[Editorial] Masimo sells Sound United to Harman/Samsung for just $350 million

Masimo, a Californian holding company specializing in medical equipment, acquired the Sound United group in 2022. The group included prestigious brands as Bowers & Wilkins, Denon, Definitive Technology, Polk Audio, Classé, Boston Acoustics and Marantz. The deal, at that time, cost more than 1.5 billion dollars and it didn't work out as expected. In fact, in the face of significant losses, the entire package is being sold off for just 350 million dollars to Samsung, through its subsidiary Harman: about a quarter of the initial investment! In the package, Harman therefore acquires the brands: Bowers & Wilkins, Denon, Marantz, Polk Audio, Boston Acoustics, Definitive Technology, HEOS and Classé Audio, which are now added to the already rich Harman portfolio. Harman already included AKG, AMX, Arcam, Bang & Olufsen Automotive, Becker, BSS Audio, Crown, dbx, DigiTech, Harman Kardon, Infinity, JBL, Lexicon, Mark Levinson, Martin, Revel, Soundcraft and Studer. In practice, an unprecedented empire is being built in the audio industry, all under Samsung's protective (???) wing.

Maybe Harman got a deal, and maybe not. Let's see the reasons why the Sound United package was sold off. The financial reports speak quite clearly: in 2024 Q3 the turnover of the newly acquired audio package went from 171.5 million dollars in 2023 to 161.4, a net drop of 10 million dollars. In total, that package made a loss of 31.3 million dollars, of which 12.9 in Q3 alone (Q3 = third quarter of 2024). It would therefore seem that these brands were not doing very well. Sure, Harman/Samsung bought a package that was previously worth a lot of money for an extremely low price...but won't this be the current market value of these brands? We are not talking about crumbs, but about pillars of the market such as B&W, Marantz and Denon, without considering the other historic brands.

What should we expect? It is not known what Samsung will do, they could also decide to move production to different factories or to purchase components from other suppliers in order to reduce costs, and this would obviously (in my opinion!) cause a detriment of the quality of the products. And what about the sound? Each of these brands has a fairly precise connotation, will it remain unchanged or will it be standardized? Let's not forget that Samsung is a giant of the consumer world, interested in making large numbers, not niche products. Maybe it will preserve the identity of these products, or maybe not. It is true that the Harman group would manage everything, but Harman is just a branch of Samsung, after all.

Moreover: what will the sales strategy be? Will the same network of dealers be used? McIntosh, for example, once acquired by Bose, suffered a bit because the products were withdrawn from some select dealers. McIntosh, indeed, has just terminated all of its remaining independent manufacturer sales representative groups.

We'll see what happens, in general I don't look favourably on the concentration of so many brands under a single umbrella but the truth is, let's face it, that the HiFi market doesn't have the numbers to keep all these brands alive. They are too many, and it's hard to understand if each of them has an added value compared to the others. The contraction in sales, despite what some dealers say, claiming to sell very expensive components by the dozen every month (I'd like to see the real numbers, though), has meant that prices - especially for high-end products - have skyrocketed, to compensate for the drop in sales. In practice: “I sell less, but I earn the same”. How long will this game survive? I can distinctly hear the sound of a ladle scraping the bottom of the barrel.

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May 2025 Editorial

Masimo sells the Sound United “package” to Harman/Samsung group