Sonos Narrows Losses in Q3, With Help of IKEA Partnership

Courtesy of Sonos
Sonos AirPlay 2

Sonos narrowed its losses in its most recent quarter, reporting solid revenue growth with help from a new partnership with IKEA.

The California-based consumer electronics giant generated a record $260 million in revenue in fiscal Q3 2019, up 25 percent year-over-year. It realized a net loss of $14 million, compared to a $27 million loss in the same quarter last year.

Overall, the financials mark the company's fourth consecutive quarter of record revenue growth. 

Sonos also benefitted from its SYMFONISK product line with IKEA, rolled out last week. Revenue from that partnership -- generated from Sonos' sell-in of technology models to IKEA -- drove 221% growth in Sonos' "other" category, which grew from $5.5 million in Q3 of 2018 to $17.7 million for the past quarter. 

In a letter to shareholders, Sonos CEO Patrick Spence called the IKEA collaboration an example of the company's efforts to think "more expansively about new addressable markets and how we monetize our technology," reaching new customers with more affordable price points. So far, products include a table lamp speaker ($179) and book-shelf speaker ($99).

"The $99 price point is particularly interesting, as we believe it has the potential to significantly expand our audience by bringing the Sonos experience into millions of new homes that our current portfolio does not address," Spence continued. "Once introduced to the simplicity of the Sonos experience, we anticipate that many customers will consider adding additional Sonos products to their homes to augment their home sound systems."

Even so, revenues from the IKEA collab are small-fry compared to Sonos' top revenue drivers.

Wireless speakers drove $104.6 million in revenue (up from $93.9 million last year), while home theater speakers were responsible for $89.7 million (last year, $66.7 million). Meanwhile, the company's voice-enabled product Sonos One enjoyed a 61% uptick in revenue year-over-year. 

In total over the past quarter, Sonos sold 1,083,216 products. 


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