Sonos approves new $150 million stock buyback plan

SANTA BARBARA, Calif. - Sonos, Inc. (NASDAQ: NASDAQ:SONO), the renowned sound experience brand, announced today that its Board of Directors has given the green light for a new stock repurchase program. The company, currently valued at $1.5 billion, is now authorized to buy back up to $150 million of its common stock. According to InvestingPro data, management has been consistently aggressive with share buybacks, demonstrating confidence in the company’s future prospects.

This new repurchase program follows the expiration of the previous $200 million program, under which $11 million remained. Sonos has stated that the repurchases may occur through various methods, such as open market transactions, private negotiations, and potentially through Rule 10b5-1 trading plans. The timing appears strategic, as the stock has declined over 35% in the past year and is currently trading at $12.51. However, the company has clarified that there is no fixed end date for the program, and it is not committed to purchasing any specific number of shares. The repurchase initiative may be adjusted, paused, or terminated at any time at Sonos’ discretion.

The funding for this stock repurchase will come from Sonos’ existing cash reserves and future cash flows. InvestingPro analysis reveals that Sonos maintains a strong balance sheet with more cash than debt and a healthy current ratio of 1.64, indicating solid liquidity. The actual timing and volume of share repurchases will be contingent on several factors, including the company’s stock price, market conditions, and trading volumes. Get access to 10+ additional exclusive ProTips and comprehensive financial metrics with InvestingPro.

While the announcement includes forward-looking statements regarding the potential effects of the repurchase program and Sonos’ long-term financial and growth outlook, these are subject to various risks and uncertainties that could cause actual outcomes to differ. These risks encompass challenges in forecasting demand, managing inventory, maintaining brand image, and potential economic and market changes.

Sonos, headquartered in Santa Barbara, California, is acknowledged as a pioneer in multi-room wireless home audio and is celebrated for its high-quality sound experiences and user-friendly designs.

The information in this article is based on a press release statement from Sonos, Inc.

In other recent news, Sonos, Inc. has announced a reorganization plan that includes a 12% reduction in its workforce, affecting around 200 positions. This decision, aimed at enhancing the company’s operating model, is expected to incur restructuring charges between $15 to $18 million, primarily for employee severance and benefits. Additionally, Sonos has eliminated the role of Chief Product Officer, with Maxime Bouvat-Merlin transitioning to an advisory capacity. In leadership changes, Patrick Spence has resigned as CEO, with Tom Conrad stepping in as Interim CEO while the company searches for a permanent replacement. Meanwhile, Rosenblatt Securities has reaffirmed its Buy rating on Sonos, citing a positive outlook and maintaining a price target of $18.00 ahead of the upcoming earnings report for the December quarter. The firm is optimistic about the company’s future financial performance, noting the potential for product innovation and profitability under the new leadership. Investors are keenly awaiting Sonos’s fiscal first-quarter results, set to be released on February 6, 2025.

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