According to a filing with the Securities and Exchange Commission, Sonos plans to eliminate 12 percent of its global workforce. The company says the layoffs are meant to “reduce operating expenses and preserve liquidity in the face of the [COVID-19] pandemic.” Sonos will also close its retail stores in Manhattan along with six satellite offices.
Sonos CEO Patrick Spence will be taking a 20 percent reduction in his salary from July through the end of the year, and other top executives will be giving up the 20 percent until September 30th.
“When the pandemic hit, we took immediate action to review our investments for the year and made changes to reduce operating expenses and preserve liquidity,” Spence said in a statement provided to The Verge. “The pandemic and resulting economic impacts have caused us to have to make some hard choices, including reductions to our workforce, and the closure of some of our smaller offices and our storefront in New York City. These changes are necessary in order for us to emerge from this period ready to take advantage of opportunities we see in the future.”
Sonos held several all-hands meetings yesterday to share news of the layoffs. “I want to thank each of them for their contributions and the passion they brought to work each day,” Spence said of the employees losing their jobs. “Supporting them through this transition is our number one priority, and we have focused on severance, equity, healthcare and career transition coaching to assist with finding what comes next.”
As noted by Engadget, the Sonos investor website says the company currently has “more than 1,450 full-time employees,” so it’s not clear exactly how many people are included in the layoffs.
With its revenues on a sharp year-over-year decline, Sonos has said it will focus on “the reduction of marketing investments, managing and tightening inventory, and eliminating certain discretionary operating expenses” to brace the company through the remainder of the pandemic.
Sonos just recently launched its new Arc, Five, and updated Sub speakers and transitioned customers to the company’s new S2 platform. The Soho space that houses the retail store is also where Sonos had planned to handle some production for its also-new Sonos Radio streaming service. The Verge has asked the company for further details on how the s news changes its plans and a more precise number of employees being laid off.
Sonos joins a growing list of companies including Uber, Kickstarter, Airbnb, Yelp, and others that have laid off or furloughed workers as the COVID-19 pandemic continues to severely disrupt the economy.