An electronic device is provided. The electronic device includes a microphone. The electronic device includes a speaker. The electronic device includes a communication circuit. The electronic device includes at least one processor. The at least one processor is configured to obtain a second signal based on decoding a first signal received through the communication circuit from an external electronic device. The at least one processor is configured to output a third signal through the speaker obtained based on executing decompression the second signal. The at least one processor is configured to compensate the second signal based on a difference between the second signal and the third signal representing a distortion of the third signal, in response to obtaining an input signal including the output third signal through the microphone. The at least one processor is configured to execute cancellation of an echo of the input signal based on the compensated second signal.