SoundHound AI’s first quarter results were marked by substantial top-line growth, but the market responded negatively following the earnings announcement. Management highlighted increased demand for its AI and enterprise solutions, particularly in automotive and IoT, with CEO Keyvan Mohajer noting “our automotive and IoT AI business was up 88% year-over-year, excluding acquisitions.” The quarter was also shaped by non-recurring costs related to acquisitions, which affected margins. Management acknowledged that while overall growth was robust, the integration of recent acquisitions introduced both opportunity and complexity.
Is now the time to buy SOUN? Find out in our full research report (it’s free for active Edge members).
SoundHound AI (SOUN) Q1 CY2026 Highlights:
- Revenue: $44.2 million vs analyst estimates of $42.74 million (51.7% year-on-year growth, 3.4% beat)
- Adjusted EPS: -$0.06 vs analyst estimates of -$0.04 ($0.02 miss)
- Adjusted Operating Income: -$22.67 million vs analyst estimates of -$41.65 million (-51.3% margin, 45.6% beat)
- Operating Margin: -51.3%, down from 440% in the same quarter last year
- Billings: $47.22 million at quarter end, up 44% year on year
- Market Capitalization: $3.64 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From SoundHound AI’s Q1 Earnings Call
- Gil Luria (D.A. Davidson) asked about SoundHound’s unique M&A strategy and how it differs from typical tech acquisitions. CEO Keyvan Mohajer explained, “We find companies that have a great team, a great business, really strong customer relationships... but for some reasons, they are going through some stressful situations and the combination really unlocks the value that was kind of trapped.”
- Gil Luria (D.A. Davidson) followed up on LivePerson revenue retention, asking if planned attrition is expected before growth resumes. COO Mike Zagorsek confirmed that SoundHound integrates conservatively, factoring in churn, and aims for a “transformational turnaround” with a new baseline before growth.
- Vijay Devar (Northland Capital Markets) inquired about which customers are the best near-term prospects for migrating to OASYS. CEO Keyvan Mohajer pointed to large enterprise renewals, such as a Fortune 100 insurance client, as the first wave, with all new customers expected to use OASYS immediately.
- Leo Carpio (Joseph Gunnar) questioned the competitive environment, especially versus big tech and API aggregators. Mohajer described SoundHound’s advantage as a “partner for the [AI] transformation,” emphasizing proprietary models and deep customer integration, rather than just technology provision.
- Scott Buck (Titan Partners) asked about drivers of sustainable profitability beyond revenue growth. Mohajer cited cost synergies from acquisitions, strategic investments in proprietary models to lower costs, and a shift to recurring revenue streams as key factors.
Catalysts in Upcoming Quarters
In the coming quarters, our team will be watching (1) the pace of integration and customer retention following the LivePerson acquisition, (2) adoption rates and measurable business impact of the OASYS platform across both new and legacy customers, and (3) the realization of expected cost synergies and improvements in operating margins. Execution on large enterprise deals and further product innovation will also be important indicators of SoundHound’s ability to deliver on its growth ambitions.
SoundHound AI currently trades at $8.45, down from $9.63 just before the earnings. Is there an opportunity in the stock?The answer lies in our full research report (it’s free).
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