Sonos Soars With Cautious Guidance Brushed Aside

This post was originally published on this site

https://i-invdn-com.akamaized.net/news/LYNXNPEC302V7_M.jpg
© Reuters. © Reuters.

By Yasin Ebrahim

Investing.com – Sonos left its guidance unchanged on Thursday, despite delivering blowout quarterly earnings, but some on Wall Street are convinced the audio device maker is setting itself up to outperform.

Sonos (NASDAQ:) reported of 60 cents a share and revenue of $562 million, beating Wall Street estimates for 48 cents a share on revenue of $546 million, sending its shares up 11%.

The quarter of performance was driven by sales of newly-launched products, with its portable speakers, in particular, proving hit with audiophiles over the crucial holiday period.

Despite revenue rising 13% for the quarter from a year earlier, the company refrained from lifting guidance, saying that planned promotion during the first quarter generated more-than-expected sales that likely pulled forward revenue from the second quarter.

The company maintained its guidance on fiscal 2020 revenue in the range of $1.365 billion to $1.4 billion.

Some on Wall Street, however, see the guidance as overly cautious in the wake of easing U.S.-China trade tensions following the phase one deal agreement last month.

“Sonos reported $20 million of tariff-related impact during the quarter, slightly ahead of the $15 million impact provided with initial guidance,” RBC said “Surprisingly, despite the reduction to 7.5% from 15% as part of Phase 1 trade deal, Sonos still expects a $30 million tariff impact for the full year. “

“While guidance was held flat, we believe that decision is likely out of conservatism, and we expect Sonos will deliver results at the high-end (or above) its full-year targets,” the bank added.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.