Sonos Inc (SONO)
Profitability ratios
Return on sales
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 43.11% | 45.74% | 47.19% | 43.18% | 42.07% |
| Operating profit margin | -1.24% | 5.14% | 9.03% | -2.06% | 0.45% |
| Pretax margin | 0.26% | 3.95% | 9.14% | -1.52% | -0.09% |
| Net profit margin | -0.62% | 3.87% | 9.24% | -1.52% | -0.38% |
Sonos Inc's profitability ratios reflect changes over the past five years. The gross profit margin decreased from 47.18% in 2021 to 43.29% in 2023, indicating a decline in the company's ability to generate profit from sales after deducting the cost of goods sold. The operating profit margin also saw a significant decrease, from 9.03% in 2021 to -1.24% in 2023, suggesting a decline in operational efficiency or an increase in operating expenses.
The pretax margin experienced a similar downward trend, declining from 9.14% in 2021 to 0.27% in 2023, signifying a reduced ability to generate profit before accounting for taxes. The net profit margin followed suit, dropping from 9.24% in 2021 to -0.62% in 2023, indicating lower profitability after accounting for all expenses and taxes.
Overall, the declining trend across all profitability margins suggests that Sonos Inc may be experiencing challenges in maintaining and growing its profitability, which may warrant further investigation into the company's cost structure, operational efficiency, and revenue generation.
Return on investment
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | -2.05% | 7.53% | 13.61% | -3.34% | 0.75% |
| Return on assets (ROA) | -1.03% | 5.67% | 13.93% | -2.46% | -0.63% |
| Return on total capital | 0.99% | 12.36% | 27.68% | -5.88% | 0.47% |
| Return on equity (ROE) | -1.98% | 12.02% | 27.87% | -6.75% | -1.70% |
Sonos Inc's profitability ratios indicate fluctuations in performance over the past five years. The operating return on assets (Operating ROA) declined from 13.61% in 2021 to -2.05% in 2023, suggesting a decrease in operating income generated per dollar of assets. Similarly, the return on assets (ROA) experienced a negative trend, dropping from 13.93% in 2021 to -1.03% in 2023. This indicates a decline in overall profitability relative to the total assets employed during the period.
The return on total capital also exhibited a negative trend, falling from 27.23% in 2021 to -3.96% in 2023, highlighting a decrease in the overall return generated from the total capital invested. Additionally, the return on equity (ROE) decreased from 27.87% in 2021 to -1.98% in 2023, indicating a decline in the return to the shareholders' equity.
These trends suggest that Sonos Inc experienced a reduction in profitability and efficiency in utilizing its assets and capital over the past few years, which may require further investigation to understand the underlying causes and management strategies.