Somnigroup Sets $100M Synergy Target, Raises 2025 EPS Guidance Amid Mattress Firm Integration

Somnigroup International Inc. reported Q2 2025 earnings with net sales increasing 53% to $1.9 billion and adjusted EBITDA reaching $334 million. The company outlined a $100 million synergy target and raised its 2025 EPS guidance amid the Mattress Firm integration. Chairman Scott L. Thompson attributed the performance to disciplined execution and progress in the combination with Mattress Firm.

Somnigroup International Inc. (SGI) reported its Q2 2025 earnings with net sales increasing 53% to $1.9 billion and adjusted EBITDA reaching $334 million. The company outlined a $100 million synergy target and raised its 2025 EPS guidance amid the successful integration of Mattress Firm.

Chairman Scott L. Thompson attributed the performance to disciplined execution and progress in the combination with Mattress Firm. The company's strategic synergy initiatives have made meaningful progress, with Tempur Sealy now expected to represent approximately 50% of Mattress Firm's total sales in 2025, up from initial expectations of 40%. This shift is anticipated to result in a $40 million benefit to 2025 adjusted EBITDA.

The company is on track to realize at least $100 million in annual run rate net cost synergies, with $15 million expected in 2025, an additional $50 million in 2026, and $35 million in 2027. A new advertising campaign, "Sleep Easy," launching in Q3, is intended to drive demand and improve consumer engagement.

On the international front, SGI reported robust double-digit sales growth and solid margin expansion, marking nine consecutive quarters of meaningful sales expansion. The launch of the new Sealy Posturepedic collection was described as the largest bedding launch in industry history, with preliminary results of the campaign being strong.

The company also announced an expanded relationship with Fullpower, including a $25 million equity investment for a 15.6% stake and a multiyear extension through 2036 for exclusive technology rights. This partnership is expected to streamline technology, accelerate innovation, and derisk new product launches.

SGI raised its adjusted earnings per share guidance for 2025 to a range of $2.40 to $2.70, with a sales midpoint of approximately $7.4 billion after intercompany elimination. Management reiterated expectations for the bedding industry to be down mid-single digits in 2025 but noted improving trends in the second half of the year.

The company's financial results showed consolidated net sales of $1.9 billion, adjusted EPS of $0.53, and operating cash generated of $186 million. The company reduced consolidated debt less cash to $4.9 billion.

During the Q&A session, analysts probed for clarity on demand trends, synergy realization, and margin dynamics. Management maintained a confident and optimistic tone, emphasizing stability, disciplined execution, and encouraging early trends.

Risks and concerns cited by management include continued bedding industry softness, tariff exposure, and potential gross margin headwinds if Sealy outpaces Tempur in sales. However, management stressed that these are planned and manageable.

References:
[1] https://seekingalpha.com/news/4482216-somnigroup-outlines-100m-synergy-target-and-raises-2025-eps-guidance-amid-mattress-firm