Sonos is laying off 6% of its workforce – more than 100 people – after a disastrous redesign of its app and mounting customer complaints forced the company to cut sales forecasts and delay product launches.
The layoffs, first reported by The Vergewere announced in a corporate filing on Wednesday (August 14). Sonos had 1,867 full-time employees — about 70 percent in the United States with the rest in other countries — as of Sept. 30, 2023, according to its most recent annual report.
Since Sonos redesigned its mobile app in May, customers have complained that the app didn't recognize existing Sonos speakers and wouldn't let them set up new speakers or headphones. The problems are such that Sonos CEO Patrick Spence said earlier this month that it would lower its company's fourth-quarter sales forecast and delay the launch of two major new products while it focuses on fixing the app.
“It's so painful to let our customers down with our app,” Spence said on a call discussing the company's most recent quarterly earnings with investors. “We needed the new app to set us up for the future. Too many of our customers … have an experience that is worse than what they had in the past.”
The company expects to spend $20-30 million to fix the app, investing in its customer support and other initiatives to win back frustrated shoppers. The layoffs will cost the company between $9 million and $12 million, of which $6 million to $8 million is expected to be related to severance packages and other benefits, most of which will hit the company this quarter, according to the filing.
