SoundHound Narrows Loss and Raises Revenue Outlook
Second-quarter revenue reached $61.9 million as major OASYS contracts drove growth.
SoundHound AI (SOUN), the voice artificial-intelligence company, narrowed its adjusted EBITDA loss to $9.6 million in the second quarter from $26.7 million in the first quarter and $14.3 million a year earlier.
The improvement accompanied a sharp rebound from the first quarter, when revenue fell about 20% sequentially. Second-quarter revenue climbed 40% from the prior period and surpassed the fourth-quarter level by about 12%, though year-over-year growth slowed to 45% from 52% in the first quarter.
GAAP gross margin expanded 14 percentage points sequentially to 45.1%, while remaining below the 47.9% recorded in the fourth quarter. GAAP gross profit rose 68% from a year earlier, outpacing revenue growth, as the margin improved 6.1 percentage points.
OASYS became a driver of the quarterly expansion after its launch in the first quarter. Growth was driven by major enterprise agreements, including a seven-figure healthcare-system contract and an initial eight-figure channel partnership covering more than 20 Latin American countries.
SoundHound's non-GAAP net loss narrowed to $9.0 million from $26.6 million in the preceding quarter and $11.9 million a year earlier. Its GAAP net loss widened sequentially to $42.8 million, although it improved 43% year over year; the latest result included a roughly $4 million gain tied to the valuation of contingent acquisition liabilities.
The company raised its full-year revenue outlook to a range of $230 million to $260 million. That forecast excludes any future update tied to the pending LivePerson acquisition, which SoundHound expects to provide after the transaction closes.
Cash and cash equivalents declined to $202.8 million at June 30 from $248.5 million at year-end, as first-half operating cash use increased to $60.0 million. SoundHound remained debt-free, while stock sales brought in $48.5 million and its basic weighted-average share count rose about 7.6% from a year earlier.