Sonos, Skyworks and AI Shape Market Narrative

Sonos reported fiscal Q1 2026 revenue of $546 million, down 1% year over year but above the midpoint of guidance. GAAP gross profit dollars rose 5%, with GAAP gross margin at 46.5% and non‑GAAP gross margin at 47.5%, roughly 300 basis points higher than a year earlier. Adjusted EBITDA jumped 45% to $132 million, matching the company’s total adjusted EBITDA for all of fiscal 2025, and adjusted EBITDA margin reached 24.2%, its highest level in four years.

CEO Tom Conrad said the focus coming into fiscal 2026 was to build on the stability achieved in 2025 and start “bending the trajectory” toward durable growth and profitability. He framed the strategy around five “growth dimensions”: product innovation; customer advocacy via reliability and service; more intentional marketing; geographic expansion; and tapping demand from external trends such as conversational AI in the home.

On the product side, Sonos ended an intentional pause in new hardware launches and introduced Amp Multi, a multi‑zone amplifier aimed at installer partners. The company described Amp Multi as a “clear expression” of its system strategy, designed to make complex installations easier while embedding Sonos deeper into sophisticated homes. At quarter‑end, Sonos had more than 53 million connected devices across over 17 million homes, with leadership citing this installed base as a platform for new services and interaction models.

Financially, Sonos guided Q2 revenue to $250–$280 million, implying flat to modest growth year over year, and full‑year 2026 revenue of $796–$826 million, flat at the midpoint but improving from prior annual declines. The company expects 2026 gross profit dollars to grow 5% (GAAP) at the midpoint, while GAAP operating expenses are forecast to fall 16% year over year. Sonos repurchased $25 million of shares in Q1 and ended the quarter with a net cash balance of $363 million.

Conrad reiterated that Sonos’ competitive focus is “systemness” — ensuring the whole-home audio system is more valuable than the sum of its parts. He pointed to multi‑device behavior, unified design across hardware and software, context‑aware experiences, and an underlying “Sonos operating system” as differentiators. The company is also exploring conversational AI and anticipatory features that could make the system “smarter, more personal, and even easier to use,” while emphasizing that any new interaction models should feel “invited rather than tacked on.”

On marketing, newly arrived CMO Colleen DeCourcy is rebuilding Sonos’ go‑to‑market approach around a full‑funnel brand architecture, with an aim to move away from episodic, launch‑driven spikes toward more sustained presence. One tactical move has been reducing the price of Era 100, which Sonos described as a critical gateway product. Q1 marked the third consecutive quarter of accelerating new customer growth among households that start with Era 100, with new customer growth for these cohorts up more than 40% year over year.

Sonos also addressed investor questions on component cost inflation, particularly memory. Management said tariffs were a roughly 300 basis‑point headwind to gross margin in Q1 but were largely offset via mitigation actions, mainly pricing. Memory costs are now another headwind, but the company noted that its products have modest memory requirements – typically 512MB to 2GB of RAM – and that customer purchasing decisions are not driven by memory configurations, giving Sonos room to pursue architectural cost efficiencies.

Looking ahead, Sonos expects Q2 adjusted EBITDA between negative $18 million and positive $10 million, but projects first‑half adjusted EBITDA of $128 million, up 42% year over year. With Amp Multi and additional yet‑to‑be‑announced products slated for launch later in fiscal 2026, management signaled confidence in returning to revenue growth while continuing to expand margins through disciplined cost control.

Skyworks Solutions reported fiscal Q1 2026 revenue of $1.035 billion, exceeding the high end of its guidance. Diluted non‑GAAP earnings per share were $1.54, $0.14 above the midpoint of its outlook. Gross margin came in at 46.6% and operating margin at 24.3%. Free cash flow reached $339 million, a 33% free cash flow margin, and the company ended the quarter with $1.6 billion in cash and investments against $1 billion in debt.

Mobile revenue represented 62% of total and was higher than expected, supported by “healthy sell‑through” and strong execution on new product launches at its largest customer. Broad Markets delivered its eighth consecutive quarter of growth, with revenue up 11% year on year and 4% sequentially, driven by edge IoT, data center and cloud infrastructure, and automotive. Management highlighted Wi‑Fi 7 momentum, solid automotive demand tied to connectivity and software‑defined vehicle architectures, and growing content in data center timing and power isolation for 800G and emerging 1.6Tb architectures.

For fiscal Q2, Skyworks guided revenue to $875–$925 million, with mobile expected to decline about 20% sequentially on seasonality and Broad Markets to be flat sequentially but up high single digits year over year, representing 44% of sales. At the midpoint of $900 million, projected diluted EPS is $1.40, and gross margin is expected at 44.5–45.5%.

CEO Philip Brace also discussed the planned combination with Qorvo, calling it “highly strategic and transformative.” The company expects the merged entity to achieve gross margins in the 50%–55% range through cycles, generate more than $500 million in synergies over time, and operate with net leverage of about 1x at close, which is targeted for early calendar 2027 subject to regulatory and shareholder approvals. Brace emphasized the complementary nature of the RF portfolios and said the deal should reduce historical mobile volatility and expand total addressable market into defense and aerospace.

Broader market commentary on Feb. 3 underscored a sharp divergence between hardware and software within the tech complex. A software heat map showed most names in the red year to date, with some stocks down as much as 40%, while semiconductor ETFs such as SOXX were up about 15%. Commentators linked software weakness to concerns that AI agents, including those from startups like Anthropic, could pressure traditional software and legal-service providers.

At the index level, the S&P 500 fell 0.84% to 6,917.81 and the Nasdaq Composite dropped 1.43% to 23,255.19, with big AI beneficiaries such as Nvidia, Microsoft and Amazon losing ground. At the same time, retailers including Walmart, Costco and Target gained, suggesting rotation from high‑risk growth into more value‑oriented names. Reports of the U.S. Navy shooting down an Iranian drone contributed to a 2.58% rise in Brent crude to $68.01 a barrel and helped push the 10‑year U.S. Treasury yield to a multi‑month high.

Against that backdrop, AI‑exposed names continued to feature prominently in company‑specific news. Palantir Technologies rose after reporting robust AI‑driven revenue growth. Applied Digital shares traded near 52‑week highs after fiscal Q2 revenue grew 250% year over year to $126.6 million, supported by long‑term AI data center leases, although the company remains loss‑making and carries over $2.6 billion of debt. Separately, analysis of Lumen Technologies highlighted its stock’s 78.5% gain over the past year as it leverages its fiber network to serve AI data centers, while still facing a heavy long‑term debt load.

In the crypto and tokenization space, Ondo Finance announced the integration of its Ondo Global Markets platform into the MetaMask mobile wallet, allowing eligible users in supported non‑U.S. jurisdictions to access over 200 tokenized U.S. stocks and ETFs, including large‑cap AI names such as Nvidia, Apple, Microsoft and Amazon, as well as commodities‑linked ETFs. The offering is available 24/5 in line with U.S. market hours, with tokens representing underlying securities and tradable around the clock.

A new report from JPMorgan Private Bank on global family offices indicated that artificial intelligence has become the dominant investment theme for the world’s wealthiest families. In a survey of 333 single‑family offices across 30 countries conducted between May and July 2025, 65% of respondents said they are prioritizing AI‑related investments either now or in the future.

By comparison, only 17% cited crypto and digital assets as a key investment theme. The report noted that 89% of family offices had no exposure to crypto at all, with average allocations to digital assets at just 0.4% globally and to Bitcoin at 0.2%. Gold also saw limited uptake: 72% of respondents reported zero exposure, leading JPMorgan to conclude that “despite geopolitical fears, family offices avoid gold and crypto.”

The survey sample was weighted toward the United States, which accounted for nearly 60% of respondents, with the remainder in Europe, Latin America and Asia‑Pacific. Across regions, JPMorgan said the findings reflect a broad, long‑term shift in how large pools of private capital are positioning, with AI and related infrastructure favored over traditional hedges and highly volatile digital assets.