Sonos, the maker of smart speakers for the home, is surging in its stock market debut Thursday after a slow start.
Shares rose more than 20 percent in midday trading after opening at $16.00, just 7 percent higher than the $15 initial selling price. The stock’s intraday high of $18.71 would give Sonos an implied market value of just over $1.8 billion.
The stock trades on the Nasdaq under the ticker symbol “SONO.”
Sonos markets its high-end, web-connected speakers to audiophiles and music fans as the speaker industry moves toward smart assistants made by Amazon and Google. Sonos introduced its first voice-enabled speaker, the Sonos One, late last year. It counts traditional speaker makers Bose and Samsung among its competitors, although it also faces competition from speakers built by Apple, Amazon and Google.
But Sonos’ competitors are also valuable partners. Sonos speakers can play music from Amazon, Apple and Google’s respective streaming services.
“Nobody thought we could put all the competitive streaming services on one platform,” Sonos CEO Patrick Spence told CNBC’s “Squawk Box” Thursday ahead of the debut trade. “I see no reason that those partners won’t continue to want to put their services on really the best multi-room home system.”
The company’s initial SEC filing revealed a critical flaw in its business model, which subjects it to Amazon’s whims on what the internet giant decides to do with its Alexa voice recognition technology. Sonos has said it plans to incorporate Google’s Assistant in its products too.
“In the filing, we’ve just been very upfront about the fact that we could turn off people’s service, they could turn them off. We’re transparent by nature, so that’s in there,” Spence said.
The company’s IPO follows a number of high-profile offerings in the first half of 2018. Music streaming service Spotify, cloud storage provider Dropbox and software company DocuSign all debuted earlier this year.
Sonos disclosed its plan to go public on July 6. Morgan Stanley and Goldman Sachs are among the lead underwriters.
—CNBC’s
Ariel Shapiro
contributed to this report.
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