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WSJ Tech News Briefing

Behind the $500 Million Fiasco at Sonos

WSJ Tech News Briefing

The Wall Street Journal

News, Tech News

4.61.6K Ratings

🗓️ 1 March 2025

⏱️ 13 minutes

🧾️ Download transcript

Summary

Sonos is a niche player in the speaker market, known for its great sound quality and seamless home audio systems. But, an app update ahead of the launch of its first pair of premium headphones cost the company $500 million in market cap. WSJ’s Ben Cohen speaks with columnist Dan Gallagher on this unusual business debacle and how Sonos could bounce back. Sign up for the WSJ's free Technology newsletter.  Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0

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0:31.0

What makes for a successful app update? It improves your experience as a user and seamlessly.

0:38.3

In fact, the best updates are the ones you barely notice at all.

0:43.3

You either put it on automatic or you hit a button and it's done and finished.

0:49.3

The ones you notice are the ones where the experience changes.

0:52.3

And that was definitely the case with this.

0:54.8

That's Dan Gallagher.

0:56.3

He's a herd on the street columnist for the Wall Street Journal,

0:59.0

and he's talking about an app update at Sonos that led to a $500 million debacle.

1:05.5

The maker of premium audio equipment rolled out a redesigned app last year

1:09.6

that was supposed to improve the user experience

1:12.1

and accelerate the company's pace of innovation. And like other Sonos products, the idea sounded great.

1:19.6

Sonos put out a press release about this app update because it was a major overhaul. It wasn't

1:25.5

some small quiet update. This was considered an entire relaunch of this app.

1:31.6

And so when that went wrong, it was actually even worse.

1:37.0

Earlier this year, Patrick Spence was ousted as the CEO of Sonos.

1:41.5

The company has said that this calamity cost at least $100 million in revenue.

1:46.1

And if you measure the financial hit by market cap, the real cost of all of this is closer to

...

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