Sonos Revenues Fell 10 Percent to $551 Million

Struggling smart speaker maker Sonos earned a net income of $50 million on revenues of $551 million in the quarter ending December 28, 2024. Those figures represent declines of 38 percent and 11 percent, respectively, year-over-year (YOY).

“I see tremendous opportunity in front of us,” Sonos interim CEO Thomas Conrad said. “The team and I are hard at work improving the core experience for our customers while designing the next set of Sonos products and innovations. It’s an honor to show up every day to do this work with the talented Sonos team.”

Sonos is coming off a tough year thanks to the Sonosgate mistakes. It finally fired its CEO in January, and yesterday the company announced a restructuring that will include about 200 layoffs, or about 12 percent of its workforce.

The company doesn’t break down its earnings by product, but it did note that Sonos speaker revenues were $467 million in the quarter, a decline of 7.1 percent YOY. Sonos system products delivered $60 million in revenues, a decline of 28.7 percent YOY. And partner products and other revenue landed at $23.4 million, a decline of 7.3 percent YOY. So the business was down all around in the quarter.

Sonos points to the positive reception of its latest Arc soundbar, which launched in October, as a highlight of the quarter. And even it found a few positive holiday-related mentions of the Ace headphones that triggered Sonosgate. But it’s almost impossible to find any good news in this announcement. Revenues from Europe, the Middle East, and Africa were up slightly, though they were down in all other regions. But that might literally be it for the win column: Cost of revenue more than doubled YOY, and research and development, sales and marketing, general and administrative, and total stock-based compensation expense costs were all up. And Sonos’s free cash flow, at $143 million, is lower than it’s been since 2020.

Sonos won’t provide guidance for the current quarter until its post earnings conference call, which is scheduled for 4:15 pm ET. That can’t be a good sign.