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SoundHound AI (SOUN) stock ripped higher on Thursday after the voice and agentic AI firm posted record Q2 earnings that blew past Wall Street estimates. SOUN’s revenue soared an exciting 45% year-on-year to an all-time high of $61.9 million, helping net loss contract to just $0.02 on a per-share basis.
Despite the post-earnings rally, SoundHound stock remains down about 30% versus the start of this year.
What Drove Strength in SoundHound’s Fiscal Q2?
The primary catalyst behind SoundHound’s record quarter was the explosive enterprise adoption of OASYS, its self-learning agentic artificial intelligence platform launched in May.
OASYS secured major enterprise contracts in Q2, including an eight-figure commitment, across healthcare, financial services, automotive, and restaurant chains like Five Guys and IHOP.
Investors are cheering SOUN shares also because operational discipline accelerated margins, with GAAP gross margin expanding 610 bps year-over-year to 45.1%.
In short, the quarterly print confirms that demand for SoundHound’s specialized voice AI solutions is rapidly converting into high-margin, scalable software revenue.
Note that the post-earnings rally drove SOUN decisively above its 50-day moving average (MA), indicating the upward momentum could sustain in the near term.
Is It Too Late to Invest in SOUN Shares?
Despite a sharp post-earnings pop, SoundHound shares look poised for continued gains given the company raised the lower end of its guidance as well on Thursday morning.
Management now sees revenue falling between $230 million and $260 million this year, notably higher than the nearly $233 million consensus.
Crucially, the revised outlook doesn’t bake in any contributions from SOUN’s pending acquisition of LivePerson, which is expected to close by the end of 2026.
The AI-enabled speech recognition specialist continues to target long-term gross margins above 70%, which further strengthens the case for buying its shares at current levels.
Wall Street Remains Bullish on SoundHound AI
Despite the recent surge, Wall Street experts remain convinced that SoundHound AI is undervalued at its current price.
According to Barchart, the consensus rating on SOUN stock sits at “Moderate Buy,” with the mean price target of $11.71 indicating potential for another 70% rally over the next 12 months.
