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Sonos
(NASDAQ:SONO)
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Rating:62Neutral
Price Target:
$16.00
▲(11.34% Upside)
Action:Reiterated
Date:05/09/26
SONO scores in the low 60s primarily due to steady balance sheet strength and healthy TTM cash generation alongside a return to profitability, but tempered by a still-inconsistent multi-year earnings/revenue trajectory. Technicals are modestly supportive (near-term uptrend, longer-term trend still mixed). Guidance points to continued growth and improving EBITDA, yet near-term gross margin headwinds from memory-cost inflation and higher inventory levels meaningfully cap the score, while valuation lacks clear support due to a negative P/E and no dividend yield provided.
Positive Factors
Strong cash generation
Consistent trailing‑12‑month operating cash flow and free cash flow provide durable internal funding for R&D, product launches, and buybacks. Sustained cash generation improves financial flexibility versus peers and cushions the firm through seasonal swings and cost headwinds.
Negative Factors
Memory cost inflation pressuring margins
Rising memory prices are a structural input cost risk that can depress gross margins for multiple quarters. Sustained input inflation would directly reduce product economics, limit reinvestment or margin recovery, and force price or mix tradeoffs that could hurt unit demand.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Consistent trailing‑12‑month operating cash flow and free cash flow provide durable internal funding for R&D, product launches, and buybacks. Sustained cash generation improves financial flexibility versus peers and cushions the firm through seasonal swings and cost headwinds.
Read all positive factors
Sonos Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where Sonos is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where Sonos is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
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The Fly
The FlySonos (SONO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.62B
Dividend YieldN/A
Average Volume (3M)1.71M
Price to Earnings (P/E)67.2
Beta (1Y)1.58
Revenue Growth-0.22%
EPS GrowthN/A
CountryUS
Employees1,708
SectorTechnology
Sector Strength88
IndustryConsumer Electronics
Share Statistics
EPS (TTM)0.20
Shares Outstanding119,128,670
10 Day Avg. Volume1,858,490
30 Day Avg. Volume1,710,765
Financial Highlights & Ratios
PEG Ratio-0.46
Price to Book (P/B)5.20
Price to Sales (P/S)1.28
P/FCF Ratio17.08
Enterprise Value/Market Cap0.97
Enterprise Value/Revenue1.07
Enterprise Value/Gross Profit2.39
Enterprise Value/Ebitda16.56
Forecast
1Y Price Target
$19.50Price Target Upside35.70% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)0.32
Revenue Forecast (FY)$1.50B
Sonos Business Overview & Revenue Model
Company Description
Globally, Sonos, Inc., along with its affiliates, focuses on the creation, production, and distribution of advanced multi-room sound systems. Its portfolio encompasses wireless loudspeakers, home cinema setups, various system components, and assoc...
How the Company Makes Money
Sonos primarily makes money by selling hardware audio products directly to consumers and through third-party retail and distribution partners. Revenue is largely generated from the sale of connected speakers (including portable models), home theat...
Sonos Earnings Call Summary
Earnings Call Date:May 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 12, 2026
Earnings Call Sentiment Positive
The call shows clear operational and commercial momentum: revenue growth, improving gross profit dollars, a return to positive adjusted EBITDA, strong regional performance (notably APAC and EMEA), successful new product launches with strong early reviews, and active capital allocation via buybacks. Key near-term headwinds are material: higher memory costs are expected to pressure gross margins through Q3 and into Q4, inventory has risen, free cash flow was negative for the quarter (seasonal), and tariff refund timing is uncertain. Management has a mitigation plan (supply actions, design optimizations, potential tariff refunds) and remains confident in growth execution, but margin pressure from memory inflation is the principal risk that tempers the outlook.Positive Updates
Revenue Growth and Return to Top-Line Expansion
Q2 revenue of $282 million, up ~8% year over year and near the top end of guidance; first half revenue up 2% year over year. Q3 revenue guidance of $355M–$375M (midpoint +6% YoY) indicates sequential acceleration.
Negative Updates
Memory Cost Inflation Pressuring Margins
Higher memory costs were ~200 basis points headwind to gross margin in Q2 and are expected to be ~400 basis points YoY headwind in Q3; management expects memory inflation to rise into Q4, pressuring full-year gross margin versus 2025.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue Growth and Return to Top-Line Expansion
Q2 revenue of $282 million, up ~8% year over year and near the top end of guidance; first half revenue up 2% year over year. Q3 revenue guidance of $355M–$375M (midpoint +6% YoY) indicates sequential acceleration.
Read all positive updates
Company Guidance
For Q3 Sonos guided revenue of $355–$375 million (up 3%–9% YoY, +6% at the midpoint) with negligible FX impact and no AMP Multi contribution, GAAP gross margin of 42.0%–44.5% (non‑GAAP about 150 bps higher) embedding an approximate 400‑bp year‑over‑year headwind from higher memory costs and no tariff‑refund benefit in Q3 (roughly 200 bps more headwind than Q2); GAAP operating expenses are expected to be $150–$160 million (non‑GAAP OPEX roughly $18 million lower than GAAP and about flat to Q2 at the midpoint); adjusted EBITDA is guided to $20–$48 million (5.6%–12.7% margin). Management said memory inflation is likely to rise into Q4, which should make 2026 GAAP and non‑GAAP gross margins somewhat below 2025 levels (2025: GAAP 43.5%, non‑GAAP 44.9%), while expecting continued momentum and a stronger second half.Sonos Financial Statement Overview
Summary
Income Statement
54
Neutral
Balance Sheet
72
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.46B | 1.44B | 1.52B | 1.66B | 1.75B | 1.72B |
| Gross Profit | 653.62M | 630.53M | 689.37M | 716.49M | 796.37M | 809.99M |
| EBITDA | 94.27M | 12.29M | 25.67M | 54.10M | 107.79M | 191.40M |
| Net Income | 23.68M | -61.14M | -38.15M | -10.27M | 67.38M | 158.59M |
Balance Sheet | ||||||
| Total Assets | 839.48M | 823.28M | 916.31M | 1.00B | 1.19B | 1.14B |
| Cash, Cash Equivalents and Short-Term Investments | 249.05M | 227.53M | 221.16M | 220.23M | 274.86M | 640.10M |
| Total Debt | 58.68M | 59.62M | 64.14M | 56.11M | 36.13M | 44.68M |
| Total Liabilities | 455.12M | 468.05M | 487.69M | 483.58M | 627.88M | 569.76M |
| Stockholders Equity | 384.36M | 355.23M | 428.62M | 518.66M | 560.51M | 569.04M |
Cash Flow | ||||||
| Free Cash Flow | 117.55M | 108.19M | 134.66M | 50.12M | -74.48M | 207.69M |
| Operating Cash Flow | 138.30M | 136.87M | 189.91M | 100.41M | -28.26M | 253.23M |
| Investing Cash Flow | -19.17M | -29.52M | -105.24M | -50.29M | -172.63M | -45.53M |
| Financing Cash Flow | -94.84M | -102.34M | -137.31M | -108.59M | -150.26M | 24.97M |
Sonos Technical Analysis
Negative
14.37
Price Trends
14.91
Negative
14.68
Negative
15.74
Negative
Market Momentum
-0.33
Positive
36.66
Neutral
13.20
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SONO, the sentiment is Negative. The current price of 14.37 is below the 20-day moving average (MA) of 14.99, below the 50-day MA of 14.91, and below the 200-day MA of 15.74, indicating a bearish trend. The MACD of -0.33 indicates Positive momentum. The RSI at 36.66 is Neutral, neither overbought nor oversold. The STOCH value of 13.20 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SONO.
Sonos Risk Analysis
Sonos disclosed 40 risk factors in its most recent earnings report. Sonos reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Sonos Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
62 Neutral | $1.62B | 67.21 | 5.99% | ― | -0.22% | ― | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | $246.11M | 296.67 | 1.02% | ― | -21.70% | -93.37% | |
51 Neutral | $56.58M | -2.98 | -13.45% | ― | -10.20% | 9.43% | |
48 Neutral | $37.77M | -34.19 | -3.62% | ― | 3.28% | -44.36% | |
43 Neutral | $131.59M | -0.95 | -201.66% | ― | -21.02% | 12.80% | |
43 Neutral | $65.91M | -0.14 | -18.46% | ― | 50.67% | 49.50% |
* Technology Sector Average
SONO
Sonos
13.57
2.76
25.53%
GPRO
GoPro
0.75
>-0.01
-1.06%
KOSS
Koss
3.99
-1.11
-21.76%
TBCH
Turtle Beach
12.40
-1.43
-10.34%
UEIC
Universal Electronics
4.48
-2.14
-32.33%
ZEPP
Zepp Health
4.49
1.83
68.80%
Sonos Corporate Events
Business Operations and StrategyExecutive/Board ChangesStock BuybackFinancial Disclosures
Sonos Appoints New COO Amid Strengthening Financial Performance
Positive
May 4, 2026
Sonos announced that it appointed former Walmart executive Frank Barbieri as Chief Operating Officer and principal operating officer on April 15, 2026, with the role effective May 4, 2026, alongside a compensation package combining salary, bonus e...
Business Operations and StrategyExecutive/Board ChangesRegulatory Filings and ComplianceShareholder Meetings
Sonos Shareholders Approve Governance Changes and Director Slate
Positive
Mar 11, 2026
At its March 5, 2026 annual meeting, Sonos stockholders voted with high turnout, representing about 88.7% of eligible shares, to elect three Class II directors to three-year terms and to ratify KPMG LLP as the independent auditor for the fiscal ye...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.