There's seemingly more bad news for Sonos. New reports say that the new Ace headphones, which the company expected to be a huge hit, have been doing disappointing numbers: where Sonos expected to make 2,500 headphones per day to cope with huge demand for its high-end cans, it's allegedly only doing a fraction of that: just 250 pairs a day. That means instead of expected sales of around 1 million units per year, it's on track to do around one-tenth of that.
That's according to reports from both Mark Gurman at Bloomberg and NotebookCheck. And the bad news keeps on coming: both reports also claim that Sonos has laid off employees "likely in part to cope with the mounting costs and loss of sales", and that its codename Pinewood, a Roku-style set-top-box, has been delayed once more. After initially being put back to January 2025, it's now scheduled for March.
This isn't the arc Sonos wanted
It's fair to say that 2024 has been disastrous for Sonos, and there's still plenty of 2024 to go. What was supposed to be a triumphant year with significant revenues from brand new product categories – such as the Ace headphones and the Pinewood project – as well as key updates to core products such as the Arc soundbar has instead been spent dealing with the ongoing fallout from the Sonos app update.
That app was released way back in the spring, but Sonos is still working on fixing it; it apologized to customers back in July and has been working on a fortnightly app update cycle for months now, but as we said after the most recent update "there's still a lot of work to be done before users are going to be happy again."
As Bloomberg reports, it's hitting Sonos in the pockets – and in the pockets of its shareholders. Bloomberg says that Sonos's stock is down 32% this year while the rest of the S&P 500 Index is up by 13%, and instead of raking in cash from new products it's spending huge sums on the app issues.
There's no doubt that the firm makes superb soundbars that are among the very best in the business, but the app issue isn't the only software concern we've seen: in 2023, Sonos eventually admitted that there was a problem with Dolby Atmos on its Arc soundbars after many months of upset customers talking about it on forums; the initial response to concerns over the app issues was similarly dismissive.
These are dangerous waters for Sonos to be swimming in. Sonos isn't just selling interchangeable audio kit here: it's selling an ecosystem of premium-priced products in an intensely competitive marketplace. That means it's not good enough to make great hardware. The software and any response to customer concerns deed to be top-notch too. It does look like the damage to Sonos's brand reputation will take even longer to repair than its app.
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