Sonos (SONO) Q2 2026 earnings summary

Executive summary

• Q2 revenue grew 8% year-over-year to $282 million, near the high end of guidance, marking a return to growth after a challenging period, with Adjusted EBITDA above midpoint and the first positive Q2 Adjusted EBITDA in four years.

• First half Adjusted EBITDA rose 48% year-over-year, driven by gross profit growth, product innovation, marketing, and operating expense reductions.

• Net loss for Q2 improved by $41 million year-over-year to $(29) million; non-GAAP net loss improved by $19 million to $(3) million.

• New products, including Sonos Play and Era 100 SL, received strong early reviews and are expected to drive further household and installed base growth.

• Leadership strengthened with the appointment of a new COO, focusing on operational excellence and growth execution.

Financial highlights

• Q2 GAAP gross margin was 44.3%, non-GAAP gross margin 46.0%; Q2 GAAP gross profit was $125 million (up 10% YoY), non-GAAP gross profit was $130 million (up 6% YoY).

• Adjusted EBITDA for Q2 was $2 million, a $3 million improvement from -$1 million last year; first half Adjusted EBITDA was $134 million, up $44 million YoY.

• Non-GAAP EPS improved to -$0.02 from -$0.18 YoY; Q2 GAAP diluted loss per share improved by $0.34 YoY to $(0.24).

• Q2 free cash flow was -$70 million, consistent with typical seasonality; Q2 free cash flow for the first half was $87 million, up from $78 million a year ago.

• $40 million spent on share repurchases in Q2, reducing share count by 2.1%; 2.5 million shares repurchased in Q2, 4.0 million shares for $65 million in the first half.

Outlook and guidance

• Q3 revenue expected between $355 million and $375 million, representing 3%-9% YoY growth (6% at midpoint).

• Q3 GAAP gross margin guided at 42%-44.5%, with non-GAAP about 150 bps higher; gross margin pressured by higher memory costs.

• Q3 adjusted EBITDA expected in the range of $20 million-$48 million (margin of 5.6%-12.7%).

• Second half gross margin expected to be lower than prior year due to memory cost inflation; no tariff refunds assumed in guidance.

• Guidance for future periods will be provided on the Q2 earnings call.