Sonos lays off 100 people over expensive app issues

Sonos is laying off about 100 people, the company confirmed Wednesday. The news comes as Sonos expects to spend $20 million to $30 million in the short term to repair damage from a poorly received app update.

In a statement to The Verge, Sonos CEO Patrick Spence said:

We have made the difficult decision to say goodbye to approximately 100 team members, representing 6 percent of the company. This action was a difficult but necessary measure to ensure continued, meaningful investment in Sonos’ product roadmap while positioning Sonos for long-term success.

Sonos said it had 1,844 employees in October 2022, according to CNBC. The company also announced layoffs of about 130 people (or 7 percent of its workforce) in June 2023 due to “continued headwinds,” according to Spence. In 2020, Sonos laid off 12 percent of its workforce, which was estimated at about 174 people.

Application problems

This latest round of layoffs comes as Sonos is expected to spend tens of millions of dollars to address the fallout from its updated app. The update, which came out in May, removed a variety of features, including the ability to use sleep timers and access local music libraries, and accessibility features. In July, Spence apologized for the app and promised it would be fixed with biweekly updates by the fall. Last week, Sonos revealed the hefty price tag to address the negative reviews, which includes spending on updating the app, boosting customer service, and trying to regain the trust of customers and partners through things like discounts.

Sonos is also expecting lower revenue in the fourth quarter of fiscal 2024 as it delays the launch of two hardware products until it can make app tweaks. Sonos hasn’t confirmed this, but one of the products is expected to be a successor to the Sonos Arc soundbar. Citing anonymous sources, The Verge reported on Wednesday that Sonos could release the soundbar in October (which would be Sonos’ 2025 fiscal year).

In his statement regarding the layoffs, Spence said that Sonos’ “continued commitment to rebuilding the app and delighting our customers remains our top priority, and we are confident that today’s actions will not impact our ability to deliver on that promise.”

Sonos may simply be relaunching its old app, The Verge reported on Wednesday. The publication stated that “there have been discussions within Sonos about reverting to the previous version of the app.”

It’s unclear whether Sonos will make both versions of the app available or withdraw the new version until it’s fixed enough to meet customer needs. We’ve reached out to Sonos for comment.

Even if Sonos quickly brings back the old app, the app’s failed design will likely affect the company’s finances for months, if not longer. Sonos executives have admitted that the app was rolled out with bugs that weren’t caught during testing. The update, which Sonos described as a massive overhaul that included a redesign of the cloud infrastructure and the player side of the system, was also rushed out ahead of the June launch of the Sonos Ace headphones, Bloomberg reported. With Sonos now dealing with long-time customers whose devices suddenly stopped working as expected, and customers who have relied on the underwhelming app for months, the ramifications of pushing out an update before it’s finished go beyond dollars and cents.