Smart speaker player Sonos (SONO) went public this year. But in the few months that the stock has listed, it has had a rocky start. The company recently announced its first results since the IPO. The disappointing performance sent the stock tumbling more than 20% in the after-hours session. The stock still remains a Billion Dollar Unicorn.
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Sonos’s Offerings
Santa Barbara-based Sonos was founded in 2002 by serial entrepreneurs Craig Shelburne, John MacFarlane, Thomas Cullen, and Trung Mai. It all began when John MacFarlane moved to Santa Barbara in 1990 to get his Ph.D. from the University of California-Santa Barbara. Those were the times when the Internet was being built. He saw the future of the Internet and together with his other three partners, he set up several Internet-based businesses over the next few years. When the four of them were searching for their next big venture, they stumbled upon the idea of building a speaker system that would do away with the need of storing physical disks and work without the complex web of wires. In 2002, digital music wasn’t such a big industry, especially since high speed internet and the online streaming services of today, such as Pandora and Spotify, weren’t born.
The four of them realized the potential of the wireless music system, and by 2003, they had built their first prototype. By the next year, they were ready to showcase their product at tech conferences and were attracting the industry’s attention.
In January of 2005, Sonos shipped its first product – the ZP100. While the product received significant positive reviews, its sales did not grow as rapidly. Recession was on its way, and Sonos was not on anyone’s priority buy-list. Sonos, however, managed to stay afloat during the recession.
In the next few years, it embraced the digital world. It launched its own free app for iPhone and Android users that allowed them to use their phones as the controller. It improved its speakers to launch PLAY:5, a smart, all-in-one speaker for a third of the cost of the ZP100. Earlier this year, it launched Sonos Beam, its first voice-enabled home theater speaker.
