Published: Sat, July 07, 2018
Money | By Ralph Mccoy

Sonos files for IPO

Sonos files for IPO

Wireless speaker maker Sonos Inc. filed for a US initial public offering. The company will be listed on Nasdaq with the ticker symbol "SONO". In 2017, the company generated $992 million in revenue, a 10% increase from $901.3 million in 2016. For services supported by Amazon's Alexa, the controls are more intricate -users can use their voice to select particular artists, songs, albums, playlists and podcasts, etc. Amazon and Google could also grow into greater threats if they offer smart speakers with better audio quality.

The company is on track to surpass $1 billion in sales this fiscal year after booking revenue of $655.7 million for the six months ending in March, according to a filing with the Securities and Exchange Commission on Friday.

Sonos One devices with Amazon's Alexa built-in.

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We also face intense competition in our markets, and we are dependent on a number of technology partners for the development of our products, some of which have developed or may develop and sell voice-enabled speaker products of their own. Its products are being integrated in Apple's new AirPlay 2 wireless music-streaming system and Google's Assistant.

An Amazon Echo, left, and a Sonos One. Today, its products are distributed in over 50 countries with 55 percent of its revenue coming from outside the USA. In fiscal 2017, people listened to about 5 billion hours of audio content using Sonos products, about a third more than in the previous year, the filing says. Moreover, the company said consumers listen to approximately 80% more music after purchasing their first Sonos product. Of its full-time employees, 66% are based in the US, with the rest in global locations including Australia, China, Denmark, France, Germany, the Netherlands, Sweden and the United Kingdom.

In detailing risk factors, Sonos noted in the IPO filing that the company depends on a single manufacturer: Taiwan-based Inventec. That could impose a huge financial burden on Sonos if Inventec's operations are disrupted. KKR initially invested $100 million in Sonos in 2012.

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