Sonos CEO Ousted After Disastrous App Update Fiasco That Cost Company Millions

In a significant leadership shakeup, Sonos CEO Patrick Spence has stepped down effective immediately, following an eight-month crisis triggered by a catastrophic app update that alienated customers and damaged the company’s reputation. The Santa Barbara-based smart speaker manufacturer announced that board member Tom Conrad will serve as interim CEO while the company searches for a permanent replacement.

The crisis began in May 2024 when Sonos launched a completely redesigned app that was plagued with problems, lacking essential features and frustrating longtime customers. The botched rollout led to widespread customer outrage, with users unable to access basic functions like searching music libraries and setting sleep timers. The company’s attempts to address these issues proved insufficient, ultimately requiring an estimated $20-30 million investment to fix the problems.

The fallout from the app disaster had far-reaching consequences for Sonos. The company was forced to lay off approximately 100 employees, representing about 7% of its workforce. The crisis overshadowed the launch of new products, including the Sonos Ace headphones, which have reportedly underperformed in sales. The company’s financial performance suffered significantly, with revenue dropping 16% in the fiscal fourth quarter.

Despite attempts to salvage the situation, including a October 2024 turnaround strategy and the engagement of a crisis management firm, the board of directors ultimately decided these measures were insufficient. Spence, who had led Sonos for eight years after joining in 2012, will remain as an advisor to the board until June 2025 and receive a $1.9 million severance package.

Interim CEO Tom Conrad, 55, brings significant experience from previous executive roles at companies like Snap, Pandora Media, and Zero Longevity Science. He will receive $175,000 per month and $2.65 million in restricted stock units during his tenure. The board has initiated a search for a permanent CEO with the assistance of an executive search firm.

The company’s next fiscal first-quarter results are scheduled for February 6, 2025, though Sonos has emphasized that the leadership change is unrelated to these upcoming financial results. The company’s shares have continued their downward trend since the app’s release, falling 6.1% to $13.64 following the announcement.