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- Going Concern (new) — Company discloses substantial doubt about ability to continue operations due to liquidity challenges and anticipated covenant violations.
- Covenant Violation (new) — Company expects to violate financial covenants over the next twelve months, triggering potential default.
Sleep Number discloses going concern doubt, covenant violations, and 19% sales decline
Filed May 12, 2026 · Period ending April 4, 2026 · ~2 min read
Key Changes
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high
Company states substantial doubt about ability to continue as a going concern for at least one year. Entered forbearance agreement April 27 after covenant violations; forbearance expires early July with no relief beyond that date.
Risk Factors: Going Concern verify on EDGAR → -
high
Q1 2026 sales fell 19% to $319M; operating loss of $37M vs $2M income prior year. Gross margin compressed 3.3 points to 57.9% on unfavorable mix and higher discounts. Free cash flow negative $13M.
Risk Factors: Operating Performance verify on EDGAR → -
high
Company expects to violate financial covenants over next twelve months. Obtained emergency $25M term loan at SOFR+8.00% maturing June 30, 2026. Total debt $606M with only $39M availability remaining.
Risk Factors: Credit Agreement verify on EDGAR →
2 more material changes behind this preview — plus the full narrative summary, section-by-section diffs against the prior filing, and verbatim quotes with EDGAR citations.
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Source-verified from EDGAR · Narrative written by AI · Jun 1, 2026 · How we verify