SoundHound AI's second-quarter revenue rose 45% year over year to a record $61.9 million, and the company raised its 2026 outlook to $230 million-$260 million. Motley Fool contributor Daniel Sparks predicts the company's revenue, boosted by its newly closed acquisition of LivePerson, will cross $500 million by 2028, while a sustained profit likely won't arrive before 2029.
SoundHound AI is on pace to pass $500 million in annual revenue years before it earns a sustained profit, according to a forecast from Motley Fool contributor Daniel Sparks. The prediction follows LivePerson shareholders' approval of their company's sale to the voice artificial intelligence specialist on Sept. 2. The mostly stock deal closed Friday, Sept. 4.
Guidance climbs as growth compounds
The company's revenue growth record is short but steep. SoundHound's own second-quarter revenue grew 45% year over year to a record $61.9 million. Management also raised the low end of its full-year outlook, which now calls for $230 million to $260 million of revenue in 2026. Revenue nearly doubled in 2025, reaching $168.9 million. The first quarter of 2026 came in at $44.2 million, up 52% year over year. That growth pace is decelerating as the numbers get bigger, though the dollar gains keep setting records. Sparks calculates that another year of 45% growth would put 2027 revenue near $355 million, with a repeat in 2028 landing the company at about $515 million. Even at 30% growth, revenue would still cross $500 million by 2029.
LivePerson deal pulls the timeline forward
The acquisition, a mostly stock deal with an enterprise value of about $250 million, adds a business nearly as large as SoundHound itself. LivePerson expects $195 million to $207 million of revenue this year. That figure is shrinking: guidance calls for a 15% to 20% decline in 2026. Revenue retention among its enterprise and mid-market customers fell to 78% last year. Sparks expects the combined company to pass $500 million in 2028, since management has said the combined business could reach up to $500 million on existing customers alone.
Losses narrow slower than revenue grows
SoundHound's adjusted EBITDA loss narrowed to $9.6 million in the second quarter from $14.3 million a year earlier, a 33% improvement. That improvement wasn't steady: the first quarter's adjusted loss had widened to $26.7 million from $22.2 million. The company's second-quarter net loss was $42.8 million, about 69% of revenue, an improvement from $74.7 million a year earlier. Meanwhile, LivePerson lost $72.6 million last quarter, including a $51.8 million goodwill impairment, adding fresh losses to the combined business.
Sparks expects a sustained operating profit — not a one-quarter accounting gain — to remain unlikely before 2029, contingent on the second quarter's operating leverage holding through the integration. Shares trade at about $6.75, down about 70% from their 52-week high of $22.17. The stock still trades near 12 times revenue based on the midpoint of this year's guidance.
Source: The Motley Fool
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