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Sonos Up 63% in 3 Months: Where Will the Stock Head From Here?
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Key Takeaways
Sonos shares have surged 62.7% in three months, nearing a 52-week high of $18.06.
Product launches like Sonos Ace and Arc Ultra are driving growth and supporting revenue.
Expansion across Asia and a direct-to-consumer push anchor Sonos' long-term strategy.
Sonos, Inc. (SONO - Free Report) stock has surged 62.7% in the past three months, outperforming the Zacks Audio Video Production and the S&P 500 composite’s growth of 19.9% and 9%, respectively. Sonos also outperformed the Zacks Consumer Discretionary sector’s decline of 2.1% in the same time frame. The stock has risen 117.9% in the past six months.
Image Source: Zacks Investment Research
It closed the last session at $18.04, hovering close to its 52-week high of $18.06. Will this recent momentum continue?
To determine if it is the right time to buy, sell or hold SONO stock, let us carefully evaluate the key factors.
Taking a Look at SONO’s Tailwinds
Sonos remains committed to driving growth through an innovative product lineup. Earlier in 2025, the company undertook a reorganization aimed at accelerating product development while cutting annual operating expenses by more than $100 million. This streamlined approach enables Sonos to focus on enhancing the core customer experience, pursuing profitable growth and delivering innovations unique to its brand. In the third quarter, it introduced AI-powered voice enhancement for Arc Ultra and advanced adaptive noise cancellation for Sonos Ace.
With the launch of the Sonos Ace, its first over-the-ear Bluetooth headphone, the company has forayed into the personal listening category. Sales of Sonos Ace have cushioned the top line amid the app fiasco. The company released two new products, Arc Ultra and Sub 4, in October 2024. Sonos Arc Ultra is a premium soundbar equipped with advanced Sound Motion transducer technology, and the Sonos Sub 4 is an upgraded version of their classic subwoofer designed to deliver immersive bass for movies and shows. The company plans to maintain a cadence of two hardware launches per year, with a focus on software-driven differentiation and a strong product roadmap for future innovation. Building on this momentum, Sonos has a robust product roadmap in place, stretching through fiscal 2026 and beyond.
Sonos is pursuing a multi-pronged growth strategy centered on direct-to-consumer expansion, a stronger partner ecosystem and broader geographic reach. The company aims to build its long-term roadmap by attracting new customers and deepening its global footprint, particularly across Asia, where sales continue to rise. It has shifted the majority of U.S.-bound production out of China to Vietnam and Malaysia, limiting exposure to China tariffs to a few accessories and co-branded products.
The company is actively evaluating pricing and promotional strategies, collaborating with contract manufacturers and retailers to limit downstream impact on consumers. Geographic expansion is seen as a key driver of long-term growth, with investments in these markets continuing to yield positive results. Its website, sonos.com, is responsible for generating a major portion of revenues. The company also anticipates expanding its presence in new regions, including underserved countries, over time, on the back of country-specific distribution channels and marketing campaigns.
Headwinds Persist for SONO
Cautious consumer spending and higher promotions pose challenges for the company. Moreover, tariff uncertainty remains a concern. The company anticipates tariff rates on its products to be 20% for Vietnam and 19% for Malaysia. Although the company is working closely with contract manufacturers and channel partners to share these costs, it has determined that price increases on certain products will be necessary later in 2025. Tariff expenses are expected to be around $5 million for the fiscal fourth quarter, with cash outlays potentially reaching $8 million to $10 million due to inventory build.
SONO’s Expensive Valuation
SONO’s stock is trading at a premium, with a Price/Book of 5.46X compared with the industry’s 2.98X.
Image Source: Zacks Investment Research
How to Play SONO Stock?
With a Zacks Rank #3 (Hold), SONO appears to be trading in the middle of the road. Frequent product innovation, the addition of new features to existing products and the expansion of direct-to-consumer initiatives bode well.
However, the company faces headwinds from unpredictable tariff policies, cautious consumer spending and increased promotional activity.
TaskUs’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while missing in one, with the average surprise being 13.01%. In the last reported quarter, TASK delivered an earnings surprise of 26.47%. Its shares have gained 28.5% in the past year.
Cadence’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 6.92%. In the last reported quarter, CDNS delivered an earnings surprise of 5.10%. Its shares have surged 24.7% in the past year.
AMETEK’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 3.4%. In the last reported quarter, AME delivered an earnings surprise of 5.95%. Its shares have inched up 8.5% in the past year.
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Sonos Up 63% in 3 Months: Where Will the Stock Head From Here?
Key Takeaways
Sonos, Inc. (SONO - Free Report) stock has surged 62.7% in the past three months, outperforming the Zacks Audio Video Production and the S&P 500 composite’s growth of 19.9% and 9%, respectively. Sonos also outperformed the Zacks Consumer Discretionary sector’s decline of 2.1% in the same time frame. The stock has risen 117.9% in the past six months.
Image Source: Zacks Investment Research
It closed the last session at $18.04, hovering close to its 52-week high of $18.06. Will this recent momentum continue?
To determine if it is the right time to buy, sell or hold SONO stock, let us carefully evaluate the key factors.
Taking a Look at SONO’s Tailwinds
Sonos remains committed to driving growth through an innovative product lineup. Earlier in 2025, the company undertook a reorganization aimed at accelerating product development while cutting annual operating expenses by more than $100 million. This streamlined approach enables Sonos to focus on enhancing the core customer experience, pursuing profitable growth and delivering innovations unique to its brand. In the third quarter, it introduced AI-powered voice enhancement for Arc Ultra and advanced adaptive noise cancellation for Sonos Ace.
With the launch of the Sonos Ace, its first over-the-ear Bluetooth headphone, the company has forayed into the personal listening category. Sales of Sonos Ace have cushioned the top line amid the app fiasco. The company released two new products, Arc Ultra and Sub 4, in October 2024. Sonos Arc Ultra is a premium soundbar equipped with advanced Sound Motion transducer technology, and the Sonos Sub 4 is an upgraded version of their classic subwoofer designed to deliver immersive bass for movies and shows. The company plans to maintain a cadence of two hardware launches per year, with a focus on software-driven differentiation and a strong product roadmap for future innovation. Building on this momentum, Sonos has a robust product roadmap in place, stretching through fiscal 2026 and beyond.
Sonos is pursuing a multi-pronged growth strategy centered on direct-to-consumer expansion, a stronger partner ecosystem and broader geographic reach. The company aims to build its long-term roadmap by attracting new customers and deepening its global footprint, particularly across Asia, where sales continue to rise. It has shifted the majority of U.S.-bound production out of China to Vietnam and Malaysia, limiting exposure to China tariffs to a few accessories and co-branded products.
The company is actively evaluating pricing and promotional strategies, collaborating with contract manufacturers and retailers to limit downstream impact on consumers. Geographic expansion is seen as a key driver of long-term growth, with investments in these markets continuing to yield positive results. Its website, sonos.com, is responsible for generating a major portion of revenues. The company also anticipates expanding its presence in new regions, including underserved countries, over time, on the back of country-specific distribution channels and marketing campaigns.
Headwinds Persist for SONO
Cautious consumer spending and higher promotions pose challenges for the company. Moreover, tariff uncertainty remains a concern. The company anticipates tariff rates on its products to be 20% for Vietnam and 19% for Malaysia. Although the company is working closely with contract manufacturers and channel partners to share these costs, it has determined that price increases on certain products will be necessary later in 2025. Tariff expenses are expected to be around $5 million for the fiscal fourth quarter, with cash outlays potentially reaching $8 million to $10 million due to inventory build.
SONO’s Expensive Valuation
SONO’s stock is trading at a premium, with a Price/Book of 5.46X compared with the industry’s 2.98X.
Image Source: Zacks Investment Research
How to Play SONO Stock?
With a Zacks Rank #3 (Hold), SONO appears to be trading in the middle of the road. Frequent product innovation, the addition of new features to existing products and the expansion of direct-to-consumer initiatives bode well.
However, the company faces headwinds from unpredictable tariff policies, cautious consumer spending and increased promotional activity.
Key Picks From the Computer and Technology Space
Some better-ranked stocks from the broader technology space are TaskUs, Inc. (TASK - Free Report) , Cadence Design Systems, Inc. (CDNS - Free Report) and AMETEK, Inc. (AME - Free Report) . TASK sports a Zacks Rank #1 (Strong Buy), while CDNS and AME carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
TaskUs’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while missing in one, with the average surprise being 13.01%. In the last reported quarter, TASK delivered an earnings surprise of 26.47%. Its shares have gained 28.5% in the past year.
Cadence’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 6.92%. In the last reported quarter, CDNS delivered an earnings surprise of 5.10%. Its shares have surged 24.7% in the past year.
AMETEK’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 3.4%. In the last reported quarter, AME delivered an earnings surprise of 5.95%. Its shares have inched up 8.5% in the past year.