NASDAQ$SONO

Sonos Inc · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

Reported third quarter results with revenue increase and adjusted EBITDA

Sonos reported a slight increase in revenue and a decrease in net income compared to the same quarter last year. The company is focusing on profitability and investing in its product roadmap.

  • Revenue increased 0.4% year-over-year to $373.4 million.
  • GAAP net loss was $23.6 million, compared to a $0.6 million loss last year.
  • Non-GAAP net income was $21.3 million, compared to $26.5 million last year.
  • Free cash flow was ($7.8) million.

Headline financials

Total Revenue

$373M

Previous: $372M+0.4%
EPS (adj)

$0.16

Previous: $0.19-15.8%
Adjusted EBITDA margin

9.2%

Previous: 11.3%-18.6%
GAAP gross margin

46.0%

Previous: 47.3%-2.7%
Capital Expenditures

-$40.1M

Previous: -$24.9M-60.7%
Free Cash Flow

-$63.7M

Previous: -$25.5M-149.2%
Net Income

-$23.6M

Previous: -$597K-3848.2%
Operating Income

-$21.3M

Previous: $6.96M-405.5%
Gross Profit

$172M

Previous: $176M-2.3%
Cash & Equivalents

$268M

Previous: $440M-39.0%
Total Assets

$1.07B

Previous: $1.24B-14.3%
Stock-Based Comp

$18.3M

No prior period

Revenue & EPS history

Sonos · Revenue · Quarterly

$373M

Q3 2023+0.4%vs Q3 2022
Beat estimate in 13 of 15 quarters(87%)
ActualEstimate

Revenue by segment

Sonos · $373M total across 3 segments · Q3 2023

  • Sonos speakers
    $290M-7.8%
  • Sonos system products
    $64.2M+67.4%
  • Partner products and other revenue
    $19.4M+0.9%

Forward guidance

Sonos expects revenue in the range of $1.64 billion to $1.66 billion, representing a decline of 6% to 5% from fiscal 2022. Gross margin is expected to be in the range of 44.0% to 44.2%, and Adjusted EBITDA is expected to be in the range of $148 million to $158 million.

Tailwinds

  • Revenue decline is expected to be between 6% and 5%.
  • Gross margin is expected to be in the range of 44.0% to 44.2%.
  • Adjusted EBITDA is expected to be in the range of $148 million to $158 million.
  • Adjusted EBITDA margin of 9.0% to 9.5%
  • Company is profitable and debt free

Headwinds

  • Revenue is expected to decline 6% to 5% from fiscal 2022.
  • Gross margin outlook was lowered from 44.3% to 44.8% to 44.0% to 44.2%.
  • Conditions in categories have not returned to normal
  • Workforce reduced by 7%
  • Macroeconomic environment

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2023

Historical avgQ3 2023

-0.5%

Avg return

Earnings day

-0.4%

Avg return

5 days after

-3.5%

Avg return

30 days after

51%

19 / 37 earnings

Positive

+29.5%

Q4 2020

Best reaction

-25.9%

Q2 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026+1.0%+1.3%+9.3%
Q1 2026+6.4%+16.7%-2.5%
Q4 2025+1.5%+1.5%+16.7%
Q2 2025+9.7%+25.3%+11.9%
Q1 2025-7.5%-12.5%-14.1%
Q4 2024-2.2%-10.2%+3.6%
Q3 2024-5.4%-8.4%-6.9%
Q2 2024-5.8%-7.0%-11.2%
Q1 2024+21.8%+15.6%+20.2%
Q4 2023+18.0%+27.2%+51.1%
Q3 2023-7.8%-11.8%-16.1%
Q2 2023-25.9%-28.7%-27.5%
Q1 2023+11.9%+14.2%+3.0%
Q4 2022-2.5%-3.7%-1.5%
Q3 2022-22.3%-22.2%-27.1%
Q2 2022+4.4%+4.5%+2.0%
Q1 2022+4.7%+2.7%-9.7%
Q4 2021-4.3%-6.8%-14.0%
Q3 2021+6.2%+13.4%+5.0%
Q2 2021-3.0%-2.9%+1.3%
Q1 2021+13.1%+10.1%+28.9%
Q4 2020+29.5%+25.1%+42.0%
Q3 2020-13.6%-16.5%-20.7%
Q2 2020-1.3%+0.6%+14.0%
Q1 2020+8.0%-5.7%-28.2%
Q4 2019-2.0%+6.5%+2.2%
Q3 2019+8.8%+18.8%+48.0%
Q2 2019+4.0%+1.8%+3.3%
Q1 2018-13.5%-9.3%-19.3%
Q1 2019-17.1%-16.5%-24.2%
Q2 2018+4.5%+7.5%-15.6%
Q2 2017+4.5%+7.5%-15.6%
Q1 2016+4.5%+7.5%-15.6%
Q4 2018+10.8%-4.4%-18.2%
Q3 2018-19.2%-21.6%-38.0%
Q3 2017-19.2%-21.6%-38.0%
Q4 2017-19.2%-11.2%-28.8%

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