$SONO Free Cash Flow
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Yegor's avatar
Or more like the lack of it, where did it all go?image

Invested Thought's avatar
@from100kto1m Couldn't meet demand throughout late 2020 and 2021, so they started to order inventory further in advance. Then when demand collapsed in mid-2022, cash flow got murdered with inventory up $269 mm y/y. Seems to be some visibility into clearing inventory during the holiday season as it's one of the first where they have had enough inventory to run promos.
Joey Hirendernath's avatar
@investedthought ouch.... that's a bad pivot for them... Have they given any guidance on whether they will go back to their previous model of operation in terms of inventory for 2023?
Invested Thought's avatar
@joeyhirendernath Patrick Spence (CEO) signaled a fair amount of confidence in selling through a lot of inventory in the holiday season, and I assume buying patterns will reflect the new demand environment. Historically, they've done a solid job managing inventory for cash flow.