SoundHound AI, Inc. (Nasdaq: SOUN), a global leader in voice artificial intelligence, today reported its financial results for the three and nine months ended September 30, 2022.
“Adoption of our voice AI is accelerating fast, as evidenced by our record quarterly revenue. In addition to strong growth in royalty revenues across automotive and IoT customers, increasing numbers of businesses are now looking to use our AI to automate their customer service – particularly for restaurant phone and drive-thru ordering,” said Keyvan Mohajer, Co-Founder and CEO of SoundHound. “Across industries voice AI is proving to be the next big interface and, as the only independent platform, SoundHound is well-positioned to establish itself as a leader in this market. On November 17, we will also unveil a new breakthrough technology that we believe will redefine conversational AI and mark a new chapter in human-computer interaction.”
Third Quarter Business Highlights
- Record cumulative bookings backlog of $302 million, up 239% year-over-year, marking the fourth straight quarter of triple-digit growth
- Record reported revenues of $11.2 million, up 178% year-over-year, driven by strong product royalty revenue
- Record monthly queries of ~180 million, surpassing an annual run rate of 2 billion queries, more than doubling year to date compared to the prior year
- Record gross margin of 77%, compared to 59% for the third quarter of 2021, benefiting from economies of scale and a favorable product mix
- Significant international market expansion of existing multi-year volume commitment with Hyundai, Kia and Genesis
- Building upon our existing 17 automotive brands we announced new and expanded relationships with Stellantis in Europe, Dongfeng Peugeot Citroën Automobiles in China, and initiated integrations with LG and Harman automotive technology platforms
- Rapidly expanding channel relationships with SoundHound for Restaurants, including new integrations with Oracle and Toast, and continuing strong uptake with Mastercard and Square
- Fully automated SoundHound for Restaurants order completion rate is on track to surpass human levels as a result of our advanced AI technology, delivering substantial value to customers
- Announced general availability of full suite of Edge and Cloud connectivity solutions and launched SoundHound Intelligent Transcription
“Our exceptional Q3 results demonstrate our business momentum. Not only have we reaffirmed our full year outlook, we also saw our cumulative bookings increase for the fourth straight quarter – to over $300 million – and our revenue eclipse that of the full year 2021 in the first nine months of this year,” said Nitesh Sharan, CFO of SoundHound. “We’re thoughtfully channeling investments to the areas that matter most, while accelerating our path to profitability.”
Third Quarter 2022 Financial Highlights
1) Cumulative bookings backlog is prior quarter end balance plus new bookings in the current quarter minus associated revenue recognized.
2) Please see table below for a reconciliation from GAAP to non-GAAP.
Summary of Cash Flows
The Company’s cash and cash equivalents was $33.4 million at September 30, 2022.
Business Outlook
SoundHound reaffirms its full year 2022 revenue guidance. Moreover, the company refines its range to now expect between $28 and $32 million (previous range between $27 and $33 million).
To streamline the company and focus on strategic initiatives to accelerate growth in key verticals, we have implemented cost reduction initiatives. The announced measures will result in a reduction in workforce of approximately 10% as well as adjustments to our discretionary expenses.
Additional Information
SoundHound expects to file its Form 10-Q for the quarterly period ended September 30, 2022, by November 14, 2022. For more information please see the company’s SEC filings which can be obtained on our website at investors.soundhound.com.
SoundHound will announce a new breakthrough technology on November 17th. Please refer to soundhound.com on November 17th for the press release.
Conference Call and Webcast
Keyvan Mohajer, Co-Founder and CEO and Nitesh Sharan, CFO will host a live audio conference call and webcast today at 2:30 p.m. Pacific Time/5:30 p.m. Eastern Time. Please click here to pre-register for the conference call and obtain your dial in number and passcode. A live webcast will also be accessible at investors.soundhound.com and a replay of the webcast will be available following the session.
Tune in to Martech Cube Podcast for visionary Martech Trends, Martech News, and quick updates by business experts and leaders!!!