Sonos NASDAQ: SONO reported fiscal second-quarter 2026 revenue of $282 million, up about 8% year-over-year and near the high end of the company’s guidance range, as management pointed to improving execution and momentum heading into the second half of the year.
CEO Tom Conrad said the company has “changed the trajectory of the business” through the first half of fiscal 2026, with revenue up 2% in the first six months and adjusted EBITDA improving meaningfully versus last year. “We’ve moved through a phase of stabilization,” Conrad said, adding that the next phase is “building durable growth.”
Quarter highlights and regional growth
CFO Saori Casey said Q2 results marked Sonos’ “seventh consecutive quarter of executing against our commitments.” Revenue growth was driven primarily by international markets, with APAC up 25% and EMEA up 21% year-over-year, while the Americas grew 2%.
Foreign exchange provided a four-point boost to year-over-year growth, Casey said. On a constant-currency basis, APAC grew 18%, EMEA grew 9%, and the Americas grew 1%.
On the product side, Casey cited “continued strength in the demand for Era 100” and “strong performance of Arc Ultra.” She noted that newly launched products Sonos Play and Era 100 SL contributed negligibly to Q2 results due to timing.
Profitability, cost actions, and adjusted EBITDA milestone
Sonos reported GAAP gross profit of $125 million, up 10% year-over-year, and non-GAAP gross profit of $130 million, up 6%. GAAP gross margin was 44.3% and non-GAAP gross margin was 46%.
Casey said higher memory costs created an approximately 200 basis point headwind to gross margin in Q2, while tariffs were “offset by our mitigation actions.” Operating expenses declined year-over-year: GAAP operating expenses fell 11% to $156 million, primarily due to restructuring costs tied to a prior reduction in force, while non-GAAP operating expenses of $137 million were mostly flat.
Adjusted EBITDA was $3 million higher than the prior-year quarter, improving to $2 million from negative $1 million. Casey called it “our first Q2 with positive adjusted EBITDA in the past four years.” Non-GAAP EPS was -$0.02, improving from -$0.18 a year earlier.
Sonos repurchased $40 million of shares in the quarter, buying back 2.5 million shares and reducing share count by 2.1%, Casey said. The company ended Q2 with $249 million in net cash, including $49 million of marketable securities.
New products, marketing changes, and operational updates
Conrad emphasized the company’s “system” approach, arguing that each device and software improvement increases the value of the overall Sonos ecosystem. He reiterated five areas of focus to drive growth: product innovation, customer advocacy, more intentional marketing, geographic expansion, and emerging demand trends.
Conrad highlighted early media reviews for Sonos Play, which launched as Q2 closed. He said early coverage used terms such as a “comeback” and “back on track,” which he framed as consistent with improving customer sentiment. He also discussed Era 100 SL, a simplified version with a $189 price point, positioned to lower the barrier to entry for new customers and offer an option for microphone-free use cases.
In response to an analyst question, Conrad said Era 100 SL was cost-optimized beyond removing microphones, giving an example of using color injection molding rather than paint to reduce costs “with no noticeable change to the product’s fit and finish.”
Conrad also announced a leadership hire: Frank Barbieri is joining Sonos as Chief Operating Officer. Conrad said Barbieri has more than 25 years of consumer business experience and most recently led Walmart’s omni-channel consumer content, media, and gaming operations. As COO, Barbieri will oversee partnerships, direct-to-consumer relationships across DTC and CRM, customer experience, revenue systems, and IT.
Outlook, memory cost headwinds, and tariffs
For fiscal Q3, Sonos guided revenue to a range of $355 million to $375 million, representing 3% to 9% year-over-year growth (6% at the midpoint). Casey said FX is expected to have a negligible impact in Q3, implying modest constant-currency acceleration versus Q2. She also noted that Amp Multi, a product aimed at the professional installer channel, is slated to launch in the fall and will not contribute revenue in Q3.
Gross margin guidance for Q3 is 42% to 44.5% on a GAAP basis, with non-GAAP gross margin expected to be about 150 basis points higher than GAAP. Casey said the range includes an expected 400 basis point year-over-year headwind from higher memory costs in Q3, which she described as roughly 200 basis points worse than the Q2 impact. She added that Sonos does not expect to receive any tariff refunds during Q3.
On the Q&A, Casey outlined factors that could move gross margins within the guidance range, including product mix, promotions, revenue leverage, and tariff rates. She said tariff rates are now at a lower 10% level, which should be a tailwind sequentially, helping offset some of the memory pressure.
Conrad said the company is managing higher memory prices stemming from a semiconductor transition from DDR4 to DDR5 and high-bandwidth memory, driven by AI and data center demand, which is tightening DDR4 supply. He said the operations team began securing supply “as early as the beginning of 2025” and expressed confidence in meeting manufacturing needs. He also noted Sonos is working to optimize memory requirements through engineering changes without harming performance.
Conrad added that Sonos plans to file for a refund of prior duties paid under IEEPA following U.S. Customs and Border Protection’s launch of phase I of CAPE. While timing is uncertain, he said the benefit “could be as large as $40 million,” which could help offset higher memory costs.
Casey said Sonos is not guiding beyond Q3, but warned that memory cost inflation could rise from Q3 into Q4, pressuring margins. As a result, she said the company currently expects second-half fiscal 2026 GAAP and non-GAAP gross margin to be “somewhat lower” than the second half of fiscal 2025.
Despite the cost pressures, management reiterated expectations for a stronger second half. Conrad said his view that growth will be higher in the second half than the first remains unchanged, citing the addition of new products, improving marketing execution under CMO Colleen DeCourcy, continued strength in expansion geographies, and what he described as a return of customer advocacy.
Conrad also addressed questions about AI, saying it is already improving internal productivity and that Sonos’ installed base—17 million households and 53 million connected, voice-enabled devices—positions it to bring AI experiences beyond phones and computers. However, he said it was “premature” to discuss specifics of product roadmaps or business models tied to AI-related adjacencies.
About Sonos NASDAQ: SONO
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.
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