Your existing setup can play Atmos. The height audio is only coming from the upfiring speakers in the Sonos Arc.
If you added Era 300 as surrounds, height audio would also be output by them, in addition to the Sonos Arc, therefore the Atmos effect is greater, but that doesn’t mean you are not playing Atmos currently. Believe what the app tells you.
One up your friend, tell him it isn’t “real” Atmos until you have all 64 speakers it supports.
Actually this is more helpful.
In Dolby Atmos, by contrast, sound can be freed from channels. It enables artists to treat specific sounds as individual entities, called audio objects. These can be precisely placed and moved by the soundtrack creator anywhere in the cinema's three-dimensional space