Select Comfort blew by analyst expectations for its first quarter, more than doubling its earnings to 56 cents per share.
"Consumers are responding enthusiastically to our brand and differentiated products. Our investments over the past few years have made us a stronger competitor and this is evident in our first quarter results," said Shelly Ibach, president and CEO of Plymouth-based Select Comfort, in a statement.
Eight analysts polled by Thomson Reuters expected the company to earn 45 cents per share in the first quarter on estimated revenue of $370.2 million.
Net income was $24.5 million, up from $13 million in the same quarter a year ago. Revenue increased 11.6 percent to $393.9 million.
Ibach said the second quarter is seeing a planned phased-in introduction of the Sleep Number 360 smart beds. The company introduced the Sleep Number 360 smart bed — which automatically adjusts firmness and comfort throughout the night — at the consumer electronics and technology trade show CES in January, winning Best of Innovation honors in its product category.
Select Comfort will introduce two models in the second quarter, and five others over the next 12 months.
Ibach told analysts on a conference call Wednesday that pilot tests of the Sleep Number 360 bed in limited stores showed good consumer reaction to the technology.
The company increased its 2017 full-year outlook saying it now expects to earn $1.25 to $1.50 per share. The company's previous guidance was for $1.20 to $1.40 per share. The outlook includes costs of 15 to 22 cents per share associated with the launch of the new bed.
The company also expects capital expenditures in 2017 to be $55 million, which includes the product rollout, new store openings and its corporate headquarters move in the fall from Plymouth to downtown Minneapolis.
The company released earnings after the stock market closed on Wednesday. Shares were up more than 12.5 percent in after-hours trading from its close of $25.87. Before the release of the first-quarter results, shares had traded between $17.95 and $28.34 per share during the past 52 weeks.
Patrick Kennedy • 612-673-7926
