Sonos Navigates Tariffs and Price Adjustments in 2025

Sonos is embracing a challenging year as it plans to increase prices on its audio products, a move stemming from recent tariff changes. In 2025, the US government's tariff on goods imported from countries like Malaysia and Vietnam directly impacts companies like Sonos, which produces some of its audio equipment there.

According to Sonos' CEO, Tom Conrad, tariffs now stand at 19% for Malaysia and 20% for Vietnam. This change has forced Sonos to consider sharing the increased costs with contract manufacturers and consumers alike. A detailed evaluation of their product line is underway to decide which items will see a price hike.

As Sonos grapples with these tariff challenges, it also aims to balance maintaining competitiveness while not alienating its customer base. Monitoring how these price changes affect consumer behavior becomes pivotal, as does ensuring collaboration with channel partners to make strategic adjustments.

Financially, tariffs have had a tangible impact on Sonos. Chief Financial Officer Saori Casey reported that the company anticipates tariff-related expenses to rise to $5 million in Q4, up from $3.5 million in the previous quarter.

Besides dealing with tariff hurdles, Sonos is in a phase of recovery following issues with their app that emerged last year. A software update had inadvertently disrupted functionality for many users, damaging their reputation. Sonos has since been working to reassure customers of the value and reliability of its products.

Looking towards the future, Sonos has plans to launch new products beyond their 2026 fiscal year. However, these products will need to justify their prices amidst a market impacted by high tariffs and previous setbacks.

The broader electronics industry is experiencing shifts due to tariffs as well. The removal of duty-free imports on goods valued below $800 has resulted in increased costs for various electronics. With the possibility of tariffs reaching up to 145% for goods from China, the impact on pricing strategies cannot be overstated.

As Sonos aims to regain momentum lost in 2024, it faces the complex task of navigating the tariff landscape while maintaining growth and customer loyalty.