Risk Factors Update Summary

• We incurred a net loss of $10.3 million in fiscal 2023 and $38.1 million in fiscal 2024. This change might result in decreased investor confidence.
• We expect to incur short-term costs of up to $30 million to improve the Sonos app experience. This change might impact our financial condition significantly.
• The company has relocated a substantial portion of contract manufacturing from China to Malaysia and Vietnam, mitigating tariff effects. Future trade restrictions may still impact revenue.
• We delayed the introduction of two new products originally planned for launch in Q4 2024 until October 2024. This change could negatively impact fourth quarter sales.
• As of September 28, 2024, we utilized $84.9 million in U.S. loss carryforwards remaining, with gross state net operating loss carryforwards of $33.4 million.
• Our accumulated deficit increased from $12 million to $50 million as of September 28, 2024. This change indicates worsening financial health and could deter investors.
• The company has $39.6 million in foreign net operating loss carryforwards with an indefinite life, which may affect future tax obligations and financial condition.
• We extended the warranty by one year for all home theater and plug-in speaker products under warranty as of October 2024. This change may enhance customer satisfaction but increase costs.