Sonos reported fourth-quarter and fiscal 2026 results on November 10, and the headline is the one management promised a year ago: growth is back. Fiscal 2026 revenue was $1.547 billion, up 7% from $1.443 billion, after a 5% decline the year before. Excluding the 53rd week in the fiscal year, growth was 5%. Shares rose after hours.
The fourth quarter
Fourth-quarter revenue was $344.4 million, up 20% year over year, or 11% excluding the extra week. That was above the $340.3 million estimate. Adjusted EPS was $0.04 against a consensus loss of $0.18. Every region grew: the Americas up 17% to $224.8 million, Europe, the Middle East and Africa up 24% to $95.9 million, and Asia Pacific up 29% to $23.8 million. New products drove most of it; Sonos launched five during the year.
Adjusted EBITDA in the quarter was only $6 million, roughly flat, because higher revenue was offset by $33 million of increased memory costs. GAAP gross margin of 46.1% included an $18 million benefit from tariff refunds. Non-GAAP gross margin was 42.1%.
The memory squeeze
Memory is the story underneath the numbers. For the full year Sonos absorbed $56 million of higher memory costs. Adjusted EBITDA still rose 39% to $184 million. Management says it would have grown 81% to $240 million without that headwind. The same DRAM and NAND shortage lifting chipmakers’ results is squeezing every company that buys memory to put in a product. Sonos is a clean example of a hardware maker caught on the wrong side of it.
GAAP net income for the year was $90 million, a $151 million swing from the prior year’s loss. Free cash flow rose 14% to $123 million, though the fourth quarter itself was $5 million negative. Adjusted EBITDA was positive in all four quarters, the first time since fiscal 2021.
What changed
CEO Tom Conrad has spent close to two years rebuilding Sonos after the 2024 app disaster. Non-GAAP operating expenses fell 3% for the year, sales and marketing dropped to 16% of revenue from 18%, and the company is pitching a system strategy in which each new product improves the ones customers already own. The software update coming next year is branded Sonos 27.
Revenue growth with cost discipline is a real turnaround. Memory prices are the variable Sonos doesn’t control, and they’ll decide how much of that growth reaches the bottom line in fiscal 2027.