In a filing with the SEC on Wednesday, Sonos shared information that it will lay off 7% of its employees. Sonos said in the 8-K filing, the company “also committed to further reducing its real estate footprint and reassessing certain program spending.” The company reported 1,844 employees as of October last year. It’s reasonable to assume Sonos has hired more people since then, but that total suggests the cuts will affect at least 130 roles.
“We have acknowledged that if we begin to deviate from our performance expectations, we will act to adapt and protect profitability while still investing in our exciting product roadmap. to drive future growth,” Sonos CEO Patrick Spence said in a statement. “Faced with continued headwinds, we had to make some tough choices, including eliminating some positions and reassessing program spending.”
Spence added: “Right now, our number one priority is to give our departing teammates a respectful and compassionate transition, while focusing on providing resources to support our employees financially, spiritually and professionally as they navigate what’s to come.”
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Sonos has not laid off significant layoffs since mid-2020, when the company cut 12% of staff globally due to the coronavirus pandemic. That move also saw Sonos close its four-year-old retail store in New York City and many executives took pay cuts.
During this time period, the company “estimates that it will incur approximately $11 to $14 million in restructuring and related costs, of which $9 to $11 million is related to allowances and expenses. employee termination.” Sonos currently operates 10 offices globally, with US locations in Santa Barbara (where its headquarters are located), Boston, Seattle and San Francisco. But the company has been a strong advocate of hiring full-time telecommuters over the past few years, so some of those spaces are likely to close for the long term.
The “headwinds” that Spence refers to include a significant drop in consumer demand for the company’s home theater and speaker products. Last month, Sonos lowered its annual revenue forecast after it reported a nearly 24% drop in annual revenue. That news sent the company’s stock plunging. A few weeks later, brighter news came when Sonos won a $32.5 million patent infringement judgment against Google.
After releasing the spatial sound-focused Era 100 and Era 300 smart speakers in March, the company’s next consumer hardware product is expected to be the second-generation Sonos Move speaker. That device recently passed the FCC ahead of its expected launch this summer.
