Sonos, maker of good dwelling audio system, has filed to go public whereas in search of to place itself for a grueling combat towards a few of tech’s largest names.
Somewhat awkwardly, these deep-pocketed rivals additionally occurred to be a couple of of Sonos’ most crucial companions: Apple, Google, and Amazon.
The filing today is preliminary, and it doesn’t say how a lot Sonos plans to lift within the providing.
“Sonos sits at the intersection of emerging trends driving the future of home entertainment,” the submitting says. “The proliferation of streaming services and the rapid adoption of voice assistants are significantly changing audio consumption habits and how consumers interact with the internet. As the leading home sound system for consumers, content partners, and developers, Sonos is poised to capitalize on the large market opportunity created by these dynamics.”
Founded in 2002, Sonos constructed a passionate following of consumers who wished higher-quality audio system that had been additionally straightforward to make use of and that might ultimately be managed by way of their smartphones.
But the corporate missed the shift to voice-controlled good audio system after Amazon launched the Alexa-enabled Dot and Echo. That launch was later adopted by Google Home, with Google Assistant baked in. And earlier this 12 months, Apple belatedly launched its Siri-controlled HomePod.
To counter, Sonos has been upgrading its speaker lineup with Alexa performance. Later this 12 months, the audio system may also hook up with Siri and Google Assistant. And final fall, the corporate launched Sonos One, its very personal good speaker.
The excellent news for Sonos is that it says for the primary six months of its present fiscal 12 months, it noticed income soar $100 million to $655.7 million, pushed largely by 29.2 enhance within the variety of models bought. Sonos provides in its security filing that this progress was largely pushed by gross sales of Sonos One.
The firm additionally turned worthwhile throughout these six months, after posting a sequence of lowering losses over the earlier three fiscal years. That profitability is helped by the truth that Sonos clients are inclined to preserve shopping for the corporate’s merchandise after they buy their first speaker, the submitting says.
However, Sonos’ submitting comes with some massive pink flags.
Streaming companies are among the many largest makes use of for Sonos audio system. And one of the standard is Apple Music, together with Google and Amazon’s respective music companies. Sonos says that freedom is an enormous aggressive benefit.
“These partners find value in our independent platform and access to millions of desirable and engaged customers,” the submitting says.
But Sonos additionally notes that it faces fierce competitors from these identical companions, who can write a lot greater checks.
“In some cases, our competitors are also our partners in our product development and resale and distribution channels, and while the presence of these competitors in the market has increased consumer awareness of products and contributed to the growth of the overall market, their resources and brand recognition pose significant competitive challenges,” the submitting says. “We expect competition to intensify in the future as more companies enter these markets and consumer demand for internet-based delivery of audio content to increase.”
Based in Santa Barbara, Sonos has 1,478 full-time staff.