Sonos (SONO) to Report Q2 Earnings: What's in the Cards?

Sonos Inc SONO is scheduled to report second-quarter fiscal 2024 results on May 7.

The Zacks Consensus Estimate for revenues is pegged at $246.5 million, indicating a year-over-year decline of 19%.

The consensus estimate is pegged at a loss of 27 cents per share. In the prior-year quarter, the company incurred a loss of 24 cents.

Let’s see how things have shaped up for the upcoming announcement.

Sonos, Inc. Price and EPS Surprise

Sonos, Inc. Price and EPS Surprise

Sonos, Inc. price-eps-surprise | Sonos, Inc. Quote

Factors at Play

Sonos’ fiscal second-quarter performance is likely to have been affected by subdued demand for the home theater category across all regions due to a slow market for TV purchases.

In the fiscal second quarter, it expects revenues to decline 59% to 61% sequentially. It expects second-quarter revenues to have been pulled forward in the first quarter due to heightened promotional activity. Unfavorable forex movement and supply-chain issues resulting in increased component costs are likely to have been other headwinds.

Continued weakness in Sonos system products and the Sonos speakers segments is likely to have affected its performance in the quarter under discussion. The Zacks Consensus Estimate for Sonos system products’ revenues is pegged at $32.4 million, indicating a year-over-year decline of 26.5%. The consensus estimate for Sonos speakers' revenues is pegged at $192.1 million, suggesting a dip of 19.5% year over year.

The company has been focused on its three strategic initiatives — expansion of its brand, augmenting its product portfolio and expanding of geographical footprint. The flywheel initiatives are expected to have helped the company expand its customer base and monetize the existing customer install base through new product launches.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for SONO this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.

SONO has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the Favorable Combination

Here are some stocks you may consider, as our proven model shows that these have the right mix of elements to beat estimates this time around.

Emerson Electric Co. EMR has an Earnings ESP of +1.99% and a Zacks Rank #2. EMR is scheduled to report second-quarter fiscal 2024 earnings on May 8. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for EMR’s to-be-reported quarter’s earnings and revenues is pegged at $1.26 per share and $4.29 billion, respectively. The stock has risen 30% in the past year.

Gray Television, Inc GTN has an Earnings ESP of +9.26% and presently carries a Zacks Rank #2. GTN is slated to release quarterly numbers on May 7.

The Zacks Consensus Estimate for GTN’s to-be-reported quarter’s earnings and revenues is pegged at 54 cents per share and $818 million, respectively. Shares of GTN have gained 17.1% in the past year.

The GEO Group, Inc GEO has an Earnings ESP of +3.90% and currently sports a Zacks Rank #1. GEO is scheduled to report quarterly earnings on May 7.

The Zacks Consensus Estimate for GEO’s to-be-reported quarter’s earnings and revenues is pegged at 19 cents per share and $603.8 million, respectively. Shares of GEO have surged 64% in the past year.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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