SoundHound AI Reports 68% Revenue Growth but Faces Severe Losses
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 10 2026
0mins
Should l Buy SOUN?
Source: NASDAQ.COM
- Significant Revenue Growth: SoundHound AI reported a 68% year-over-year increase in sales, reaching $42 million last quarter, indicating strong demand and competitive positioning in commercial applications.
- Profitability Issues: Despite rapid revenue growth, the company faced a negative free cash flow of $111 million over the past twelve months, highlighting severe cash burn that could hinder future investment capabilities.
- Shareholder Dilution Risk: Since going public, the number of shares outstanding has increased by over 100%, which poses a significant drag on long-term returns, especially as the company struggles to achieve profitability.
- Valuation Concerns: With a market capitalization of $5 billion and a price-to-sales ratio of 32, significantly above the S&P 500 average, the stock reflects market skepticism regarding its future profitability potential.
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Analyst Views on SOUN
Wall Street analysts forecast SOUN stock price to rise
7 Analyst Rating
5 Buy
2 Hold
0 Sell
Moderate Buy
Current: 8.520
Low
11.00
Averages
16.60
High
26.00
Current: 8.520
Low
11.00
Averages
16.60
High
26.00
About SOUN
SoundHound AI, Inc. is engaged in conversational intelligence, offering voice and conversational artificial intelligence (AI) solutions that let businesses offer experiences to their customers. Through its proprietary technology, its voice AI delivers speed and accuracy in numerous languages to product creators and service providers across retail, financial services, healthcare, automotive, smart devices, and restaurants via AI-driven products, such as Smart Answering, Smart Ordering, Dynamic Drive Thru, and Amelia AI Agents. Along with SoundHound Chat AI, a voice assistant with integrated Generative AI, it powers various products and services, and processes billions of interactions each year for businesses. Its developer platform, Houndify, is an open-access platform that allows developers to leverage its Voice AI technology and a library of over 100 content domains, including commonly used domains for points of interest, weather, flight status, sports and more.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
SoundHound AI Reports Strong Revenue Growth but Stock Price Declines
- Strong Earnings Report: SoundHound AI reported robust revenue growth for Q1 2026, yet the stock price declined as the company maintained its full-year revenue forecast of $225 million to $260 million, disappointing investors.
- Acquisition of LivePerson: SoundHound intends to acquire LivePerson, expecting it to contribute $100 million to total revenue in 2027, although skepticism surrounds the deal, with some viewing it as a potential money pit.
- Negative Market Sentiment: Despite impressive revenue growth, SoundHound remains unprofitable, and LivePerson has reported significant losses of $134.2 million in 2024 and $67.2 million in 2025, leading to concerns about the acquisition's viability.
- AI Market Potential: The global AI agent market is projected to grow from $7.6 billion in 2025 to $182.9 billion by 2033, positioning SoundHound to potentially lead in this expanding sector if it can successfully leverage the LivePerson acquisition.
See More
SoundHound AI's LivePerson Acquisition Sparks Market Concerns
- Revenue Growth vs. Expectations: SoundHound AI reported strong revenue growth in Q1 2026 but maintained its full-year revenue forecast of $225 million to $260 million, which disappointed investors and led to a stock price decline.
- Potential Impact of LivePerson Acquisition: SoundHound plans to acquire LivePerson for $43 million in an all-stock deal, expecting it to contribute $100 million in revenue by 2027, although market skepticism about profitability looms large.
- Market Concerns Over Acquisition: Despite impressive revenue growth, SoundHound remains unprofitable, while LivePerson has reported significant losses of $134.2 million in 2024 and $67.2 million in 2025, raising doubts about the viability of the acquisition.
- AI Agent Market Outlook: The global AI agent market is projected to grow from $7.6 billion in 2025 to $182.9 billion by 2033, positioning SoundHound to lead in this burgeoning sector, but the success of the integration will take time to assess.
See More
SoundHound AI's LivePerson Acquisition Fuels Growth Prospects
- Significant Revenue Growth: SoundHound AI reported a 52% year-over-year revenue increase in Q1, reaching $44.2 million, with automotive and IoT revenues surging by 88%, indicating strong performance in the rapidly evolving AI market despite profitability challenges.
- Acquisition of LivePerson: SoundHound plans to acquire LivePerson with cash, which has faced challenges in its customer service transformation; this acquisition will provide SoundHound access to a large customer base and aims to turn around LivePerson's business within the next year, enhancing competitive positioning.
- Future Revenue Guidance: The company maintains its 2023 revenue guidance between $225 million and $260 million, expecting combined revenues to reach between $350 million and $400 million by 2027, with LivePerson contributing at least $100 million, although this estimate may be conservative.
- Cash Flow and Profitability: Despite revenue growth, SoundHound faces profitability issues, reporting an adjusted EPS loss of $0.06 and an operating cash outflow of $26.3 million in Q1, highlighting the need for careful cash flow management during its expansion efforts.
See More
SoundHound AI Reports Revenue Growth Amid Rising Losses
- Significant Revenue Growth: SoundHound reported a revenue of $44.2 billion for the quarter ending March 31, marking a 52% increase year-over-year, indicating strong market demand in the voice AI sector; however, the accompanying rise in losses has raised investor concerns.
- Declining Gross Margin: Despite revenue growth, SoundHound's gross margin fell from 36.5% to 31.1%, with a net loss exceeding $25 million compared to a profit of nearly $130 million last year, highlighting a deterioration in profitability.
- Increased Cash Burn: In Q1, SoundHound's cash burn escalated to $26.3 million, up from $19.2 million a year earlier, suggesting that ongoing cash outflows may force the company to rely on frequent stock offerings to fund its growth initiatives.
- Market Confidence Wanes: Although the growth in the past quarter is impressive, the lack of significant improvement in cash flow and earnings has left many investors skeptical about SoundHound's sustainability, contributing to a stock price decline of over 60% from its peak.
See More
SoundHound AI Q1 2026 Earnings Report Analysis
- Significant Revenue Growth: SoundHound AI reported Q1 revenue of $44.2 million, a 52% year-over-year increase, showcasing the company's potential in a $140 billion total addressable market despite not raising full-year guidance.
- Negative Market Reaction: Although revenue met expectations, the market's concerns over the lack of guidance increase and ongoing losses led to a 7.89% drop in stock price post-earnings, reflecting investor caution regarding short-term prospects.
- Client Collaboration Expansion: SoundHound's agreement with Walmart to integrate its voice AI technology into retail television brands further solidifies its market position in smart devices and customer service sectors.
- Optimistic Future Outlook: The company projects full-year revenue for 2026 between $225 million and $260 million, with 2027 revenue expected to reach at least $350 million to $400 million, indicating strong growth potential, although investors must navigate significant stock volatility.
See More
SoundHound AI Reports Strong Q1 2026 Revenue but Shares Decline
- Significant Revenue Growth: SoundHound AI reported a revenue of $44.2 million in Q1 2026, marking a 52% year-over-year increase; however, despite meeting expectations, concerns over ongoing losses led to a sharp decline in share price.
- Market Expectations Missed: The company did not raise its full-year revenue guidance, maintaining a forecast of $225 million to $260 million for 2026 and a minimum of $350 million to $400 million for 2027, failing to meet market expectations for higher guidance.
- Customer Satisfaction Improvement: SoundHound's technology has shown strong performance among clients, with an average revenue increase of 11% and a 14% boost in customer satisfaction post-implementation, indicating the effectiveness and potential of its products in the market.
- Long-Term Growth Potential: Despite short-term stock volatility, SoundHound's total addressable market is estimated at $140 billion, suggesting the company is still in the early stages and could achieve larger revenue growth through partnerships with major clients.
See More
SoundHound AI Reports Strong Revenue Growth but Stock Price Declines
- Strong Earnings Report: SoundHound AI reported robust revenue growth for Q1 2026, yet the stock price declined as the company maintained its full-year revenue forecast of $225 million to $260 million, disappointing investors.
- Acquisition of LivePerson: SoundHound intends to acquire LivePerson, expecting it to contribute $100 million to total revenue in 2027, although skepticism surrounds the deal, with some viewing it as a potential money pit.
- Negative Market Sentiment: Despite impressive revenue growth, SoundHound remains unprofitable, and LivePerson has reported significant losses of $134.2 million in 2024 and $67.2 million in 2025, leading to concerns about the acquisition's viability.
- AI Market Potential: The global AI agent market is projected to grow from $7.6 billion in 2025 to $182.9 billion by 2033, positioning SoundHound to potentially lead in this expanding sector if it can successfully leverage the LivePerson acquisition.
See More
SoundHound AI's LivePerson Acquisition Sparks Market Concerns
- Revenue Growth vs. Expectations: SoundHound AI reported strong revenue growth in Q1 2026 but maintained its full-year revenue forecast of $225 million to $260 million, which disappointed investors and led to a stock price decline.
- Potential Impact of LivePerson Acquisition: SoundHound plans to acquire LivePerson for $43 million in an all-stock deal, expecting it to contribute $100 million in revenue by 2027, although market skepticism about profitability looms large.
- Market Concerns Over Acquisition: Despite impressive revenue growth, SoundHound remains unprofitable, while LivePerson has reported significant losses of $134.2 million in 2024 and $67.2 million in 2025, raising doubts about the viability of the acquisition.
- AI Agent Market Outlook: The global AI agent market is projected to grow from $7.6 billion in 2025 to $182.9 billion by 2033, positioning SoundHound to lead in this burgeoning sector, but the success of the integration will take time to assess.
See More
SoundHound AI's LivePerson Acquisition Fuels Growth Prospects
- Significant Revenue Growth: SoundHound AI reported a 52% year-over-year revenue increase in Q1, reaching $44.2 million, with automotive and IoT revenues surging by 88%, indicating strong performance in the rapidly evolving AI market despite profitability challenges.
- Acquisition of LivePerson: SoundHound plans to acquire LivePerson with cash, which has faced challenges in its customer service transformation; this acquisition will provide SoundHound access to a large customer base and aims to turn around LivePerson's business within the next year, enhancing competitive positioning.
- Future Revenue Guidance: The company maintains its 2023 revenue guidance between $225 million and $260 million, expecting combined revenues to reach between $350 million and $400 million by 2027, with LivePerson contributing at least $100 million, although this estimate may be conservative.
- Cash Flow and Profitability: Despite revenue growth, SoundHound faces profitability issues, reporting an adjusted EPS loss of $0.06 and an operating cash outflow of $26.3 million in Q1, highlighting the need for careful cash flow management during its expansion efforts.
See More
SoundHound AI Reports Revenue Growth Amid Rising Losses
- Significant Revenue Growth: SoundHound reported a revenue of $44.2 billion for the quarter ending March 31, marking a 52% increase year-over-year, indicating strong market demand in the voice AI sector; however, the accompanying rise in losses has raised investor concerns.
- Declining Gross Margin: Despite revenue growth, SoundHound's gross margin fell from 36.5% to 31.1%, with a net loss exceeding $25 million compared to a profit of nearly $130 million last year, highlighting a deterioration in profitability.
- Increased Cash Burn: In Q1, SoundHound's cash burn escalated to $26.3 million, up from $19.2 million a year earlier, suggesting that ongoing cash outflows may force the company to rely on frequent stock offerings to fund its growth initiatives.
- Market Confidence Wanes: Although the growth in the past quarter is impressive, the lack of significant improvement in cash flow and earnings has left many investors skeptical about SoundHound's sustainability, contributing to a stock price decline of over 60% from its peak.
See More
SoundHound AI Q1 2026 Earnings Report Analysis
- Significant Revenue Growth: SoundHound AI reported Q1 revenue of $44.2 million, a 52% year-over-year increase, showcasing the company's potential in a $140 billion total addressable market despite not raising full-year guidance.
- Negative Market Reaction: Although revenue met expectations, the market's concerns over the lack of guidance increase and ongoing losses led to a 7.89% drop in stock price post-earnings, reflecting investor caution regarding short-term prospects.
- Client Collaboration Expansion: SoundHound's agreement with Walmart to integrate its voice AI technology into retail television brands further solidifies its market position in smart devices and customer service sectors.
- Optimistic Future Outlook: The company projects full-year revenue for 2026 between $225 million and $260 million, with 2027 revenue expected to reach at least $350 million to $400 million, indicating strong growth potential, although investors must navigate significant stock volatility.
See More
SoundHound AI Reports Strong Q1 2026 Revenue but Shares Decline
- Significant Revenue Growth: SoundHound AI reported a revenue of $44.2 million in Q1 2026, marking a 52% year-over-year increase; however, despite meeting expectations, concerns over ongoing losses led to a sharp decline in share price.
- Market Expectations Missed: The company did not raise its full-year revenue guidance, maintaining a forecast of $225 million to $260 million for 2026 and a minimum of $350 million to $400 million for 2027, failing to meet market expectations for higher guidance.
- Customer Satisfaction Improvement: SoundHound's technology has shown strong performance among clients, with an average revenue increase of 11% and a 14% boost in customer satisfaction post-implementation, indicating the effectiveness and potential of its products in the market.
- Long-Term Growth Potential: Despite short-term stock volatility, SoundHound's total addressable market is estimated at $140 billion, suggesting the company is still in the early stages and could achieve larger revenue growth through partnerships with major clients.
See More
