SoundHound AI (SOUN) closed out FY 2025 with Q4 revenue of US$55.1 million, basic EPS of US$0.10 and net income of US$40.1 million, while its trailing twelve month figures show revenue of US$168.9 million and a small net loss, with basic EPS at roughly flat levels overall. The company has seen quarterly revenue move from US$25.1 million in Q3 2024 to US$34.5 million in Q4 2024, then to US$29.1 million in Q1 2025, US$42.7 million in Q2, US$42.0 million in Q3 and US$55.1 million in Q4, alongside EPS that swung between losses and profits, so the latest print puts the focus squarely on how durable these margins really are.

See our full analysis for SoundHound AI.

With the latest numbers on the table, the next step is to see how this earnings profile lines up with the prevailing stories around SoundHound AI, and where those narratives might need a reality check.

TTM loss of US$14 million keeps profitability in focus

• Over the last twelve months, SoundHound AI booked US$168.9 million in revenue and a net loss of US$14.0 million, so even though Q4 FY 2025 was profitable, the full year still lands in loss making territory.
• Consensus narrative talks about margin improvement toward near term profitability, yet trailing data shows losses widening at about 21.4% per year over five years, which
  • supports the concern that heavy R&D and operating costs can keep earnings under pressure even as revenue grows.
  • challenges the idea that a single profitable quarter is enough to signal a clear path to sustained positive EPS.

Valuation at 21.4x P/S versus industry at 3.4x

• The shares trade on a P/S of 21.4x compared with roughly 3.4x for the wider US software industry and 18.9x for peers, so investors are paying a higher multiple despite the trailing loss.
• Consensus narrative highlights strong revenue growth potential, but the high P/S multiple alongside forecasts for average annual earnings declines of 48.6% over the next three years
  • supports the cautious view that a lot of future revenue optimism is already embedded in the current valuation.
  • raises the question of how long the market will keep paying a premium if losses persist and earnings keep moving further away from break even.

Q4 US$40 million profit versus full year EPS still slightly negative

• Q4 FY 2025 showed net income of US$40.1 million and basic EPS of roughly US$0.10, but on a trailing twelve month basis EPS is still slightly negative at about US$0.03 loss per share.
• Bulls point to expanding voice AI adoption across industries as a driver of higher margin, recurring revenue, yet the mix of quarterly results, from a US$258.6 million loss in Q4 FY 2024 to US$129.2 million profit in Q1 FY 2025 and losses again in Q2 and Q3 FY 2025
  • supports the bullish idea that the product set can generate large positive quarters when deals land, especially as revenue stepped from US$25.1 million in Q3 FY 2024 to US$55.1 million by Q4 FY 2025.
  • also shows the bearish concern about earnings volatility has footing, because profitability has depended on big swings in net income rather than a smooth, consistent margin trend so far.

Bulls argue that if high margin voice AI revenue keeps building on quarters like Q4 FY 2025, today’s lumpiness could turn into a more predictable earnings story that aligns with their longer term view of the business. 🐂 SoundHound AI Bull Case

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for SoundHound AI on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

With sentiment in the article pulling in both bullish and cautious directions, it is worth stepping back, checking the numbers yourself and deciding where you stand. Our data already highlights that the company faces risks that some investors are wary of and rewards that others are excited about, so it is worth weighing both sides through 1 key reward and 3 important warning signs.

See What Else Is Out There

SoundHound AI still has a trailing twelve month loss of US$14.0 million and highly volatile quarterly earnings, while trading on a premium 21.4x P/S.

If that mix of losses and price premium makes you cautious, you might want to shift your focus toward 46 high quality undervalued stocks that pair more grounded valuations with financial profiles you find easier to get comfortable with.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.