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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the quarterly period ended June 30, 2022
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to .

Commission file number 001-31922

TEMPUR SEALY INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 33-1022198
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
1000 Tempur Way
Lexington, Kentucky 40511
(Address of principal executive offices)
Registrant’s telephone number, including area code: (800) 878-8889
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of exchange on which registered
Common Stock, $0.01 par valueTPXNew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ý  Yes  o No 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  ý Yes    o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filerNon-accelerated filerSmaller reporting companyEmerging Growth Company
x
 o
 o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.): Yes  No ý

The number of shares outstanding of the registrant’s common stock as of July 27, 2022 was 172,194,644 shares.


Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q, (this "Report"), including the information incorporated by reference herein, contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which includes information concerning one or more of our plans; objectives; goals; strategies and other information that is not historical information. Many of these statements appear, in particular, under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part I, ITEM 2 of this Report. When used in this Report, the words "assumes," "estimates," "expects," "guidance," "anticipates," "might," "projects," "predicts," "plans," "proposed," "targets," "intends," "believes," "will," "may," "could," "is likely to" and variations of such words or similar expressions are intended to identify forward-looking statements. These forward-looking statements are based upon our expectations and beliefs and various assumptions. There can be no assurance that we will realize our expectations or that our beliefs will prove correct.

Numerous factors, many of which are beyond the Company's control, could cause actual results to differ materially from any that may be expressed herein as forward-looking statements in this Report. These risk factors include the impact of the macroeconomic environment in both the U.S. and internationally on our business segments and expectations regarding growth of the mattress industry; changes in economic conditions, including inflationary trends in the price of raw materials; uncertainties arising from global events (including the Russia-Ukraine conflict), natural disasters or pandemics including COVID-19 and their impact on raw material prices, labor costs and other employment-related costs; loss of suppliers and disruptions in the supply of raw materials; competition in our industry; the effects of strategic investments on our operations, including our efforts to expand our global market share and actions taken to increase sales growth; the ability to develop and successfully launch new products; the ability to realize all synergies and benefits of acquisitions; our reliance on information technology and the associated risks involving potential security lapses and/or cyber-based attacks; deterioration in labor relations; the possibility of exposure of product liability and premises liability claims; our ability to protect our intellectual property; disruptions to the implementation of our strategic priorities and business plan caused by changes in our executive management team; changes in interest rates; effects of changes in foreign exchange rates on our reported earnings; expectations regarding our target leverage and our share repurchase program; compliance with regulatory requirements and the possible exposure to liability for failures to comply with these requirements; the outcome of pending tax audits or other tax, regulatory or investigation proceedings and pending litigation; changes in foreign tax rates and changes in tax laws generally, including the ability to utilize tax loss carryforwards; and our capital structure and debt level, including our ability to meet financial obligations and continue to comply with the terms and financial ratio covenants of our credit facilities;

Other potential risk factors include the factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2021 (the "2021 Annual Report") and in this Quarterly Report on Form 10-Q for the quarter ended June 30, 2022. In addition, there may be other factors that may cause our actual results to differ materially from the forward-looking statements.

All forward-looking statements attributable to us apply only as of the date of this Report and are expressly qualified in their entirety by the cautionary statements included in this Report. Except as may be required by law, we undertake no obligation to publicly update or revise any of the forward-looking statements, whether as a result of new information, future events, or otherwise.

When used in this Report, except as specifically noted otherwise, the term "Tempur Sealy International" refers to Tempur Sealy International, Inc. only, and the terms "Company," "we," "our," "ours" and "us" refer to Tempur Sealy International, Inc. and its consolidated subsidiaries. When used in this Report, the term "Tempur" may refer to Tempur-branded products and the term "Sealy" may refer to Sealy-branded products or to Sealy Corporation and its historical subsidiaries, in all cases as the context requires. In addition, when used in this Report, "2019 Credit Agreement" refers to the Company's senior credit facility entered into in 2019; "2029 Senior Notes" refers to the 4.00% senior notes due 2029 issued in 2021; and "2031 Senior Notes" refers to the 3.875% senior notes due 2031 issued in 2021.
2


TABLE OF CONTENTS
 
  Page
  
 
   
 
 
 
 
 
 
   
   
   
  
 
   
   
   
   
   
   
  



PART I.     FINANCIAL INFORMATION
ITEM 1.     FINANCIAL STATEMENTS

TEMPUR SEALY INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
($ in millions, except per common share amounts)
(unaudited)
 Three Months EndedSix Months Ended
 June 30,June 30,
 2022202120222021
Net sales$1,211.0 $1,169.1 $2,450.5 $2,212.9 
Cost of sales714.5 650.9 1,431.2 1,235.8 
Gross profit496.5 518.2 1,019.3 977.1 
Selling and marketing expenses252.9 216.8 496.4 414.5 
General, administrative and other expenses102.3 85.1 199.9 164.6 
Equity income in earnings of unconsolidated affiliates(2.6)(7.0)(9.5)(13.7)
Operating income143.9 223.3 332.5 411.7 
Other expense, net:
Interest expense, net23.7 20.0 44.6 32.3 
Loss on extinguishment of debt 18.0  23.0 
Other expense (income), net0.7 (0.1)(0.6)(0.4)
Total other expense, net24.4 37.9 44.0 54.9 
Income from continuing operations before income taxes 119.5 185.4 288.5 356.8 
Income tax provision(28.3)(44.7)(66.4)(85.2)
Income from continuing operations91.2 140.7 222.1 271.6 
Loss from discontinued operations, net of tax (0.3) (0.5)
Net income before non-controlling interests91.2 140.4 222.1 271.1 
Less: Net income (loss) attributable to non-controlling interests0.6 (0.4)0.8 (0.2)
Net income attributable to Tempur Sealy International, Inc.$90.6 $140.8 $221.3 $271.3 
Earnings per common share:
Basic$0.52 $0.72 $1.24 $1.36 
Diluted$0.51 $0.69 $1.20 $1.32 
Weighted average common shares outstanding:
Basic174.1 197.0 178.3 200.4 
Diluted178.8 204.1 183.7 204.9 

See accompanying Notes to Condensed Consolidated Financial Statements. 
4

TEMPUR SEALY INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
($ in millions)
(unaudited)
Three Months EndedSix Months Ended
June 30,June 30,
 2022202120222021
Net income before non-controlling interests$91.2 $140.4 $222.1 $271.1 
Other comprehensive income, net of tax:
Foreign currency translation adjustments(57.8)6.7 (75.3)(4.1)
Other comprehensive (loss) income, net of tax(57.8)6.7 (75.3)(4.1)
Comprehensive income33.4 147.1 146.8 267.0 
Less: Comprehensive income (loss) attributable to non-controlling interests0.6 (0.4)0.8 (0.2)
Comprehensive income attributable to Tempur Sealy International, Inc.$32.8 $147.5 $146.0 $267.2 
 
See accompanying Notes to Condensed Consolidated Financial Statements.


5

TEMPUR SEALY INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
($ in millions)
 June 30, 2022December 31, 2021
ASSETS(Unaudited)
Current Assets:
Cash and cash equivalents$110.3 $300.7 
Accounts receivable, net481.6 419.5 
Inventories619.1 463.9 
Prepaid expenses and other current assets94.2 91.5 
Total Current Assets1,305.2 1,275.6 
Property, plant and equipment, net672.8 583.5 
Goodwill1,066.6 1,107.4 
Other intangible assets, net727.8 750.9 
Operating lease right-of-use assets507.7 480.6 
Deferred income taxes12.4 13.6 
Other non-current assets111.9 111.8 
Total Assets$4,404.4 $4,323.4 
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY  
Current Liabilities:  
Accounts payable$432.6 $432.0 
Accrued expenses and other current liabilities528.1 558.5 
Current portion of long-term debt65.6 53.0 
Income taxes payable30.8 9.9 
Total Current Liabilities1,057.1 1,053.4 
Long-term debt, net2,817.0 2,278.5 
Long-term operating lease obligations454.9 427.0 
Deferred income taxes119.3 129.2 
Other non-current liabilities137.0 140.3 
Total Liabilities4,585.3 4,028.4 
Redeemable non-controlling interest9.0 9.2 
Total Stockholders' (Deficit) Equity(189.9)285.8 
Total Liabilities, Redeemable Non-Controlling Interest and Stockholders' (Deficit) Equity$4,404.4 $4,323.4 
 
See accompanying Notes to Condensed Consolidated Financial Statements. 


6

TEMPUR SEALY INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
($ in millions)
(unaudited)

Three Months Ended June 30, 2022
Tempur Sealy International, Inc. Stockholders' Equity
Redeemable
Non-controlling Interest
Common StockTreasury StockAccumulated Other Comprehensive LossTotal Stockholders' Equity
Shares IssuedAt ParShares IssuedAt CostAdditional Paid in CapitalRetained Earnings
Balance as of March 31, 2022
$9.4 283.8 $2.8 107.1 $(3,267.2)$563.6 $2,716.8 $(116.7)$(100.7)
Net income90.6 90.6 
Net income attributable to non-controlling interest0.6  
Dividend paid to non-controlling interest in subsidiary(1.0) 
Foreign currency adjustments, net of tax(57.8)(57.8)
Exercise of stock options— 0.2 (0.1)0.1 
Dividends declared on common stock ($0.10 per share)
(17.9)(17.9)
Issuances of PRSUs, RSUs, and DSUs
(0.1)2.9 (2.9) 
Treasury stock repurchased
4.4 (117.0)(117.0)
Treasury stock repurchased - PRSU/RSU releases— (0.2)(0.2)
Amortization of unearned stock-based compensation
13.0 13.0 
Balance, June 30, 2022
$9.0 283.8 $2.8 111.4 $(3,381.3)$573.6 $2,789.5 $(174.5)$(189.9)

Three Months Ended June 30, 2021
Tempur Sealy International, Inc. Stockholders' Equity
Redeemable
Non-controlling Interest
Common StockTreasury StockAccumulated Other Comprehensive LossNon-controlling Interest in SubsidiariesTotal Stockholders' Equity
Shares IssuedAt ParShares IssuedAt CostAdditional Paid in CapitalRetained Earnings
Balance as of March 31, 2021
$8.9 283.8 $2.8 85.9 $(2,360.7)$590.0 $2,161.3 $(76.3)$1.2 $318.3 
Net income140.8 140.8 
Net loss attributable to non-controlling interests(0.4) 
Purchase of remaining interest in subsidiary(3.4)(1.2)(4.6)
Foreign currency adjustments, net of tax6.7 6.7 
Exercise of stock options(0.1)3.4 (1.5)1.9 
Dividends declared on common stock ($0.07 per share)
(14.2)(14.2)
Issuances of PRSUs, RSUs, and DSUs
(0.1)3.1 (3.1) 
Treasury stock repurchased
1.6 (61.6)(61.6)
Treasury stock repurchased - PRSU/RSU releases(0.8)(0.8)
Amortization of unearned stock-based compensation
15.1 15.1 
Balance, June 30, 2021
$8.5 283.8 $2.8 87.3 $(2,416.6)$597.1 $2,287.9 $(69.6)$ $401.6 

See accompanying Notes to Condensed Consolidated Financial Statements.
7

TEMPUR SEALY INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (CONTINUED)
($ in millions)
(unaudited)

Six Months Ended June 30, 2022
Tempur Sealy International, Inc. Stockholders' Equity
Redeemable
Non-controlling Interest
Common StockTreasury StockAccumulated Other Comprehensive LossTotal Stockholders' Equity
Shares IssuedAt ParShares IssuedAt CostAdditional Paid in CapitalRetained Earnings
Balance as of December 31, 2021
$9.2 283.8 $2.8 96.4 $(2,844.7)$622.0 $2,604.9 $(99.2)$285.8 
Net income221.3 221.3 
Net income attributable to non-controlling interests0.8  
Dividend paid to non-controlling interest in subsidiary(1.0) 
Foreign currency adjustments, net of tax(75.3)(75.3)
Exercise of stock options— 0.4 (0.2)0.2 
Dividends declared on common stock ($0.20 per share)
(36.7)(36.7)
Issuances of RSUs
(2.6)75.0 (75.0) 
Treasury stock repurchased
16.6 (566.2)(566.2)
Treasury stock repurchased - PRSU/RSU/DSU releases1.0(45.8)(45.8)
Amortization of unearned stock-based compensation
26.8 26.8 
Balance, June 30, 2022
$9.0 283.8 $2.8 111.4 $(3,381.3)$573.6 $2,789.5 $(174.5)$(189.9)

Six Months Ended June 30, 2021
Tempur Sealy International, Inc. Stockholders' Equity
Redeemable
Non-controlling Interest
Common StockTreasury StockAccumulated Other Comprehensive LossNon-controlling Interest in SubsidiariesTotal Stockholders' Equity
Shares IssuedAt ParShares IssuedAt CostAdditional Paid in CapitalRetained Earnings
Balance as of December 31, 2020
$8.9 283.8 $2.8 78.9 $(2,096.8)$617.5 $2,045.6 $(65.5)$1.0 $504.6 
Net income271.3 271.3 
Net (loss) attributable to non-controlling interests(0.4)0.2 0.2 
Purchase of remaining interest in subsidiary(3.4)(1.2)(4.6)
Foreign currency adjustments, net of tax(4.1)(4.1)
Exercise of stock options(0.5)14.3 (5.8)8.5 
Dividends declared on common stock ($0.14 per share)
(29.0)(29.0)
Issuances of PRSUs, RSUs, and DSUs
(1.6)41.4 (41.4) 
Treasury stock repurchased
10.0 (361.4)(361.4)
Treasury stock repurchased - PRSU/RSU/DSU releases0.5(14.1)(14.1)
Amortization of unearned stock-based compensation
30.2 30.2 
Balance, June 30, 2021
$8.5 283.8 $2.8 87.3 $(2,416.6)$597.1 $2,287.9 $(69.6)$ $401.6 


See accompanying Notes to Condensed Consolidated Financial Statements.

8

TEMPUR SEALY INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
($ in millions) (unaudited)
 Six Months Ended
 June 30,
 20222021
CASH FLOWS FROM OPERATING ACTIVITIES FROM CONTINUING OPERATIONS:
Net income before non-controlling interests$222.1 $271.1 
Loss from discontinued operations, net of tax 0.5 
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities:
Depreciation and amortization61.3 53.5 
Amortization of stock-based compensation26.9 30.2 
Amortization of deferred financing costs1.9 1.2 
Bad debt expense3.8 2.9 
Deferred income taxes(6.7)8.0 
Dividends received from unconsolidated affiliates3.9 5.3 
Equity income in earnings of unconsolidated affiliates(9.5)(13.7)
Loss on extinguishment of debt 3.0 
Foreign currency adjustments and other0.2 0.6 
Changes in operating assets and liabilities, net of effect of business acquisitions(237.4)(49.6)
Net cash provided by operating activities from continuing operations66.5 313.0 
CASH FLOWS FROM INVESTING ACTIVITIES FROM CONTINUING OPERATIONS:  
Purchases of property, plant and equipment(130.2)(52.6)
Acquisitions, net of cash acquired (5.6)
Other1.1 0.3 
Net cash used in investing activities from continuing operations(129.1)(57.9)
CASH FLOWS FROM FINANCING ACTIVITIES FROM CONTINUING OPERATIONS:  
Proceeds from borrowings under long-term debt obligations1,317.9 1,936.1 
Repayments of borrowings under long-term debt obligations(771.7)(1,782.3)
Proceeds from exercise of stock options0.2 8.5 
Treasury stock repurchased(612.0)(374.4)
Dividends paid(36.2)(28.1)
Payments of deferred financing costs (14.2)
Repayments of finance lease obligations and other(8.4)(6.1)
Net cash used in financing activities from continuing operations(110.2)(260.5)
Net cash used in continuing operations(172.8)(5.4)
Net operating cash flows used in discontinued operations (0.7)
NET EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS(17.6)(0.8)
Decrease in cash and cash equivalents(190.4)(6.9)
CASH AND CASH EQUIVALENTS, beginning of period300.7 65.0 
CASH AND CASH EQUIVALENTS, end of period$110.3 $58.1 
Supplemental cash flow information:  
Cash paid during the period for:  
Interest$45.6 $28.2 
Income taxes, net of refunds$48.0 $71.9 
See accompanying Notes to Condensed Consolidated Financial Statements.
9

TEMPUR SEALY INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited)

(1) Summary of Significant Accounting Policies
 
(a) Basis of Presentation and Description of Business. Tempur Sealy International, Inc., a Delaware corporation, together with its subsidiaries, is a U.S. based, multinational company. The term "Tempur Sealy International" refers to Tempur Sealy International, Inc. only, and the term "Company" refers to Tempur Sealy International, Inc. and its consolidated subsidiaries.

The Company designs, manufactures and distributes bedding products, which include mattresses, foundations and adjustable bases, and other products, which include pillows and other accessories. The Company also derives income from royalties by licensing Sealy® and Stearns & Foster® brands, technology and trademarks to other manufacturers. The Company sells its products through two sales channels: Wholesale and Direct.

The Company has ownership interests in Asia-Pacific joint ventures to develop markets for Sealy® and Stearns & Foster® branded products and ownership in a United Kingdom joint venture to manufacture, market, and distribute Sealy® and Stearns & Foster® branded products. The Company's ownership interests in each of these joint ventures is 50.0%. The equity method of accounting is used for these joint ventures, over which the Company has significant influence but does not have control, and consolidation is not otherwise required. The Company's equity in the net income and losses of these investments is reported in equity income in earnings of unconsolidated affiliates in the accompanying Condensed Consolidated Statements of Income.

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X and include all of the information and disclosures required by generally accepted accounting principles in the United States ("GAAP") for interim financial reporting. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements of the Company and related footnotes for the year ended December 31, 2021, included in the 2021 Annual Report filed with the Securities and Exchange Commission on February 22, 2022.
 
The results of operations for the interim periods are not necessarily indicative of results of operations for a full year. It is the opinion of management that all necessary adjustments for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein.

(b) Inventories. Inventories are stated at the lower of cost and net realizable value, determined by the first-in, first-out method, and consist of the following:
June 30,December 31,
(in millions)20222021
Finished goods$411.9 $297.8 
Work-in-process22.4 11.4 
Raw materials and supplies184.8 154.7 
 $619.1 $463.9 

(c) Warranties. The Company provides warranties on certain products, which vary by segment, product and brand. Estimates of warranty expenses are based primarily on historical claims experience and product testing. Estimated future obligations related to these products are charged to cost of sales in the period in which the related revenue is recognized. The Company considers the impact of recoverable salvage value on warranty costs in determining its estimate of future warranty obligations.

The Company provides warranties on mattresses with varying warranty terms. Tempur-Pedic mattresses sold in the North America segment and all Sealy mattresses have warranty terms ranging from 10 to 25 years, generally non-prorated for the first 10 to 15 years and then prorated for the balance of the warranty term. Tempur-Pedic mattresses sold in the International segment have warranty terms ranging from 5 to 15 years, non-prorated for the first 5 years and then prorated on a straight-line basis for the last 10 years of the warranty term. Tempur-Pedic pillows have a warranty term of 3 years, non-prorated.

10

TEMPUR SEALY INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)
The Company had the following activity for its accrued warranty expense from December 31, 2021 to June 30, 2022:
(in millions)
Balance as of December 31, 2021$43.9 
Amounts accrued10.2 
Warranties charged to accrual(9.7)
Balance as of June 30, 2022$44.4 

As of June 30, 2022 and December 31, 2021, $19.8 million and $20.2 million of accrued warranty expense is included as a component of accrued expenses and other current liabilities and $24.6 million and $23.7 million of accrued warranty expense is included in other non-current liabilities on the Company's accompanying Condensed Consolidated Balance Sheets, respectively.

(d) Allowance for Credit Losses. The allowance for credit losses is the Company's best estimate of the amount of expected lifetime credit losses in the Company's accounts receivable. The Company regularly reviews the adequacy of its allowance for credit losses. The Company estimates losses over the contractual life using assumptions to capture the risk of loss, even if remote, based principally on how long a receivable has been outstanding. As of June 30, 2022, the Company's accounts receivable were substantially current. Other factors considered include historical write-off experience, current economic conditions and also factors such as customer credit, past transaction history with the customer and changes in customer payment terms. Account balances are charged off against the allowance for credit losses after all reasonable means of collection have been exhausted and the potential for recovery is considered remote. The allowance for credit losses is included in accounts receivable, net in the accompanying Condensed Consolidated Balance Sheets.

The Company had the following activity for its allowance for credit losses from December 31, 2021 to June 30, 2022:
(in millions)
Balance as of December 31, 2021
$62.1 
Amounts accrued3.8 
Write-offs charged against the allowance(3.6)
Balance as of June 30, 2022
$62.3 

(e) Fair Value. Financial instruments, although not recorded at fair value on a recurring basis, include cash and cash equivalents, accounts receivable, accounts payable and the Company's debt obligations. The carrying value of cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short-term maturity of those instruments. Borrowings under the 2019 Credit Agreement and the securitized debt are at variable interest rates and accordingly their carrying amounts approximate fair value. The fair value of the following material financial instruments were based on Level 2 inputs, which include observable inputs estimated using discounted cash flows and market-based expectations for interest rates, credit risk and the contractual terms of debt instruments. The fair values of these material financial instruments are as follows:
Fair Value
(in millions)June 30, 2022December 31, 2021
2029 Senior Notes$643.8 $816.9 
2031 Senior Notes$601.7 $803.7 




11

TEMPUR SEALY INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (unaudited) (continued)

(2) Net Sales     

The following table presents the Company's disaggregated revenue by channel, product and geographical region, including a reconciliation of disaggregated revenue by segment, for the three months ended June 30, 2022 and 2021:

Three Months Ended June 30, 2022Three Months Ended June 30, 2021
(in millions)North AmericaInternationalConsolidatedNorth AmericaInternationalConsolidated
Channel
Wholesale$847.8 $91.3 $939.1 $890.8 $114.6 $1,005.4 
Direct116.9 155.0 271.9 123.0 40.7 163.7 
Net sales$964.7 $246.3 $1,211.0 $1,013.8 $155.3 $1,169.1 
North AmericaInternationalConsolidatedNorth AmericaInternationalConsolidated
Product
Bedding$909.1 $205.1 $1,114.2 $962.5 $118.9 $1,081.4 
Other55.6 41.2 96.8 51.3 36.4 87.7 
Net sales$964.7 $246.3 $1,211.0 $1,013.8 $155.3 $1,169.1 
North AmericaInternationalConsolidatedNorth AmericaInternationalConsolidated
Geographical region
United States$890.3 $ $890.3 $946.3 $ $946.3 
All Other74.4 246.3 320.7 67.5 155.3 222.8 
Net sales$964.7 $246.3 $1,211.0 $1,013.8 $155.3 $1,169.1 


The following table presents the Company's disaggregated revenue by channel, product and geographical region, including a reconciliation of disaggregated revenue by segment, for the six months ended June 30, 2022 and 2021:

Six Months Ended June 30, 2022Six Months Ended June 30, 2021
(in millions)North AmericaInternationalConsolidatedNorth AmericaInternationalConsolidated
Channel
Wholesale$1,659.1 $204.1 $1,863.2 $1,656.3 $230.5 $1,886.8 
Direct237.0 350.3 587.3 240.8 85.3 326.1 
Net sales$1,896.1 $554.4 $2,450.5 $1,897.1 $315.8 $2,212.9 
North AmericaInternationalConsolidatedNorth AmericaInternationalConsolidated
Product
Bedding$1,774.0 $461.6 $2,235.6 $1,792.8 $240.6 $2,033.4 
Other122.1 92.8 214.9 104.3 75.2 179.5 
Net sales$1,896.1 $554.4 $2,450.5 $1,897.1 $315.8 $2,212.9 
North AmericaInternationalConsolidatedNorth AmericaInternationalConsolidated
Geographical region
United States$1,754.6 $ $1,754.6 $1,764.8 $ $1,764.8 
All Other141.5 554.4 695.9 132.3 315.8 448.1 
Net sales$1,896.1 $554.4 $2,450.5 $1,897.1 $315.8 $