Sonos’ mostly positive earnings report on Wednesday was dulled by the announcement that the company’s longtime chief financial officer would retire by year’s end, news that has sent share prices falling for the premium speaker maker.
The company said it sold 2,384,581 products during the first fiscal quarter of 2019, generating $496 million in revenue, a 6 percent jump year over year, and net profit of $61.6 million, representing a 12.4 percent improvement YOY. Driving the revenue growth was the Sonos Beam, which itself fueled an 87 percent rise in home theater speaker sales. Conversely, wireless speaker sales dropped 11 percent, which Sonos chalks up to product reductions.
Sonos’ letter to shareholders also warned that revenue in the current quarter may not meet exceptions, due to “reduced sell-through velocity” toward the end of Q1, which created “higher channel inventory levels than we would have liked.”
Also in its Q1 disclosure, CEO Patrick Spence announced that CFO Mike Giannetto would be leaving after more than seven years. “My time at Sonos has been truly remarkable,” commented Giannetto, who will remain until a replacement is found. “It’s a special place, filled with incredibly talented people who all share a love for music and a passion for building great sound experiences. I’ll retire proud of what we’ve accomplished, confident in the future of the business and grateful for the many friends and colleagues I’ve met along the way.”
Following news of Giannetto’s departure, shares of Sonos’ stock sunk 6 percent in trading on Wednesday and 15 percent in after-hours trading. The stock is currently trading at close to $11, down from $13.36 at opening bell on Wednesday.