(Bloomberg) — Sonos Inc. Chief Executive Officer Patrick Spence is leaving after eight years in the job, a move that follows a botched app revamp that upset customers and stymied growth.
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The audio technology company named Tom Conrad, a board member and former executive at Snap Inc. and the Pandora music streaming service, as interim CEO effective Monday and said the company has hired a firm to find a new leader. Sonos said the move isn’t related to its first-quarter financial results, which will be announced in February.
Shares of Sonos fell as much as 6.1% to $13.64 after trading opened in New York on Monday, in line with a broader market pullback. The stock initially jumped as much as 7.1% in premarket trading on the news of Spence’s departure.
The decision to tap a new CEO comes after several months of turmoil at Sonos. In May, the company rolled out a new mobile app — the software consumers use to control their speakers and other equipment — that was riddled with bugs. Among the problems, the user interface confused customers, lost key accessibility features, and removed capabilities like the sleep timer and alarms.
“When it doesn’t work, our customers are taken out of the moment and are right to feel that we’ve let them down,” Conrad said about the Sonos user experience in an email to employees. “I think we’ll all agree that this year we’ve let far too many people down.”
Though Sonos has managed to release “remarkable” products, such as the Arc Ultra soundbar and Ace headphones, it was overshadowed by the poor experience, he wrote. It’s just not enough “when our customers’ alarms don’t go off, their kids can’t hear their playlist during breakfast, their surrounds don’t fire, or they can’t pause the music in time to answer the buzzing doorbell,” he wrote.
Customers complained that they, in some cases, spent tens of thousands of dollars outfitting their homes with pricey Sonos speaker systems, only for them to no longer work as expected because of the app. The revamp was originally meant to modernize the design and better support a new range of hardware offerings, but it didn’t go smoothly. Though the company investigated the idea of switching back to the old app, it determined that such a move wasn’t possible because of the engineering challenges.
For months, Sonos and Spence worked to fix the problems and restore features, but the damage was done to the company’s brand. The crisis also marred the launch of new products like the Ace headphones. Revenue fell 16% in the fiscal fourth quarter, which ended Sept. 28, and Wall Street is projecting a 15% decline in the holiday period.
