SoundHound AI, Inc. (NASDAQ: SOUN) reported record second-quarter 2026 revenues of $61.9 million, a 45% year-over-year jump, alongside meaningful improvements in profitability metrics.
The company’s non-GAAP net loss narrowed 24% to $9 million from $11.9 million in the same period last year, with non-GAAP loss per share improving to 2 cents from 3 cents.
Adjusted EBITDA loss tightened 33% year over year to $9.6 million, reflecting stronger operating momentum and tighter cost discipline across the business.
GAAP gross margin expanded 610 basis points to 45.1%, though non-GAAP gross margin held steady at 58.4%, pointing to ongoing investment in the company’s infrastructure and growth initiatives.
SoundHound’s OASYS agentic AI platform is playing a central role in converting early-stage pilots into large-scale implementations, including one eight-figure commitment signed within 90 days of an initial product demo.
The company is also shifting more workloads onto its proprietary technology stack, with its small and medium business customers now operating entirely on SoundHound’s own model infrastructure.
Management expects its Polaris speech model, specialized large language models, and speech synthesis technology to improve output quality while reducing costs and supporting higher margins over time.
Cash usage remains a concern, with SoundHound burning through nearly $60 million in operating cash during the first half of 2026, up from $43.7 million during the same period a year earlier.
Despite the elevated cash consumption, the company holds $203 million in cash with no debt, and management has raised its full-year 2026 revenue guidance to a range of $230 million to $260 million.
SoundHound competes directly with Five9 (NASDAQ: FIVN) and NICE (NASDAQ: NICE) in conversational AI, customer engagement, and AI-powered contact-center automation, both of which serve as meaningful profitability benchmarks.
Five9 posted second-quarter 2026 revenues of $312.4 million, a 10% year-over-year increase, with adjusted EBITDA of $70.1 million representing a 22.4% margin and non-GAAP net income of $53.5 million.
NICE reported second-quarter 2026 revenues of $782.3 million, up 7.6%, with cloud revenues advancing 12.6% to $609 million and non-GAAP operating income reaching $198 million at a 25.3% margin.
NICE’s AI and self-service annual recurring revenue surged 52% to $362 million, underscoring the scale of profitable AI adoption that SoundHound is still working to match.
SoundHound shares have lost 25.4% year to date, underperforming the broader industry, while the stock currently trades at a forward price-to-sales multiple of 12.7, slightly above the industry average.
The Zacks Consensus Estimate for SoundHound’s 2026 and 2027 loss per share has narrowed over the past 30 days to 16 cents and 13 cents respectively, though the 2026 figure remains wider than the prior year’s loss of 13 cents per share.
