Slide 1: Q2 Fiscal Year 2025 Financial Results
Q2 Fiscal Year 2025 Financial Results May 7, 2025
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements that involve risks and uncertainties. These forward-looking statements include statements regarding our outlook for the fiscal quarter ending June 28, 2025; our long-term outlook; our long-term focus, financial, growth, a
Slide 3: Fiscal Q2 Financial Summary
Fiscal Q2 Financial Summary NET REVENUE GROSS MARGIN 2Q25 revenue increase of 2Q25 GAAP GM declined +3% y/y driven by home -60bps y/y primarily due to theater strength (Arc Ultra impact of reorganization launch) and Ace (launched efforts, partially offset by June 2024), partially offset lower inventory
Slide 4: Inventory Trends
Inventory Trends ● Inventories decreased by $41M, -23% y/y driven by workdown of component inventory ○ Finished goods inventory decreased by $1M y/y, -1% ○ Components balance decreased by $40M y/y, -61% Note: In $ millions (unless noted), unaudited. Percentages and comparisons have been calculated u
Slide 5: Cash Flow & Balance Sheet Highlights
Cash Flow & Balance Sheet Highlights ● Cash, cash equivalents & marketable securities of $224M ○ Includes $50M cash deployed into short duration treasury bills 2Q25 2Q24 Cash flow from operations $ (59.7) $ (111.2) ● Total liquidity of $321M, includes $97.6M borrowing Capital expenditures $ (5.6) $ (
Slide 6: Fiscal Q2 Operating Expense Trends
Fiscal Q2 Operating Expense Trends Research and Development Sales and Marketing GAAP R&D was $77M ($65M excluding restructuring) GAAP S&M was $64M ($61M excluding restructuring) Non-GAAP R&D1 was $57M, down 18% y/y due to cost Non-GAAP S&M1 was $57M, up optimization efforts 1% y/y General and Adminis
Slide 7: 3Q25 Outlook
3Q25 Outlook To be provided on 2Q25 earnings call 7
Slide 8: The Sonos Story
The Sonos Story 8
Slide 9: Sonos at a Glance
Sonos at a Glance 2002 Founded $1.52B FY24 Revenue 16M+ Household Install Base 3.08 FY24 products per Household 44% Products Registered to Existing 18 Flagship Products 6 Categories 4,300+ US Patents and Applications Household Install Base 9
Slide 10: Broad Product Portfolio Spanning Variety of Price Points and Use Cases
Broad Product Portfolio Spanning Variety of Price Points and Use Cases Home Theater Ray Beam $199 $499 Arc Ultra Arc Sub Mini Sub $999 $899 $429 $799 Speakers Components and Architectural Era 100 Era 100 Pro Era 300 Five Amp Port Sonos and Sonance Sonos and Sonance Sonos and Sonance Sonos and Sonanc
Slide 11: Market Position
Market Position Premium Sonos is differentiated by our unique combination of an open content and control platform with high-quality, premium hardware that spans a variety of form factors, use cases, and price points. No other company has created an interoperable suite of products serving customers in
Slide 12: Sonos Audio Innovation Is Widely Adopted
Sonos Audio Innovation Is Widely Adopted Sonos Sonos releases digital founded June music system in 2002 February 2005 Sonos Apple HomePod demos at D2 June 2004 Google Home Amazon Echo Denon Heos Lenbrook Bluesound Jan Jan Jan Jan Jan Jan Jan Jan Jan 2018 Present 2002 2004 2006 2008 2010 2012 2014 20
Slide 13: … Yet We Remain the Leader
… Yet We Remain the Leader FY24 Top Ranked Models (by $ share) United States EMEA1 $200+ Home Theater2 $150+ Streaming Audio $200+ Home Theater2 $150+ Streaming Audio Brand Rank: #1 Brand Rank: #2 Brand Rank: #1 Brand Rank: #2 Top Products in Category Top Products in Category Top Products in Categor
Slide 14: Why the Sonos Ecosystem Wins
Why the Sonos Ecosystem Wins Hardware + Software + Interoperability Sound Easy to use Design Reliable 100+ third-party apps Quality All works together Voice services Durability Rich patent portfolio = = = Sounds great, System Open platform looks beautiful, and choice and lasts 14
Slide 15: Our Innovation Is Protected by a Robust and Growing Patent Portfolio
Our Innovation Is Protected by a Robust and Growing Patent Portfolio Total Sonos U.S. Patents and Patent Applications (filed over time, cumulative) 15 Source: Internal Data
Slide 16: Open Platform Enables Freedom of Choice
Open Platform Enables Freedom of Choice 100+ Content Partners Home Automation & Voice Assistants Home Control Partners 16
Slide 17: Key Drivers of Long Term Growth: The Sonos Flywheel
Key Drivers of Long Term Growth: The Sonos Flywheel New households enter the Sonos ecosystem, and existing households purchase additional products at a steady rate Improving the core experience is critical to fueling the Sonos flywheel 1 Continue to raise the bar in New Existing existing product cate
Slide 18: Large and Growing Install Base
Large and Growing Install Base Total Households 16.3 Existing Households Net New Households 15.3 1.0 14.0 1.3 AGR 17%C 12.6 1.4 10.9 1.7 9.1 1.8 7.4 1.7 5.9 1.5 4.6 1.3 1.2 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 Source: Internal Data 18 Note: Unaudited.
Slide 19: Framing Our Long Term Opportunity: Households
Framing Our Long Term Opportunity: Households PLUS Geographic Expansion 391M Households in Core Markets1 ~9% Current penetration of total affluent households 172M Affluent ($75k+2) Households 16M Sonos FY24 Households Source: Euromonitor 2023 1. Core Markets include the United States, Canada, Mexico, Au
Slide 20: Our Install Base Continues to Purchase Additional Sonos Products
Our Install Base Continues to Purchase Additional Sonos Products A significant portion of our annual product registrations come from our existing households (HHs), many of which start with just one product. Lifetime value of customers grows as products per HH increases Incremental revenue opportunity
Slide 21: Average Registrations per Customer
A Detailed Look at Customer Behavior and Install Base Monetization Over Time Consistent repurchase behavior across larger cohorts and greater monetization of products sold underscores our conviction to deliver our long term financial targets Cohorts behave similarly over time, regardless of when first
Slide 22: New Product Innovation Drives Household Acquisition & Repurchase Activity
New Product Innovation Drives Household Acquisition & Repurchase Activity We continue to launch new products across our six current categories FY25 FY18 FY19 FY20 FY21 FY22 FY23 FY24 to date -Arc -Beam (Gen 2) -Arc Ultra Home Theater -Beam (Gen 1) -Sub Mini -Sub (Gen 3) -Ray -Sub (Gen 4) -Era 100 Sp
Slide 23: Framing Our Long Term Opportunity: Revenue
NEW: Framing Our Long Term Opportunity: Revenue Launch of our new premium over-the-ear (OTE) headphones unlocks an incremental $5bn core Premium OTE headphones TAM, +23% increase PLUS Audio content, services & business $22bn $5bn Premium Global Premium Global Home Audio TAM over-the-ear (OTE) $100B
Slide 24: Differentiated Channel Distribution
Differentiated Channel Distribution Channel mix in FY24 remained relatively flat y/y 2018 2019 2020 2021 2022 2023 2024 ● Retail & Other (55% of revenue, +0 bps), -8% y/y Retail and Other 830 930 838 1,011 987 918 842 % yoy 12% (10%) 21% (2%) (7%) (8%) ● DTC (23% of revenue, -100 bps), -12% y/y DTC 13
Slide 25: Summary Financial Overview
Summary Financial Overview 2018 2019 2020 2021 2022 2023 2024 Americas 603 678 756 981 1,044 1,048 1,005 % y/y 12% 11% 30% 6% 0% (4%) EMEA 479 485 471 618 578 518 430 % y/y 1% (3%) 31% (7%) (10%) (17%) APAC 55 98 100 117 130 89 83 % y/y 78% 2% 18% 11% (32%) (7%) Total Revenue 1,137 1,261 1,326 1,717
Slide 26: Appendix
Appendix 26
Slide 27: Reconciliation of GAAP to Non-GAAP Gross Margin
Reconciliation of GAAP to Non-GAAP Gross Margin 2Q20 2Q21 2Q22 2Q23 2Q24 2Q25 Reconciliation of GAAP gross profit GAAP gross profit $ 73,009 $ 165,776 $ 179,034 $ 131,618 $ 112,038 $ 113,609 Stock-based compensation expense 278 261 377 581 686 1,606 Amortization of intangibles - 76 213 973 973 3,144 R
Slide 28: Reconciliation of Certain GAAP to Non-GAAP Operating Expenses
Reconciliation of Certain GAAP to Non-GAAP Operating Expenses 2Q20 2Q21 2Q22 2Q23 2Q24 2Q25 GAAP R&D $ 49,593 $ 56,370 $ 64,947 $ 80,785 $ 80,322 $ 77,423 Less: Stock-based compensation expense $ 5,427 $ 6,683 $ 8,091 $ 9,565 $ 10,419 $ 8,021 Less: Amortization of intangibles $ 529 $ 414 $ 737 $ 495
Slide 29: Reconciliation of Operating (Loss) Income to Adjusted EBITDA
Reconciliation of Operating (Loss) Income to Adjusted EBITDA 2Q20 2Q21 2Q22 2Q23 2Q24 2Q25 Operating (Loss) Income (GAAP) $ (53,207) $ 12,395 $ 10,042 $ (57,226) $ (70,960) $ (61,224) Stock-based compensation 13,394 16,363 21,225 21,025 23,673 20,102 Legal and transaction related costs (1) 1,705 11,
Slide 30: Reconciliation of Net (Loss) Income to Adjusted EBITDA
Reconciliation of Net (Loss) Income to Adjusted EBITDA 2Q20 2Q21 2Q22 2Q23 2Q24 2Q25 (In thousands, except percentages) Net (loss) income $ (52,320) $ 17,221 $ 8,566 $ (30,652) $ (69,709) $ (70,144) Add (deduct): Depreciation and amortization 9,726 8,742 9,575 11,713 11,243 15,167 Stock-based compen
Slide 31: Reconciliation of Cash Flows to Free Cash Flow
Reconciliation of Cash Flows Provided by (Used in) Operating Activities to Free Cash Flow 2Q20 2Q21 2Q22 2Q23 2Q24 2Q25 Cash flows (used in) provided by operating activities $ (83,472) $ (38,560) $ (97,562) $ (112,962) $ (111,244) $ (59,666) Less: Purchases of property and equipment (9,886) (8,594) (
Slide 32: SONOS
SONOS