Pros:
No traffic.
No stupid meetings.
Less time/effort spent on being presentable.
Better hardware at home.
Cons:
Potentially missing out on a nice office environment, if that applies to you or if you care about that.
I sit in front of a computer most of the day anyway, whether I'm working or not. I'm more productive at home. Actually, I'm most productive when multi-tasking (working on personal projects).
On its own, the time saved by not having to commute far outweighs any negatives for me. While I do enjoy driving, especially in my 3er, I don't enjoy sitting in traffic. Doesn't help that I've only lived in areas with rather bad traffic.