What changed in this filing

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Item 1. Financial Statements

2026-08-07 compared with 2026-05-08 · 215 added, 83 removed, 457 unchanged (39% of the section changed)

2 unchanged sentences

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

($ in millions, except per common share amounts)

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2026 2025 2026 2025

Net sales $ 1,823.5 $ 1,880.8 $ 3,625.0 $ 3,485.5

3 unchanged sentences

General, administrative and other expenses 165.1 175.9 332.0 385.4

Loss on disposal of business — 13.9 — 13.9

Equity income in earnings of unconsolidated affiliates ( 3.1 ) ( 3.0 ) ( 8.7 ) ( 7.8 )

4 unchanged sentences

Total other expense, net 53.9 77.2 103.7 139.7

Income (loss) before income taxes 137.3 ( 49.3 )

Income before income taxes 147.8 102.7 285.1 53.4

Income tax provision (benefit) ( 37.2 ) ( 3.2 ) ( 70.6 ) 13.3

Net income (loss) before non-controlling interest 103.9 ( 32.8 )

Net income before non-controlling interest 110.6 99.5 214.5 66.7

Net (loss) income attributable to non-controlling interest ( 0.3 ) 0.5 ( 0.6 ) 0.8

Net income (loss) attributable to Somnigroup International Inc.

Net income attributable to Somnigroup International Inc.

$ 110.9 $ 99.0 $ 215.1 $ 65.9

Earnings (loss) per common share:

Earnings per common share:

Basic $ 0.53 $ 0.47 $ 1.02 $ 0.33

6 unchanged sentences

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

($ in millions)

Three Months Ended

Net income (loss) before non-controlling interest $ 103.9 $ ( 32.8 )

Three Months Ended Six Months Ended

June 30, June 30,

2026 2025 2026 2025

Net income before non-controlling interest $ 110.6 $ 99.5 $ 214.5 $ 66.7

Other comprehensive (loss) income, net of tax:

2 unchanged sentences

Other comprehensive (loss) income, net of tax ( 3.9 ) 68.8 ( 18.1 ) 99.1

Comprehensive income (loss) 89.7 ( 2.5 )

Comprehensive income 106.7 168.3 196.4 165.8

Comprehensive (loss) income attributable to non-controlling interest ( 0.3 ) 0.5 ( 0.6 ) 0.8

Comprehensive income (loss) attributable to Somnigroup International Inc.

Comprehensive income attributable to Somnigroup International Inc.

$ 107.0 $ 167.8 $ 197.0 $ 165.0

4 unchanged sentences

($ in millions)

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

ASSETS (unaudited)

33 unchanged sentences

($ in millions) (unaudited)

Three Months Ended March 31, 2026

Three Months Ended June 30, 2026

Somnigroup International Inc.

2 unchanged sentences

Shares Issued At Par Shares Issued At Cost Additional Paid in Capital Retained Earnings

Balance as of December 31, 2025

Balance as of March 31, 2026

$ 7.9 283.8 $ 2.8 73.5 $ ( 1,662.4 ) $ 1,022.2 $ 3,897.4 $ ( 112.6 ) $ 3,147.4

6 unchanged sentences

( 36.0 ) ( 36.0 )

Exercise of stock options — 0.3 ( 0.3 ) —

Issuances of PRSUs and RSUs

2 unchanged sentences

Amortization of unearned stock-based compensation

Balance as of June 30, 2026

$ 7.6 283.8 $ 2.8 73.5 $ ( 1,661.5 ) $ 1,032.3 $ 3,972.3 $ ( 116.5 ) $ 3,229.4

Three Months Ended June 30, 2025

Somnigroup International Inc.

Stockholders' Equity

Non-controlling Interest Common Stock Treasury Stock Accumulated Other Comprehensive Loss Total Stockholders'

Shares Issued At Par Shares Issued At Cost Additional Paid in Capital Retained Earnings

Balance as of March 31, 2025

$ 8.6 283.8 $ 2.8 75.2 $ ( 1,675.1 ) $ 1,063.3 $ 3,507.2 $ ( 156.5 ) $ 2,741.7

Three Months Ended March 31, 2025

Net income 99.0 99.0

Net income attributable to non-controlling interest 0.5 —

Dividend paid to non-controlling interest in subsidiary ( 0.2 ) —

Foreign currency adjustments, net of tax 68.8 68.8

Dividends declared on common stock ($ 0.15 per share)

( 31.7 ) ( 31.7 )

Exercise of stock options ( 2.7 ) 103.7 ( 55.6 ) 48.1

Issuances of PRSUs and RSUs

— 0.8 ( 0.8 ) —

Treasury stock repurchased - PRSU/RSU releases 1.4 ( 94.9 ) ( 94.9 )

Amortization of unearned stock-based compensation

Balance as of June 30, 2025

$ 8.9 283.8 $ 2.8 73.9 $ ( 1,665.5 ) $ 1,017.0 $ 3,574.5 $ ( 87.7 ) $ 2,841.1

See accompanying Notes to Condensed Consolidated Financial Statements .

SOMNIGROUP INTERNATIONAL INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (CONTINUED)

($ in millions) (unaudited)

Six Months Ended June 30, 2026

Somnigroup International Inc.

Stockholders' Equity

4 unchanged sentences

Net income 215.1 215.1

Net income attributable to non-controlling interest 0.3 —

Net income attributable to non-controlling interests ( 0.6 ) —

Dividend paid to non-controlling interest in subsidiary ( 0.7 ) —

3 unchanged sentences

( 72.0 ) ( 72.0 )

Exercise of stock options — 0.3 ( 0.3 ) —

Issuances of PRSUs and RSUs

( 0.7 ) 28.7 ( 28.7 ) —

Treasury stock repurchased - PRSU/RSU releases 0.3 ( 26.2 ) ( 26.2 )

Amortization of unearned stock-based compensation

Balance as of June 30, 2026

$ 7.6 283.8 $ 2.8 73.5 $ ( 1,661.5 ) $ 1,032.3 $ 3,972.3 $ ( 116.5 ) $ 3,229.4

Six Months Ended June 30, 2025

Somnigroup International Inc.

Stockholders' Equity

Non-controlling Interest Common Stock Treasury Stock Accumulated Other Comprehensive Loss Total Stockholders' Equity

Shares Issued At Par Shares Issued At Cost Additional Paid in Capital Retained Earnings

Balance as of December 31, 2024

$ 9.3 283.8 $ 2.8 110.2 $ ( 3,330.0 ) $ 501.2 $ 3,571.8 $ ( 186.8 ) $ 559.0

Net income 65.9 65.9

Net income attributable to non-controlling interests 0.8 —

Dividend paid to non-controlling interest in subsidiary ( 1.2 ) —

Adjustment to pension liability, net of tax 0.6 0.6

Foreign currency adjustments, net of tax 98.5 98.5

Dividends declared on common stock ($ 0.30 per share)

( 63.2 ) ( 63.2 )

Shares issued in connection with Mattress Firm Acquisition ( 34.2 ) 1,609.9 635.2 2,245.1

5 unchanged sentences

Amortization of unearned stock-based compensation

Balance as of March 31, 2025

Balance as of June 30, 2025

$ 8.9 283.8 $ 2.8 73.9 $ ( 1,665.5 ) $ 1,017.0 $ 3,574.5 $ ( 87.7 ) $ 2,841.1

4 unchanged sentences

($ in millions)

Three Months Ended

Six Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss) before non-controlling interest $ 103.9 $ ( 32.8 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Net income before non-controlling interest $ 214.5 $ 66.7

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization 123.3 116.2

5 unchanged sentences

Equity income in earnings of unconsolidated affiliates ( 8.7 ) ( 7.8 )

Loss on disposal of business — 13.9

Foreign currency adjustments and other 3.8 4.4

21 unchanged sentences

Cash paid for interest $ 121.7 $ 142.3

Income taxes, net of refunds $ 33.2 $ 1.1

Non-cash investing activities:

15 unchanged sentences

The Company designs, manufactures, distributes and retails bedding products, which include mattresses, foundations and adjustable bases, and other products, which include pillows and other accessories.

The Company also derives income from royalties by licensing Sealy® and Stearns & Foster® brands, technology and trademarks to other manufacturers, as well as licensing the Mattress Firm® trademark to retail franchisees.

The Company also derives income from royalties by licensing Sealy®, Stearns & Foster® and Tempur® brands, technology and trademarks to other manufacturers, as well as licensing the Mattress Firm® trademark to retail franchisees.

The Company sells its products through two sales channels:

3 unchanged sentences

The equity method of accounting is used for these joint ventures, over which the Company has significant influence but does not have control, and consolidation is not otherwise required.

The Company's equity in the net income and losses of these investments is reported in equity income in earnings of unconsolidated affiliates in the accompanying Condensed Consolidated Statements of Income (Loss).

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X and include all of the information and disclosures required by generally accepted accounting principles in the United States ("GAAP") for interim financial reporting.

4 unchanged sentences

Inventories are stated at the lower of cost or net realizable value, determined by either the first-in, first-out method or the weighted average cost method, depending on reportable segment , and consist of the following:

March 31, December 31,

June 30, December 31,

(in millions) 2026 2025

12 unchanged sentences

The fair values of these material financial instruments are as follows:

(in millions) March 31, 2026 December 31, 2025

(in millions) June 30, 2026 December 31, 2025

2029 Senior Notes $ 771.9 $ 780.1

2 unchanged sentences

On April 13, 2026, Somnigroup International and Leggett & Platt, Incorporated ("Leggett & Platt") entered into a definitive agreement (the "Merger Agreement") for a proposed business acquisition in which Somnigroup International, through a wholly-owned subsidiary, will acquire Leggett & Platt in an all-stock transaction (the "Transaction") valued at approximately $ 2.5 billion based on the closing price of Somnigroup International's common stock as of April 10, 2026 and inclusive of Leggett & Platt's existing indebtedness.

The Transaction is currently anticipated to close by year-end 2026, subject to the satisfaction of customary closing conditions, including approval by Leggett & Platt’s shareholders and receipt of applicable regulatory approvals.

The Transaction is currently anticipated to close by the end of the third quarter of 2026, subject to the satisfaction of customary closing conditions, including approval by Leggett & Platt’s shareholders and receipt of applicable regulatory approvals.

The Transaction does not require Somnigroup International shareholder approval.

4 unchanged sentences

(2) Net Sales

The following table presents the Company's disaggregated revenue by channel and geographical region, including a reconciliation of disaggregated revenue by segment, for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31, 2026 Three Months Ended March 31, 2025

Three Months Ended June 30, 2026 Three Months Ended June 30, 2025

(in millions) Mattress Firm Tempur Sealy North America Tempur Sealy International Consolidated Mattress Firm Tempur Sealy North America Tempur Sealy International Consolidated

8 unchanged sentences

Substantially all revenue is associated with bedding product sales.

Six Months Ended June 30, 2026 Six Months Ended June 30, 2025

(in millions) Mattress Firm Tempur Sealy North America Tempur Sealy International Consolidated Mattress Firm Tempur Sealy North America Tempur Sealy International Consolidated

Direct $ 1,808.1 $ 187.4 $ 403.1 $ 2,398.6 $ 1,542.5 $ 226.1 $ 375.5 $ 2,144.1

Wholesale — 977.9 248.5 1,226.4 — 1,118.5 222.9 1,341.4

Net sales $ 1,808.1 $ 1,165.3 $ 651.6 $ 3,625.0 $ 1,542.5 $ 1,344.6 $ 598.4 $ 3,485.5

Mattress Firm Tempur Sealy North America Tempur Sealy International Consolidated Mattress Firm Tempur Sealy North America Tempur Sealy International Consolidated

Geographical Region

United States $ 1,808.1 $ 1,036.3 $ — $ 2,844.4 $ 1,542.5 $ 1,221.4 $ — $ 2,763.9

All other — 129.0 651.6 780.6 — 123.2 598.4 721.6

Net sales $ 1,808.1 $ 1,165.3 $ 651.6 $ 3,625.0 $ 1,542.5 $ 1,344.6 $ 598.4 $ 3,485.5

Substantially all revenue is associated with bedding product sales.

SOMNIGROUP INTERNATIONAL INC.

8 unchanged sentences

The Company accounted for this transaction as a business combination in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations .

Mattress Firm's financial results for the three months ended March 31, 2026 and the period of February 5, 2025 through March 31, 2025 (the "stub period") are included in the Company's Condensed Consolidated Financial Statements for the three months ended March 31, 2026 and March 31, 2025, respectively.

Mattress Firm's financial results for the period April 1, 2025 through June 30, 2025 and February 5, 2025 through June 30, 2025 (the "stub period") are included in our Condensed Consolidated Financial Statements for the three and six months ended June 30, 2025, respectively.

On May 1, 2025, the Company completed the previously announced divestiture of 73 Mattress Firm retail locations and the Company's Sleep Outfitters subsidiary, which includes 103 specialty mattress retail locations and seven distribution centers to MW SO Holdings Company, LLC ("Mattress Warehouse").

48 unchanged sentences

Transaction Costs

The Company incurred an immaterial amount of transaction costs related to the Mattress Firm Acquisition during the three months ended March 31, 2026 and $ 50.2 million in the three months ended March 31, 2025.

The Company incurred an immaterial amount of transaction costs related to the Mattress Firm Acquisition during the three months ended June 30, 2025.

The Company incurred $ 50.2 million of transaction costs related to the Mattress Firm Acquisition during the six months ended June 30, 2025.

Transaction costs primarily included legal and professional fees associated with the Mattress Firm Acquisition.

3 unchanged sentences

Consolidated Results of Operations

The business acquired in the Mattress Firm Acquisition contributed revenue of $ 885.9 million and $ 593.7 million for the three months ended March 31, 2026 and March 31, 2025, respectively and contributed net income of $ 32.4 million and $ 0.8 million for the three months ended March 31, 2026 and March 31, 2025, respectively.

The business acquired in the Mattress Firm Acquisition contributed revenue of $ 922.2 million and $ 948.8 million for the three months ended June 30, 2026 and June 30, 2025, respectively and contributed net income of $ 52.7 million and $ 52.3 million for the three months ended June 30, 2026 and June 30, 2025, respectively.

Unaudited Pro Forma Financial Information

1 unchanged sentence

Pro forma results do not include the effect of any future synergies anticipated to be achieved from the acquisition, and accordingly, are not necessarily indicative of the results that would have occurred if the acquisition had occurred on the date indicated or that may result in the future.

Three Months Ended March 31,

(unaudited) (unaudited)

Three Months Ended June 30, Six Months Ended June 30,

(in millions) 2025 2025

2 unchanged sentences

The pro forma amounts have been calculated after applying the Company's accounting policies and by including the results of Mattress Firm, and adjusting the combined results to give effect to the following, as if the acquisition had been consummated on January 1, 2024, together with the consequential tax effects thereon:

(unaudited) Three months ended

(in millions) March 31, 2025

Six Months Ended

(in millions) June 30, 2025

Pro Forma Adjustments to Net Sales, as Reported:

10 unchanged sentences

Total adjustments to net loss $ ( 195.7 )

(1) For the three months ended March 31, 2025, Mattress Firm pre-acquisition loss included a one-time charge of $ 340.5 million related to stock-based compensation expense recognized when the Mattress Firm Acquisition became probable.

(1) For the six months ended June 30, 2025, Mattress Firm pre-acquisition loss included a one-time charge of $ 340.5 million related to stock-based compensation expense recognized when the Mattress Firm Acquisition became probable.

(2) Represents $ 50.2 million of transaction costs for professional fees incurred by the Company in connection with the Mattress Firm Acquisition, which were reclassified to the prior year presented in accordance with ASC 805.

2 unchanged sentences

(5) Represents the net effect of interest expense on borrowings associated with the Mattress Firm Acquisition.

(6) Represents the income tax benefit (provision) for the above pro forma adjustments, which applies an estimated blended statutory income tax rate of 25.0 %.

(6) Represents the income tax provision for the above pro forma adjustments, which applies an estimated blended statutory income tax rate of 25.0 %.

SOMNIGROUP INTERNATIONAL INC.

2 unchanged sentences

The following summarizes changes to the Company's goodwill, by segment:

(in millions) Tempur Sealy North America Tempur Sealy International Mattress Firm Consolidated

(in millions) Mattress Firm Tempur Sealy North America Tempur Sealy International Consolidated

Balance as of December 31, 2025 $ 3,493.9 $ 607.0 $ 495.0 $ 4,595.9

Foreign currency translation and other — ( 1.9 ) ( 9.5 ) ( 11.4 )

Balance as of March 31, 2026 $ 606.2 $ 486.8 $ 3,493.9 $ 4,586.9

Balance as of June 30, 2026 $ 3,493.9 $ 605.1 $ 485.5 $ 4,584.5

Debt for the Company consists of the following:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

(in millions, except percentages) Amount Rate Amount Rate Maturity Date

14 unchanged sentences

Total long-term debt, net $ 4,292.8 $ 4,573.3

(1) Interest at SOFR index plus 10 basis points of credit spread adjustment, plus applicable margin of 1.375 % as of March 31, 2026 and December 31, 2025.

(2) Term B Interest at SOFR index plus applicable margin of 2.250 % as of March 31, 2026 and December 31, 2025.

(1) Interest at SOFR index plus 10 basis points of credit spread adjustment, plus applicable margin of 1.375 % as of June 30, 2026 and December 31, 2025.

(2) Term B Interest at SOFR index plus applicable margin of 2.250 % as of June 30, 2026 and December 31, 2025.

(3) Interest at one month SOFR index plus 10 basis points of credit spread adjustment, plus 85 basis points.

(4) New finance lease obligations are a non-cash financing activity.

As of March 31, 2026, the Company was in compliance with all applicable debt covenants.

As of June 30, 2026, the Company was in compliance with all applicable debt covenants.

2023 Credit Agreement

2 unchanged sentences

The 2023 Credit Agreement also contains a $ 60.0 million sub-facility for the issuance of letters of credit.

The Company had outstanding borrowings of $ 426.5 million under the revolving credit facility as of March 31, 2026.

Total availability under the revolving facility was $ 762.7 million, after a $ 0.8 million reduction for outstanding letters of credit, as of March 31, 2026.

The Company had outstanding borrowings of $ 291.5 million under the revolving credit facility as of June 30, 2026.

Total availability under the revolving facility was $ 897.7 million, after a $ 0.8 million reduction for outstanding letters of credit, as of June 30, 2026.

On July 27, 2026, the Company entered into an Amendment No.

5 to the 2023 Credit Agreement ("Amendment No.

5"), which provides for (i) a term loan A of $ 1,200.0 million (the "Term A Loans") and (ii) an incremental revolving commitment of $ 510.0 million.

The proceeds of the Term A Loans were used to refinance the amounts outstanding under the term loan facility and the Delayed Draw Term A Loan under the 2023 Credit Agreement.

The Company's commitments under the Company's revolving credit facility were $ 1,700.0 million after giving effect to Amendment No.

Amendment No.

5 was executed in connection with the pending acquisition of Leggett & Platt and extended the maturity dates of the Term A Loans and the revolving credit facility to July 27, 2031.

Borrowings under the Term A Loans and the revolving credit facility will generally bear interest, at the election of the Company's and its subsidiary borrowers, at either (i) a base rate plus an applicable margin of 0.125 % to 0.875 %, (ii) a term SOFR rate plus an applicable margin of 1.125 % to 1.875 % or (iii) a daily simple SOFR rate plus an applicable margin of 1.125 % to 1.875 %.

For the Term A Loans and the revolving credit facility the applicable margin is determined by a pricing grid based on the consolidated total net leverage ratio of the Company.

In connection with Amendment No.

5, the Company prepaid $ 700.0 million of the outstanding Term B Loan with the remaining proceeds from the Term A Loans and revolving credit facility.

Securitized Debt

1 unchanged sentence

While subject to a $ 150.0 million overall limit, the availability of revolving loans varies over the course of the year based on the seasonality of the Company's accounts receivable.

As of March 31, 2026, the Company had fully drawn down the Accounts Receivable Securitization with borrowings of $ 89.5 million.

Borrowings under this facility are classified as long-term debt within the Condensed Consolidated Balance Sheets at March 31, 2026, based on the Company's ability and intent to refinance on a long-term basis.

As of June 30, 2026, the Company had fully drawn down the Accounts Receivable Securitization with borrowings of $ 103.8 million.

Borrowings under this facility are classified as long-term debt within the Condensed Consolidated Balance Sheets at June 30, 2026, based on the Company's ability and intent to refinance on a long-term basis.

(6) Stockholders' Equity

(a) Treasury Stock.

As of March 31, 2026, the Company had approximately $ 774.5 million remaining under its share repurchase authorization.

The Company did not repurchase shares under the program during the three months ended March 31, 2026 or 2025.

The Company acquired 0.3 million and 0.7 million shares upon the vesting of certain restricted stock units ("RSUs") and performance restricted stock units ("PRSUs"), which were withheld to satisfy tax withholding obligations during each of the three months ended March 31, 2026 and 2025, respectively.

The shares withheld were valued at the closing price of the stock on the New York Stock Exchange on the vesting date or first business day prior to vesting, resulting in $ 26.2 million and $ 37.5 million in treasury stock acquired for the three months ended March 31, 2026 and 2025, respectively.

As of June 30, 2026, the Company had approximately $ 774.5 million remaining under its share repurchase authorization.

The Company did not repurchase shares under the program during the three and six months ended June 30, 2026 or 2025.

The Company acquired an insignificant amount and 1.4 million shares upon the exercise of stock options, the vesting of certain restricted stock units ("RSUs") and performance restricted stock units ("PRSUs"), which were withheld to satisfy tax withholding obligations during each of the three months ended June 30, 2026 and 2025, respectively.

The shares withheld were valued at the closing price of the stock on the New York Stock Exchange on the vesting date or first business day prior to vesting, resulting in an immaterial amount and $ 94.9 million for the three months ended June 30, 2026 and 2025, respectively.

The Company acquired 0.3 million and 2.1 million shares during the six months ended June 30, 2026 and 2025, respectively, resulting in $ 26.2 million and $ 132.4 million for the six months ended June 30, 2026 and 2025, respectively.

SOMNIGROUP INTERNATIONAL INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

(b) Accumulated Other Comprehensive Loss ("AOCL").

AOCL consisted of the following:

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

(in millions) 2026 2025 2026 2025

8 unchanged sentences

Net change from period revaluations (2)

0.5 — 0.5 0.6

Balance at end of period $ 1.5 $ 1.0 $ 1.5 $ 1.0

1 unchanged sentence

(2) In 2026 and 2025, there were no tax impacts related to pension adjustments.

SOMNIGROUP INTERNATIONAL INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

(7) Other Items

1 unchanged sentence

Accrued expenses and other current liabilities consisted of the following:

(in millions) March 31, 2026 December 31, 2025

(in millions) June 30, 2026 December 31, 2025

Wages and benefits $ 121.3 $ 130.6

6 unchanged sentences

(8) Stock-Based Compensation

The Company's stock-based compensation expense for the three months ended March 31, 2026 and 2025 included PRSUs, RSUs and non-qualified stock options.

The Company's stock-based compensation expense for the three and six months ended June 30, 2026 and 2025 included PRSUs, RSUs and non-qualified stock options.

A summary of the Company's stock-based compensation expense is presented in the following table:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(in millions) 2026 2025 2026 2025

6 unchanged sentences

During the first quarter of 2026, the Company granted PRSUs as a component of the long-term incentive plan ("2026 PRSUs").

The Company has recorded stock-based compensation expense related to the 2026 PRSUs during the three months ended March 31, 2026, as it was probable that the Company would achieve the specified performance targets for the performance period.

The Company has recorded stock-based compensation expense related to the 2026 PRSUs during the three and six months ended June 30, 2026, as it was probable that the Company would achieve the specified performance targets for the performance period.

SOMNIGROUP INTERNATIONAL INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

(9) Commitments and Contingencies

5 unchanged sentences

(10) Income Taxes

The Company's effective tax rates for the three months ended March 31, 2026 and 2025 were 24.3 % and 33.5 %, respectively.

The Company's effective tax rates for the three months ended March 31, 2026 and 2025 differed from the U.S.

The Company's effective tax rates for the three months ended June 30, 2026 and 2025 were 25.2 % and 3.1 %, respectively.

The Company's effective tax rates for the six months ended June 30, 2026 and 2025 were 24.8 % and ( 24.9 )%, respectively.

The Company's effective tax rates for the three and six months ended June 30, 2026 and 2025 differed from the U.S.

federal statutory rate of 21.0% principally due to subpart F income (i.e., global intangible low-taxed income, or "GILTI," earned by the Company's foreign subsidiaries), foreign income tax rate differentials, state and local taxes, changes in the Company's uncertain tax positions, the excess tax benefit related to stock-based compensation and certain other permanent items.

SOMNIGROUP INTERNATIONAL INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

(11) Earnings Per Common Share

The following table sets forth the components of the numerator and denominator for the computation of basic and diluted earnings per share for net income attributable to Somnigroup International Inc.:

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

(in millions, except per common share amounts) 2026 2025 2026 2025

Net income (loss) attributable to Somnigroup International Inc.

Net income attributable to Somnigroup International Inc.

$ 110.9 $ 99.0 $ 215.1 $ 65.9

2 unchanged sentences

Denominator for diluted earnings per common share-adjusted weighted average shares 212.5 212.4 212.6 205.7

Basic earnings (loss) per common share $ 0.50 $ ( 0.17 )

Diluted earnings (loss) per common share $ 0.49 $ ( 0.17 )

Basic earnings per common share $ 0.53 $ 0.47 $ 1.02 $ 0.33

Diluted earnings per common share $ 0.52 $ 0.47 $ 1.01 $ 0.32

The Company excludes shares issuable upon exercise of certain outstanding stock options from the diluted earnings per common share computation because their exercise price was greater than the average market price of Somnigroup International Inc.'s common stock or they were otherwise anti-dilutive.

As a result, the Company excluded 0.8 million shares for the three months ended March 31, 2026, and an immaterial amount of shares for the three months ended March 31, 2025.

As a result, the Company excluded 1.4 million shares for both the three and six months ended June 30, 2026, and excluded an immaterial amount of shares for the three and six months ended June 30, 2025.

Holders of non-vested stock-based compensation awards do not have voting rights but do participate in dividend equivalents distributed upon the award vesting.

SOMNIGROUP INTERNATIONAL INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

(12) Business Segment Information

10 unchanged sentences

The following table summarizes total assets by segment:

(in millions) March 31, 2026 December 31, 2025

(in millions) June 30, 2026 December 31, 2025

Mattress Firm $ 8,128.2 $ 7,929.7

4 unchanged sentences

Total assets $ 11,611.0 $ 11,600.7

SOMNIGROUP INTERNATIONAL INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

The following table summarizes property, plant and equipment, net, by segment:

(in millions) March 31, 2026 December 31, 2025

(in millions) June 30, 2026 December 31, 2025

Mattress Firm $ 300.6 $ 270.7

4 unchanged sentences

The following table summarizes operating lease right-of-use assets by segment:

(in millions) March 31, 2026 December 31, 2025

(in millions) June 30, 2026 December 31, 2025

Mattress Firm $ 1,363.6 $ 1,344.9

3 unchanged sentences

Total operating lease right-of-use assets $ 1,893.5 $ 1,878.8

The following table summarizes segment information for the three months ended March 31, 2026:

SOMNIGROUP INTERNATIONAL INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

The following table summarizes segment information for the three months ended June 30, 2026:

(in millions) Mattress Firm Tempur Sealy North America Tempur Sealy International Corporate Eliminations Consolidated

4 unchanged sentences

Gross profit 307.5 367.8 141.9 — — 817.2

Advertising expense 30.9 91.6 27.9 — — 150.4

Other selling and marketing expense 153.9 62.0 56.1 6.1 — 278.1

Advertising expenses 45.8 109.8 22.0 — — 177.6

Other selling and marketing expenses 154.2 61.3 54.4 6.0 — 275.9

General, administrative and other expenses 48.1 40.8 31.0 45.2 — 165.1

2 unchanged sentences

Interest expense, net 59.0

Other income, net ( 5.1 )

Income before income taxes $ 147.8

Depreciation and amortization (1)

$ 21.0 $ 30.1 $ 8.5 $ 13.8 $ — $ 73.4

Capital expenditures 34.8 11.9 6.4 1.6 — 54.7

(1) Depreciation and amortization includes stock-based compensation amortization expense.

SOMNIGROUP INTERNATIONAL INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

The following table summarizes segment information for the three months ended June 30, 2025:

(in millions) Mattress Firm Tempur Sealy North America Tempur Sealy International Corporate Eliminations Consolidated

Net sales $ 948.8 $ 638.4 $ 293.6 $ — $ — $ 1,880.8

Inter-segment sales — 263.5 0.1 — ( 263.6 ) —

Total net sales and inter-segment sales $ 948.8 $ 901.9 $ 293.7 $ — $ ( 263.6 ) $ 1,880.8

Inter-segment royalty expense (income) — 11.1 ( 11.1 ) — — —

Gross profit 337.4 348.2 141.6 — — 827.2

Advertising expenses 62.1 103.3 24.1 — — 189.5

Other selling and marketing expenses 151.8 64.0 50.9 4.3 — 271.0

General, administrative and other expenses 56.2 41.0 29.8 48.9 — 175.9

Loss on disposal of business 4.1 9.8 — — — 13.9

Equity income in earnings of unconsolidated affiliates — — ( 3.0 ) — — ( 3.0 )

Operating income (loss) $ 63.2 $ 130.1 $ 39.8 $ ( 53.2 ) $ — $ 179.9

Interest expense, net 72.5

Other expense, net 4.7

7 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

The following table summarizes segment information for the three months ended March 31, 2025:

The following table summarizes segment information for the six months ended June 30, 2026:

(in millions) Mattress Firm Tempur Sealy North America Tempur Sealy International Corporate Eliminations Consolidated

4 unchanged sentences

Gross profit 580.4 694.2 319.5 — — 1,594.1

Advertising expense 33.6 83.6 25.7 — — 142.9

Other selling and marketing expense 101.5 68.0 46.6 3.6 — 219.7

Advertising expenses 76.7 201.4 49.9 — — 328.0

Other selling and marketing expenses 308.1 123.3 110.5 12.1 — 554.0

General, administrative and other expenses 102.8 81.9 64.8 82.5 — 332.0

2 unchanged sentences

Interest expense, net 119.0

Other income, net ( 15.3 )

Income before income taxes $ 285.1

Depreciation and amortization (1)

$ 44.5 $ 60.2 $ 17.1 $ 24.1 $ — $ 145.9

Capital expenditures 82.1 19.5 11.9 1.7 — 115.2

(1) Depreciation and amortization includes stock-based compensation amortization expense.

SOMNIGROUP INTERNATIONAL INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

The following table summarizes segment information for the six months ended June 30, 2025:

(in millions) Mattress Firm Tempur Sealy North America Tempur Sealy International Corporate Eliminations Consolidated

Net sales $ 1,542.5 $ 1,344.6 $ 598.4 $ — $ — $ 3,485.5

Inter-segment sales — 393.6 0.3 — ( 393.9 ) —

Total net sales and inter-segment sales 1,542.5 1,738.2 598.7 — ( 393.9 ) 3,485.5

Inter-segment royalty expense (income) — 17.3 ( 17.3 ) — — —

Gross profit 528.6 588.2 290.9 — — 1,407.7

Advertising expenses 95.7 186.9 49.8 — — 332.4

Other selling and marketing expenses 253.3 132.0 97.5 7.9 — 490.7

General, administrative and other expenses 105.5 89.1 60.5 130.3 — 385.4

Loss on disposal of business 4.1 9.8 — — — 13.9

Equity income in earnings of unconsolidated affiliates — — ( 7.8 ) — — ( 7.8 )

Operating income (loss) $ 70.0 $ 170.4 $ 90.9 $ ( 138.2 ) $ — $ 193.1

Interest expense, net 133.8

Other expense, net 5.9

Loss before income taxes $ ( 49.3 )

Income before income taxes $ 53.4

Depreciation and amortization (1)

4 unchanged sentences

(in millions)

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

United States $ 884.9 $ 889.3

$ 884.4 $ 889.3

All other 124.8 129.9

2 unchanged sentences

The following table summarizes operating lease right-of-use assets by geographic region:

(in millions) March 31, 2026 December 31, 2025

(in millions) June 30, 2026 December 31, 2025

United States $ 1,666.6 $ 1,653.1

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements