Sleep Number bankruptcy: What Chapter 11 means for stores, orders and warranties

Sleep Number has filed for Chapter 11 bankruptcy, but the company says it is not shutting down while it pursues a court-supervised sale. Stores and the website remain open, and Sleep Number says it is still taking orders, delivering mattresses and honoring warranties, gift cards and its 100-night trial.

Is Sleep Number going out of business?

The company is in Chapter 11, a process that can let a business keep operating while it restructures or sells assets under court supervision. Sleep Number said its goal is to combine with Sleep Country Canada, with Sleep Country serving as the “stalking horse” bidder, or opening bidder, in the sale process.

That does not mean the sale is complete. In a June 12 SEC filing, Sleep Number said the proposed $415 million asset sale is subject to higher or better offers, Bankruptcy Court approval and other closing conditions.

For customers, the immediate answer is more practical: Sleep Number says normal shopping, delivery and service channels remain available during the case.

Are Sleep Number stores still open?

Sleep Number says its stores are open and operating during regular business hours. The company also says its website is accepting new orders.

There is still some uncertainty around the store footprint. Sleep Number said it has been reviewing locations and intends to keep as many retail stores as possible based on profitability. It also said it filed a motion to reject leases for 44 non-operational locations that were already closed and not serving customers.

Customers planning to visit a store should check the local store listing before leaving, especially if they are traveling for service, exchanges or a major purchase.

What happens to orders and deliveries?

Pending and new orders are not automatically canceled because of the Chapter 11 filing. Sleep Number says it is fulfilling and delivering orders and that customers can continue to reach customer service and home-delivery teams through normal support channels.

Customers with an order in progress should keep order confirmations, payment records, delivery windows and any chat or email records. The company’s website also directs customers to its order-status tools. For a delayed delivery or unresolved scheduling issue, the safest step is to contact Sleep Number directly and keep the response in writing when possible.

Customers who financed a purchase should also keep watching statements from the lender or financing provider, because payments may be handled separately from Sleep Number’s bankruptcy case.

Are warranties, gift cards and the 100-night trial still valid?

Sleep Number says it is standing behind its 100-night trial and honoring warranties, gift cards, Sleep Number Reward points and store credits during the process. The company also says the infrastructure supporting its connected smart beds and app will remain operational.

Sleep Number’s warranty page describes its bed warranty as a 10-year limited warranty and says product registration is not required to activate the warranty. Customers with an active warranty problem should open a claim through the company’s normal support channels, save the claim number and keep photos, service notes and receipts together.

Because the sale is not final, customers should avoid relying on assumptions about how the company will look after the transaction closes. The best available company statement for now is that current customer programs are continuing.

What is the sale process?

Sleep Number and its subsidiaries filed voluntary Chapter 11 petitions on June 12 in the U.S. Bankruptcy Court for the Southern District of New York. The case is being jointly administered as In re: Sleep Number Corporation, et al., Case No. 26-11399, according to the company’s SEC filing.

The proposed buyer is SNBR Inc., a subsidiary of Sleep Country Canada Inc. The agreement calls for a $415 million cash purchase price plus the assumption of certain liabilities, subject to possible adjustments and court approval.

Sleep Number also said it expects up to about $260 million in debtor-in-possession financing. That financing, if approved by the court, is meant to support operations while the sale process moves forward.

Reuters, citing court filings, reported that Sleep Number would hold an auction on July 13 if a higher bid is received, seek sale approval by July 15 and target a July 31 closing. Those dates can change if the court process or bidding changes.

What customers should do now

Customers do not need to assume their local store is closed or that an order has stopped because of the bankruptcy filing. The company’s current message is that shopping, delivery, warranty service and app support continue.

Before making a new purchase, check the store or website, review the trial and warranty terms, and save all documents. For existing orders, confirm the delivery date through Sleep Number’s order tools or customer service. For warranty or service issues, submit the request through normal support channels and keep a copy of the claim.

Gift card, reward-point and store-credit holders should confirm balances before shopping and keep records of any redemption attempt. Anyone with a dispute over a payment, refund, financing account or warranty claim should keep written records so the issue can be documented if needed.

What could change next

The biggest open questions are whether another bidder emerges, which stores remain open after the sale and when the transaction closes. The company’s customer-facing commitments are clear for the current phase, but the final sale still depends on the court-supervised process.

Updates to watch are any court order approving bidding procedures, any auction result, a sale-approval order and any company notice changing store, delivery, warranty, gift card or app operations.