Sonos Inc Q2 FY2026 earnings call

Tom Conrad mentioned the company is returning to growth, with progress across product innovation, customer advocacy, marketing, geo expansion, and emerging demand trends. New product Sonos Play launched near quarter end with positive early reviews. Aero 100 SL launched alongside Play, lowering entry barrier. Frank Barbieri joined as COO. Operations team working on securing memory supply. AI is transforming internal operations. Also, filing for tariff refund to offset memory cost headwinds.

In Q2, Sonos generated $282 million of revenue, up about 8% year over year. GAAP gross profit dollars grew double digits. On a product basis, AR10100 and ArcUltra showed strength, while Play and Era 100 SL had negligible Q2 revenue contribution. APAC and EMEA grew 25% and 21% respectively in Q2, Americas grew 2% year over year. GAAP gross margin was 44.3% and non-GAAP gross margin was 46%, with higher memory costs being a headwind.

Q3 revenue expected to be in range of $355 million to $375 million, growth of 3% to 9% year over year. Q3 GAAP gross margin range 42% to 44.5%, non-GAAP roughly 150 basis points higher. Expect memory cost inflation to pressure gross margin in Q4. Q3 GAAP operating expenses range $150 million to $160 million. Adjusted EBITDA range $20 million to $48 million.

Higher memory costs putting downward pressure on gross margin due to semiconductor industry transition from DDR4 to DDR5. Uncertainty around timing of tariff refund.

Q: Steve Frankel asked about AI monetization strategy, Tom Conrad said AI is transforming internal operations but specifics premature.

Q: Steve asked about memory supply for back half, Tom said global ops team secured supply.

Q: Steve asked about Aero 100 SL, Tom explained it's cost-optimized, appeals to value-conscious customers.

Q: Analyst asked about Q3 gross margin scenarios, Saori Casey explained memory headwind, tariff tailwind, and other moving parts.

Q: Analyst asked about impact of geopolitical conflicts on demand, Tom said feeling good about demand.

Q: Brent Thill asked about second half improvement stepping stones, Tom mentioned new products, marketing, geo expansion, customer advocacy.