As trading closed on Thursday, sitting at the top of the Nasdaq, home audio innovator Sonos (NASDAQ: SONO) saw the stock rocket in a packet of double-edition good news for investors.
The company changed its revenue from a loss of $29.6 million in the fourth quarter to $18.4 million in revenue. Similarly, revenues rose 16% to $339.8 million, but adjusted EBITDA spins from a loss of $2.8 million to a profit of $46.4 million.
This situation was equally peachy for Sonos shareholders, with the diluted EPS turning back from a loss of $0.28 to a profit of $0.15 a year-over-year.
But the big news for stakeholders is that the company has completed its $50 million share repurchase program, in which it bought 3.8 million shares, and now the board has granted an additional repurchase program to buy the same amount of shares again.
With cash and cash equivalents, buybacks can see the excellent Sonos stocks absorbed from the open market.
Speaking about the company’s update and what he sees as a paradigm shift in business, CEO Patrick Spence said: As customers realize, Sonos products work seamlessly, with more products improving the experience. That’s why our existing customers add more products to their systems.
“We have increased total households by at least 20% for the 15th consecutive year in 2020, but existing customers once again exhibit strong repurchase habits, accounting for a record 41% of product registrations. We have begun the process of delivering consistent cadences of new innovative products and services, both old and new, to realize our customers’ lifelong value.”
“In 2020, we delivered a record 8.2% adjusted EBITDA margin, or 10.6% excluding the effects of tariffs. Next year we will provide an EBITDA margin that is adjusted from 12% to 14%.
He added that the company will continue to commit to supporting the distribution of “innovative new products” and its partnerships in the future. Over the long term, he believes the company can bring about strong profit margins, cash flow, revenue growth and increased shareholder value.
Following the news, Sonos shares rose 29.84%, up to $22.19 at 11/20/19. Not only is this far surpassed the $7.92 low since the start of the year, but it was ahead of the previous all-time high of $20.95 in August 2018.
