“Sonos Executives Will Forego Bonuses Due to App-Related Issues”

"Sonos Executives Will Forego Bonuses Due to App-Related Issues"

“Sonos Executives Will Forego Bonuses Due to App-Related Issues”

# Sonos CEO Acknowledges May App Update Was a “Mistake” Amid Customer Outrage

In a frank acknowledgment, Sonos CEO Patrick Spence admitted that the company’s controversial app update in May 2024 was a considerable blunder, labeling it “clearly a mistake.” This admission follows months of customer dissatisfaction concerning the removal of vital features and technical glitches that affected the app, particularly for users with older Sonos devices. Spence made these comments during an interview with *Reuters*, where he accepted full accountability for the flawed launch and described the company’s ongoing measures to address the issue.

## The May Update: Customer Outrage

Upon the release of the new Sonos app in May, it received immediate backlash from dedicated customers. The update eliminated several critical features, including the ability to browse music libraries, modify song and playlist queues, and establish sleep timers—essential functions that had been fundamental to the user experience. Furthermore, the update led to performance problems for some older Sonos devices, leaving long-term users feeling frustrated and overlooked.

The timing of the update was especially unfortunate, as it coincided with the eagerly awaited launch of Sonos’ inaugural headphones, the Ace. The app redesign was reportedly hurried to accommodate the new product, resulting in a premature rollout that lacked adequate testing and quality checks.

## Sonos’ Action: Restoring Features and Rebuilding Faith

In a message to investors on Tuesday, Sonos gave an update on its initiatives to fix the app’s deficiencies. The company noted that “over 80 percent of the app’s missing features have been reinstated” and reassured users that the app should be “nearly 100 percent restored in the coming weeks.” Sonos has been implementing updates every two weeks to return the app to parity with its previous iteration.

Spence, in his conversation with *Reuters*, recognized that the company had misjudged the system’s complexity and failed to perform sufficient testing ahead of the launch. “We underestimated the complexity of the system, and thus our testing didn’t capture all of the necessary elements. We launched it too early,” he remarked. This admission underscores the internal difficulties Sonos encountered in balancing a new product introduction with the necessity for a stable and dependable app experience.

## The Price of Haste: Technical Debt and Employee Issues

The hurried launch of the app has unmasked deeper problems within Sonos’ development practices. Last month, both former and current Sonos employees criticized the app for accumulating “technical debt” over time. This term pertains to the long-term ramifications of shortcuts taken in software development, such as neglecting underlying issues or postponing essential enhancements. As per these accounts, the app update was expedited despite some employees voicing concerns that it was unready for release.

The choice to prioritize the app’s debut to align with the Ace headphones seems to have backfired, as the ensuing technical troubles have frustrated customers and strained internal resources. Sonos has since postponed two hardware launches, compounding the company’s difficulties.

## No Executive Bonuses for 2024

In light of the app controversy, Sonos’ leadership faces a financial setback. Spence and seven other senior executives have opted to forgo their bonuses for the fiscal year ending September 30, 2024. As reported by *Reuters*, Spence received a bonus of about $72,000 for the fiscal year 2023, but there will be no such compensation available for the current year. The executives must achieve “certain benchmarks” to be eligible for bonuses in the subsequent fiscal year, which spans from October 2024 to September 2025.

The decision to withhold executive bonuses reflects the wider financial ramifications the app failure has had on the organization. In addition to harming Sonos’ reputation and alienating long-time users, the app issues have resulted in tangible financial repercussions. The company anticipates spending as much as $30 million in the short term to amend the app and regain the trust of customers and partners. This includes not only development costs but also potential lost revenues from delayed hardware releases.

## Financial Consequences and Stock Drop

The financial fallout from the app failure is considerable. Sonos has already reduced its fiscal 2024 projections due to delays in hardware releases and the expenses involved in rectifying the app. The company’s stock has also suffered, with shares plummeting more than 30 percent since the app update’s launch in May, according to *Reuters*.

The $30 million cost related to the app recovery efforts highlights the gravity of the situation. Sonos is not only striving to restore the app’s functionality but also to rebuild confidence with its customer base and partners. The company has a challenging journey ahead as it endeavors to recover from the consequences of the rushed launch.

## Moving Ahead: Lessons Gained

Although the May app update undoubtedly presented a setback for Sonos, the company’s leadership appears devoted to gaining insights from the experience.