Key Takeaways
- Tempur Sealy said second-quarter sales in the U.S. were hurt by macroeconomic pressures on consumers.
- Both adjusted EPS and sales were below estimates.
- The mattress maker reduced its full-year profit guidance.
- CEO Scott Thompson said that Tempur Sealy anticipates it will be successful in fending off a challenge from the FTC to block its $4 billion purchase of Mattress Firm.
Mattress maker Tempur Sealy International (TPX) on Tuesday reported worse-than-expected results and cut its outlook as inflation led to falling demand in the U.S.
The company posted second-quarter adjusted earnings per share (EPS) of $0.63, with sales declining 2.8% year-over-year to $1.23 billion. Both were shy of consensus forecasts of analysts polled by Visible Alpha.
North American sales slid 3.8% to $978.4 million, which Tempur Sealy said was primarily the result of “continued macroeconomic pressures impacting U.S. consumer behavior.” Chief Executive Officer (CEO) Scott Thompson explained that the company faced “softer than anticipated industry volumes.”
Tempur Sealy now sees full-year adjusted EPS in a range of $2.45 to $2.65, down from its previous estimate of $2.60 to $2.90.
CEO Thinks It Will Fend Off FTC Challenge To Mattress Firm Acquisition
Thompson said that Tempur Sealy anticipates it will be successful in fending off a challenge from the Federal Trade Commission (FTC) to block its $4 billion purchase of Mattress Firm. He indicated the company is confident of the “pro-competitive rationale” of the acquisition, and believes it will win the litigation in the next few months, allowing the purchase to close late this year or early 2025. The FTC argues that the merger would stifle competition and raise mattress prices for consumers.
Shares of Tempur Sealy, which closed Monday at $48.60, fell to $45.58 soon after markets opened Tuesday but rebounded and edged up to $48.83 as of 10:50 a.m. ET. They have lost about 4% so far in 2024.