Sonos, the popular smart speaker company, has officially filed for an initial public offering (IPO) as revealed in a Form S-1. Founded in 2002, Sonos was one of the pioneers of the Wi-Fi enabled smart speakers that can be controlled with smartphones.
“Sonos sits at the intersection of emerging trends driving the future of home entertainment,” wrote Sonos in the filing. “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.”
Sonos’ devices compete against the Google Home, Apple HomePod, and the Amazon Echo devices. But Sonos is also partnered with all of those companies. Rather than building its own digital assistant, Sonos is building speakers that are compatible with Amazon Alexa compatibility. And later this year, Sonos speakers may also support Google Assistant and Apple Siri.
“Revenue increased by $100.3 million, or 18.1%, from $555.4 million for the six months ended April 1, 2017 to $655.7 million for the six months ended March 31, 2018, due to a 29.2% increase in the number of products sold from 2.4 million in the six months ended April 1, 2017 to 3.1 million in the six months ended March 31, 2018. The volume growth was primarily driven by sales of our newest wireless speaker product, Sonos One, which launched in October 2017,” says Sonos’ S-1 document. “Revenue growth from the sale of our wireless speakers was primarily driven by sales of our new Sonos One product launched in October 2017, while growth from the sale of our home theater speakers was driven by sales of our new PLAYBASE product launched in April 2017.”
During those six months, Sonos also returned a profit as it saw decreasing losses over the past three fiscal years. For example, Sonos saw a $14.2 million loss for the 2017 fiscal year on revenue of $992.5 million compared to a $38.2 million loss for 2016 on revenue of $901.3 million and $68.8 million loss in 2016 on revenue of $843.5 million. The reason for the growth is largely due to repeat business from customers.
Sonos currently has 1,478 full-time employees and the company expects to hit $1 billion in 2018 revenue. Through the IPO, Sonos is expecting to raise as much as $100 million (placeholder amount). And Sonos plans to trade on the Nasdaq under the symbol “SONO.”
In terms of ownership, KKR has 26% equity in Sonos. And Index Ventures and Sonos co-founder and former CEO John McFarlane each have roughly 13%.