SoundHound AI, Inc. SOUN used its second-quarter 2026 call to emphasize accelerating enterprise adoption of OASYS, stronger deal conversion and a raised full-year revenue outlook. Management also highlighted improving profitability measures despite continued investment.
The quarter produced $61.9 million in revenues, up 45% year over year, versus the Zacks Consensus Estimate of $52.49 million. Non-GAAP loss per share was 2 cents, compared with the consensus loss estimate of 3 cents.
SOUN Raises 2026 Revenue Outlook
Interim CFO and co-founder James Hom raised 2026 revenue expectations to $230 million to $260 million after the strong first half. The outlook excludes the pending LivePerson acquisition.
Hom said SoundHound intends to remain aggressive in capturing market share through existing-customer expansion, new customer wins and targeted investments in channels and OASYS.
CEO and co-founder Keyvan Mohajer said management expects to update guidance after LivePerson closes, which the company continues to expect before year-end.
SoundHound Puts OASYS at the Center
Mohajer described OASYS as a major contributor to second-quarter performance. He said SoundHound is moving prospects from demonstrations to signed contracts in months and converting pilots to larger deployments at a record pace.
In response to a Cantor Fitzgerald analyst, Mohajer said the company’s pipeline and win rate have never been stronger. He pointed to wins in demonstrations, RFPs and pilots as evidence of OASYS traction.
He also detailed OASYS’ “AI builds AI” capability, which can reduce complex agent-development work from months to minutes and support automated improvement after deployment.
SOUN Sees Broad Enterprise Expansion
Hom said enterprise AI remained SoundHound’s largest revenue contributor, with growth spanning healthcare, financial services, technology and automotive. Healthcare generated seven deals, including one seven-figure agreement.
Mohajer highlighted continued momentum in Asia, where SoundHound has signed major deals for five consecutive quarters. The company landed a seven-figure China automotive infotainment deal and expanded generative AI deployments with Stellantis and Hyundai.
Restaurants also remained an expansion area. Mohajer said renewal rates reached 100% for key accounts, while Smart Answering more than doubled year over year and several major restaurant chains expanded location coverage.
SoundHound Targets Margin Gains From In-House AI
Hom said GAAP gross margin reached 45.1%, up 6.1 percentage points year over year, while non-GAAP gross margin was 58.4%. Adjusted EBITDA loss improved 33% to $9.6 million.
Management attributed efficiencies to infrastructure modernization, cloud optimization, legacy-system consolidation and increased use of in-house technology. Hom said the company still expects gross margin to exceed 70% over time.
Mohajer added that smaller customers now run entirely on SoundHound’s own stack, while one large healthcare customer is preparing to switch. He tied the model strategy to lower costs, higher quality and greater control.
SOUN Clarifies LivePerson Path in Q&A
A D.A. Davidson analyst asked how guidance changes under a LivePerson closing scenario. Mohajer reiterated that current 2026 guidance excludes the acquisition and that timing uncertainty prevents a precise contribution estimate.
A Northland Capital Markets analyst asked about 2027 expectations. Mohajer maintained the previously discussed $350 million to $400 million range, assuming the merger closes successfully in the second half of 2026.
Mohajer also identified two key integration opportunities: upgrading LivePerson customers to OASYS and adding voice capabilities to LivePerson’s digital customer-service base. He said regulatory clearances have been secured.
SoundHound Keeps Focus on Scale and Discipline
Management’s tone centered on expanding enterprise adoption while maintaining cost discipline. Hom said SoundHound plans to keep investing in technology and go-to-market capacity as it works toward profitable growth.
Mohajer emphasized OASYS, proprietary models, channel partnerships and acquisitions as the company’s main scaling levers. He also pointed to upcoming Voice Commerce projects in vehicles and televisions as additional use cases.
The call left management focused on converting a larger pipeline, broadening deployments within existing accounts and preparing for LivePerson integration without including the acquisition in current-year guidance.
SOUN Rank and Style Scores Point to Caution
SOUN currently carries a Zacks Rank #3 (Hold). Its Value Score is F, Growth Score is D, Momentum Score is F and VGM Score is F, leaving the shares without the stronger A or B style characteristics emphasized in the Zacks framework. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Style Scores are designed to complement the Zacks Rank, with higher grades indicating more favorable characteristics. Investors should note that the Zacks Rank can change as earnings estimates are revised following the just-reported results.
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SoundHound AI, Inc. (SOUN): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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