The earnings call reflects a mixed sentiment. While Sonos exceeded financial expectations for the quarter and demonstrated strong operational efficiency and brand strength, it faced significant year-over-year revenue decline, tariff challenges, and cyclical market difficulties.

Company Guidance

During the Sonos Third Quarter Fiscal 2025 conference call, CEO Tom Conrad and CFO Saori Casey provided an optimistic outlook for the company's future, highlighting a series of financial and operational metrics. The company reported Q3 revenue of $345 million, exceeding the high end of their guidance range, although it represented a 13% year-over-year decline. Adjusted EBITDA was positive at $36 million, also at the high end of their guidance. Sonos achieved a gross margin of 43.4% (non-GAAP: 44.7%), despite incurring $2.1 million in tariff expenses. They successfully reduced GAAP operating expenses by 15% to $153 million and non-GAAP operating expenses by 23% on a normalized basis. The company's net cash balance increased by $30 million to $254 million, and free cash flow rose to $33 million. For Q4, Sonos expects revenue between $260 million and $290 million and adjusted EBITDA ranging from minus $10 million to $14 million. They anticipate continuing their transformation efforts to drive profitability while facing a dynamic macro environment, including a tariff impact of approximately $5 million.

Revenue and Adjusted EBITDA Exceed Expectations

Q3 revenue of $345 million exceeded the high end of guidance, with adjusted EBITDA at $36 million reaching the top of the guidance range. This performance was driven by better-than-expected portables and component products.

Operational Efficiency and Cost Reduction

Operating expenses decreased by 15% year-over-year, resulting in significant savings. Non-GAAP operating expenses came in about $9 million below the low end of guidance.

Strategic Positioning and Brand Strength

Sonos maintains its position as the #1 home theater brand in the U.S., demonstrating strong brand equity and channel partnerships.

Positive Free Cash Flow and Strong Balance Sheet

Q3 free cash flow was $33 million, improving from negative $65 million last quarter. The net cash balance increased by $30 million to $254 million.

Sonos (SONO) Earnings, Revenues Date & History

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SONO Earnings History

Report Date	Fiscal Quarter	Forecast / EPS	Last Year's EPS	EPS YoY Change	Slides	Play Transcript
Nov 12, 2025	2025 (Q4)	-0.24 / -	-0.44	―	―	―
Aug 06, 2025	2025 (Q3)	-0.10 / -0.03	0.03	-200.00% (-0.06)
May 07, 2025	2025 (Q2)	-0.44 / -0.58	-0.56	-3.57% (-0.02)
Feb 06, 2025	2025 (Q1)	0.17 / 0.40	0.64	-37.50% (-0.24)
Nov 13, 2024	2024 (Q4)	-0.40 / -0.44	-0.25	-76.00% (-0.19)
Aug 07, 2024	2024 (Q3)	0.03 / 0.03	-0.18	116.67% (+0.21)
May 07, 2024	2024 (Q2)	-0.46 / -0.56	-0.24	-133.33% (-0.32)
Feb 06, 2024	2024 (Q1)	0.42 / 0.64	0.57	12.28% (+0.07)
Nov 15, 2023	2023 (Q4)	-0.18 / -0.25	-0.5	50.00% (+0.25)
Aug 09, 2023	2023 (Q3)	-0.20 / -0.18	0	―

The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.

Beat

Missed

SONO Earnings-Related Price Changes

Report Date	Price 1 Day Before	Price 1 Day After	Percentage Change
Aug 06, 2025	$11.04	$10.97	-0.63%
May 07, 2025	$8.97	$9.84	+9.70%
Feb 06, 2025	$14.26	$15.00	+5.19%
Nov 13, 2024	$14.08	$13.75	-2.34%

Earnings announcements can affect a stock’s price. This table shows the stock's price the day before and the day after recent earnings reports, including the percentage change.