Shares of Sonos Inc rose as much as 34 per cent to $20.20 in their market debut on Thursday, at which the US wireless audio systems maker has a market value of nearly $1.9 billion.
The stock opened at $16, about 7 per cent above the initial public offering (IPO) price of $15 per share.
The IPO was priced below the target range of $17-$19 per share on Wednesday, signalling that investors are selective about backing stock market hopefuls in the technology sector.
“We definitely felt some nervousness from investors as we hit what seemed like some down days on the Nasdaq and we kind of got caught up in that,” said Patrick Spence, chief executive officer at Sonos. “It’s one day in the grand scheme of things.”
Sonos’ offering of about 5.6 million shares raised $83.3 million. Existing Sonos shareholders, which include investment firm KKR & Co, sold an additional 8.3 million shares.
Sonos’ IPO follows other successful technology listings this year, including those of Spotify Technology SA, Dropbox Inc and DocuSign Inc.
Founded in 2002, Sonos’ speakers and the company’s tie-ups with around 100 music streaming providers, including Apple Music, Pandora, Spotify and TuneIn, have attracted audiophiles around the world.
The Santa Barbara, California-based company has faced pressure over both the pricing and variety of its products, as smart speakers such as Amazon Inc’s Echo and Apple’s HomePod entered the market.
“What I’m most excited about is being able to come to people listening to Pandora or Apple Music or something else and say ‘Hey, for $149 you can get started on Sonos and start listening to your music out loud in your home,’” Spence said.
Morgan Stanley, Goldman Sachs and Allen & Co are among the lead underwriters for the offering.