Sonos Inc (SONO)
Profitability ratios
Return on sales
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 45.33% | 43.11% | 45.74% | 47.19% | 43.18% |
| Operating profit margin | -3.16% | -1.24% | 5.14% | 9.03% | -2.06% |
| Pretax margin | -1.79% | 0.26% | 3.95% | 9.14% | -1.52% |
| Net profit margin | -2.51% | -0.62% | 3.87% | 9.24% | -1.52% |
Sonos Inc's profitability ratios have shown a mixed trend over the past five years. The gross profit margin has fluctuated within a range of 43.11% to 47.19%, with the highest margin recorded in 2021. This indicates that the company has been efficient in managing its production costs and generating profits from sales.
However, the operating profit margin has been more volatile, ranging from -3.16% to 9.03%. The negative margins in 2024 and 2020 suggest that Sonos may have experienced challenges in controlling its operating expenses relative to its revenues, leading to operating losses in these years.
Similarly, the pretax margin has been inconsistent, ranging from -1.79% to 9.14%. The negative pretax margin in 2024 indicates that the company's profitability before accounting for taxes was impacted by operating losses and other expenses in that year.
The net profit margin, which reflects the bottom-line profitability after all expenses, has also fluctuated significantly, with negative margins observed in 2024 and 2020. The positive margins in 2022 and 2021 indicate periods of stronger profitability for Sonos, likely driven by effective cost management and revenue generation.
Overall, Sonos Inc's profitability ratios suggest that while the company has been able to maintain healthy gross profit margins, it has faced challenges in controlling operating expenses and achieving consistent bottom-line profitability in recent years. Monitoring and improving operational efficiency and cost management may be key areas of focus for enhancing the company's overall profitability in the future.
Return on investment
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | -5.24% | -2.05% | 7.53% | 13.61% | -3.34% |
| Return on assets (ROA) | -4.16% | -1.03% | 5.67% | 13.93% | -2.46% |
| Return on total capital | -11.21% | 0.99% | 12.36% | 27.68% | -5.88% |
| Return on equity (ROE) | -8.90% | -1.98% | 12.02% | 27.87% | -6.75% |
Sonos Inc's profitability ratios show fluctuating trends over the past five years. The operating return on assets (Operating ROA) experienced declines from 7.53% in 2022 to -5.24% in 2024. This indicates that the company's operating income generated from its assets has been decreasing, possibly due to increased operating expenses or declining sales.
The overall return on assets (ROA) also exhibited a negative trend, dropping from 5.67% in 2022 to -4.16% in 2024. This suggests that Sonos Inc's ability to generate profits from its total assets has declined, indicating potential inefficiencies in asset utilization or declining profitability.
Furthermore, the return on total capital and return on equity (ROE) ratios show similar patterns of decline over the years. The return on total capital decreased from 12.36% in 2022 to -11.21% in 2024, while the ROE dropped from 12.02% in 2022 to -8.90% in 2024. These reductions indicate that the company's profitability in relation to its total capital and equity has deteriorated.
In summary, Sonos Inc's profitability ratios reflect a concerning downward trend, indicating potential challenges in effectively utilizing assets and generating returns for its stakeholders. Further analysis of the company's financial performance and strategic initiatives may be necessary to address these issues and improve profitability in the future.