The increase in profitability was supported by improved margins and higher operating income during the quarter. For the quarter ended June 30, 2026, the company’s gross margin expanded to 44.8 per cent from 44.0 per cent a year earlier, helping offset the impact of lower sales. Operating income increased 12.1 per cent to $201.7 million, while earnings before interest, tax, depreciation and amortisation (EBITDA) rose to $280.8 million.
Somnigroup’s Q2 FY26 net income rose 12 per cent to $110.9 million despite a 3 per cent sales decline to $1.82 billion, supported by margin expansion and higher operating income.
Gross margin improved to 44.8 per cent, while EBITDA rose to $280.8 million.
The company raised 2026 EPS guidance and focuses on Mattress Firm integration, the Stearns & Foster launch and Leggett & Platt acquisition.
Total net sales fell 3 per cent YoY to $1.82 billion from $1.88 billion in Q2 FY25.
Despite the weaker revenue, the company maintained profitability by improving margins and continuing to execute on its business strategy, including investments in its brands and international expansion.
Somnigroup chairman and CEO Scott Thompson said the company delivered solid results in a dynamic operating environment while continuing to invest in its brands, advance its international growth strategy, prepare for the North American launch of its new Stearns & Foster collection and strengthen its distribution platforms.
The company said progress across these areas reinforces its confidence in its long-term strategy and its ability to create sustainable value.
Segment performance
Mattress Firm segment net sales declined 2.8 per cent to $922.2 million, primarily due to store closures, although same-store sales were slightly higher.
Gross margin for Mattress Firm fell to 33.3 per cent from 35.6 per cent, reflecting product mix and higher consumer financing costs, while operating margin slipped to 6.4 per cent.
Tempur Sealy North America reported a 5.7 per cent decrease in net sales to $601.8 million, impacted by market conditions and the divestiture of Sleep Outfitters. However, gross margin improved sharply to 61.1 per cent from 54.5 per cent, driven by synergies from the Mattress Firm acquisition and operational efficiencies. Operating margin increased to 25.9 per cent from 20.4 per cent.
Tempur Sealy International segment net sales rose 2 per cent to $299.5 million. Gross margin declined to 47.4 per cent from 48.2 per cent, and operating margin fell to 12.4 per cent.
Guidance and strategic outlook
Somnigroup revised its FY26 adjusted EPS guidance to a range of $2.85 to $3.15, representing an approximate 11 per cent increase at the midpoint over 2025.
The company cited ongoing integration of Mattress Firm, the planned North American launch of the Stearns & Foster collection, and the pending acquisition of Leggett & Platt as strategic priorities, in its press release. The Leggett & Platt transaction, valued at approximately $2.5 billion, is expected to close by the end of the third quarter (Q3) of 2026, subject to customary approvals.
The company noted that its outlook remains subject to macroeconomic and geopolitical uncertainties, including potential tariff changes and supply chain risks, according to the company’s quarterly results.
Fibre2Fashion News Desk (CG)
