Sonos cuts 12% of workers in bid to improve product organisation

Sonos said it’s cutting about 12 per cent of its staff, or 200 workers, in a bid to make its product teams “flatter, smaller and more focused”.

Santa Barbara, California-based Sonos, maker of high-end speakers and audio equipment, announced the cuts on Wednesday (Feb 5) in a companywide call, saying that employees will be informed imminently if they are being laid off.

The move comes just weeks after the company parted ways with chief executive officer Patrick Spence as part of the fallout from a failed mobile app revamp. The app has bruised the Sonos brand and has had a negative impact on sales during a period of major new hardware products such as headphones.

Spence’s replacement, interim CEO Tom Conrad, told employees in a memo that Sonos has “become mired in too many layers that have made collaboration and decision-making harder than it needs to be”. The company is therefore restructuring, he said, a move that includes major changes to its product-development team.

“We are reorganising our product organisation into functional groups for hardware, software, design, quality and operations, and away from dedicated business units devoted to individual product categories,” Conrad wrote. “With this simpler organisation in place, cross-functional project teams will come together to improve our core experience and deliver new products.”

“Lately we have let too many projects run under a cloud of half-commitment,” Conrad added. “We are going to fix this too.”

The company said in a separate filing on Wednesday with the Securities and Exchange Commission that the job cuts will result in US$15 million to US$18 million of restructuring and related charges, mostly in the current period. Sonos will report its first-quarter earnings on Thursday. The company’s shares have declined 9.9 per cent in the past year. BLOOMBERG

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