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Shares in Sleep Number Corp. fell sharply Wednesday after the Minneapolis company reported difficulties keeping up with customer demand in the second quarter.

The trouble reached deep into the company's supply base, executives said, but added they were being ironed out. Resins and computer chips were two of the products that constrained its mattress production.

"We have made substantial progress in addressing temporary component shortages and expect strong delivery volumes the balance of the year," Shelly Ibach, the company's chief executive, said.

Executives felt confident enough that they raised earnings expectations for the remainder of the year. They now expect per-share profit for the full year of $7.25, up from previous guidance of $6.50 and a 58% jump from full-year 2020.

Sleep Number reported late Tuesday that sales for the quarter amounted to $484.3 million, a 39% increase over the same period last year that was affected by pandemic-related store closures. But that was well below the consensus sales expectations of analysts for $511 million.

On Wednesday, Seth Basham, an analyst at Wedbush, told investors, "We believe the supplier challenges weighing on [Sleep Number] are much more severe than for other publicly traded mattress companies."

The company's shares fell 12.9% to $97.78 on a day when broad-market indexes rose nearly 1%. Sleep Number shares over the past 52 weeks have ranged from $42.15 to $151.44.

Sleep Number's chief financial officer, David Callen, said some of the the supply chain problems stemmed from suppliers of its direct suppliers. Increased demand for their products made the difficulties worse.

"Each of the last four quarters [demand] has accelerated faster than the previous quarter," Callen said in an interview Wednesday. "In the first half ... the orders that we've been booking have grown more than 40% versus 2019."

The company said it earned $22.3 million, or 88 cents a share, also below analysts' forecast of $1.16. Sleep Number had a net loss of $12.6 million, or 45 cents per share, in the second quarter of 2020.