SoundHound AI is set to enter the latter half of 2025 with a strong automotive pipeline, highlighting its unique voice AI capabilities in response to changing preferences among original equipment manufacturers (OEMs). During the first-quarter earnings call, management noted a significant trend in the industry where automakers are distancing themselves from major tech voice platforms, opting instead for customized, white-labeled solutions. This shift aligns perfectly with SoundHound’s offering, particularly its Polaris model, which is designed for faster response times and heightened accuracy in challenging environments.
The company is witnessing a resurgence of interest from both electric vehicle (EV) and internal combustion engine manufacturers, as global brands are now exploring pilots and proofs of concept for SoundHound’s voice commerce solutions. Unlike previously being perceived as just a background feature, SoundHound is now recognized as a potential revenue generator, particularly through its transactional voice capabilities that allow for in-car food ordering and parking reservations.
Despite seeing some downturn in automotive unit volumes in the first quarter of 2025, attributed to broader economic uncertainties, management remains optimistic. The voice commerce platform has rapidly gained traction, integrating more than 15 major restaurant brands and prompting several OEMs to expedite their adoption timelines. This momentum suggests a significant opportunity for growth in royalty and subscription revenues in the near future.
Though auto unit sales are currently a smaller segment of SoundHound’s diverse revenue base, their strategic importance is increasing. The company is favorably positioned to benefit from a substantial shift in in-vehicle voice technology adoption as 2025 progresses.
In the competitive landscape, SoundHound faces notable challenges from rivals like Cerence Inc. and Amazon’s Alexa Auto. Cerence, while well-established in automotive voice tech, struggles with transitioning to cloud and transactional services, creating openings for SoundHound to leverage its hybrid-cloud and voice-commerce features. Meanwhile, Amazon’s Alexa Auto capitalizes on its consumer ecosystem, but OEMs show a growing preference for customizable solutions where SoundHound excels.
SoundHound’s stock performance has been robust, with shares increasing by 16.7% over the past three months, outperforming the industry growth of 7.4%. Despite stabilizing loss estimates for 2025 of 16 cents per share, an improvement from a year-ago loss of $1.04, SoundHound maintains a Zacks Rank of #3. This indicates a solid standing within the market as it navigates the evolving landscape of automobile voice technology.
Overall, SoundHound’s innovative solutions and proactive response to industry shifts position it strategically for growth in the burgeoning automotive voice AI sector.