Sonos stock slid late Wednesday after the producer of wireless speakers and other audio products posted weak June quarter revenue and reduced its outlook, citing the impact of a tougher macroeconomic environment.
The results are consistent with recent softening sales of other consumer electronics products, including personal computers and smartphones.
Sonos shares dived roughly 18% in after-hours trading to $18.59. During the regular session Wednesday, shares had risen 3.6% to $22.77.
For the quarter, Sonos (ticker: SONO) reported revenue of $371.8 million, down 1.8% from a year ago, and well below the Street consensus forecast at $423.2 million. The company earned 19 cents a share on an adjusted basis, ahead of consensus at 7 cents a share. Sonos broke even in the quarter under generally accepted accounting practices. Adjusted Ebitda, or earnings before interest, taxes, depreciation and amortization, was $42.1 million, down from $46.7 million in the year-earlier quarter.
"We have seen the macroeconomic backdrop become significantly more challenging for us starting in June as the dollar's appreciation and high inflation have adversely affected consumer sentiment globally, particularly in the categories in which we play," CEO Patrick Spence said in a statement. "Although we cannot predict when macroeconomic conditions will normalize, we remain confident that, when they do, we will return to double-digit revenue growth."
For the September 2022 fiscal year, Sonos now sees revenue of $1.73 billion to $1.755 billion, up 1% to 2% from fiscal 2021, down from a previous forecast range of $1.95 billion to $2 billion.
The company now sees full-year adjusted Ebtida between $215 million and $230 million, lowered from the previous target range of $290 million to $310 million. The new range represents an adjusted Ebitda margin of 12.4% to 13.1%, down from a previous target of 14.9% to 15.5%.
Sonos added that "due to the uncertain and evolving macroeconomic backdrop," the timetable for the company's previous forecast for reaching $2.5 billion in revenue, 45% to 47% gross margins, and 15% to 18% adjusted Ebitda margins is now "extended beyond" the previous target of fiscal 2024.
Sonos also announced that CFO Brittany Bagley has resigned effective September 1. She has been named CFO and chief business officer at Axon (AXON), which makes Taser stun guns and other safety products. Sonos said that chief legal officer Eddie Lazarus has been named interim CFO.