Sonos is elevating costs this 12 months to make up for tariff bills
Sonos plans to boost costs throughout its lineup of merchandise later this 12 months to be able to reduce the affect of tariffs on its earnings, the corporate has revealed alongside its monetary outcomes for the third quarter of 2025. It hasn’t listed the merchandise and their new costs but, nevertheless it stated that it is evaluating any modifications it’d have to its promotional methods and that it has flexibility to maneuver manufacturing between Vietnam and Malaysia as wanted. To notice, the Trump administration had imposed a 20 p.c tariff on imports from Vietnam and a 19 p.c tariff on imports from Malaysia. Sonos additionally stated that it’ll make investments on diversifying its geographic footprint and increasing its presence in markets that symbolize solely a small share of its income at present to drive development.
A Sonos spokesperson confirmed that not every little thing within the firm’s lineup will go up in worth, nevertheless it feels like merchandise in its predominant product classes will get costlier. We do not but know the specifics on what merchandise are getting costlier but.
The corporate took steps to diversify its provide chain final 12 months, which led to its manufacturing amenities within the two aforementioned international locations. It now solely depends on Chinese language plans for merchandise certain to the US for a restricted variety of equipment, comparable to speaker stands. Nonetheless, for the third quarter of 2025, tariffs lowered Sonos’ gross margin for the third quarter by $2.1 million and its money circulate by $3.5 million. Within the fourth quarter of the 12 months, which covers the vacation purchasing season, Sonos expects tariffs to scale back its gross margin by $5 million and to take away between $8 to $10 billion from its money circulate.
Total, Sonos posted a income of $344.8 million within the third quarter, which is nearly $100 million bigger than its income for the fourth quarter of 2024. It isn’t a secret that 2024 was a tricky 12 months for the corporate. It rolled out a significant replace that broke its app, which led to the delay of product releases because it labored to repair the problem. Former Sonos CEO Patrick Spence even stepped down at first of 2025 and was changed by ex-Snap govt Tom Conrad.
Replace, August 11, 2024, 11:08AM ET: This story has been up to date to notice that not all of Sonos’ merchandise are getting worth will increase.
