Somnigroup Q4 Revenue Rises 54.7% to $1.87B, EPS $0.72 In Line
Somnigroup reported Q4 CY2025 revenue of $1.87 billion, a 54.7% year-on-year increase but 3.2% below $1.93 billion estimates, with adjusted EPS of $0.72 matching consensus. Management projected fiscal 2026 adjusted EPS of $3.20 at midpoint, missing analyst forecasts by 3.9%.
1. Q4 CY2025 Financial Results
Somnigroup delivered Q4 revenue of $1.87 billion, up 54.7% year-on-year but 3.2% shy of the $1.93 billion consensus. Adjusted EPS of $0.72 matched estimates, while adjusted EBITDA reached $348.5 million, a 0.9% shortfall versus projections.
2. FY2026 EPS Guidance
The company forecasted adjusted EPS of $3.20 at the midpoint for fiscal 2026, a 3.9% miss against sell-side expectations. This guidance raises questions about near-term earnings momentum given last quarter’s strong top-line growth.
3. Profitability and Cash Flow
Operating margin expanded to 13.2% from 10.6% a year earlier, reflecting improved efficiency. However, free cash flow margin plunged to 2.2% from 9%, indicating elevated working capital or capital spending pressures.
4. Growth Drivers and Segment Performance
Direct-to-consumer sales surged, driving overall revenue, while wholesale channel sales declined. Over two years, direct revenue grew 193% annualized versus a 17.1% decline in wholesale, underscoring shifting distribution dynamics.