You're having a good day. Saori Casey is with us. She's CFO of Sonos, and really appreciate you being here. Many of you know she spent 12 years at Apple prior to joining here and was VP of Corporate Financial Planning at the company. Before that was at Cisco, servicing in many finance roles. Thanks for the ongoing support of the conference and. Thanks for having us. Supporting my family household making it come alive. Happy to be here. When you think about, 2026 was the year returning to growth. The first half, I think, was up 2%, and you've guided an acceleration in the second half. If you can walk through, when you think about what's giving you this confidence in the second half, what are the drivers and what's most important that we should keep an eye on? Yeah. Like you said, we were able to grow 2% the first half of FY 2026, with the most recent quarter, Q2, that we released grew 8% year-over-year. We have proceeded to say that the second half, we expect that 2% from the first half to accelerate. If you look back, even a year ago, we've been progressively growing, if you want to look on a half basis. We don't think that's sort of a fluke and an accident, but something that we have been stabilizing. Year of FY 2025, we had kind of called it the year of stabilization, and then 2026, taking that momentum into the second half of this year. Q3, we have guided to a 3%-9% growth year-over-year with a midpoint of 6%. If you compare that to Q2, the 8% that we reported, but 4 percentage points of that was a tailwind from foreign exchange. If you take that constant currency-based 4% from Q2 into Q3 midpoint of our guidance of 6%, it would imply a continued momentum and acceleration of the growth. We're super excited about that. How are we doing that? Between stabilizing the business, really staying focused, reinforcing the roadmap and the innovation. Tom has recently spoken over the last couple of quarters about five dimensions of growth and certainly innovation being one. Our growth markets, that certainly is helping fuel our growth. However, it might be small base, but it does have a meaningful contribution to our overall growth rate. You saw in the Q2 results, our EMEA and APAC business grew on a double-digit basis, even on a constant currency basis, and we attribute a big part of that to some of this growth market focus that we have. We have a new Chief Marketing Officer. The marketing aspect of how we go to market and how we tell our system story that we have been talking about over the last couple of quarters as to, that is truly what differentiates Sonos from other audio vendors that we need to really lean in on that, given our business model is such that we're not trying to generate revenue from one-and-done customers, but the customers that expand our Sonos system, and really the features that compound as you have more devices and our software features that we continue to roll out. The other aspect of it is to really have the reliability and the customer experience, which is something that, especially after the app situation over two years ago, we have really focused on and continued to be a focus for us. Without the system stability and the reliability, the system seamlessness that differentiates Sonos doesn't go anywhere. Last but not least, some of the emerging technologies like AI is certainly something that we feel we can leverage and be part of our growth story in the future. Nothing that we have explicitly reported so far, but that is part of our growth pillars that we have talked about of the five. You've been here now since January of 2024. You have a new CEO. You have a new CMO. Maybe speak to the team and, do you kind of have all the right people in the spots, or are you still kind of building this new team out, or how would you characterize where we're at? Yeah. No, it's a great question. Just over the past year, there's been a big change in our leadership team. About coming up on a year, not quite. Tom has been our permanent CEO. He had been an Interim CEO since January last year. He was named a CEO officially July, I believe, last year. Starting with that, Colleen, our CMO, was hired at the very end of the year. She started actually early this calendar year. We also have the newly hired COO, Chief Operating Officer, Frank, who has come in and who will focus on some of the strategies around our direct-to-consumer business, our customer experience, IT, and partnership and business development. I think we have a very great team with a lot of depth in their domain, and we're very excited about that given how we've stabilized the company so far in some of the areas like how we tell our story in marketing and the upper funnel, and really lean in on our brand to be able to leverage for the future. We believe we have the right expertise at the table to help our future growth. I don't know if there's an analogy to Apple, but Sonos has always been this great brand. You kind of play it safe, and maybe I've considered it almost too safe, and can you start to do more? I have a laundry list of things that I've reportedly said. I'm not a product guy, but I think I have some good suggestions, and some of them may be crazy, but like AI can help you on a Sunday morning when your wife has a birthday party, which happened, and I go downstairs and I turn on Sonos and it's ripping Def Leppard versus a cool Sunday morning. There's a use case of AI. Hey, it knows it's Sunday morning. There's a lot in the software. In the hardware, there's a lot of things you can do, which is I need a cockpit for my desk. I don't have a Sonos cockpit. I'd love one. With AI, I don't think we're going to be using our thumbs for AI. Is there a way that it can adjust what we want as users, as my personal AI assistant and yours? I'm interfacing. Are you starting to think about bigger creative things that you can tie off? I've mentioned this to James about what Turtlebox has done with Scottie Scheffler, the number one golfer in the world, putting Turtlebox on his golf cart, and he's advertising. There's an incredible category, but it's also like how much do you want to play outside the bounds versus we want to continue the safe, secure Sonos, which is a great brand. Yeah. We love that you have all these ideas. We really think. I'm a big user. I like the product. We get a lot of feedback from Brent, which is great. He keeps us on our toes, which is great, we do appreciate because that means customers really enjoy our products and believe in us that we can do much more with not only our brand or our technology and the expertise that we have to be able to be successful. That is exactly the job here. Last year we needed to be focused to get the bottom line in the right place and set the company up for success, and doing too much was part of the reason why it had created the situation that we were in on the software front. We needed to stabilize that, which meant more focused than as opposed to expand because that was the reason for the glitch. We need to get that right and be able to selectively venture into new technologies and new areas and do it well given the brand that we have and the reputation that we want to continue to build on reliability and what seamless system looks like for Sonos. We need to stay true to that. Very much top of mind to be innovative. That is as Tom talked about the five dimensions of growth, that is the top item. I don't think it's by accident it's at the top of that list that the innovation is key for us. Really launch padding off of the baseline of the reputation that we have and the brand. We got to do it right. We are very much looking into a number of areas that Tom has also alluded to, not just AI, but otherwise, and we haven't announced anything yet, but we're excited to share more when we're ready to do so. Great. We're excited. I guess maybe as a bridge while these ideas are coming, is there more you can do at the install base where, I have a bunch of amps failing at the home. Maybe it can be like, well, Brent, you have product reg data on me. Like, "Hey, your amp's six years old. Here's a coupon code." Maybe you're doing this and I'm missing the emails in my spam, but are there more you can do for the install base just to keep them moving? No, it's a great question. We have outlined our installed base along without adding a single new customer, could be upwards of $12 billion between having someone like yourself keep expanding even more into the Sonos product. Those that are only enjoying Sonos with one product to make them into multiple product users, those alone have upwards of $12 billion of opportunity. The intelligence that we get from customer data very much is something that we need to harvest further, and that's part of the reason why Tom hired Frank. He's going to be running some of the strategy around the direct-to-consumer business and how we can leverage that in conjunction with both the marketing team, Colleen, that has come on board, and she's very much into that. The partners are between Frank, our COO, the CMO, and the go-to-market, Dunja, our CRO. It will be a powerful combination to be able to leverage some of those opportunities of our install base. Okay. For Frank, maybe many don't know much about Frank, but what is he going to add to the operation role that's critical that you don't have today? Yeah. No, he recently joins us from being at Walmart's Vice President of some of their digital commerce area. He brings a lot of depth and breadth to that aspect of our business. Certainly, we do have a great DTC business, but we think we can do more there. The balance from the mix of our go-to-market channel between our channel retail channel and direct-to-consumer business, and then we do have a very meaningful installer business as well. We want to grow them all, right? We think there's still more we can do there on the DTC business, given it's ours, and especially with marketing, we can do a lot more there. Okay. Just when you look at the category, it feels like the category, we went through a massive surge during COVID, and then everyone was spending on experiences, not things. At some point, I told my wife, "We can't do four Europe trips in a year. Let's go back to the core house and upgrade the amps instead of spending a ticket to go to Europe." Do you feel, are there signals that, hey, we're going to see a more resilient. The consumer numbers have been pretty good, right? Is there anything in the data you're seeing where the consumer behavior is, there's any signals, either positive, negative, or how would you characterize just the consumer behavior now? Yeah, no. We're certainly looking at things. What are the leading indicators or lagging indicators? We often look at new home starts, or when people move, in general, certainly are some opportunities. High rates don't help. Yeah. Exactly. In the meantime, as you heard, the five growth dimensions that we mentioned were not necessarily depending on any market to turn around or any particular things externally to change for us. We've come to this point where we have to pave our own growth story here of what we can control. None of those five that we talked about, even though things like emerging technologies and the trend in the market may be a little more market driven, but it's more about what we can do for ourselves. There's plenty to do. The market doesn't have to grow in a rapid space because our market share is only 6%, and that means there's tremendous upside to our opportunities and areas like international and growth markets that we have literally have been scratching the surface for. That's even not producing one more new product. Those are opportunities that we can have with our existing product portfolio that we have. Those are certainly something we're leaning into. We get away from the tariffs, and then the AI data center build-outs give you a higher memory price, which you've said- That's right. has a higher impact at gross margin. One thing leaves, another thing comes in. When you think about component costs being driven up by our AI friends, how are you managing this? Is there any special sauce here, or is it just nothing we can do? Yeah. No. There is certainly, of course, we cannot change the market dynamics. Back to what we can control, there are certainly things like we did, you reminded it was tariff. A year ago, we went through a series of mitigation actions that we took to mitigate tariff. When we, just as we thought we were done doing that, we did have a bit of a tailwind of tariff rate going down from our average 20%, given most of our supply is coming from Vietnam and Malaysia, to more recently have come down to 10%. We have a little bit of that mitigation that we had done for tariff that we could put those proceeds, if you will, to the memory mitigation. As far as what we can control, we are looking at areas like product configuration, the memory component usage on our products. To the extent our customers are looking for great experience from Sonos, not buying based on a memory configuration, unlike PCs and smartphones. Our engineering team is evaluating how we can deliver the best experience while looking at our component configuration of our products. That's something we can help ourselves on, continuing to provide seamless experience for our customers. There are some areas based on the usage, we can see that we have more memory than required in order for us to deliver the experience to our customers. That's one. What we had done for tariff was we had increased prices. We're trying to navigate through that very cautiously. We had developed a pricing strategy that looks at elasticity. Sounds mom on apple pie, but we have another layer of lens. As many of you know, our revenue comes from not only the new customer acquisitions of the new products, but the repurchases from the existing customer cohort, the installed base that we talked about earlier. We want to make sure that we are looking at that as to what products and the pricing that affects the volume is actually shooting ourselves in the foot for the future repurchases. We are looking at that very cautiously. As we do that, now for memory mitigation, given we had increased price somewhere in the range of 5%-15%, depending on the products last year, we're very cautiously navigating that to do that again, existing products, because it does come from volume decline. Again, our goal is to maximize gross profit, but at the same time, we are also deeply caring about getting new customers. We'll evaluate new pricing as we have new products. Like for example, when we came out with Arc Ultra versus its predecessor, Arc, we had increased price because there was a lot of features that we believe customer valued, and that turned out to be the case. That price increase didn't necessarily come with a volume decline. We'll be evaluating that as we come up with new products to make sure that we're pricing it properly and be able to help mitigate some of the memory price Has anything changed competitively? At the low end it's always been noisy. I'm skiing at Jackson Hole, and Turtlebox are on every lift and every other ski resort. Turtlebox are everywhere now. They've had some pretty innovative marketing and a lot of kids, that's low end. I don't know if that was considered your core market. That seemed to have changed at the low end. At the high end, I was shown by a contractor, BluOS, Ubiquiti has a new music amp. There's others, and we've made the call to continue with the Sonos family. Has anything else changed that you've seen that's been different? Yeah. We think of low end as low end, not heavily discounted price point and getting the one-and-done customers, but low end like Era 100 SL that we recently launched to bring into the entry point into the ecosystem. Right. T hat will likely then expand from there. Sonos Play that we just launched also, while it's portables, we're also marketing it differently, that it is part of the broader system as opposed to a point product. That's something that we deeply care about. Whether it's an entry point, lower price point, but our intent is that we want those quality customers that will expand from there. Right. The installation channel's really excited about this new integrated solution on the amp side. I know it's coming without an exact date. They probably know the date. We don't know the date. Are there other things that you're doing? That seems like a very friendly solution, which just takes up a lot less space. You don't maybe need as big a racks. There's a lot of other space. Are there other things you're doing for the installation channel to keep them excited? Yeah. No, our installer channel is very, very important to us, and that's one of our differentiator for Sonos, unlike other point product vendors, that our installer channel continues to believe in us and also ask more out of us and plus Brent. We are continuing to look at some of the most requested products, and Amp Multi, despite the lack of general availability date, is something we very much listen to our installers and what they really want out of us and what they think we can be successful at. That is definitely top of mind. Okay. When you think about just overall margins, other than some of the other issues that are impacting or under your control, like memory, are there other things that you're utilizing in AI or other areas that you think are really exciting? Snowflake did a call today, and they're like, "We don't have to hire as many sales reps because AI's doing the job. Yeah. They publicly said that tonight. Are you starting to see an impact that maybe perhaps you? It's a trend all of our companies that we've spent time with today. Yeah are hiring fewer people. Yeah. Very much so. At this point, it's been a lot of value add. We haven't necessarily reduced headcount in the name of that. We've been citing some examples, such as our customer experience area, where we have started to lean in on the AI agents to deflect human calls. In some cases, the ability to bring customer issues to resolution may be more productive than in certain cases. There's a number of areas where it's happening live already, as opposed to thinking about it mode. Back office accounting areas. The opportunities abound. There's some areas that have already been leaning in much harder, but we think that there's a lot more opportunities there. That's part of call it memory mitigation or otherwise. It's something that we need to lean in on. As a company, that's the best way to grow our profit while we are able to do a lot more with the same, and bring more value to the overall company. In inventory, any issues going on there from an inventory perspective, or you feel good? Yeah. No, we think it will ebb and flow with our product launches. More recent quarter, we reported, if you look at it on a year-over-year basis, inventory had grown, but that's because we were launching the two new products that we have already announced and are shipping now. Other than in those new product introduction related ebbs and flows of our inventory, we're generally happy with it. There are times like when we were part of the tariff mitigation, we wanted to pull in our inventory as much as possible before the tariff rates were kicking in. We were trying to look at the same for the memory side as well. We were trying to use our balance sheet to make sure we can be able to do that, to make sure our P&L is the best economically beneficial, using our balance sheet to be able to do that. Besides that, we try to stay as lean as possible. The software issues, most of them have gone away. I still think maybe the UI and some of the things could be easier. How do you think about the overall kind of software strategy, where you're at, what you want to accomplish next? Yeah. No, that's part of the reason why it's one of our key five growth dimensions. We realize that is not a work that's finished or ever will be finished. When we say customer experience, it's not only the customer service side, but also the customer experience interfacing with our app and our software experience. That is also one of the top pillars of our growth. Okay. Kind of thinking about into the summer and the back half of this year, anything we should expect? We know the integrated Amp's coming at least in the fall. It seems like maybe the fall, I don't know. Anything else that we should keep an eye on that you've talked about or announced or? Yeah. We haven't announced any more than the two products that we've launched and the Amp Multi coming in the fall. Sorry. I can't wait to give you the date. I am very much looking forward to. Very cool looking. It's very cool looking. It's very cool looking. More to come on our product roadmap. Obviously, innovation being one of our five pillars as well, and more to be announced. Three years ago, we got a lot of questions. You were talking about auto and working with Audi, and I know you had to go back to the core, but are all these growth vectors still an opportunity? Meaning like, could auto, could portable, could I know you have a headset and things. I wear it all the time when I take flights. Thank you. Are all these still on the table, or are you saying, "Hey," I'm just curious? Yeah, no, good question. It's kind of, lack of a better term, you've been a little bit on defense. Can you get back to offense, and can these offensive angles for growth come back at some point? Yeah. Have you said, "Hey, we're never going back to automotive"? Yeah. We have not declared that. Last year was stabilizing focus and get the home right. If we can't get the home right, we can go into these adjacencies. We've got to get the job one right. We haven't necessarily killed auto, for example. I think Tom might have externally said at the time that we will keep an eye on those areas. It may be relatively smaller resources than some of our core home Amp Multi, for example, that we will continue to be focused on, given those are really keeping the company and the brand that it is. Those adjacent areas, we are continuing to invest, not in the most heaviest sense, but we're not ignoring them. Capital allocation, I know you have a buyback, but can you use M&A? There are other uses of cash, or? Yeah. No, we're always keeping that flexibility open. As much as buyback is something that our investors continue to support us for, but we're making sure both flexibility on whether it's M&A or be able to pull inventory when the supply chain instances happen, when we can get a best price possible. We're much keeping that flexibility in addition to the buyback. Any questions in the room? I guess, as the next core vectors kind of evolve with AI, I guess, what are you guys going to do to make sure you're kind of aligned with who's the next iPhone, essentially, in that realm? Where are you going to make sure you just stay out of? Yeah. No. We're in over 17 million households and 53 million plus devices in the home. We'll very much lean on our strength. Just as we've been independent or neutral to music services, for example, we think that's our advantage that we're not tied to one particular area. That's the approach that Tom also discussed on the earnings call in the past about we want to use that to our advantage, and given the existence in the homes already. Her comment on the iPhone, the sound blows on this. It's not very good. It's interesting. If I go to apple.com, I type in Sonos, it brings all their speakers up. It's taking your cue for audio. I don't know too many people that have the HomePod. Is there more you can do collaboratively, or you can't say? Well, there's always more we can do. Okay. Absolutely. I look forward to that. Great. Anything else that you think investors are missing? No, you've covered a lot. You've covered a lot. I was just thinking about this. I think you've covered all gamut there. Terrific. Thank you. Thank you so much for coming.