SoundHound AI (NASDAQ:SOUN) Posts Earnings Results, Misses Estimates By $0.01 EPS

Key Points

• SoundHound AI reported Q1 EPS of -$0.06, missing analyst estimates by one cent, even though revenue came in at $44.2 million and topped expectations. Revenue rose about 52% year over year.
• The company highlighted strategic growth moves, including a planned LivePerson acquisition expected to close in the second half and the launch of OASYS, a new AI agent system designed to speed deployments and lower costs.
• Despite strong sales growth, profitability remains under pressure with a -$26.7 million adjusted EBITDA loss and a $25 million GAAP net loss; shares fell after the report and recent insider selling added to investor caution.

SoundHound AI (NASDAQ:SOUN - Get Free Report) posted its quarterly earnings results on Thursday. The company reported ($0.06) EPS for the quarter, missing analysts' consensus estimates of ($0.05) by ($0.01), FiscalAI reports. SoundHound AI had a negative return on equity of 41.46% and a negative net margin of 91.84%.The company had revenue of $44.20 million during the quarter, compared to the consensus estimate of $42.56 million. During the same period in the previous year, the business earned ($0.06) earnings per share. SoundHound AI's revenue was up 51.7% on a year-over-year basis.

Here are the key takeaways from SoundHound AI's conference call:

• Q1 revenue was $44.2 million, up 52% year‑over‑year, with SoundHound's automotive and IoT AI business up ~88% excluding acquisitions, driven by a growing enterprise pipeline.
• SoundHound signed a definitive agreement to acquire LivePerson (expected H2 close), expanding enterprise reach across 30+ countries and positioning the combined business to target roughly $500 million from the existing customer base (with at least ~$100M attributable from LivePerson in 2027).
• Introduced OASYS, an orchestrated agent system powered by SoundHound's Polaris speech model that builds omni‑channel AI agents in minutes, aims to cut operational costs, enable faster migrations, and reduce runtime reliance on third‑party frontier models.
• Profitability remains pressured: adjusted EBITDA loss was -$26.7M and GAAP net loss was $25M (including a ~$39M non‑cash contingent liability); S&M and G&A rose materially due to acquisitions though the company has $216M cash and expects cost synergies and time‑boxed model investments to improve margins.

SoundHound AI Stock Down 7.8%

NASDAQ:SOUN traded down $0.75 during trading hours on Friday, hitting $8.88. 49,054,322 shares of the company's stock traded hands, compared to its average volume of 33,216,310. The firm has a market cap of $3.75 billion, a P/E ratio of -18.89 and a beta of 2.58. SoundHound AI has a 52 week low of $5.83 and a 52 week high of $22.17. The business's fifty day simple moving average is $7.57 and its two-hundred day simple moving average is $10.18.

Insider Activity at SoundHound AI

In other SoundHound AI news, CFO Nitesh Sharan sold 44,027 shares of SoundHound AI stock in a transaction dated Friday, March 20th. The stock was sold at an average price of $6.79, for a total transaction of $298,943.33. Following the completion of the sale, the chief financial officer owned 1,661,121 shares of the company's stock, valued at $11,279,011.59. The trade was a 2.58% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, SVP Majid Emami sold 31,019 shares of SoundHound AI stock in a transaction dated Friday, March 20th. The stock was sold at an average price of $6.79, for a total value of $210,619.01. Following the sale, the senior vice president directly owned 501,826 shares of the company's stock, valued at approximately $3,407,398.54. This trade represents a 5.82% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold 307,973 shares of company stock valued at $2,091,110 in the last ninety days. 8.84% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On SoundHound AI

Hedge funds have recently added to or reduced their stakes in the company. Danske Bank A S bought a new stake in SoundHound AI during the third quarter worth about $26,000. Northwestern Mutual Wealth Management Co. lifted its stake in SoundHound AI by 83.1% during the second quarter. Northwestern Mutual Wealth Management Co. now owns 2,336 shares of the company's stock worth $25,000 after purchasing an additional 1,060 shares during the last quarter. Parallel Advisors LLC lifted its stake in SoundHound AI by 42.8% during the third quarter. Parallel Advisors LLC now owns 3,204 shares of the company's stock worth $52,000 after purchasing an additional 960 shares during the last quarter. Advisors Asset Management Inc. lifted its stake in SoundHound AI by 58.2% during the fourth quarter. Advisors Asset Management Inc. now owns 7,012 shares of the company's stock worth $70,000 after purchasing an additional 2,579 shares during the last quarter. Finally, PNC Financial Services Group Inc. lifted its stake in SoundHound AI by 20.4% during the fourth quarter. PNC Financial Services Group Inc. now owns 8,583 shares of the company's stock worth $86,000 after purchasing an additional 1,456 shares during the last quarter. Institutional investors own 19.28% of the company's stock.

Trending Headlines about SoundHound AI

Here are the key news stories impacting SoundHound AI this week:

• Positive Sentiment: SoundHound posted record Q1 revenue of $44.2 million, up about 52% year over year, and exceeded revenue expectations, showing continued momentum in its voice AI business. SoundHound AI Reports Record Q1 Revenue of $44.2 Million, Up 52%
• Positive Sentiment: The company launched OASYS, a self-learning AI agent platform, which could expand SoundHound’s product offering and support longer-term growth. SoundHound AI (SOUN) Launches OASYS Self-Learning AI Agent Platform
• Positive Sentiment: SoundHound outlined 2027 revenue expectations of at least $350 million to $400 million after the planned LivePerson acquisition, suggesting management sees meaningful future scale. SoundHound outlines 2027 revenue of at minimum $350M-$400M following planned LivePerson acquisition
• Neutral Sentiment: Analysts remain broadly constructive, with at least one recent upgrade to strong-buy and commentary that the stock could have meaningful upside if execution improves. Wall Street Bulls Look Optimistic About SoundHound AI (SOUN): Should You Buy?
• Negative Sentiment: Despite the revenue beat, SoundHound missed earnings estimates and cited higher acquisition-related costs and vendor true-ups, which pressured margins and weighed on investor sentiment. SOUN Q1 Earnings Miss on Higher Costs, Revenue Beat, Stock Down
• Negative Sentiment: Investors also appear concerned that the planned LivePerson deal and broader acquisition strategy could continue to pressure earnings even as revenue grows. SoundHound's stock falls as acquisitions weigh on earnings results

Wall Street Analysts Forecast Growth

A number of equities analysts have recently commented on the company. Piper Sandler reaffirmed a "neutral" rating and issued a $9.00 price target (down from $11.00) on shares of SoundHound AI in a report on Friday, February 27th. LADENBURG THALM/SH SH raised SoundHound AI to a "strong-buy" rating in a report on Wednesday. Weiss Ratings reaffirmed a "sell (d-)" rating on shares of SoundHound AI in a report on Friday, January 9th. HC Wainwright cut their price target on SoundHound AI from $26.00 to $20.00 and set a "buy" rating for the company in a report on Monday, March 2nd. Finally, Zacks Research raised SoundHound AI from a "strong sell" rating to a "hold" rating in a report on Monday, February 9th. One equities research analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating, three have issued a Hold rating and one has assigned a Sell rating to the company's stock. According to data from MarketBeat.com, SoundHound AI presently has a consensus rating of "Moderate Buy" and a consensus price target of $14.93.

About SoundHound AI

SoundHound AI, Inc is a voice AI and conversational intelligence company specializing in speech recognition, natural language understanding and sound identification technologies. Founded in 2005 and headquartered in Santa Clara, California, the company initially gained recognition with its music discovery app before pivoting to enterprise-grade voice AI solutions. Over the years, SoundHound AI has built a comprehensive platform that enables developers and businesses to embed conversational intelligence into a wide range of products and services.

The company's core offering is the Houndify voice AI platform, which provides customizable speech-to-meaning technology, domain-specific natural language understanding and text-to-speech capabilities.

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