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Sonos
(NASDAQ:SONO)
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Rating:50Neutral
Price Target:
$14.50
▼(-1.29% Downside)
Action:Reiterated
Date:07/31/26
Overall score reflects (1) a mixed financial profile—strong balance sheet and improving operating trends, but ongoing net losses and a sharp deterioration in recent cash flow; (2) weak-to-neutral technical positioning with the stock below key moving averages; and (3) a demanding valuation (P/E ~83) that leaves little room for disappointment. The latest earnings call adds support via improving growth/EBITDA outlook and buybacks, but memory-cost-driven margin pressure remains a prominent near-term risk.
Positive Factors
Conservative balance sheet
Sonos's low debt-to-equity (~0.15) and sizable equity provide structural financial flexibility for a hardware cycle business. This reduces refinancing risk, supports continued product investment and buybacks, and cushions the company against episodic margin or working-capital shocks over months.
Negative Factors
Weak cash generation
Near‑breakeven operating cash flow and slightly negative free cash flow reduce the company’s ability to self-fund R&D, inventory builds, or share repurchases without drawing down cash. This constraint elevates sensitivity to seasonal working capital swings and limits strategic optionality.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative balance sheet
Sonos's low debt-to-equity (~0.15) and sizable equity provide structural financial flexibility for a hardware cycle business. This reduces refinancing risk, supports continued product investment and buybacks, and cushions the company against episodic margin or working-capital shocks over months.
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.
Data provided by:
The Fly
The FlySonos (SONO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.73B
Dividend YieldN/A
Average Volume (3M)2.21M
Price to Earnings (P/E)―
Beta (1Y)1.55
Revenue Growth5.64%
EPS GrowthN/A
CountryUS
Employees1,404
SectorTechnology
Sector Strength88
IndustryConsumer Electronics
Share Statistics
EPS (TTM)-0.31
Shares Outstanding118,293,976
10 Day Avg. Volume2,179,237
30 Day Avg. Volume2,206,921
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 Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$19.50Price Target Upside32.74% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)0.39
Revenue Forecast (FY)$1.53B
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 its hardware audio products directly to consumers and through retail and e-commerce channel partners; this hardware sales revenue is the company’s main revenue stream. Its product portfolio spans categories s...
Sonos Earnings Call Summary
Earnings Call Date:May 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 18, 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
46
Neutral
Balance Sheet
73
Positive
Cash Flow
38
Negative
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.49B | 1.44B | 1.52B | 1.66B | 1.75B | 1.72B |
| Gross Profit | 693.21M | 630.53M | 689.37M | 716.49M | 796.37M | 809.99M |
| EBITDA | 119.36M | 12.29M | 25.67M | 54.10M | 107.79M | 191.40M |
| Net Income | -37.86M | -61.14M | -38.15M | -10.27M | 67.38M | 158.59M |
Balance Sheet | ||||||
| Total Assets | 882.12M | 823.28M | 916.31M | 1.00B | 1.19B | 1.14B |
| Cash, Cash Equivalents and Short-Term Investments | 261.03M | 227.53M | 221.16M | 220.23M | 274.86M | 640.10M |
| Total Debt | 50.19M | 59.62M | 64.14M | 56.11M | 36.13M | 44.68M |
| Total Liabilities | 478.59M | 468.05M | 487.69M | 483.58M | 627.88M | 569.76M |
| Stockholders Equity | 403.53M | 355.23M | 428.62M | 518.66M | 560.51M | 569.04M |
Cash Flow | ||||||
| Free Cash Flow | 125.15M | 108.19M | 134.66M | 50.12M | -74.48M | 207.69M |
| Operating Cash Flow | 147.09M | 136.87M | 189.91M | 100.41M | -28.26M | 253.23M |
| Investing Cash Flow | -23.31M | -29.52M | -105.24M | -50.29M | -172.63M | -45.53M |
| Financing Cash Flow | -117.01M | -102.34M | -137.31M | -108.59M | -150.26M | 24.97M |
Sonos Technical Analysis
Positive
14.69
Price Trends
14.89
Positive
14.47
Positive
15.57
Positive
Market Momentum
0.30
Negative
54.72
Neutral
26.07
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SONO, the sentiment is Positive. The current price of 14.69 is below the 20-day moving average (MA) of 14.93, below the 50-day MA of 14.89, and below the 200-day MA of 15.57, indicating a bullish trend. The MACD of 0.30 indicates Negative momentum. The RSI at 54.72 is Neutral, neither overbought nor oversold. The STOCH value of 26.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 |
|---|---|---|---|---|---|---|---|
75 Outperform | $4.54T | 35.26 | 146.69% | 0.32% | 14.24% | 32.57% | |
63 Neutral | $143.35B | -103.05 | -2.74% | 0.76% | -1.74% | -118.42% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | $243.13M | 296.67 | 1.02% | ― | -21.70% | -93.37% | |
58 Neutral | $57.85M | -3.05 | -13.45% | ― | -10.20% | 9.43% | |
50 Neutral | $1.73B | -47.29 | -9.55% | ― | 5.64% | ― | |
48 Neutral | $34.84M | -31.53 | -3.62% | ― | 3.28% | -44.36% |
* Technology Sector Average
SONO
Sonos
15.77
4.90
45.08%
AAPL
Apple
303.42
100.87
49.80%
KOSS
Koss
3.73
-1.69
-31.18%
TBCH
Turtle Beach
12.81
-1.51
-10.54%
SONY
Sony Group
22.63
-1.51
-6.27%
UEIC
Universal Electronics
4.72
-1.70
-26.48%
Sonos Corporate Events
Business Operations and StrategyExecutive/Board Changes
Sonos Announces Board Expansion and CFO Retirement Plans
Neutral
Jul 29, 2026
On July 28, 2026, Sonos expanded its board of directors from ten to eleven members and appointed investor Chris Shackelton as a Class II director, with his term running through the 2029 annual meeting. Shackelton, co-founder and managing partner o...
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...
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.