the we pushed it with beginning third new here beds. in Yes. And of XXX the

the likely then in So And ClimateXXX most to few next that launch we do will plan quarters. XXXX. early over

Operator

KeyBanc. Our next question comes with from Brad Thomas

line open. is Your

Brad Thomas

Congratulations quarter margins - about quarter. wanted the momentum fourth on about the the here. and thinking costs the in and ask I to

talk looks you're expansion generate the contribution guidance As the standpoint we as here you're getting to an may as be just flow about just third I that that limits revenue what's saw a XQ, expense what the strong going saw set on here? you math only strong margin standpoint margin do the from what about it in you through forward or margin changing Can like on you implying in quarter. or some that up from rough half the

David Callen

as the we back sequentially support At for marketing and be operated out but of we've we in need QX, forward. our particular, sales to here that QX, - And about to business this on the we of going year. from operating $XX And our we million thanks took and in expect that model, Brad, question onset seen where Yes. QX It's about and we really important to business. QX. of $XX have big some million how aren't - the COVID changes - business late made then that. you've of our to in yet the into added expenses, to built we out

So we rebuild seeing continuing that's in in some QX our structure to and the QX. QX, relative costs that are to of you're

excited to or absorbing more loss that. the very QX momentum $X we're know However, about that have deliver EPS beyond opportunity in and while in $X.XX we

Brad Thomas

initial not week I takes wouldn't you Obviously, formal take on you to I us give out. give would helpful. to curious That's that And know XXXX yet, an you're year. how have you so know about next we modeling any that think guidance here if but was could extra

easy next comparisons got in for you how as year thinking the XXXX? company are like about an might growth look XQ, You what unusual but we lap

David Callen

going new we us. February the certainly thing call. basis year. and the kind It in next will you all That's to a on for not Right. done We've on is color quarter-over-quarter past, that comparison interesting of provide an lots be year of

line, drive you deploying the XXXX take using the top down our which week we our $X.XX considered all is shareholders. can X the on to on build growth business adjustments and growth Brad, capital growth should and correct, to meaning numbers of But to the and extra of count from for to efficiently on expect the EPS Your callout, continue EPS from. points drivers, about model value be leveraging us

Operator

next James. with Our from comes Griffin Bobby Raymond question

Your line is open.

Bobby Griffin

hope on my up Thank questions. and the guess really, really is healthy. Brad's to I all question, and parts for taking Dave, everyone year staying the with you safe I pandemic. moving follow interesting

back into business. out, the costs had You coming coming costs

on guys years. some of last the from throughout been too, couple supply chain have working interesting You the things,

drastically? fixed So cost pre-COVID, the if variable versus at high-level has of the take model we - nature versus look maybe business a changed model the

David Callen

time, lean There some efficiencies the in Bobby. innovation out and the of know changing, At elements need protecting certainly to that we is that I changes are also are make our of that into are future. areas. but we're to same our getting sure some terms we lever of tremendous, - that pipeline several we

points to that basis the long-term That's of rate the home than directionally to is we're business, Our less which growth bias expect the to to about element what the in gross that here QX. in is phone in and be the meant continue margin so profitable gross versus delivery see we as overall do. QX, reflection the in about as we'll flat support inflation prior question likely I of QX costs logistics, QX is or XX to tech, in prior profitability to the One that's or of it was other margin comment operations, well year, factors starting and labor. about a some on

Just I'd purposes. your of modeling that all share for thought

Bobby Griffin

then… helpful. And That's Okay.

Shelly Ibach

just maybe of driving an I'll to perspective in from - performance. Bobby, overall And just jump

and the As that our more this quarter have growth in highlighted, fulfillment. we yes, invest to for place and drive delivery a the the And to and innovation consecutive efficiencies. to this, business we to after QX, actions going soon We lot the nature exactly efficiencies. and we're found just there sales, but forward. business have move And efficiencies put to support our back I term, be is Those continuity. some hard-and-fast be and long-term agility that it, different and We've ensure through all and able the long cut we're sustainability we on demand the that of deeply to we'll the quarter home as investments on still say enabled are new, went this year will And And efficient demand. while digital bring to so that solutions - us in hanging expenses to to evident quarter while on it's also the new some learning ensure a with capabilities we stay took would ability quarter. the year, the the to too coming we'll continue marketing, take learn reach our a where I little initiatives us third in how in And third we'll say certainly - ways customers. year across a to to really this months. in - the right. that next think can and this in expenses flow-through up for that to it mean, in continue is is tremendous the for be we bullish forward, model There's year. but it's you the see I is I growth have in here lot we've going after do out doing third we'll double-digit a year, so

is consumer we've value wellness of with some giving of part consumers a health to have. the to areas how them. fronts. excited than what number in on foresight otherwise a we really uncovered, had around past and delivering us It's reaching see greater think the big as life-changing otherwise I we're well. into opportunity And faster we're would So we trends we and that lean future than the And really probably

Bobby Griffin

this year, trying of XQ of some kind versus where Because XQ at I in really has XQ to it out and up that's dive of there. exactly you historical and you standards. the flow-through stepped was look And take

it just on, marketing we've XX look of item follow the gains you portion, mean, the is deleverage type quarter, really lastly efficiencies performance change called that So non-media I a me from of points in the this some line points media I out, mean, guess Dave, time of line over also the seen up the variable which it at implies on of first but Shelly leverage I fixed sales time. makes structure. that XXX to and from if these long wonder that

David Callen

Yes.

We got forward. differently call And expect For to and we going about the But efficiencies some February. in environment. stay that on go to to on this said, as of have those some as significantly We're learnings sure. operating we we've to were QX we're hang a lot tuned. talk applying, in Shelly

Bobby Griffin

and of of right. appreciate Best luck Well, in through I quarter. very All That's going fourth line the kind good. items. details the

David Callen

Thanks a lot, Bobby.

Operator

Our comes Seth Wedbush Securities. next Basham from question with

Your line open. is

Seth Basham

also pandemic. seemed unprecedented question had pulled around the some because the quarter, on it primarily, like seems, had expenses My expense this line. and back you It sales marketing is leverage during you

think about expected when expense back out be fourth more the thinking extra going much there going is an Are leverage limited, is you forward? that from you more standpoint quarter to your forward, the QX going If week. normalized especially you

David Callen

No. we're the even would we leverage I than that going more I to week. have have, don't. expect excluding normally extra

Seth Basham

it And then your XXXX? you secondly could would backlog? and expect for the quarter, into extend here. thinking caught about on fourth the forecast the Or first the backlog Based have on to up quarter of

David Callen

is XXrd actually time, be to everything. on up at We've same new another And We - get same. next growth had kind we're caught quarterly that year, shifts gives demand by week delivering but much to the in the this this adding explosive demand level. week the in prior see years, of this and the - we us so

we forward going as go And be as normal so it. see we to yes, this is

Seth Basham

last attribute just you performance to leverage. of advertising is my lower Good quarter. this around question And that media How would rates? much

David Callen

we more quarter, spent So we the just our to over R&D be clear, year our like year more year. just year over in spent in media in

of near- marketplace. and winning well side We media in leaning support growth benefits favorable the into did, in teams our are the and to get cost our digital as long-term We some drivers. but the are marketplace, our continue indeed,

Seth Basham

Could from what you just on color some year? advertising seeing you're provide digital the rates through

Shelly Ibach

leverage ROI. in step-up our majority the just this in to need again, media another media. of I Well, first the And was highlight

that So of source digital data. we proprietary been how also reach the it the algorithm also and But potential for consumers managing us efficiency overall greatest drive traffic. was we're has that our And XXXX. utilizing increased our was our platforms high-converting had most because continuous to and efficient and our quarter, efficiency tremendous and digital of with since ability

placements vary certainly also helpful hear the fourth and our here what by even - secure and initiatives rates and from not confident fourth favorable as we going our not about out maybe to to media ability in but advance forward move to drive I'm or it's that So rate, and further. growth the business, have And would continue part our we in feel we came will expect quarter. quarter we it leverage our to whether split and we

Operator

Our with comes question Maheswari UBS. from next Atul

Your line is open.

Atul Maheswari

quarter market, the your bit you you from? And below quite you share was do so, comp one if think gained do case? of your Why competitors. demand you gained third that So do who was the And you think think broader versus a larger share? then

Shelly Ibach

asked Well, this of you double-digit continue operate different year share I'm over is than growth. so taken we're of year. because we taking the the and question delivering consecutive share to believe competitors. term, share, any us business our we'll for take long and and this That's for very We've this four third our absolutely for glad years

Operator

Our next with question Bank comes from Curtis Nagle America. of

line Your open. is

Curtis Nagle

pressure. of terms the better seeing my now? beginning And where worse just on were some are the Thanks to in for XQ very follow seeing, I some of biggest than points and much Seth's of to of the questions component you're at I they of shortages issues perhaps, you're or wanted kind of up or quickly question. taking the sourcing relative guess,

Shelly Ibach

a in productivity. at obvious were different been for - most shut our were aspects business Well, some And right say, and to color. this their were the matter they advantaged I right additional inventory responding deliver not is our without part, lot better together across and the customers product worked coordinated moves the And V highlight has inventory everyone pandemic creative quarter. revenue how while on shortly reasons pretty specifics is to And in as they or in our down any when excited very meaningful where keep I'll they resolved. issues with were model, integrated and than There we I'm introducing with as I'm model to some fairly way. QX, our how demand. dealing we disruption this partial would at And put really hit. mind, new ways the time. times add really that and a all about as David more QX. start, you there's for it what level were been integrated has And how, the low right supplier a I that hyper-shaped delivery levels has vertical this Certainly closely shortage, were and complexity - can after factories of to we for have how and the it's teams partners so recovery it a find masterful the suppliers of of really business at of that do layered been third to in having our get responsive some would also in sure in line extraordinary because solve not of the during highly far because in places where around

on top And the teams all that managed end. our we the drove have collectively so and on that performance of delivered

big board, a just happen of across impressed. - the really would to shout-out this passion. really dedication without everyone's our team None and So I'm all

David Callen

demand to our also last prior want about revisit misunderstanding. there's and question I the second competitors, versus a some to take

demand is consumer, We of highlighted three Shelly to fully years that - are end growth real the demand on consumers. to direct all double-digit based and our

of independent have another some some I that competitors sales - are retailers. And demand that - out know there And they anymore. that through their a to different today competitor our pure player is delivering there's of don't models. have DTC growth

your as that do in you keep just comparisons. So mind

Curtis Nagle

other guess with like air One the of - good in issues single-sourcing I any the in I components, pumps? terms that may, sorry, shape? air some the just Or is follow-up, quick if of sourcing.

Shelly Ibach

but shape. in good tight, good shape. is we're in Everything We're

Operator

Brad Our KeyBanc. Thomas next comes with question from

Your is open. line

Brad Thomas

me get so demand much talk letting Thanks for just the I about trends. was in for a bit little a follow-up. to hoping

I think were the up us end of single you quarter quarter, and toward last high last May running you told digits June. of

more XX% Day, by and you color had things reported You month how for was demand month a if I around nuances little any hoping for us were Labor example. could there played out growth XQ. give

Shelly Ibach

we robust and growth during the continue momentum fourth Day before, as strong after had quarter, throughout the demand with both quarter. head We've and into Labor event

Brad Thomas

guidance XQ. triangulate your GAAP about for growth try I so versus implies to the thinking revenues And to me XX% your it guidance to for that trends, seems demand if about XX% revenue

has got about X%. week extra that You've an

a that had million If you that you backlog worked could through, X%. $XX be

traction imply So XX% Am XQ? range through it about right to apart it in revenue that that demand the XX% the I might maybe I breaking way, if way? think

David Callen

Brad. Sure,

we're about delivering the the in that all XX% QX, year on more top-line highlighted, where performance about what been rebound - nothing we've EPS $X And that the we're fair. And the has having our Shelly or there. despite growth excited just going. you in we're as for overall think for to decline QX. are is - and the got X% X% excited full This that's of in sales momentum and in stellar, opportunities should keep cylinders, initiatives won't working in we're and short stop and mind I

Brad Thomas

just If I on could squeeze in one, one last stores.

down you stores you're a and openings and row. initial thinking as relates term XXXX an few store longer it repositions on maybe a How in to think are quarter about I second thought base? for XQ in the the and

David Callen

change Right. store was that expecting because some Yes. as were reflects of our our highlighted, openings And we of initiatives stores we - $XX COVID, as that. - and part CapEx at paused million well. We're of

end we local X%, average, And expected to opportunities now development XXXX. to market is overall this grow expect see to term, portfolio about then store for continue We on XXX The and great year long to expansion. year between and X% per now stores. still with

Shelly Ibach

as and sales well, driving while online increases that's Brad. And phone

Operator

the will further this for I are back time. questions Sleep at There closing turn over call to Number remarks. no

Dave Schwantes

quarter today. discussing look February. us for big. We and joining performance forward Sleep Thank dream you our XXXX to you in well with fourth

Operator

conference today’s concludes This call.

You may now disconnect.

Sleep Number (SNBR) 14 Oct 202020 Q3 Earnings call transcript