Prediction: SoundHound Passes $500 Million in Revenue Before It Turns a Profit

SoundHound AI (NASDAQ:SOUN) is becoming a much bigger company. LivePerson (NASDAQ:LPSN) shareholders approved the sale of their company to the voice artificial intelligence (AI) specialist on Sept. 2, and the mostly stock deal closed on Friday, Sept. 4.

SoundHound's own second-quarter revenue grew 45% year over year to a record $61.9 million, and management raised the low end of its full-year outlook, which now calls for $230 million to $260 million of revenue in 2026.

Stack a large acquired business on top of that growth, and the top line could reach half a billion dollars surprisingly soon. The losses are moving much more slowly. Here's my prediction: SoundHound passes $500 million in annual revenue before it earns a sustained profit.

Image source: The Motley Fool.

Record revenue, a raised outlook

SoundHound's growth record is short but steep. 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, and the second quarter's growth was 45%, with revenue up 40% from the first quarter alone. The growth rate is decelerating as the numbers get bigger. But the dollars keep setting records.

This year's guidance of $230 million to $260 million implies 36% to 54% growth. Notably, the range excludes LivePerson. Management plans to update its guidance after the deal closes, likely before the end of the year.

From the $245 million midpoint, the compounding works fast. Another year of 45% growth would put 2027 revenue near $355 million, and a repeat in 2028 would land the company at about $515 million. Even if growth cooled to 30%, revenue would cross $500 million in 2029.

LivePerson pulls the timeline into 2028

The acquisition, a mostly stock deal with an enterprise value of about $250 million, brings a business nearly as large as SoundHound itself. LivePerson expects $195 million to $207 million of revenue this year.

That revenue is shrinking, though. Guidance calls for a 15% to 20% decline in 2026, and revenue retention among LivePerson's enterprise and mid-market customers fell to 78% last year.

SoundHound's own combined-company forecast reflects the erosion. Management projects at least $350 million to $400 million of revenue in 2027 (still below what the two would generate this year combined).

Still, from the top of that range, the combined company needs only about 25% growth in 2028 to pass $500 million -- a fraction of the rate SoundHound is delivering on its own. Management has said the combined business is expected to reach up to $500 million on its existing customers alone. I think revenue crosses in 2028, with 2029 as the slow case.

When do the profits show up?

Much later, on the current trend.

SoundHound's non-GAAP (adjusted) EBITDA loss narrowed to $9.6 million in the second quarter from $14.3 million a year earlier, a 33% improvement. (Adjusted EBITDA is earnings before interest, taxes, depreciation, and amortization, excluding items like stock-based compensation.)

The loss line is narrowing, but not in a straight line. The first quarter's adjusted loss widened year over year, to $26.7 million from $22.2 million.

The bigger problem is the gap between that measure and the company's full losses. SoundHound's second-quarter net loss was $42.8 million (about 69% of revenue), an improvement from $74.7 million a year earlier. Stock-based compensation plus depreciation and amortization alone separate the two figures by more than $30 million a quarter, and quarterly mark-to-market swings on acquisition-related liabilities add noise on top.

Of course, those swings can point the other way, too. SoundHound reported $40.1 million of net income in the fourth quarter of 2025, thanks to an $85 million non-cash mark-to-market gain. But that isn't the kind of profit this prediction is about.

And LivePerson won't speed things up. It lost $72.6 million last quarter, including a $51.8 million goodwill impairment, and the merger adds fresh acquisition accounting on top.

Ultimately, this isn't a close race. On the current pace, revenue passes $500 million in 2028. A sustained profit (money earned on operations, not a one-quarter accounting gain) looks unlikely before 2029 at the earliest. And even that requires the second quarter's operating leverage to hold through a big integration.

For the stock, that order matters. Shares trade at about $6.75 as of this writing, down about 70% from their 52-week high of $22.17, yet still about 12 times revenue, based on the midpoint of this year's guidance. That price already assumes the growth keeps coming, and I think it will.

But anyone buying the growth stock should expect red ink for years while the top line does the work. I'd avoid buying shares here until the loss line proves it can keep narrowing through the integration.

Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends SoundHound AI. The Motley Fool has a disclosure policy.