SoundHound AI Reports Record Fourth Quarter Revenue, Up 101%, Exceeding $34.5 Million; Raises Full Year Outlook
- Strong year-end performance propels the company to the top end of revenue guidance range with strong momentum in voice-enabled Agentic AI
-
Company closes the year with nearly
$200 million in cash and no debt
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SoundHound AI Reports Record Fourth Quarter Revenue, Up 101%, Exceeding
“We had a breakthrough year, expanding our leadership position in voice and conversational AI through major customer wins, expanded partnerships, groundbreaking generative AI innovation, and strategic acquisitions,” said
Fourth Quarter and Full Year Financial Highlights
-
Fourth quarter revenue was
$34.5 million , an increase of 101% year-over-year - Fourth quarter GAAP gross margin was 39.9%; non-GAAP gross margin was 52.1%
-
Fourth quarter adjusted EBITDA was
($16.8) million -
Full year revenue was
$84.7 million , an increase of 85% year-over-year - Full year GAAP gross margin was 48.9%; non-GAAP gross margin was 58.5%
-
Full year adjusted EBITDA was
($61.9) million -
SoundHound's year-end stock price increase resulted in an increase in its fair value of contingent liabilities, significantly impacting both fourth quarter and full year GAAP net loss and EPS. The fluctuation is non-operating and non-cash in nature and is calculated based on mark to market fair value accounting standards. The corresponding non-GAAP values are not impacted. Accordingly, fourth quarter GAAP EPS was ($0.69 ) and fourth quarter non-GAAP EPS was ($0.05 ).
“We exited 2024 in a position of strength, and with accelerating momentum," said
Business Highlights
Customer Momentum
-
In Restaurants: Working with over 30% of the top 20 quick-service restaurant (QSR) brands, and continuing to expand across renowned restaurant brands including Burger King
UK , Church’s Texas Chicken, Peet’s Coffee, Torchy’s Tacos, and Whataburger, among others. -
In Healthcare: New partners including
Duke Health ,Wellstar Health System , andEnglewood Health . Customers includeAllina Health , Aveanna Healthcare, andMUSC Health , among others. -
In Automotive: Expanding adoption across leading EV manufacturers, with customers including
Lucid Motors , and Togg; launched in Lancia vehicles inEurope , adding to six other live Stellantis brands withSoundHound Chat AI Automotive . -
In Retail: Expanding AI solutions for multi-location retail brands in clothing, fitness, vehicle maintenance, home services, waste management, and more. Customers include Torrid, multiple Planet Fitness franchise groups, and
My Gym , among others. -
In Energy:
SoundHound continues to expand into new industries, adding one of the largest electric utilities inthe United States to our wide-ranging portfolio of customers. -
In Government:
SoundHound signed a contract with theCity of Coral Springs and continues to roll out our conversational AI capabilities with federal government agencies such as a branch ofthe United States military together with General Dynamics Information Technology. -
In Telecom: Expanding in
South America with Telefónica following recent multi-year renewal, and scaling with a major European broadcaster and telecommunications provider in five countries. -
In Financial Services: Customers including
BNP Paribas as well regional banks and credit unions such asAmerican Heritage Credit Union ,Nordic Bank ,Sterling Bank , andTruly Credit Union .SoundHound also works with 70% of the top 10 global financial institutions. - In Insurance: In partnership with EXL expanding our industry presence with customers such as Transamerica, and scaling with companies like Apivia Courtage – surpassing 100 thousand calls automated in 2024.
-
In Travel and Hospitality: Enhancing customer experiences for companies like AeroMexico and
Resorts World Las Vegas , which recently highlighted our presence at CES 2025 on their digital display on The Strip.
Other Notable Highlights
-
SoundHound is at the forefront of the Agentic AI revolution, leveraging its proven platform and strong market position to deliver next-generation agentic capabilities – an inevitable evolution in AI functionality for its customers. - Unveiled the first ever in-vehicle voice commerce platform that enables seamless voice-controlled food ordering on the go at CES 2025.
- Partnered with Rekor to develop first-of-its-kind audio-visual AI, bringing hands-free voice control to emergency vehicle technology.
- Leading phone ordering technology surpassed 100 million customer interactions and processed hundreds of millions of dollars in restaurant orders.
- Conducted a research study about voice generative AI in vehicles, which found that 77% of regular drivers are likely to use voice generative AI capabilities in their vehicle if available.
Events and Awards
-
Successful showcase at CES 2025, featuring collaborations with NVIDIA, Perplexity,
Lucid Motors , LG and a broad range of the company's restaurant partners. -
SoundHound’s best-in-class technology earned multiple awards:
- Frost Radar™ Leader in Enterprise Conversational AI in Healthcare 2024
- XCelent Advanced Technology 2024 Award
- Best Use of AI in the Automation & Self-Service Awards 2024
- “Overall Connected Solution of the Year” at the AutoTech Breakthrough Awards
- Shortlisted for Reuters 2024 Automotive D.R.I.V.E Honours for Innovation
- Finalist for the 2025 Automotive News PACE Awards
- The company will be participating in NVIDIA GTC 2025, featuring demos of its voice assistant leveraging generative AI on the edge with NVIDIA Drive AGX™, and its recently introduced voice commerce ecosystem.
Fourth Quarter 2024 Financial Measures1
Three Months Ended (thousands, unless otherwise noted) |
|
|
|
|
Change |
|||
Revenues |
$ |
34,543 |
|
$ |
17,147 |
|
|
101% |
GAAP gross profit |
$ |
13,784 |
|
$ |
13,236 |
|
|
4% |
GAAP gross margin |
|
39.9% |
|
|
77.2% |
|
|
(37.3)pp |
Non-GAAP gross profit |
$ |
18,007 |
|
$ |
13,354 |
|
|
35% |
Non-GAAP gross margin |
|
52.1% |
|
|
77.9% |
|
|
(25.8)pp |
GAAP operating loss2 |
$ |
(257,072) |
|
$ |
(12,393) |
|
|
1,974% |
Non-GAAP adjusted EBITDA |
$ |
(16,793) |
|
$ |
(3,593) |
|
|
367% |
GAAP net loss2 |
$ |
(258,599) |
|
$ |
(18,003) |
|
|
1,336% |
Non-GAAP net loss |
$ |
(18,993) |
|
$ |
(9,771) |
|
|
94% |
GAAP net loss per share2 |
$ |
(0.69) |
|
$ |
(0.07) |
|
|
(0.62) |
Non-GAAP net loss per share |
$ |
(0.05) |
|
$ |
(0.04) |
|
|
(0.01) |
Full Year 2024 Financial Measures1
Twelve Months Ended (thousands, unless otherwise noted) |
|
|
|
|
Change |
|||
Revenues |
$ |
84,693 |
|
$ |
45,873 |
|
|
85% |
GAAP gross profit |
$ |
41,384 |
|
$ |
34,566 |
|
|
20% |
GAAP gross margin |
|
48.9% |
|
|
75.4% |
|
|
(26.5)pp |
Non-GAAP gross profit |
$ |
49,538 |
|
$ |
34,978 |
|
|
42% |
Non-GAAP gross margin |
|
58.5% |
|
|
76.2% |
|
|
(17.8)pp |
GAAP operating loss2 |
$ |
(341,353) |
|
$ |
(68,608) |
|
|
398% |
Non-GAAP adjusted EBITDA |
$ |
(61,915) |
|
$ |
(35,896) |
|
|
72% |
GAAP net loss2 |
$ |
(350,681) |
|
$ |
(88,937) |
|
|
294% |
Non-GAAP net loss |
$ |
(69,073) |
|
$ |
(58,162) |
|
|
19% |
GAAP net loss per share2 |
$ |
(1.04) |
|
$ |
(0.40) |
|
|
(0.64) |
Non-GAAP net loss per share |
$ |
(0.20) |
|
$ |
(0.25) |
|
|
0.05 |
1) |
Please see tables below for a reconciliation from GAAP to non-GAAP. |
|||
2) |
GAAP-only operating loss includes a significant impact from the calculated fair value of contingent acquisition liabilities where future earn-out shares are marked-to-market on a quarterly basis, and with the increase in stock price at year-end the loss associated with this item was |
Liquidity and Cash Flows
The company’s total cash and cash equivalents was
Condensed Cash Flow Statement
Year Ended
(thousands) |
|
|
|
||
Cash flows: |
|
|
|
|
|
Net cash used in operating activities |
$ |
(108,878) |
|
$ |
(68,265) |
Net cash used in investing activities |
$ |
(12,372) |
|
$ |
(392) |
Net cash provided by financing activities |
$ |
210,906 |
|
$ |
168,237 |
Effects of exchange rate changes on cash |
$ |
225 |
|
$ |
(20) |
Net change in cash and cash equivalents |
$ |
89,881 |
|
$ |
99,560 |
Business Outlook
Additional Information
For more information please see the company’s
Conference Call and Webcast
About
Forward Looking Statements
This press release contains forward-looking statements, which are not historical facts, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, you can identify forward-looking statements by the use of words such as “may,” “could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” “likely,” “will,” “would” and variations of these terms and similar expressions, or the negative of these terms or similar expressions. These forward-looking statements include, but are not limited to, statements concerning our expected financial performance, our ability to implement our business strategy and anticipated business and operations, and guidance for financial results for 2025. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by us and our management, are inherently uncertain. As a result, readers are cautioned not to place undue reliance on these forward-looking statements. Our actual results may differ materially from those expressed or implied by these forward-looking statements as a result of risks and uncertainties impacting SoundHound’s business including, our ability to successfully launch and commercialize new products and services and derive significant revenue, our market opportunity and our ability to acquire new customers and retain existing customers, unexpected costs, charges or expenses resulting from our 2024 acquisitions, the ability of our 2024 acquisitions to be accretive on the company's financial results, and those other factors described in our risk factors set forth in our filings with the
Non-GAAP Measures of Financial Performance
To supplement the company’s financial statements, which are presented on the basis of
The company believes that providing this non-GAAP information in addition to the GAAP financial information allows investors to view the financial results in the way the company views its operating results. The company also believes that providing this information allows investors to not only better understand the company's financial performance, but also, better evaluate the information used by management to evaluate and measure such performance.
As such, the company believes that disclosing non-GAAP financial measures to the readers of its financial statements provides the reader with useful supplemental information that allows for greater transparency in the review of the company’s financial and operational performance.
The company defines its non-GAAP measures by excluding certain items:
The company arrives at non-GAAP gross profit and non-GAAP gross margin by excluding (i) amortization of intangibles (including acquired intangible assets) and (ii) stock-based compensation.
The company arrives at adjusted EBITDA by excluding (i) total other interest, net (included other interest and expense), (ii) loss on early extinguishment of debt, (iii) income taxes/(benefits), (iv) depreciation and amortization expense (including acquired intangible assets), (v) stock-based compensation, (vi) restructuring expense, (vii) change in fair value of contingent acquisition liabilities, and (viii) acquisition-related expenses.
The company arrives at non-GAAP net loss and non-GAAP net loss per share by excluding (i) depreciation and amortization expense (including acquired intangible assets), (ii) stock-based compensation, (iii) restructuring expense, (iv) loss on early extinguishment of debt, (v) change in fair value of contingent acquisition liabilities, (vi) gain on bargain purchase, (vii) acquisition-related expenses, and (viii) income tax effects related to acquisitions.
Reconciliations of GAAP to these adjusted non-GAAP financial measures are included in the tables below. When analyzing the company's operating results, investors should not consider non-GAAP measures as substitutes for the comparable financial measures prepared in accordance with GAAP.
To the extent that the company presents any forward-looking non-GAAP financial measures, the company does not present a quantitative reconciliation of such measures to the most directly comparable GAAP financial measure (or otherwise present such forward-looking GAAP measures) because it is impractical to do so.
Fourth Quarter Reconciliation of GAAP Gross Profit to Non-GAAP Gross Profit and GAAP Gross Margin to Non-GAAP Gross Margin
Three Months Ended |
|
|
|||
(thousands, unless otherwise noted) |
2024 |
|
|||
GAAP gross profit1 |
$ |
13,784 |
$ |
13,236 |
|
Adjustments: |
|
|
|
|
|
Amortization of Intangibles |
|
4,123 |
|
- |
|
Stock-based compensation |
|
100 |
|
118 |
|
Non-GAAP gross profit |
$ |
18,007 |
$ |
13,354 |
|
GAAP gross margin |
|
39.9% |
|
77.2% |
|
Non-GAAP gross margin |
|
52.1% |
|
77.9% |
|
1) |
GAAP gross profit is calculated by subtracting the cost of revenues from revenues. |
Fourth Quarter Reconciliation of GAAP Net Loss to Non-GAAP Adjusted EBITDA
Three Months Ended |
|
|
|||
(thousands) |
|
|
|||
GAAP net loss |
$ |
(258,599) |
$ |
(18,003) |
|
Adjustments: |
|
|
|
|
|
Total other expense, net1 |
|
1,174 |
|
4,003 |
|
Loss on early extinguishment of debt |
|
42 |
|
- |
|
Income taxes/(benefits) |
|
311 |
|
1,607 |
|
Depreciation and amortization |
|
7,939 |
|
372 |
|
Stock-based compensation |
|
9,853 |
|
6,569 |
|
Restructuring |
|
- |
|
806 |
|
Change in fair value of contingent acquisition liabilities |
|
220,946 |
|
- |
|
Acquisition-related expenses |
|
1,541 |
|
1,053 |
|
Non-GAAP adjusted EBITDA |
$ |
(16,793) |
$ |
(3,593) |
|
1) |
Includes other income (expense), net of ( |
Fourth Quarter Reconciliation of GAAP Net Loss to Non-GAAP Net Loss and Non-GAAP Net Loss Per Share
Three Months Ended (thousands, unless otherwise noted) |
|
|
|||
|
|
|
|||
GAAP net loss attributable to |
$ |
(258,599) |
$ |
(18,571) |
|
Adjustments: |
|
|
|
|
|
Depreciation and amortization |
|
7,939 |
|
372 |
|
Stock-based compensation |
|
9,853 |
|
6,569 |
|
Restructuring |
|
- |
|
806 |
|
Loss on early extinguishment of debt |
|
42 |
|
- |
|
Change in fair value of contingent acquisition liabilities |
|
220,946 |
|
- |
|
Acquisition-related expenses |
|
1,541 |
|
1,053 |
|
Income tax effects related to acquisitions |
|
(715) |
|
- |
|
Non-GAAP net loss |
$ |
(18,993) |
$ |
(9,771) |
|
GAAP net loss per share1 |
$ |
(0.69) |
$ |
(0.07) |
|
Adjustments |
|
0.64 |
|
0.03 |
|
Non-GAAP net loss per share1 |
$ |
(0.05) |
$ |
(0.04) |
|
1) |
Weighted average common shares outstanding (basic and diluted) for the three months ended |
Full Year Reconciliation of GAAP Gross Profit to Non-GAAP Gross Profit and GAAP Gross Margin to Non-GAAP Gross Margin
Year Ended |
|
|
||||
(thousands, unless otherwise noted) |
|
|
|
|||
GAAP gross profit1 |
$ |
41,384 |
|
$ |
34,566 |
|
Adjustments: |
|
|
|
|
|
|
Amortization of Intangibles |
|
7,696 |
|
|
- |
|
Stock-based compensation |
|
458 |
|
|
412 |
|
Non-GAAP gross profit |
$ |
49,538 |
|
$ |
34,978 |
|
GAAP gross margin |
|
48.9% |
|
|
75.4% |
|
Non-GAAP gross margin |
|
58.5% |
|
|
76.2% |
1) |
GAAP gross profit is calculated by subtracting the cost of revenues from revenues. |
Full Year Reconciliation of GAAP Net Loss to Non-GAAP Adjusted EBITDA
Year Ended |
|
|
|||
(thousands) |
|
|
|||
GAAP net loss |
$ |
(350,681) |
$ |
(88,937) |
|
Adjustments: |
|
|
|
|
|
Total other expense, net1 |
|
2,946 |
|
15,578 |
|
Loss on early extinguishment of debt |
|
15,629 |
|
837 |
|
Income taxes/(benefits) |
|
(9,247) |
|
3,914 |
|
Depreciation and amortization |
|
16,054 |
|
2,313 |
|
Stock-based compensation |
|
33,145 |
|
24,789 |
|
Restructuring |
|
- |
|
4,557 |
|
Change in fair value of contingent acquisition liabilities |
|
222,670 |
|
- |
|
Acquisition-related expenses |
|
7,569 |
|
1,053 |
|
Non-GAAP adjusted EBITDA |
$ |
(61,915) |
$ |
(35,896) |
|
1) |
Includes other income (expense), net of |
Full Year Reconciliation of GAAP Net Loss to Non-GAAP Net Loss and Non-GAAP Net Loss Per Share
Year Ended (thousands, unless otherwise noted) |
|
|
|||
|
|
|
|||
GAAP net loss attributable to |
$ |
(351,097) |
$ |
(91,711) |
|
Adjustments: |
|
|
|
|
|
Depreciation and amortization |
|
16,054 |
|
2,313 |
|
Stock-based compensation |
|
33,145 |
|
24,789 |
|
Restructuring |
|
- |
|
4,557 |
|
Loss on early extinguishment of debt |
|
15,629 |
|
837 |
|
Change in fair value of contingent acquisition liabilities |
|
222,670 |
|
- |
|
Gain on bargain purchase |
|
(1,223) |
|
- |
|
Acquisition-related expenses |
|
7,569 |
|
1,053 |
|
Income tax effects related to acquisitions |
|
(11,820) |
|
- |
|
Non-GAAP net loss |
$ |
(69,073) |
$ |
(58,162) |
|
GAAP net loss per share1 |
$ |
(1.04) |
$ |
(0.40) |
|
Adjustments |
|
0.84 |
|
0.15 |
|
Non-GAAP net loss per share1 |
$ |
(0.20) |
$ |
(0.25) |
|
1) |
Weighted average common shares outstanding (basic and diluted) for the years ended |
View source version on businesswire.com: https://www.businesswire.com/news/home/20250227063191/en/
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