Revenue Recognition

3 Months Ended

Mar. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue Recognition

Deferred contract assets and deferred contract liabilities are included in the condensed consolidated balance sheets as follows (in thousands):

	March 30, 2024		December 30, 2023
Deferred contract assets included in:
Other current assets	$	29,189	$	28,567
Other non-current assets	54,015		54,795
	$	83,204	$	83,362

	March 30, 2024		December 30, 2023
Deferred contract liabilities included in:
Other current liabilities	$	37,134	$	36,421
Other non-current liabilities	67,971		69,098
	$	105,105	$	105,519

Deferred revenue and costs related to SleepIQ® technology are currently recognized on a straight-line basis over the product's estimated life of 4.5 to 5.0 years because the Company’s inputs are generally expended evenly throughout the performance period. During both the three months ended March 30, 2024 and April 1, 2023, the Company recognized revenue of $10 million, that was included in the deferred contract liability balances at the beginning of the respective periods.

Revenue from goods and services transferred to customers at a point in time accounted for approximately 98% of revenues for both the three months ended March 30, 2024 and April 1, 2023.

Net sales were as follows (in thousands):

	Three Months Ended
	March 30, 2024		April 1, 2023
Retail stores	$	414,755	$	458,663
Online, phone, chat and other	55,694		67,864
Total Company	$	470,449	$	526,527

Obligation for Sales Returns

The activity in the sales returns liability account was as follows (in thousands):

	Three Months Ended
	March 30, 2024		April 1, 2023
Balance at beginning of year	$	22,402	$	25,594
Additions that reduce net sales	25,470		29,843
Deductions from reserves	(25,457)		(31,366)
Balance at end of period	$	22,415	$	24,071