SoundHound AI Reports Record Q3 Revenue and Guides to Sustained Adjusted EBITDA Profitability within 2H 2027
SOUNDHOUND AI, INC. (SOUN) filed an SEC Form 8-K — Results of Operations and Financial Condition. SoundHound AI Reports Record Q3 Revenue and Guides to Sustained Adjusted EBITDA Profitability within 2H 2027 SANTA CLARA, Calif.--SoundHound AI, Inc. (Nasdaq: SOUN), a global leader in voice and agentic AI, today reported its financial results for the third quarter 2026. "This is
How this was made
The 30-second read
Why it matters
The earnings release provides fresh guidance and cost‑synergy estimates, offering a new data point for valuation models.
Market read
First‑report earnings and guidance for a small‑cap AI firm; modest trading relevance.
What to watch
Integration risks from the LivePerson acquisition and potential cash burn before synergies materialize.
SoundHound AI Reports Record Q3 Revenue and Guides to Sustained Adjusted EBITDA Profitability within 2H 2027
Revenue reached a record $62.4 million and grew 48.5% year-over-year in the financial highlights, but both GAAP and non-GAAP gross margins declined, adjusted EBITDA loss widened, and the company reported substantial nine-month operating cash use. Management's outlook centers on LivePerson cost synergies, margin remediation, and sustained adjusted EBITDA positivity within the second half of 2027.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Third quarter 2026 revenueGAAP | $62.42M | – | 48% |
| Third quarter 2026 revenue, financial highlightGAAP | $62.4M | – | 48.5% |
| Third quarter 2026 GAAP gross profitGAAP | $21.28M | – | 19% |
| Third quarter 2026 GAAP gross marginGAAP | 34.1% | – | (8.5) pp |
| Third quarter 2026 non-GAAP gross profitnon-GAAP | $31.39M | – | 26% |
| Third quarter 2026 non-GAAP gross marginnon-GAAP | 50.3% | – | (9.0) pp |
| Third quarter 2026 GAAP operating lossGAAP | −$46.50M | – | 60% |
| Third quarter 2026 adjusted EBITDAnon-GAAP | −$20.66M | – | (42)% |
| Third quarter 2026 GAAP net lossGAAP | −$46.37M | – | 58% |
| Third quarter 2026 non-GAAP net lossnon-GAAP | −$21.21M | – | (63)% |
| Third quarter 2026 GAAP net loss per shareGAAP | $(0.10) | – | $0.17 |
| Third quarter 2026 non-GAAP net loss per sharenon-GAAP | $(0.05) | – | $(0.02) |
| Third quarter 2026 GAAP gross profit reconciliation: depreciation and amortizationother | $6.67M | – | – |
| Third quarter 2026 GAAP gross profit reconciliation: stock-based compensation and related payroll taxesother | $3.13M | – | – |
| Third quarter 2026 GAAP gross profit reconciliation: acquisition-related expensesother | $311K | – | – |
| Third quarter 2026 adjusted EBITDA reconciliation: total other expense (income), netother | $233K | – | – |
| Third quarter 2026 adjusted EBITDA reconciliation: income taxesother | −$362K | – | – |
| Third quarter 2026 adjusted EBITDA reconciliation: depreciation and amortizationother | $13.32M | – | – |
| Third quarter 2026 adjusted EBITDA reconciliation: amortization of capitalized commissionsother | $65K | – | – |
| Third quarter 2026 adjusted EBITDA reconciliation: stock-based compensation and related payroll taxesother | $22.54M | – | – |
| Third quarter 2026 adjusted EBITDA reconciliation: change in fair value of contingent acquisition liabilitiesother | −$23.43M | – | – |
| Third quarter 2026 adjusted EBITDA reconciliation: litigation settlement expensesother | $420K | – | – |
| Third quarter 2026 adjusted EBITDA reconciliation: acquisition-related expensesother | $12.91M | – | – |
| Third quarter 2026 non-GAAP net loss reconciliation: change in fair value of derivativeother | $581K | – | – |
| Third quarter 2026 non-GAAP net loss reconciliation: income tax effects related to acquisitionsother | −$1.26M | – | – |
| Third quarter 2026 weighted average common shares outstanding, basicother | 454,512,160 | – | – |
| Third quarter 2026 weighted average common shares outstanding, dilutedother | 454,512,160 | – | – |
| Nine months ended September 30, 2026 net cash used in operating activitiesGAAP | −$95.99M | – | – |
| Nine months ended September 30, 2026 net cash provided by (used in) investing activitiesGAAP | $9.80M | – | – |
| Nine months ended September 30, 2026 net cash provided by financing activitiesGAAP | $45.31M | – | – |
| Nine months ended September 30, 2026 effects of exchange rate changes on cashGAAP | $291K | – | – |
| Nine months ended September 30, 2026 net change in cash and cash equivalentsGAAP | −$40.58M | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
2026 and 2027 outlook
- Revenue2026 revenue to be in the range of $250M - $260M; 2027 revenue in the range of $350M - $400M
- NoteSignificant annualized cost synergies of $120 million
- NoteOver $80 million in actions scheduled to take effect before January 1, 2027
- NoteFull $120 million run-rate expected in 2027
- NoteSustained adjusted EBITDA positive within the second half of 2027, even at the lower-end of its revenue guidance
- NoteContinued non-renewal and exit of certain negative gross margin contracts inherited from prior acquisitions, with a positive impact on both gross margin and EBITDA
- NotePrioritize a hosted-service model and reduce upfront licensing, with expected more predictable revenue and long-term, sustainable ARR growth
What drove it
- Closed the acquisition of LivePerson on September 4th.
- Coordinated outreach to LivePerson's top 90 enterprise accounts representing over $100 million in ARR.
- Signed a 7-figure minimum-guarantee agreement with a tier one Chinese automotive supplier for voice AI and edge capabilities.
- Signed a deal with LG to debut a new commerce channel across approximately 20 million smart TVs in the US.
- Resorts World Las Vegas expanded from an on-property digital concierge to an external-facing autonomous booking agent.
- A household-name pizza chain added SoundHound AI ordering to nearly 100 additional restaurant locations.
- Management identified significant annualized cost synergies of $120 million.
Concerns
- GAAP gross margin was 34.1%, compared with 42.6% in the prior-year period.
- Non-GAAP gross margin was 50.3%, compared with 59.3% in the prior-year period.
- Adjusted EBITDA was a loss of $(20,665) (thousands), compared with a loss of $(14,546) (thousands) in the prior-year period.
- Non-GAAP net loss was $(21,215) (thousands), compared with $(13,022) (thousands) in the prior-year period.
- Nine-month net cash used in operating activities was $(95,986) (thousands), compared with $(76,336) (thousands) in the prior-year period.
- The company is strategically non-renewing and exiting certain negative gross margin contracts inherited from prior acquisitions.
What to watch
- Execution of over $80 million in cost-synergy actions scheduled to take effect before January 1, 2027.
- Progress toward the full $120 million cost-synergy run-rate expected in 2027.
- Realization of LivePerson integration, revenue, and cost synergies.
- The shift from upfront license deals to hosted structures and its intended effect on revenue predictability and long-term, sustainable ARR growth.
- Improvement in gross margin and adjusted EBITDA as the company exits negative gross margin contracts.
- Progress toward sustained adjusted EBITDA positivity within the second half of 2027.
Balance sheet and cash flow
- Total cash and cash equivalents was $207.6 million at September 30, 2026.
- The Company had $3.8 million of short-term debt as of September 30, 2026, assumed from the LivePerson acquisition in September 2026.
- Nine months ended September 30, 2026 net cash used in operating activities was $(95,986) (thousands).
- Nine months ended September 30, 2026 net cash provided by financing activities was $45,315 (thousands).
- Nine months ended September 30, 2026 net change in cash and cash equivalents was $(40,577) (thousands).
Analysis
SoundHound reported third-quarter 2026 revenue of $62,425 (thousands), up 48% from $42,049 (thousands) in the prior-year period. The financial highlights characterized revenue as $62.4 million, up 48.5% year-over-year. The release described broad commercial activity across enterprise and customer care, automotive and devices, voice commerce, hospitality, and restaurant ordering, while the LivePerson acquisition closed on September 4th.
Profitability metrics weakened at the gross-margin and adjusted-EBITDA levels. GAAP gross margin was 34.1%, compared with 42.6%, while non-GAAP gross margin was 50.3%, compared with 59.3%. Adjusted EBITDA was a loss of $(20,665) (thousands), versus a loss of $(14,546) (thousands). GAAP operating loss narrowed to $(46,497) (thousands) from $(115,891) (thousands), but GAAP operating loss included a $23.4 million gain from the calculated fair value of contingent acquisition liabilities.
The company reported a GAAP net loss of $(46,368) (thousands), compared with $(109,271) (thousands), and a non-GAAP net loss of $(21,215) (thousands), compared with $(13,022) (thousands). Acquisition-related expenses were $12,915 (thousands) in the adjusted EBITDA reconciliation, while stock-based compensation and related payroll taxes were $22,540 (thousands). Management said it is shifting upfront license arrangements to hosted structures and exiting certain inherited negative gross margin contracts to improve revenue predictability, gross margin, and EBITDA.
Liquidity included $207.6 million of cash and cash equivalents at September 30, 2026, alongside $3.8 million of short-term debt assumed from the LivePerson acquisition. Nine-month operating cash use was $(95,986) (thousands), compared with $(76,336) (thousands) in the prior-year period. The company guided to 2026 revenue of $250M - $260M and 2027 revenue of $350M - $400M, identified $120 million of annualized cost synergies, and expects sustained adjusted EBITDA positivity within the second half of 2027 even at the lower end of its revenue guidance.
Management, verbatim
This is a milestone moment for SoundHound. We announced another record quarter, closed our acquisition of LivePerson, and guided that the company will be adjusted EBITDA profitable within the second half of 2027.
Keyvan Mohajer, CEO and Co-Founder of SoundHound AI
Since closing the LivePerson acquisition, we have moved swiftly and decisively to integrate the businesses and realize substantial cost and revenue synergies. At the same time, we are improving our quality of earnings by shifting upfront license deals to hosted structures and exiting non-core, dilutive business lines, making our revenue more stable and predictable.
John Collins, CFO of SoundHound AI
Not in the filing
stated, not guessed- Revenue by reportable financial segment
- Segment operating income or loss
- Quarterly operating cash flow
- Free cash flow
- Capital expenditures
- Capital returns, including share repurchases and dividends
- GAAP operating expenses
- Prior-quarter comparisons for reported third-quarter metrics
- Prior guidance or previous outlook for comparison
- Guidance for gross margin, operating expenses, or tax rate
- Cash and debt prior-period comparisons
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was checked against the filing text, and a metric whose value, prior period and change do not add up is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
SoundHound AI filed an 8‑K reporting its Q3 2026 financials and integration progress after acquiring LivePerson.
Ticker impact
SoundHound AI disclosed Q3 2026 results with record $62.4M revenue and guidance to achieve adjusted EBITDA profitability in H2 2027.
likely modest upside as investors price in strong revenue growth and cost‑synergy outlook.
The company reported a 48.5% YoY revenue increase and outlined $120M annual cost synergies, which should support a short‑term rally despite the distant profitability timeline.
Market effects
Highlights growing demand for voice and agentic AI, potentially benefiting peers in AI‑software space.
Limited to U.S. small‑cap investors; no broader regional effect.
Shows continued expansion of AI services globally, but impact confined to niche market.
Counterpoint
The long‑term profitability target may be overly optimistic; investors could remain cautious until EBITDA turns positive.
Key entities
- companySoundHound AI, Inc.
Voice and agentic AI platform provider.
- companyLivePerson
Acquired AI conversational platform.
