SoundHound AI Q3 Earnings: Growth and Guidance Raise
SoundHound AI Q3 earnings had $42M revenue and a $165M–$180M 2025 guide raise, showing enterprise traction and drawing investor scrutiny over GAAP loss.
KEY TAKEAWAYS
- Q3 revenue was $42M, up 68% year-over-year.
- Company raised 2025 revenue guidance to $165M–$180M and targets adjusted-EBITDA profitability by year-end.
- GAAP net loss was $109.3M, including a $66M non-cash mark-to-market charge.
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SoundHound AI reported strong third-quarter revenue growth and raised its full-year 2025 guidance in a Nov. 6, 2025 press release, citing broad enterprise AI adoption and a nationwide rollout with Red Lobster.
Q3 Financial Results and Outlook
SoundHound posted third-quarter revenue of $42.0 million, a 68% increase year-over-year. The company raised its full-year revenue guidance to $165 million–$180 million from the prior $160 million–$178 million range, attributing the boost to accelerating enterprise demand. It also targets adjusted EBITDA profitability by year-end 2025, assuming continued scaling of deployments, cloud optimizations, and new Agentic+ use cases.
On a GAAP basis, SoundHound reported a net loss of $109.3 million, which included a $66 million non-cash mark-to-market loss related to contingent acquisition liabilities. The press release did not detail that charge further. On a non-GAAP basis, the net loss was $13.0 million, with an adjusted EBITDA loss of $14.5 million, improving from $15.9 million a year earlier. GAAP gross margin was 42.6%, and non-GAAP gross margin was 59.3%, both flat year-over-year.
The company ended the quarter with $269 million in cash and equivalents and reported no long-term debt.
Commercial Expansion and Product Updates
SoundHound and Red Lobster announced a partnership to deploy an AI-powered phone-ordering agent across all U.S. Red Lobster locations. The company has expanded commercial deployments to millions of endpoints globally across automotive, restaurants, healthcare, finance, telecom, and Internet of Things (IoT) sectors.
On the product front, SoundHound released Amelia 7.3, which reduces latency and improves user experience, updated its Vision AI offerings, and completed the acquisition of Interactions. No regulatory approvals were required for these developments or the Red Lobster partnership.
CEO and co-founder Keyvan Mohajer said, "Enterprise AI adoption is booming globally, and SoundHound is strengthening its leading position with deployments in millions of endpoints across highly diversified industries and customers."
SoundHound’s raised outlook, strong cash position, and path to adjusted EBITDA profitability highlight its commercial scaling. However, the widened GAAP loss driven by the mark-to-market accounting charge and the stock’s post-earnings decline reflect investor scrutiny of execution and accounting details.
"We see enormous potential in the near and long-term horizon, and we’re positioning our business to take full advantage," Mohajer added.
