Sonos is the latest big tech company laying off staff. The smart speaker brand has revealed in an SEC filing that it’s cutting 7 percent of its workforce, or about 130 jobs. It’s also planning to further shrink its “real estate footprint” and rethink spending on certain programs, according to the filing. This will cost an estimated $11 million to $14 million, up to $11 million of which will be linked to severance and benefits.
In a statement to Engadget, Sonos chief Patrick Spence says his company already planned to “protect profitability” if performance didn’t match expectations. The layoffs and spending changes are the result of “continued headwinds,” the CEO adds.
Sonos has run into financial trouble in recent months. It has swung between narrow profits and losses for multiple quarters, and in the second quarter of 2023 lost $30.7 million compared to a $8.6 million profit a year earlier. Spence pinned the shortfall on “softening” demand and tightening store inventory, and promised “swift action” to cut costs. It’s not clear how much of a role the rough economy played in the reduced sales, but it won’t have helped.
This is the first significant round of layoffs at Sonos since 2020, when the company slashed 12 percent of its headcount due to the difficulties of the COVID-19 pandemic. They also come at a critical moment. Sonos just introduced its most important speakers in years, the Era 100 and spatial audio-focused Era 300, and is still fighting Google over patent royalties. It’s also facing renewed competition that includes the second-generation Apple HomePod. The market is evolving, and Sonos is under pressure to keep up.
Source: www.engadget.com