Tech

Sonos tanks after disclosing CFO Michael Giannetto will retire this year

Key Points
  • Shares of Sonos plunged after the company disclosed its CFO plans to retire as it reported earnings that beat expectations.
  • CFO Michael Giannetto will stay in the role until Sonos appoints his successor, Sonos said.
  • The company reaffirmed its guidance for the 2019 fiscal year, which ends Sept. 30.
The Sonos One
Todd Haselton | CNBC

Sonos plunged more than 11 percent in after hours trading Wednesday after reporting its Q1 2019 earnings and announcing its Chief Financial Officer Michael Giannetto plans to retire.

In an SEC filing, the company said Giannetto will continue in his role until the company appoints a successor.

Sonos reported earnings per share of $0.55 versus $0.41 expected by analysts, per Refinitiv, and quarterly revenue of $496 million versus $491 million expected. The company reaffirmed guidance for its 2019 fiscal year, which ends Sept. 30: It expects EBITDA of $83 million to $88 million on revenue of $1.25 billion to $1.28 billion.

Sonos was an early pioneer in wireless home audio, but faces increasing competition from lower-priced offerings from tech giants like Google, Amazon, and Apple. The company made its public market debut last August, and shares are down about 30% from that time.

In a letter to investors, Sonos said its growth in Europe was slower than expected since the growing adoption of voice in the region was skewed toward low-priced products.

"So, while we believe we benefited from consumers upgrading to Sonos in North America, our growth in Europe was slower as voice is in an earlier stage of adoption," Sonos wrote. "As European consumers increasingly embrace voice technology, we are optimistic we will benefit from a similar step-up trend in Europe in the future."

Watch: Sonos CEO: We're not focused on pushing one particular voice or music streaming service

VIDEO3:4103:41
Sonos CEO: We're not focused on pushing one particular voice or music streaming service