Sonos (NASDAQ:SONO) Releases Earnings Results, Misses Expectations By $0.20 EPS

Key Points

• Sonos reported Q2 EPS of ($0.24), missing estimates by $0.20, but revenue was $281.5M (+8.4% YoY) and adjusted EBITDA improved 48%, indicating a return to growth.
• Management says recent product launches — notably the Sonos Play and value-focused Era 100 SL — are driving adoption and should help expand the installed base.
• Profitability is under pressure from higher DDR4 memory costs, creating an estimated ~200 bps gross-margin hit in Q2 and ~400 bps embedded in Q3 guidance, though a potential tariff refund of up to ~$40M remains uncertain.

Sonos (NASDAQ:SONO - Get Free Report) issued its quarterly earnings data on Monday. The company reported ($0.24) EPS for the quarter, missing analysts' consensus estimates of ($0.04) by ($0.20), Briefing.com reports. Sonos had a negative net margin of 1.22% and a positive return on equity of 0.82%. The business had revenue of $281.53 million during the quarter, compared to analyst estimates of $267.72 million. During the same period in the previous year, the company posted ($0.18) earnings per share. Sonos's revenue was up 8.4% on a year-over-year basis.

Here are the key takeaways from Sonos' conference call:

• Sonos returned to growth in FY26 Q2 with revenue of $282M (+8% YoY), first-half revenue up 2%, and adjusted EBITDA improving 48%, signaling meaningful operational momentum.
• New product launches are driving the growth story: the recently launched Sonos Play received strong global reviews and the value-focused Era 100 SL targets price-sensitive customers and should help expand the installed base.
• Higher memory costs (DDR4 supply tightness) are creating a material gross margin headwind—~200 bps in Q2 and an ~400 bps YoY headwind embedded in Q3 guidance—with pressure likely to continue into Q4; a potential tariff refund (up to ~$40M) is possible but timing is uncertain.
• Financial and operational discipline is improving—GAAP opex down 16%, non-GAAP opex down 10%, first positive Q2 adjusted EBITDA in four years, $40M of buybacks executed and $249M net cash—though Q2 free cash flow was negative $70M and inventory rose 16% ahead of new product ramps.

Sonos Stock Up 0.2%

SONO stock opened at $14.87 on Tuesday. Sonos has a 52-week low of $8.73 and a 52-week high of $19.82. The company has a market capitalization of $1.80 billion, a PE ratio of -87.47 and a beta of 1.94. The stock's 50 day moving average is $14.06 and its two-hundred day moving average is $15.92.

Analysts Set New Price Targets

SONO has been the topic of several recent research reports. Morgan Stanley set a $18.00 price objective on shares of Sonos in a research report on Wednesday, February 4th. Rosenblatt Securities reaffirmed a "buy" rating and issued a $21.00 target price on shares of Sonos in a research note on Monday, February 2nd. Wall Street Zen downgraded Sonos from a "strong-buy" rating to a "buy" rating in a report on Saturday. Jefferies Financial Group raised their price objective on Sonos from $19.00 to $21.00 and gave the stock a "buy" rating in a report on Monday, January 5th. Finally, Weiss Ratings reaffirmed a "sell (d-)" rating on shares of Sonos in a research report on Tuesday, April 21st. Two equities research analysts have rated the stock with a Buy rating, two have issued a Hold rating and one has given a Sell rating to the company. According to MarketBeat.com, Sonos has an average rating of "Hold" and an average price target of $20.00.

Insider Activity

In other news, major shareholder Coliseum Capital Management, L acquired 125,000 shares of the stock in a transaction that occurred on Tuesday, March 17th. The stock was purchased at an average cost of $13.57 per share, with a total value of $1,696,250.00. Following the completion of the acquisition, the insider directly owned 18,070,762 shares in the company, valued at $245,220,240.34. This represents a 0.70% increase in their ownership of the stock. The acquisition was disclosed in a legal filing with the SEC, which can be accessed through the SEC website. In the last quarter, insiders have bought 3,140,482 shares of company stock valued at $46,905,007. Corporate insiders own 1.25% of the company's stock.

Institutional Trading of Sonos

Several institutional investors have recently added to or reduced their stakes in SONO. AQR Capital Management LLC boosted its stake in Sonos by 22.4% in the first quarter. AQR Capital Management LLC now owns 51,169 shares of the company's stock valued at $546,000 after acquiring an additional 9,355 shares during the period. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. lifted its holdings in shares of Sonos by 5.1% in the 1st quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 71,984 shares of the company's stock worth $768,000 after purchasing an additional 3,483 shares during the last quarter. Intech Investment Management LLC boosted its position in Sonos by 38.5% during the 1st quarter. Intech Investment Management LLC now owns 151,152 shares of the company's stock valued at $1,613,000 after purchasing an additional 42,006 shares during the period. Strs Ohio acquired a new position in Sonos during the 1st quarter valued at approximately $147,000. Finally, Norges Bank bought a new position in Sonos during the 2nd quarter worth $289,000. Institutional investors own 85.82% of the company's stock.

Sonos News Summary

Here are the key news stories impacting Sonos this week:

• Positive Sentiment: Q2 results: Sonos reported a smaller-than-expected loss (beat on EPS vs Zacks consensus) and revenue that beat estimates; revenue was up year-over-year, signaling improving trends. Sonos (SONO) Reports Q2 Loss, Beats Revenue Estimates
• Positive Sentiment: Company commentary: CEO Tom Conrad said H1 FY26 marks a turning point as Sonos returns to growth, attributing gains to better products, stronger software, and more effective marketing — supportive for sentiment if execution continues. Sonos Reports Second Quarter Fiscal 2026 Results
• Positive Sentiment: Insider activity: Reported bullish option purchases by insiders suggest conviction from people close to the company, which can support investor confidence. Sonos Insiders Placed Bullish Bets Worth US$2.78m
• Neutral Sentiment: Guidance: Sonos gave Q3 revenue guidance in a $355M–$375M range (consensus ~$363M). The range straddles consensus, so it’s neither a clear beat nor miss — investors will watch the midpoint and margin assumptions. (Guidance published with earnings release.)
• Neutral Sentiment: Earnings call transcript and slides are available for detail on product cadence, channel dynamics and margin drivers — important for judging whether the growth trajectory is sustainable. Sonos, Inc. (SONO) Q2 2026 Earnings Call Transcript
• Neutral Sentiment: Pre-earnings coverage and analysis pieces add context on expectations but don’t move the needle beyond the results and guidance. What to expect from Sonos’s (SONO) Q1 earnings
• Neutral Sentiment: Corporate news unrelated to operations (executive real estate listing) — unlikely to affect fundamentals. Sonos Exec Colleen DeCourcy Lists Hamptons Compound
• Negative Sentiment: GAAP EPS miss: Another reported EPS figure missed the consensus (Sonos posted ($0.14) vs. an expected ($0.04) in one widely circulated summary), which highlights ongoing pressure on near-term profitability and explains some investor caution. Sonos Q2 Earnings Summary and Transcript

Sonos Company Profile

Sonos, Inc is a consumer electronics company specializing in wireless home audio systems. The company's core business revolves around designing, developing and manufacturing smart speakers and soundbars that deliver high-fidelity audio and seamless multi-room listening experiences. Sonos products connect via Wi-Fi or Bluetooth and integrate with popular streaming services, enabling users to control music and other audio content through a dedicated mobile app, voice assistants or traditional controls.

Sonos offers a diversified product lineup that includes compact speakers such as Sonos One and Sonos Roam, premium models like Sonos Five and Sonos Move, home theater solutions including Sonos Beam and Sonos Arc, as well as accessories such as the Sonos Sub and Sonos Amp.