Sleep Number filed for bankruptcy protection on June 12 in New York, citing inflation, tariffs, and supply-chain disruptions. The smart-bed maker is seeking court approval to sell the business to Sleep Country Canada, aiming to keep stores, deliveries, warrant
By the time the filing was made in New York, Sleep Number’s turnaround plans had run into the wall of costs.
On June 12, the Minneapolis-headquartered smart-bed maker filed for bankruptcy protection in New York with about $672 million in debt. In its court request. the company pointed to inflation. tariffs. and supply chain disruptions as forces that strained its finances and pushed it toward a court-supervised Chapter 11 process.
Customers were told not to expect their beds—or their support—to disappear. During restructuring, the company said people can still shop in stores and online, receive deliveries, and rely on warranties and smart-bed services as usual.
The central question now is whether a planned sale can stabilize the business fast enough.
Sleep Number said it wants court oversight to move ahead with a sale to Sleep Country Canada. framing it as a path to build what it called a “leading North American mattress and bedding company.” The company said the deal would expand its reach across the United States and Canada. pairing a broader mix of products with more distribution in stores and online.
For its part, Sleep Country Canada’s chief executive, Stewart Schaefer, said the transaction would bring together complementary businesses and create opportunities to expand across North America. He also said the company would introduce Sleep Number products to Canadian consumers.
If the acquisition is approved, the companies said it would combine Sleep Number’s U.S. footprint with Sleep Country Canada’s network of more than 300 stores.
Sleep Number’s scale is part of why the outcome matters beyond boardrooms. The company employs about 2,920 people and operates 572 stores nationwide.
The pressure building behind the filing came through in the company’s financial results. Sleep Number reported $319 million in net sales and a $50 million net loss in the first quarter of 2026. according to a Securities and Exchange Commission filing. Court documents also show Sleep Number attempted to stabilize finances before turning to Chapter 11. including refinancing debt. closing stores. and streamlining its product lineup.
In the company’s telling. tariffs and broader supply chain disruptions didn’t just raise costs—they added uncertainty that ultimately left it with no practical alternative. That is the sequence the court filing describes: losses and rising costs strained the business. earlier stabilization efforts were not enough. and the combination of tariffs and supply-chain problems pushed it to seek Chapter 11 protection.
A critical detail sits underneath every shopping cart and delivery schedule: the bankruptcy process is also about capital structure. Sleep Number President and CEO Linda Findley said the company had made progress on turnaround efforts. but its capital structure “remains unsustainable.” She said the bankruptcy process and acquisition by Sleep Country Canada are meant to reduce debt and position the company for long-term growth. including potential expansion beyond the United States.
At the same time, the company’s high-profile marketing deal is now sitting in a paperwork-heavy gray area. Sleep Number has maintained advertising partnerships with the NFL. including a sponsorship agreement with Kansas City Chiefs tight end Travis Kelce. Under the agreement. Kelce committed to purchasing Sleep Number stock on the open market and was eligible to receive additional shares over the course of a three-year partnership.
Court filings do not indicate how much stock Kelce acquired or how the sponsorship agreement will be handled during bankruptcy. In many Chapter 11 cases, existing equity shares are ultimately wiped out—an outcome that turns even routine sports marketing into a legal and financial risk.
As Sleep Number continues through the court-supervised process. its promise to keep stores. online shopping. deliveries. warranties. and smart-bed services running offers customers reassurance in the near term. The larger test now is whether a sale to Sleep Country Canada can win approval and deliver the debt relief the company says it needs—before costs and uncertainty squeeze the business again.
Sleep Number Chapter 11 bankruptcy filing Sleep Country Canada smart beds mattress industry inflation tariffs supply chain disruptions Minneapolis Travis Kelce NFL sponsorship debt