Sonos (NASDAQ:SONO) Posts Earnings Results, Beats Expectations By $0.22 EPS

Sonos (NASDAQ:SONO) released its quarterly earnings data on Tuesday. The company reported $0.04 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of ($0.18) by $0.22, FiscalAI reports. The company had revenue of $344.44 million for the quarter, compared to analyst estimates of $340.33 million. Sonos had a return on equity of 19.10% and a net margin of 3.82%.

Here are the key takeaways from Sonos’ conference call:

• Sonos returned to growth in fiscal 2026, with revenue up 7% to $1.55 billion; fourth-quarter revenue rose 20% year over year, or 11% excluding the extra week. Growth was reported across all three regions.
• Profitability improved substantially: full-year adjusted EBITDA increased 39% to $184 million, and free cash flow rose 14% to $123 million. The company also completed $130 million in share repurchases and authorized a new $150 million program.
• Higher memory costs remain a major margin headwind. They reduced fiscal 2026 adjusted EBITDA by $56 million, and Sonos expects Q1 gross margin to fall about 1,000 basis points year over year, with memory and component costs contributing roughly 1,200 basis points of pressure.
• Management expects fiscal 2027 revenue growth and Q1 revenue of $570 million–$630 million, up 4%–15% year over year. It expects memory-cost mitigation to deliver about 500 basis points of annualized gross-margin improvement by the end of FY2027, while investing in new products, software and AI features.

Sonos Trading Down 0.7%

Shares of NASDAQ SONO traded down $0.12 during midday trading on Tuesday, hitting $16.89. 2,168,012 shares of the company’s stock were exchanged, compared to its average volume of 1,758,741. Sonos has a 12-month low of $12.44 and a 12-month high of $19.82. The company has a market cap of $2.00 billion, a price-to-earnings ratio of 37.53 and a beta of 1.94. The business’s fifty day moving average price is $16.74 and its two-hundred day moving average price is $15.29.

Sonos News Roundup

Here are the key news stories impacting Sonos this week:

• Positive Sentiment: Sonos reported quarterly EPS of $0.04, beating analysts’ consensus estimate of a loss of $0.18, and revenue of $344.44 million exceeded the $340.33 million forecast. Revenue rose 20%, with new product launches contributing to growth. Sonos 4Q Revenue Climbs 20% On New Product Launches
• Positive Sentiment: The company authorized a new $150 million stock repurchase program after completing its previous program. Buybacks can return capital to shareholders and potentially support per-share results. Sonos Announces $150 Million Stock Repurchase Program
• Neutral Sentiment: Sonos audio equipment was selected for a luxury Belgian estate, offering a small signal of product demand, though the report did not disclose the deal’s financial value. Sonos distributed audio selected for luxury Belgian estate
• Negative Sentiment: Coverage flagged memory costs as a squeeze on margins. If these costs persist, they could offset some of the benefit from rising sales. Sonos Q4 2026: Revenue Beats but Memory Costs Squeeze Margins

Insider Buying and Selling at Sonos

In other Sonos news, Director Karen Boone sold 46,766 shares of the firm’s stock in a transaction dated Friday, September 25th. The stock was sold at an average price of $18.13, for a total transaction of $847,867.58. Following the sale, the director owned 69,271 shares in the company, valued at $1,255,883.23. This trade represents a 40.30% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Company insiders own 1.25% of the company’s stock.

Wall Street Analyst Weigh In

Several analysts have issued reports on SONO shares. Wall Street Zen cut shares of Sonos from a “strong-buy” rating to a “buy” rating in a research note on Saturday, August 22nd. Weiss Ratings upgraded shares of Sonos from a “hold (c)” rating to a “hold (c+)” rating in a research report on Tuesday, October 13th. Finally, Rosenblatt Securities restated a “buy” rating and set a $21.00 price target on shares of Sonos in a research report on Thursday, July 30th. Two equities research analysts have rated the stock with a Buy rating and two have issued a Hold rating to the stock. According to MarketBeat, the stock currently has a consensus rating of “Moderate Buy” and a consensus target price of $20.00.

About Sonos

Sonos, Inc. designs and sells wireless audio products and software for home entertainment. Its lineup includes wireless speakers, soundbars, subwoofers, amplifiers and related components that can be used individually or connected through the Sonos platform to play audio in multiple rooms. The company’s products support music and other audio from a range of streaming services, as well as television and home theater setups. Sonos also offers software and services, including Sonos Radio, and sells products through its website and retail partners in markets around the world.