SoundHound AI posts strong revenue growth but sees stock plunge amid heavy short interest

SoundHound AI reported a 52% year‑over‑year increase in revenue to $44.2 million for the fiscal first quarter of 2026, beating estimates of $42.56 million. Despite the top‑line growth, the company posted a GAAP loss of $25 million and an adjusted EBITDA loss of $26.7 million, with earnings per share of –$0.06. Short sellers own more than 38% of the float, and the share price has fallen more than 16% since the earnings release. Analysts remain broadly optimistic, with eight of ten covering analysts maintaining Buy ratings and a 12‑month price target implying over 67% upside.

The company also announced an acquisition of LivePerson to broaden its conversational‑AI platform, aiming for $350‑$400 million in revenue by 2027 and identifying a $500 million opportunity from the combined enterprise offering. In a separate analysis, Nebius Group, a full‑stack AI cloud provider, posted FY 2025 revenue of $529.8 million and a net profit of $101.7 million, while SoundHound’s FY 2025 revenue was $168.9 million with a net loss of $14 million. Nebius trades at a premium on valuation metrics, whereas SoundHound appears cheaper on a price‑to‑sales basis but carries higher short‑interest risk.