SoundHound AI (NASDAQ:SOUN) reported record fourth-quarter and full-year 2025 results, highlighted by rapid revenue growth, improved profitability metrics, and a surge in customer deal activity as the company positions its “agentic AI” platform for broader adoption across industries.
Record year and Q4 deal momentum
CEO Keyvan Mohajer said 2025 was a record year for SoundHound, with revenue “nearly doubling” year-over-year and a record fourth quarter. Mohajer stated Q4 revenue rose 59% year-over-year and that “all key profit metrics improved.”
- A new automotive customer in Japan for an AI assistant with a “seven-digit unit commitment.”
- A multi-year agreement with “one of the largest telecommunications companies in the world.”
- A multi-year global deal with “one of the largest athletic shoes and apparel companies” to power AI customer service.
Mohajer said channel partner execution was “exceptional,” including multiple seven-figure deals in 2025, and described AI-driven disruption in software and services markets as a tailwind as enterprises seek to automate processes and improve customer experiences.
Product strategy: Agentic platform and “Agentic Plus” network
Management framed SoundHound’s strategy around a unified agentic framework that can be deployed across “call centers to cars, robots, phones, apps, TVs and websites.” Mohajer said customers can “build an agent once and deploy it anywhere,” and that the company offers access to multiple model options, including third-party and “SoundHound’s own models,” which he said “consistently outperform big tech players” in certain measures.
He highlighted technology elements such as Polaris, the company’s custom speech recognition foundation model, and a conversation orchestration approach spanning on-device, cloud, on-premise, and “human augmented services.” Mohajer described this combined approach as an “Agentic Plus network” blending agentic, deterministic, and human-assisted understanding.
The company also pointed to scale and data advantages, noting it has processed “billions of interactions” across major global languages and maintains a physical presence in multiple markets.
Vertical highlights: Automotive, voice commerce, restaurants, and enterprise
In automotive, Mohajer said SoundHound added multiple new OEM wins in the quarter, including a Korean OEM with a global footprint, an Italian high-performance luxury sports car maker, and manufacturers in China and Vietnam. He also said the company signed its “first two-wheeler” and is seeing interest from at least six other OEMs. Mohajer noted Stellantis expanded adoption to include “live generative AI capabilities for real-time responses,” and that SoundHound added an Italian commercial truck company. He also referenced a multi-year renewal with “one of the largest American automobile manufacturers” to deploy enterprise AI solutions.
Mohajer and CFO Nitesh Sharan described “voice commerce” as a key growth initiative, connecting SoundHound’s footprint in cars and devices with merchant relationships. Mohajer said the solution is “quickly advancing to go live in the U.S.” with a prominent German automotive OEM. He also said SoundHound previewed a fully agentic voice commerce platform for in-vehicle and on-TV commerce and expects that solution to go live later in the year, referencing a demo involving a smart TV manufacturer and a national pizza restaurant. Partnerships with Parkopedia and OpenTable were cited as ecosystem additions, with plans to expand into events and travel booking.
In restaurants, Mohajer said “voice insight” demand is rising, with top-25 restaurant chains signing to collect drive-through efficiency data. He cited Panda Express expanding into dozens more locations and a multi-year renewal with Casey’s General Store that added “smart answering” for non-food calls, along with franchise wins for IHOP and Jersey Mike’s. Sharan said restaurant order activity crossed 9 million calls in Q4 for the first time, up “strong double digits” year-over-year.
In enterprise AI, management cited record deal volume and traction in regulated industries such as financial services, healthcare, and insurance. Mohajer provided examples of operational impact reported by customers, including a healthcare network where an AI agent handles more than a third of patient appointment scheduling, a telecommunications customer reporting a 20% reduction in labor costs associated with billing disputes, and an auto insurance customer increasing containment by 10 percentage points in under 60 days.
Financial results: Revenue growth, margin expansion, and GAAP net income impact
Sharan reported Q4 revenue of $55.1 million, up 59% year-over-year, and full-year revenue of $169 million, up 99% from the prior year. He said growth was driven across multiple verticals, with enterprise AI performing particularly well in healthcare and financial services. He also emphasized customer diversification, noting no customer contributed more than 10% of revenue for the quarter or full year.
On profitability, Sharan said GAAP gross margin was 48% in Q4 and non-GAAP gross margin was 61%, with improvements year-over-year. He attributed margin progress to infrastructure modernization, cloud spend optimization, consolidation of legacy systems, and moving from third-party solutions to “home-built” ones, as well as pruning low-margin acquired contracts.
Operating expenses included R&D of $24.8 million (up 22% year-over-year), sales and marketing of $17.4 million (up 82% year-over-year), and G&A of $21.2 million (up 29% year-over-year), with increases largely attributed to acquisitions and related costs. Adjusted EBITDA loss was $7.4 million, an improvement of 56% year-over-year.
SoundHound posted GAAP net income of $40.1 million and GAAP EPS of $0.10, which Sharan said was positively impacted by an approximately $85 million change in fair value of contingent liabilities tied to acquisitions. He characterized the item as non-operating and non-cash and said it was excluded from non-GAAP results. Non-GAAP net loss was $7.3 million and non-GAAP loss per share was $0.02.
Sharan said the balance sheet ended the quarter with $248 million in cash and equivalents and no debt.
2026 outlook, investments, and Q&A themes
For 2026, Sharan guided for revenue of $225 million to $260 million, noting the company expects a ramp through the year due to seasonality and timing of large deals, though he said seasonality should improve as recurring revenue mix grows. He reiterated a focus on balancing growth and profitability and said the company is “entering our break-even phase,” though he cautioned the transition will not be linear. Sharan also reiterated a long-term target model of 70%+ gross margins and 30%+ EBIT margins at scale.
In Q&A, management said AI advances are improving deployment speed and reducing resource requirements, with Mohajer stating demand is rising while the resources needed to deliver are “actually going down.” On renewals, he described them as upsell opportunities as customers upgrade to agentic capabilities, which can include price increases, larger volume commitments, and higher revenue tied to improved containment rates.
Responding to questions about competition and platform durability in an agentic era, Mohajer said software automation trends have been a tailwind and argued that faster AI-driven development should further benefit SoundHound. He also said customers risk missing innovation if they bet on a single large model provider, positioning SoundHound as model-agnostic and able to bring the best available technology to customers.
On M&A, Sharan said 2026 guidance does not contemplate additional acquisitions. On stock-based compensation, he said the company aims to distribute equity broadly across employees, acknowledged investor concerns about dilution, and said the stock-comp-to-revenue profile should normalize as the company scales.
About SoundHound AI (NASDAQ:SOUN)
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.
