Somnigroup International (SGI) Q4 2024 earnings summary

Executive summary

• Completed the merger of Mattress Firm and Tempur Sealy, rebranding as Somnigroup International and listing under the ticker SGI; acquisition finalized in February 2025, establishing the world's largest bedding company.

• Q4 2024 net sales were $1.21 billion, up 3.2% year-over-year, with international growth offsetting flat North America sales.

• Adjusted EPS for Q4 2024 was $0.60, up 13.2%, outperforming expectations due to strong international performance.

• The company operates with decentralized business units: Tempur Sealy, Dreams, and Mattress Firm.

• Quarterly cash dividend increased 15% to $0.15 per share, the fifth increase since 2021.

Financial highlights

• Q4 2024 consolidated sales: $1.21 billion; adjusted EPS: $0.60; adjusted net income grew 14.2% to $107.2 million.

• Gross margin for Q4 2024 was 43.3% (adjusted: 45.3%), with adjusted gross margin expanding by 130 basis points year-over-year.

• Full-year 2024 net sales were $4.93 billion, up 0.1%; adjusted EPS for the year was $2.55, up 6.3%.

• 2024 free cash flow reached $569 million, the highest since 2021.

• Leverage ratio improved to 2.31x adjusted EBITDA for 2024, down from 2.87x in 2023.

Outlook and guidance

• 2025 adjusted EPS guidance: $2.60–$3.00, representing 10% growth at the midpoint.

• 2025 sales guidance (post-intercompany eliminations): $7.5–$7.8 billion, including 11 months of Mattress Firm operations and a planned divestiture.

• Industry expected to be stable in 2025, with recovery anticipated in H2.

• Long-term target: mid-single-digit sales CAGR from 2026, with EPS growing from $2.80 (2025 midpoint) to ~$4.85 by 2028 (20% CAGR).

• At least $100 million in annual run-rate synergies expected by 2028 from the Mattress Firm acquisition.