The activity in the accrued warranty liabilities account was as follows (in thousands):


	Nine Months Ended
	September 27, 2025	September 28, 2024
Balance at beginning of period	$6,947	$8,503
Additions charged to costs and expenses for current-year sales	8,881	9,981
Deductions from reserves	(8,335)	(11,546)
Changes in liability for pre-existing warranties during the current year, including expirations	(1,674)	511
Balance at end of period	$5,819	$7,449

The Company is involved from time to time in various legal proceedings arising in the ordinary course of its business,

including primarily commercial, product liability, employment and intellectual property claims. In accordance with U.S.

GAAP, the Company records a liability in its consolidated financial statements with respect to any of these matters when it

is both probable that a liability has been incurred and the amount of the liability can be reasonably estimated. If a material

loss is reasonably possible but not known or probable, and may be reasonably estimated, the estimated loss or range of

loss is disclosed. With respect to currently pending legal proceedings, the Company has not established an estimated

range of reasonably possible material losses either because it believes that it has valid defenses to claims asserted

against it, the proceeding has not advanced to a stage of discovery that would enable it to establish an estimate, or the

potential loss is not material. The Company currently does not expect the outcome of pending legal proceedings to have a

material effect on its consolidated results of operations, financial position or cash flows. Litigation, however, is inherently

unpredictable, and it is possible that the ultimate outcome of one or more claims asserted against the Company could

adversely impact its consolidated results of operations, financial position or cash flows. The Company expenses legal

On January 14, 2025, purported customers served a putative class action complaint on behalf of themselves and a

putative class of California consumers against Sleep Number in the United States District Court for the Central District of

California alleging that Sleep Number’s beds are perpetually on sale in violation of California law. The Plaintiff sought

injunctive relief, damages and attorney’s fees. Sleep Number brought a motion to dismiss for failure to state a claim and a

motion to transfer or, alternatively, dismiss based on the first-to-file doctrine (citing the purported class action complaint

filed on September 27, 2024 as described below). On April 8, 2025, the Court granted Sleep Number’s motion to transfer

or, alternatively, dismiss and dismissed the matter in its entirety based on the first-to-file doctrine. The plaintiffs did not

On September 27, 2024, a purported customer served a putative class action complaint on behalf of themself and a

putative class of California consumers against Sleep Number in the United States District Court for the Eastern District of

California alleging that Sleep Number’s beds are perpetually on sale in violation of California law. The plaintiff seeks