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SoundHound AI (SOUN) shares fell 75.3% over the past year, yet buyers still pay 10 times sales for the company's voice and agentic AI software. For that price to make sense, SoundHound's sales must keep climbing fast, and the companies it is buying have to make the software more profitable. SoundHound holds $203 million in cash and $5.4 million of debt, giving the company about 1.6 years of cash to show both, based on the $125 million it burned over the past twelve months. So is SoundHound's sales growth holding up as the company gets bigger?

Is SoundHound AI's Sales Growth Holding Up?

Yes, so far. SoundHound's revenue grew 81.7% a year on average over the three twelve-month periods ending in June 2024, 2025 and 2026, compared to 5.9% for the S&P 500. During the latest of those periods, the twelve months to June 2026, revenue reached $203 million, up 54.6% from a year earlier.

Management said the June quarter's results beat its own expectations. It credited a significant part of that performance to OASYS, the self-learning agentic AI platform launched in May, and raised its full-year revenue forecast to a range of $230 million to $260 million. Enterprise AI remained the largest contributor to revenue, management said on the August 5 call.

The pace has slowed, though. Revenue growth fell every quarter, dropping from 67.6% in the quarter to September 2025 to 45.0% in the quarter to June 2026.

Are Acquisitions Lifting Gross Margin At SoundHound AI?

Not yet, though the gross margin is moving the right way. SoundHound's reported gross margin was 45.1% in the quarter to June 2026, up from 39.0% a year earlier. Management said acquisitions have temporarily hurt the gross margin, and it expects that margin to exceed 70% in the future.

The next deal is LivePerson. SoundHound has secured all key regulatory clearances to buy it, and management expects the deal to close before the end of the year. LivePerson's customers already use its digital chat, and management sees an upsell in upgrading the AI behind that chat to OASYS. The full-year revenue forecast does not include LivePerson.

What SoundHound AI's Sales Multiple Leaves Out

Investors pay more than three times as much for each dollar of SoundHound's sales as the 3.1 times sales they pay for the S&P 500. Those sales still come with heavy losses. SoundHound posted an operating loss equal to 98.8% of its revenue over the twelve months to June 2026, while the S&P 500 earned an operating margin of 18.5%. A price-to-earnings ratio is not meaningful for a company with no earnings.

These losses consume cash. SoundHound burned $125 million of free cash flow over those twelve months, an amount equal to about 62% of the cash it held at the end of June. If sales growth keeps slowing or the gross margin stalls, that outflow has little reason to shrink.

Holders have also seen SoundHound fall harder than the market in sell-offs. The stock dropped 35% during the 2025 tariff shock, against 19% for the S&P 500.

Today, SoundHound's sales are still growing, but at a slower pace each quarter. Its gross margin sits well below management's goal, and the LivePerson deal has yet to close. SoundHound's next report is expected on or around November 5, 2026, and its reported gross margin is the number to watch in it. You can weigh trimming or adding against that number and the growth rate: a gross margin climbing toward management's goal while growth holds up would support paying 10 times sales, and a stalled margin with slowing growth would not.

Does This Mean You Should Act On SOUN?

Our purpose is to inform you with unique data so you make the right investment decisions. That said, betting on a single stock is always risky, no matter which direction you choose.

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