Sonos forecasts 2022 sales above estimates; shares rise

Sonos forecasts 2022 sales above estimates; shares rise
By Reuters
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By Stephen Nellis

-Sonos Inc on Wednesday forecast fiscal 2022 sales above analyst estimates, despite facing backlogs for its smart speakers because of supply constraints.

Sonos said it expects fiscal 2022 sales of between $1.925 billion and $2 billion, above Wall Street estimates of $1.86 billion, according to IBES data from Refinitiv.

Shares of Sonos were up 4.6% to $35 in after-hours trading following the results.

For the fiscal fourth quarter ended Oct. 2, Sonos reported sales of $359.54 million and a profit, excluding items, of 8 cents per share, compared with expectations for sales of $360.2 million and a loss of 7 cents per share, according to Refinitiv data.

Santa Barbara, California-based Sonos has fended off challenges from major tech companies such as Apple Inc that tried to enter the market for premium-priced smart speakers but have since scaled back to lower price points. Sonos earlier this year introduced Roam, a sub-$200 product that aims to introduce the Sonos brand to a broader audience.

Sonos said it expects gross margins of 46% to 47% for fiscal 2022, in line with analyst expectations. The company in recent years diversified its supply chain away from China to include Malaysian factories in an effort to mitigate U.S. tariffs. This year, it has worked though both chip shortages and backups at U.S. ports.

Chief Executive Patrick Spence said the company imports its products via planes and ships, depending on the size.

"We've particularly pushed on air to try and make sure that we're meeting customer needs in the holiday period," Spence told Reuters, noting that the uptick in air cargo is factored into the company's margin forecast. "We'll do whatever we can to sustainably bring products in and be smart about that."

Sonos also said it had finished a $100 million share buyback program and would initiate a new $150 million repurchase program.

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