SoundHound AI (NASDAQ:SOUN) Releases Earnings Results, Beats Expectations By $0.11 EPS

SoundHound AI (NASDAQ:SOUN) issued its quarterly earnings results on Wednesday. The company reported ($0.02) EPS for the quarter, topping analysts’ consensus estimates of ($0.13) by $0.11, Briefing.com reports. The business had revenue of $61.90 million for the quarter, compared to analyst estimates of $42.56 million. SoundHound AI had a negative return on equity of 31.06% and a negative net margin of 67.45%.SoundHound AI’s quarterly revenue was up 45.0% compared to the same quarter last year. During the same period last year, the company posted ($0.19) earnings per share.

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

• Positive Sentiment: SoundHound reported a record quarter, with Q2 revenue of $61.9 million, up 45% year over year and 40% sequentially. Gross margin improved to 45% on a GAAP basis, while adjusted EBITDA loss narrowed 33% year over year.
• Positive Sentiment: The newly launched OASYS agentic AI platform is driving stronger demos, win rates, pilot conversions, and customer expansions, including an eight-figure commitment signed within 90 days. Management said OASYS can reduce implementation times from months to minutes through its “AI Builds AI” capabilities.
• Positive Sentiment: Management raised full-year 2026 revenue guidance to $230 million-$260 million, citing broad-based demand across healthcare, financial services, automotive, restaurants, and Asia. The company also highlighted a $203 million cash balance and no debt.
• Neutral Sentiment: The LivePerson acquisition has received key regulatory clearances and is still expected to close by year-end, but current guidance excludes its contribution and management did not provide specific 2026 revenue expectations for the deal. The company continues to target at least $350 million-$400 million of revenue in 2027 if the transaction closes.
• Negative Sentiment: Despite improving profitability metrics, SoundHound remains unprofitable, posting a $42.8 million GAAP net loss and a $9.6 million adjusted EBITDA loss in Q2. Management expects future margin expansion, but acquisitions and related costs continue to weigh on gross margin and expenses.

SoundHound AI Stock Up 13.3%

SoundHound AI stock traded up $0.94 during trading on Friday, hitting $8.02. The stock had a trading volume of 65,011,906 shares, compared to its average volume of 37,984,616. SoundHound AI has a 1 year low of $5.65 and a 1 year high of $22.17. The stock’s 50 day moving average is $6.79 and its two-hundred day moving average is $7.61. The stock has a market cap of $3.47 billion, a price-to-earnings ratio of -21.10 and a beta of 2.64.

Insider Buying and Selling at SoundHound AI

In other news, insider James Ming Hom sold 28,843 shares of the company’s stock in a transaction on Monday, June 15th. The stock was sold at an average price of $7.46, for a total transaction of $215,168.78. Following the transaction, the insider owned 743,521 shares of the company’s stock, valued at $5,546,666.66. This represents a 3.73% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, SVP Majid Emami sold 28,843 shares of the company’s stock in a transaction on Monday, June 15th. The shares were sold at an average price of $7.46, for a total value of $215,168.78. Following the transaction, the senior vice president directly owned 472,983 shares in the company, valued at $3,528,453.18. This represents a 5.75% decrease in their position. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold 268,022 shares of company stock valued at $1,999,444 in the last quarter. Insiders own 8.84% of the company’s stock.

Institutional Investors Weigh In On SoundHound AI

Hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Morgan Stanley grew its stake in SoundHound AI by 48.1% in the 4th quarter. Morgan Stanley now owns 8,987,522 shares of the company’s stock valued at $89,606,000 after buying an additional 2,917,280 shares in the last quarter. Voloridge Investment Management LLC lifted its position in shares of SoundHound AI by 2,259.7% during the fourth quarter. Voloridge Investment Management LLC now owns 2,199,511 shares of the company’s stock worth $21,929,000 after acquiring an additional 2,106,298 shares in the last quarter. Jump Financial LLC purchased a new stake in shares of SoundHound AI during the third quarter worth $21,679,000. HRT Financial LP bought a new position in shares of SoundHound AI in the second quarter worth $11,914,000. Finally, Goldman Sachs Group Inc. boosted its holdings in shares of SoundHound AI by 69.8% in the first quarter. Goldman Sachs Group Inc. now owns 2,639,689 shares of the company’s stock worth $21,434,000 after acquiring an additional 1,085,473 shares during the period. 19.28% of the stock is currently owned by institutional investors.

Analyst Upgrades and Downgrades

A number of research analysts have issued reports on SOUN shares. LADENBURG THALM/SH SH upgraded SoundHound AI to a “strong-buy” rating in a research note on Wednesday, May 6th. Weiss Ratings reiterated a “sell (e+)” rating on shares of SoundHound AI in a research note on Monday, June 15th. Piper Sandler cut their price target on shares of SoundHound AI from $8.00 to $7.00 and set a “neutral” rating on the stock in a report on Thursday. Finally, DA Davidson reduced their price target on shares of SoundHound AI from $12.00 to $10.00 and set a “buy” rating for the company in a research report on Thursday. One equities research analyst has rated the stock with a Strong Buy rating, five have given a Buy rating, three have issued a Hold rating and one has given a Sell rating to the stock. According to MarketBeat.com, the company has a consensus rating of “Moderate Buy” and an average price target of $14.07.

Key Stories Impacting SoundHound AI

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

• Positive Sentiment: Record revenue and earnings beat: Second-quarter revenue rose 45% year over year to $61.9 million, well above the approximately $42.6 million consensus estimate. The adjusted loss of $0.02 per share also beat expectations, while profitability metrics and margins improved. SoundHound Q2 Earnings Beat on OASYS Demand, Revenues Top, Stock Up
• Positive Sentiment: Higher full-year outlook: SoundHound raised its 2026 revenue floor, citing OASYS-driven enterprise adoption, faster deal conversions and broader customer demand. Management also emphasized continued margin improvement despite ongoing investment. SOUN Raises 2026 Revenue Outlook After OASYS Drives Record Q2 Sales
• Positive Sentiment: Potential strategic catalyst: Proxy adviser Glass Lewis recommended that LivePerson stockholders vote in favor of the proposed transaction with SoundHound at the August 20 special meeting, supporting the planned expansion of SoundHound’s conversational-AI capabilities. Glass Lewis Recommends LivePerson Stockholders Vote For SoundHound AI Transaction
• Positive Sentiment: Trading momentum: Heavy call-option activity and high short interest may be amplifying the post-earnings move as bullish traders participate and short sellers cover positions.
• Neutral Sentiment: Analyst support is mixed: DA Davidson maintained a Buy rating while lowering its price target from $12 to $10. Piper Sandler cut its target from $8 to $7 and retained a Neutral rating.
• Negative Sentiment: Valuation and financial risks: Analysts note that SOUN remains expensive relative to sales, with projected 2026 growth needing to justify the premium. The company continues to report losses and cash burn, while potential dilution and execution risks could limit further upside. SOUN Dips 16.9% in 3 Months

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.