Document And Entity Information
Document And Entity Information | 12 Months Ended |
Dec. 31, 2022 | |
Document Information Line Items | |
Entity Registrant Name | SOUNDHOUND AI, INC. |
Document Type | POS AM |
Amendment Flag | false |
Entity Central Index Key | 0001840856 |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 9,245 | $ 21,626 |
Restricted cash equivalents | 460 | |
Accounts receivable, net of allowances of $109 as of December 31, 2022 and December 31, 2021 | 3,414 | 2,060 |
Prepaid expenses | 2,514 | 1,276 |
Contract assets | 1,671 | 54 |
Other current assets | 859 | 1,995 |
Total current assets | 17,703 | 27,471 |
Restricted cash equivalents, non-current | 230 | 736 |
Right-of-use assets | 8,119 | 10,291 |
Property and equipment, net | 3,447 | 6,155 |
Deferred tax asset | 55 | 2,169 |
Contract assets, non-current | 7,041 | |
Other non-current assets | 1,656 | 2,381 |
Total assets | 38,251 | 49,203 |
Current liabilities: | ||
Accounts payable | 2,798 | 3,760 |
Accrued liabilities | 7,462 | 7,298 |
Operating lease liabilities | 3,282 | 3,281 |
Finance lease liabilities | 160 | 1,301 |
Income tax liability | 1,314 | 2,737 |
Deferred revenue | 5,812 | 6,042 |
Convertible note | 29,868 | |
Derivative liability | 3,488 | |
Notes payable | 16,668 | 29,964 |
Total current liabilities | 37,496 | 87,739 |
Operating lease liabilities, net of current portion | 5,715 | 8,611 |
Finance lease liabilities, net of current portion | 128 | 292 |
Deferred revenue, net of current portion | 7,543 | 14,959 |
Notes payable, net of current portion | 18,299 | |
Other non-current liabilities | 4,295 | 1,336 |
Total liabilities | 73,476 | 112,937 |
Commitments and contingencies (Note 7) | ||
Legacy SoundHound redeemable convertible preferred stock; $0.0001 par value; 0 and 146,218,514 shares authorized; 0 and 106,949,326 shares issued and outstanding, liquidation preference of $0 and $284,826 as of December 31, 2022 and December 31, 2021, respectively | 279,503 | |
Legacy SoundHound Common Stock, $0.0001 par value; 250,030,433 shares authorized; 0 and 68,258,556 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively | 1 | |
Class A Common Stock, $0.0001 par value; 455,000,000 shares authorized; 160,297,664 and 0 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively | 16 | |
Class B Common Stock, $0.0001 par value; 44,000,000 shares authorized; 39,735,408 and 0 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively | 4 | |
Additional paid-in capital | 466,857 | 43,491 |
Accumulated deficit | (502,102) | (386,729) |
Total stockholders’ deficit | (35,225) | (343,237) |
Total liabilities, redeemable convertible preferred stock, and stockholders’ deficit | $ 38,251 | $ 49,203 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accounts receivable, net of allowances (in Dollars) | $ 109 | $ 109 |
Redeemable convertible preferred stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Redeemable convertible preferred stock, shares authorized | 0 | 146,218,514 |
Redeemable convertible preferred stock, shares issued | 0 | 106,949,326 |
Redeemable convertible preferred stock, shares outstanding | 0 | 106,949,326 |
Liquidation preference (in Dollars) | $ 0 | $ 284,826 |
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 250,030,433 | 250,030,433 |
Common stock, shares issued | 0 | 68,258,556 |
Common stock, shares outstanding | 0 | 68,258,556 |
Class A Common Stock | ||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 455,000,000 | 455,000,000 |
Common stock, shares issued | 160,297,664 | 0 |
Common stock, shares outstanding | 160,297,664 | 0 |
Class B Common Stock | ||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 44,000,000 | 44,000,000 |
Common stock, shares issued | 39,735,408 | 0 |
Common stock, shares outstanding | 39,735,408 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | ||
Revenues | $ 31,129 | $ 21,197 |
Operating expenses: | ||
Cost of revenues | 9,599 | 6,585 |
Sales and marketing | 20,367 | 4,240 |
Research and development | 76,392 | 59,178 |
General and administrative | 30,178 | 16,521 |
Total operating expenses | 136,536 | 86,524 |
Loss from operations | (105,407) | (65,327) |
Other expense, net: | ||
Interest expense | (6,893) | (8,342) |
Other expense, net | (184) | (5,415) |
Total other expense, net | (7,077) | (13,757) |
Loss before provision for income taxes | (112,484) | (79,084) |
Provision for income taxes | 2,889 | 456 |
Net loss | (115,373) | (79,540) |
Other comprehensive gain: | ||
Unrealized holding gain on available-for-sale securities, net of tax | 1 | |
Comprehensive loss | $ (115,373) | $ (79,539) |
Net loss per share: | ||
Basic and diluted (in Dollars per share) | $ (0.73) | $ (1.18) |
Weighted-average common shares outstanding: | ||
Basic and diluted (in Shares) | 157,317,695 | 67,255,538 |
Consolidated Statements of Op_2
Consolidated Statements of Operations and Comprehensive Loss (Parentheticals) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | ||
Basic and diluted (in Dollars per share) | $ (0.73) | $ (1.18) |
Basic and diluted (in Shares) | 157,317,695 | 67,255,538 |
Consolidated Statements of Rede
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Deficit - USD ($) $ in Thousands | Legacy SoundHound Redeemable Convertible Preferred Stock | Class A Common Stock | Class B Common Stock | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Total |
Balance at Dec. 31, 2020 | $ 273,687 | $ 1 | $ 30,836 | $ (1) | $ (307,189) | $ (276,353) | ||
Balance (in Shares) at Dec. 31, 2020 | 19,132,387 | 11,818,761 | ||||||
Retroactive application of Business Combination (Note 3) | ||||||||
Retroactive application of Business Combination (Note 3) (in Shares) | 87,171,583 | 53,849,015 | ||||||
Adjusted Balances, beginning of period | $ 273,687 | $ 1 | 30,836 | (1) | (307,189) | (276,353) | ||
Adjusted Balances, beginning of period (in Shares) | 106,303,970 | 65,667,776 | ||||||
Issuance of common stock upon exercise of stock options | 2,490 | 2,490 | ||||||
Issuance of common stock upon exercise of stock options (in Shares) | 2,590,780 | |||||||
Issuance of common stock warrants | 3,843 | 3,843 | ||||||
Other comprehensive gain, net of tax | 1 | 1 | ||||||
Stock-based compensation | 6,322 | 6,322 | ||||||
Issuance of redeemable convertible Series C preferred stock upon net exercise of Series C Warrants | $ 5,816 | |||||||
Issuance of redeemable convertible Series C preferred stock upon net exercise of Series C Warrants (in Shares) | 645,356 | |||||||
Net loss | (79,540) | (79,540) | ||||||
Balance at Dec. 31, 2021 | $ 279,503 | $ 1 | 43,491 | (386,729) | (343,237) | |||
Balance (in Shares) at Dec. 31, 2021 | 106,949,326 | 68,258,556 | ||||||
Issuance of common stock upon exercise of stock options | 2,840 | 2,840 | ||||||
Issuance of common stock upon exercise of stock options (in Shares) | 2,582,535 | |||||||
Net exercise of outstanding warrants | ||||||||
Net exercise of outstanding warrants (in Shares) | 673,416 | |||||||
Conversion of convertible note | 20,239 | 20,239 | ||||||
Conversion of convertible note (in Shares) | 2,046,827 | |||||||
Effect of reverse recapitalization, net of costs (Note 3) | $ (279,503) | $ 14 | $ 4 | $ (1) | 279,486 | 279,503 | ||
Effect of reverse recapitalization, net of costs (Note 3) (in Shares) | (106,949,326) | 140,114,400 | 40,396,600 | (73,561,334) | ||||
PIPE financing | $ 1 | 86,584 | 86,585 | |||||
PIPE financing (in Shares) | 11,300,000 | |||||||
Issuance of Class A common shares pursuant to the Business Combination | $ 1 | 4,105 | 4,106 | |||||
Issuance of Class A common shares pursuant to the Business Combination (in Shares) | 4,693,050 | |||||||
Issuance of Class A common shares upon conversion of Class B common shares | ||||||||
Issuance of Class A common shares upon conversion of Class B common shares (in Shares) | 661,192 | (661,192) | ||||||
Issuance of Class A common shares upon exercise of stock options | 1,320 | 1,320 | ||||||
Issuance of Class A common shares upon exercise of stock options (in Shares) | 1,013,171 | |||||||
Issuance of Class A common shares upon vesting of restricted stock units | ||||||||
Issuance of Class A common shares upon vesting of restricted stock units (in Shares) | 2,515,851 | |||||||
Stock-based compensation | 28,792 | 28,792 | ||||||
Net loss | (115,373) | (115,373) | ||||||
Balance at Dec. 31, 2022 | $ 16 | $ 4 | $ 466,857 | $ (502,102) | $ (35,225) | |||
Balance (in Shares) at Dec. 31, 2022 | 160,297,664 | 39,735,408 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (115,373) | $ (79,540) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 4,037 | 5,502 |
Stock-based compensation | 28,792 | 6,322 |
Change in fair value of derivative and warrant liability | 606 | 4,920 |
Amortization of debt issuance costs | 2,287 | 4,746 |
Non-cash lease amortization | 3,307 | 3,586 |
Deferred income taxes | 2,114 | 113 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (1,354) | 1,515 |
Prepaid expenses | (1,238) | (168) |
Other current assets | 299 | (917) |
Contract assets | (8,658) | |
Other assets | (539) | (1,470) |
Accounts payable | 302 | 424 |
Accrued liabilities | 116 | 3,671 |
Operating lease liabilities | (4,030) | (3,565) |
Deferred revenue | (7,646) | (10,281) |
Other liabilities | 2,959 | (1,035) |
Net cash used in operating activities | (94,019) | (66,177) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (1,329) | (636) |
Net cash used in investing activities | (1,329) | (636) |
Cash flows from financing activities: | ||
Proceeds from issuance of convertible notes, net of issuance costs | 14,905 | |
Proceeds from note payable, net of issuance costs | 29,833 | |
Proceeds from the issuance of common stock upon exercise of options | 4,160 | 2,490 |
Proceeds from Business Combination and PIPE, net of transaction costs | 90,689 | |
Payments on notes payable | (11,545) | |
Payments on finance leases | (1,303) | (2,575) |
Net cash provided by financing activities | 82,001 | 44,653 |
Net change in cash, cash equivalents, and restricted cash equivalents | (13,347) | (22,160) |
Cash, cash equivalents, and restricted cash equivalents, beginning of year | 22,822 | 44,982 |
Cash, cash equivalents, and restricted cash equivalents, end of year | 9,475 | 22,822 |
Reconciliation to amounts on the consolidated balance sheets: | ||
Cash and cash equivalents | 9,245 | 21,626 |
Current portion of restricted cash equivalents | 460 | |
Non-current portion of restricted cash equivalents | 230 | 736 |
Total cash, cash equivalents, and restricted cash equivalents shown in the consolidated statements of cash flows | 9,475 | 22,822 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 4,364 | 2,631 |
Cash paid for income taxes | 1,044 | 263 |
Noncash investing and financing activities: | ||
Operating lease liabilities and right-of-use assets through adoption of ASC 842 | 11,428 | |
Operating lease liabilities arising from obtaining right-of-use assets | 650 | 3,422 |
Property and equipment acquired under finance leases or debt | 584 | |
Conversion of convertible note into common stock pursuant to Business Combination | 20,239 | |
Conversion of redeemable convertible preferred stock to common stock pursuant to Business Combination | 279,503 | |
Debt discount through issuance of common stock warrants | 3,842 | |
Non-cash debt discount | 525 | |
Issues of series C redeemable convertible preferred stock for exercise of warrants | $ 5,816 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2022 | |
Organization [Abstract] | |
ORGANIZATION | 1. ORGANIZATION Nature of Operations SoundHound AI, Inc. (“SoundHound” or the “Company”) turns sound into understanding and actionable meaning. SoundHound’s technology applications enable humans to interact with the things around them in the same way they interact with each other: by speaking naturally to mobile phones, cars, televisions, music speakers, coffee machines, and every other part of the emerging “connected” world. The conversation voice AI platform is called “Houndify”, where product creators can develop their own voice interfaces with their customers. Hound is primarily used as a prototyping tool to demonstrate what Houndify can deliver. Products and services built on the Houndify platform are referred to as Houndified Products and Houndified Services. The SoundHound music app allows customers to identify and play songs by singing or humming into the smartphone’s microphone, or by identifying the sound playing in the background from external sources. On April 26, 2022 (the “Closing Date”), pursuant to a merger agreement dated as of November 15, 2021 by and among Archimedes Tech SPAC Partners Co. (“ATSP”), ATSPC Merger Sub, Inc. and SoundHound, Inc. (“Legacy SoundHound”), the parties consummated the merger of ATSPC Merger Sub, Inc. with and into Legacy SoundHound, with Legacy SoundHound continuing as the surviving corporation (the “Merger”), as well as the other transactions contemplated by the Merger Agreement (the Merger and such other transactions, the “Business Combination”). In connection with the closing (the “Closing”) of the Business Combination, Legacy SoundHound became a wholly owned subsidiary of ATSP and ATSP changed its name to SoundHound AI, Inc., and all of Legacy SoundHound common stock (“Legacy SoundHound Common Stock”) and Legacy SoundHound redeemable convertible preferred stock (“Legacy SoundHound Preferred Stock”) automatically converted into shares of the Company’s Class A common stock, par value of $0.0001 per share (the “Class A Common Stock”), and the Company’s Class B common stock, par value of $0.0001 per share (the “Class B Common Stock”, and collectively with the Class A Common Stock, the “common stock”). The Company’s Class A Common Stock and warrants commenced trading on the Nasdaq Global Market (“Nasdaq”) under the symbols “SOUN” and “SOUNW,” respectively, on April 28, 2022. Refer to Note 3 to these consolidated financial statements for more information on the Business Combination. Legacy SoundHound determined that it was the accounting acquirer in the Business Combination based on an analysis of the criteria outlined in Accounting Standards Codification 805, Business Combinations • • • -to-day Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of Legacy SoundHound issuing stock for the net assets of ATSP, accompanied by a reverse recapitalization. The primary asset acquired from ATSP was related to the cash amounts that were assumed. Separately, the Company also assumed warrants that were deemed to be equity upon Closing of the Business Combination. No goodwill or other intangible assets were recorded as a result of the Business Combination. While ATSP was the legal acquirer in the Business Combination, because Legacy SoundHound was deemed the accounting acquirer, the historical financial statements of Legacy SoundHound became the historical financial statements of the combined company upon the consummation of the Business Combination. As a result, the financial statements included in this report reflect (i) the historical operating results of Legacy SoundHound prior to the Business Combination; (ii) the combined results of the Company and Legacy SoundHound following the Closing of the Business Combination; (iii) the assets and liabilities of Legacy SoundHound at their historical cost; and (iv) the Company’s equity structure for all periods presented. In accordance with guidance applicable to these circumstances, the equity structure has been retroactively restated in all comparative periods up to the Closing Date, to reflect the number of shares of the Company’s Class A Common Stock and Class B Common Stock issued to Legacy SoundHound Common Stockholders and Legacy SoundHound Preferred Stockholders in connection with the Business Combination. As such, the shares and corresponding capital amounts and earnings per share related to Legacy SoundHound Preferred Stock and Legacy SoundHound Common Stock prior to the Business Combination have been retroactively restated as shares reflecting the conversion ratio established in the Business Combination. Going Concern Since inception, the Company has generated recurring losses as well as negative operating cash flows and reported a net loss of $115.4 million for the year ended December 31, 2022. As of December 31, 2022, the Company had an accumulated deficit of $502.1 million. Management expects to continue to incur additional substantial losses in the foreseeable future primarily as a result of research and development activities. The Company has historically funded its operations primarily through equity or debt financings. Total cash and cash equivalents on hand as of December 31, 2022 was $9.2 million. Although the Company has incurred recurring losses each year since its inception, the Company expects it will be able to fund its operations for at least the next twelve months through a combination of cash on hand (including as a result of the net proceeds from the recently closed Series A Preferred Stock Transaction (See Note 19)), proceeds from sales of Class A common stock under the ELOC program (see Note 19), securing additional funding through debt or equity financings, implementing incremental expense reduction measures or a combination thereof. Further, in the future, the Company may seek additional funding through debt or equity financing arrangements, implement incremental expense reduction measures or a combination thereof to continue financing its operations. Although management continues to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company to fund continuing operations, if at all. The Company’s consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. The consolidated financial statements do not include adjustments to reflect the possible future effects on the recoverability and classification of recorded assets or the amounts of liabilities that might be necessary should the Company be unable to continue as a going concern. Other Risk and Uncertainties The COVID -19 -19 The COVID -19 -enabling -19 reduction in our revenue and adversely impact results of operations and financial condition. The COVID -19 Further, inflation has risen significantly worldwide and the United States has recently experienced historically high levels of inflation. This inflation and government efforts to combat inflation, such as recent and future significant increases to benchmark interest rates and other related monetary policies, have and could continue to increase market volatility and have an adverse effect on the domestic and international financial markets and general economic conditions. Additionally, U.S. and global markets are experiencing volatility and disruption following the escalation of geopolitical tensions and the start of the military conflict between Russia and Ukraine. On February 24, 2022, a full -scale -term |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Basis of Presentation and Significant Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding annual financial reporting. Any reference in these notes to applicable accounting guidance is meant to refer to the authoritative U.S. GAAP included in the Accounting Standards Codification (“ASC”), and Accounting Standards Update (“ASU”) issued by the Financial Accounting Standards Board (“FASB”). Principles of Consolidation The Company’s consolidated financial statements include the accounts of the Company and its wholly -owned We consolidate any variable interest entity (“VIE”) where we have determined we are the primary beneficiary. The primary beneficiary is the entity which has both: (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance; and (ii) the obligation to absorb losses or receive benefits of the entity that could potentially be significant to the VIE. Reclassification Certain prior period balances have been reclassified to conform to the current year presentation. Such changes include reclassifications or combinations of certain accounts on the consolidated balance sheets. Foreign Currency The functional currency of the Company and its subsidiaries is the U.S. dollar. Foreign currency denominated transactions are converted into U.S. dollars at the average rates of exchange prevailing during the period. Assets and liabilities denominated in foreign currency are remeasured into U.S. dollars at current exchange rates at the balance sheet date for monetary assets and liabilities and at historical exchange rates for non -monetary Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and judgments that affect the amounts reported and disclosures in the consolidated financial statements and accompanying notes. Such estimates include revenue recognition, allowance for doubtful accounts, accrued liabilities, derivative and warrant liabilities, calculation of the incremental borrowing rate, financial instruments recorded at fair value on a recurring basis, valuation of deferred tax assets and uncertain tax positions and the fair value of common stock and other assumptions used to measure stock -based Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of 90 days or less from the date of purchase to be cash equivalents. The Company’s cash equivalents consist of mutual funds, commercial paper and certificates of deposit. The deposits exceed federally insured limits. Restricted Cash Equivalents The Company’s restricted cash equivalents were established according to the requirements under the leases for the Company’s corporate headquarters, data center and sales office and are subject to certain restrictions under the leases. All amounts in restricted cash equivalents as of December 31, 2022 and 2021 represent funds held in certificates of deposit, have original maturities of six months to one year and are recorded at cost plus accrued interest, which approximates fair value as of December 31, 2022 and 2021. Restricted cash equivalents are classified as current or non -current Accounts Receivable, Net Accounts receivable consist of current trade receivables due from customers recorded at invoiced amounts, net of allowance for doubtful accounts. Accounts receivable do not bear interest and the Company generally does not require collateral or other security in support of accounts receivable. The Company has established an allowance for doubtful accounts and evaluates the collectability of its accounts receivable based on known collection risks and historical experience. Uncollectible receivables are written off when all efforts to collect have been exhausted and recoveries are recognized when received. Property and Equipment, Net Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is provided using the straight -line The estimated useful lives of the Company’s property and equipment are as follows: Computer equipment 3 – 4 years Software 3 years Furniture and fixtures 5 years Leasehold improvements Lesser of useful life or the term of the lease Maintenance and repairs that do not extend the life or improve the asset are expensed as incurred. Impairment of Long-Lived Assets The Company evaluates property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. An impairment loss is recognized when the total of estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount. Impairment, if any, would be assessed using discounted cash flows or other appropriate measures of fair value. Through December 31, 2022, there have been no such impairments. Leases We determine if an arrangement is a lease at its inception. Operating lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. We generally use our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of future payments, because the implicit rate of the lease is generally not known. ROU assets related to our operating lease liabilities are measured at lease inception based on the initial measurement of the lease liability, plus any prepaid lease payments and less any lease incentives, as applicable. Our lease terms that are used in determining our operating lease liabilities at lease inception may include options to extend or terminate the leases when it is reasonably certain that we will exercise such options. We amortize our ROU assets as operating lease expense generally on a straight -line Segment Information The Company has determined that the Chief Executive Officer is its chief operating decision maker. The Company’s Chief Executive Officer reviews financial information on a consolidated basis for purposes of allocating resources and evaluating financial performance. The Company’s property and equipment is primarily located in the United States. Accordingly, the Company has determined that it operates as a single reportable segment. The Company’s property and equipment is primarily located in the United States. As of December 31, 2022, the Company’s property and equipment is located in the United States, except for 11.4% of assets located in Canada and 7.0% in other foreign jurisdictions. Emerging Growth Company Status The Company is an emerging growth company (“EGC”) as defined in the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”) and may take advantage of reduced reporting requirements that are otherwise applicable to public companies. Section 107 of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with those standards. This means that when a standard is issued or revised and it has different application dates for public and nonpublic companies, the Company has the option to adopt the new or revised standard at the time nonpublic companies adopt the new or revised standard and can do so until such time that the Company either (i) irrevocably elects to “opt out” of such extended transition period or (ii) no longer qualifies as an emerging growth company. The Company has elected to use the extended transition period for complying with new or revised accounting standards unless the Company otherwise early adopts select standards. Concentrations of Credit Risk and Other Risks and Uncertainties Financial instruments that potentially subject the Company to potential significant concentrations of credit risk consist principally of cash and cash equivalents. The Company regularly monitors its credit risk exposure and takes steps to mitigate the likelihood of these exposures resulting in actual loss. As of December 31, 2022, accounts receivable balances due from two customers collectively totaled 75% of the Company’s consolidated accounts receivable balance. As of December 31, 2021, accounts receivable balances due from five customers collectively totaled 86% of the Company’s consolidated accounts receivable balance. For the year ended December 31, 2022, the Company had three customers that accounted for 67% of revenue. For the year ended December 31, 2021, the Company had three customers that accounted for 61% of revenue. Equity Issuance Costs The Company capitalizes certain legal, professional, accounting and other third -party -process Revenue Recognition The Company recognizes revenue under Accounting Standards Codification Topic 606 (“ASC 606”), Revenue from Contracts with Customers (i) (ii) (iii) (iv) (v) Contracts are accounted for when both parties have approved and committed to the contract, the rights of the parties and payment terms are identifiable, the contract has commercial substance and collectability of consideration is probable. Any payments received from customers that do not meet criteria for having a contract are recorded as deposit liabilities on the consolidated balance sheet. Under ASC 606, assuming all other revenue recognition criteria have been met, the Company recognizes revenue for arrangements upon the transfer of control of the Company’s performance obligations to its customers. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer and is the unit of account in ASC 606. Revenues are recognized when control of the promised goods or services are transferred to a customer in an amount that reflects the consideration that the Company expects to receive in exchange for those services. The Company currently generates its revenues through the following performance obligations: (1) hosted services, (2) professional services (3) monetization and (4) licensing. Research and Development The Company’s research and development costs are expensed as incurred. These costs include salaries and other personnel related expenses, contractor fees, facility costs, supplies, and depreciation of equipment associated with the design and development of new products prior to the establishment of their technological feasibility. Warrants The Company determines whether to classify contracts, such as warrants, that may be settled in its own stock as equity of the entity or as a liability. An equity -linked Income Taxes The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. A valuation allowance is established when, in management’s estimate, it is more -likely-than-not -likely-than-not The Company classifies interest and penalties related to uncertain tax positions in income tax expense, if applicable. There has been no interest expense or penalties related to unrecognized tax benefits recorded through December 31, 2022. Stock-Based Compensation The Company measures and records the expense related to stock -based -based -line -based -Scholes -pricing -Scholes -pricing -Scholes -pricing Expected Volatility Expected Term -based -vesting Risk -Free Interest Rate -free -coupon Expected Dividend Yield Restricted Stock Units The Company issues restricted stock unit awards (“RSUs”) to grantees as compensation for services. The fair value of the RSUs is determined at the grant date based on the fair value of the Company’s Class A Common Stock and for RSUs with service conditions only, is recognized straight -line The Company issues RSUs with vesting conditions tied to certain performance criteria (“Performance -Based -based -Based The Company issues RSUs with vesting conditions tied to certain market conditions (“Market -Based -Based -based -Based Fair Value Measurements The Company defines fair value as the exchange price that would be received from an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The Company follows a three -level • Level 1 — • Level 2 — • Level 3 — The Company’s derivative liabilities and warrants are measured at fair value on a recurring basis and are classified as Level 3 liabilities. The Company records subsequent adjustments to reflect the increase or decrease in estimated fair value at each reporting date on the consolidated statements of operations and comprehensive loss. Redeemable Convertible Preferred Stock Legacy SoundHound Preferred Stock did not have a mandatory redemption date and are assessed at issuance for classification and redemption features requiring bifurcation. The Company presents as temporary equity any stock which (i) the Company undertakes to redeem at a fixed or determinable price on the fixed or determinable date or dates; (ii) is redeemable at the option of the holders, or (iii) has conditions for redemption which are not solely within the control of the Company. Legacy SoundHound Preferred Stock was redeemable upon a deemed liquidation event which the Company determined was not solely within its control and thus has classified shares of Legacy SoundHound Preferred Stock as temporary equity until such time as the conditions are removed or lapse. Since the occurrence of a deemed liquidation event was not probable, the carrying values of the shares of Legacy SoundHound Preferred Stock were not being accreted to their redemption values. As a result of the Business Combination, the shares of Legacy SoundHound Preferred Stock outstanding immediately prior to the effective time of the Business Combination (the “Effective Time”) were converted into 106,949,326 Convertible Notes and Derivative Liabilities The Company evaluates its convertible notes, and other contracts, if any, to determine if those contracts or embedded components of those contracts qualify as derivatives requiring bifurcation. The Company accounts for conversion features that meet the criteria for bifurcation as liabilities at fair value and adjusts the derivative instruments to fair value at each reporting period. The conversion features qualify as derivatives, as they continuously reset as the underlying stock price increases or decreases to provide a fixed value of equity to the holders at any conversion date. The conversion features are subject to remeasurement at each balance sheet date until exercised, and any change in fair value is recognized as a component of other expense, net in the consolidated statements of operations and comprehensive loss. The fair value of the conversion features has been estimated using a probability -weighted The Company held its convertible notes at amortized cost and amortized the associated debt discount created from bifurcated derivatives and issuance costs under the effective interest or straight -line Net Loss Per Share Basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted -average Diluted net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted -average Accordingly, in periods in which the Company reports a net loss, diluted net loss per share is the same as basic net loss per share, since dilutive common stock is not assumed to have been issued if their effect is anti -dilutive Recent Accounting Pronouncements — Adopted In February 2016, the FASB issued Accounting Standards Update 2016 -02 Leases -13 -10 -11 -20 -01 -of-use -line payments. Topic 842 is effective for the Company for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. A modified retrospective application is required with an option to not restate comparative periods in the period of adoption. The Company adopted Topic 842 on January 1, 2021 using the modified retrospective approach, and financial information for the comparative period was not updated. In addition, the Company elected the transition package of three practical expedients which allow companies not to reassess (i) whether agreements contain leases, (ii) the classification of leases, and (iii) the capitalization of initial direct costs. Further, the Company elected to separate lease and non -lease -lease -line The Company’s lease portfolio consists primarily of real estate assets and computer equipment. Some of these leases also require the Company to pay maintenance, utilities, taxes, insurance, and other operating expenses associated with the leased space. Based upon the nature of the items leased and the structure of the leases, the Company’s leases classified as operating leases continue to be classified as operating leases and capital leases will be accounted for as financing leases under the new accounting standard. As a result of the adoption of the new lease accounting guidance, the Company recognized on January 1, 2021: • -by-lease • • See Note 14 for additional information. |
Business Combination
Business Combination | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination [Abstract] | |
BUSINESS COMBINATION | 3. BUSINESS COMBINATION As discussed in Note 1, on April 26, 2022, the Business Combination was consummated. Pursuant to the Company’s certificate of incorporation, the Company is authorized to issue 500,000,000 No The Business Combination was approved by ATSP’s stockholders at a special meeting thereof (the “Special Meeting”), held in lieu of the 2022 annual meeting of the Company’s stockholders. The Business Combination fulfilled the definition of an “initial business combination” as required by the ATSP’s Amended and Restated Certificate of Incorporation. This fulfillment resulted in ATSP ceasing to be a shell company upon the Closing. An aggregate of 12,767,950 As a result of the Business Combination, among other things (1) all outstanding shares of Legacy SoundHound Common Stock as of immediately prior to the Closing (including Legacy SoundHound Common Stock resulting from the Legacy SoundHound Preferred Stock Conversion), were exchanged at an conversion ratio of 5.5562 (the “Conversion Ratio”) for an aggregate of 140,114,060 In connection with the Merger Agreement, ATSP entered into subscription agreements (collectively, the “Subscription Agreements”) with certain accredited investors (the “Subscribers”). Pursuant to the Subscription Agreements, the Subscribers agreed to purchase, and ATSP agreed to sell to the Subscribers, an aggregate of 11,300,000 The Business Combination is accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, ATSP was treated as the “acquired” company for financial reporting purposes (See Note 1). The net assets of Legacy SoundHound were stated at historical cost, with no goodwill or other intangible assets recorded. In accounting for the Business Combination and after redemptions, net proceeds received by the Company totaled $90.7 million. The table below shows the total net proceeds from the Business Combination and the PIPE Investment (in thousands): Cash – ATSP trust and cash (net of redemption) $ 5,357 Cash – PIPE Investment 113,000 Less: transaction costs (27,668 ) Net proceeds from Business Combination and PIPE Investment $ 90,689 Relating to the consummation of the Business Combination, the Company incurred $27.7 million in total transaction costs consisting of direct legal, accounting and other fees. $4.1 million of Legacy SoundHound transaction costs specific and directly attributable to the Business Combination were initially capitalized as deferred offering costs and included in Other non -current -in The amount recorded to additional paid -in-capital The number of shares of common stock issued immediately following the consummation of the Business Combination was as follows: Class A Common Stock – conversion of Legacy SoundHound Common Stock and Legacy SoundHound Preferred Stock outstanding prior to Business Combination 140,114,060 Class B Common Stock – conversion of Legacy SoundHound Common Stock and Legacy SoundHound Preferred Stock outstanding prior to Business Combination 40,396,600 Class A Common Stock – PIPE Investment 11,300,000 Class A Common Stock – issuance to ATSP shareholders 532,050 Class A Common Stock – issuance to Legacy SoundHound founders and representatives 4,161,000 Total shares of common stock immediately after Business Combination 196,503,710 |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2022 | |
Revenue Recognition [Abstract] | |
REVENUE RECOGNITION | 4. REVENUE RECOGNITION Revenue Recognition The Company recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Revenues are generally recognized upon the transfer of control of promised products or services provided to customers, reflecting the amount of consideration the Company expects to receive for those products or services. The Company enters into contracts that can include various products or services, which are generally capable of being distinct and accounted for as separate performance obligations. The Company derives its revenue primarily from the following performance obligations: (1) hosted services, (2) professional services, (3) monetization and (4) licensing. Revenue is reported net of applicable sales and use taxes that are passed through to customers. The Company’s arrangements with customers may contain multiple obligations. Individual services are accounted for separately if they are distinct — that is, if a service is separately identifiable from other items in the contract and a customer can benefit from it in its own or with other resources that are readily available to the customer. The Company has the following performance obligations in contracts with customers: Hosted Services Hosted services, along with non -distinct twenty The Company has determined that the hosted services arrangements are a single performance obligation comprised of a series of distinct services, since each day of providing access to hosted services is substantially the same and the customer simultaneously receives and consumes the benefits as access is provided. These services are provided either on a usage basis (i.e., variable consideration) or on a fixed fee subscription basis. The Company recognizes revenue as each distinct service period is performed (i.e., recognized as incurred). Hosted services generally include up -front In instances where the Company concluded that the up -front Professional Services Revenue from distinct professional services, such as non -integrated -time For distinct professional services determined to be recognized over -time Monetization Monetization revenues are primarily derived from advertising payments associated with ad impressions placed on the SoundHound music identification application. The Company derives an immaterial amount of revenue from, sales commissions earned from song purchases facilitated by the SoundHound app and App store fees paid for ads -free Licensing The Company licenses voice solutions that are embedded in customer products. Licensing revenue is a distinct performance obligation that is recognized when control is transferred to the customer, which is at a point in time for non -customized -based -type -contract When a contract has multiple performance obligations, the transaction price is allocated to each performance obligation based on its relative estimated standalone selling price (“SSP”). Judgments are required to determine the SSP for each distinct performance obligation. SSP is determined by maximizing observable inputs from pricing of standalone sales, when possible. Since prices vary from customer to customer based on customer relationship, volume discount and contract type, in instances where the SSP is not directly observable, the Company estimates SSP by considering the following factors: • • • • These factors may vary over time, depending upon the unique facts and circumstances related to each deliverable. If the facts and circumstances underlying the factors considered change or should future facts and circumstances lead the Company to consider additional factors, the Company’s best estimate of SSP may also change. For the years ended December 31, 2022 and 2021, revenue under each performance obligation was as follows (in thousands): Year Ended 2022 2021 Hosted services $ 17,743 $ 12,764 Professional services 4,220 7,142 Monetization 844 1,291 Licensing 8,322 — Total $ 31,129 $ 21,197 For the years ended December 31, 2022 and 2021, the disaggregated revenue by geographic location was as follows (in thousands): Year Ended 2022 2021 Korea $ 14,530 $ 2,460 Germany 4,134 7,526 United States 3,344 4,030 Japan 3,866 3,797 France 4,023 2,616 Other 1,232 768 Total $ 31,129 $ 21,197 For the years ended December 31, 2022 and 2021, the disaggregated revenue by recognition pattern was as follows (in thousands): Year Ended 2022 2021 Over time revenue $ 19,955 $ 15,210 Point-in-time 11,174 5,987 Total $ 31,129 $ 21,197 The Company also disaggregates revenue by service type. This disaggregation consists of Product Royalties, Service Subscriptions and Monetization. Product Royalties revenue is derived from Houndified Products, which are voice -enabled -based Year Ended 2022 2021 Product royalties $ 28,447 $ 18,356 Service subscriptions 1,838 1,550 Monetization 844 1,291 Total $ 31,129 $ 21,197 Contract Balances The Company performs its obligations under a contract with a customer by licensing access to software or providing services in exchange for consideration from the customer. The timing of the Company’s performance often differs from the timing of the customer’s payment, which results in the recognition of a receivable, a contract asset or a contract liability. During the year ended December 31, 2022, we recognized $7.6 million of licensing revenue from our Houndify Edge solution, which we delivered to a customer during the second half of 2022, related to minimum guarantee units to be utilized over the life of the contract and resulted in a corresponding increase in our contract assets balance. The Company has not recorded any asset impairment charges related to contract assets during the periods presented in the consolidated financial statements. Revenue recognized included in the deferred revenue balance at the beginning of the reporting period for the years ended December 31, 2022 and 2021 was $6.4 million and $14.9 million, respectively. As of December 31, 2022, the aggregate amount of the transaction price allocated to the remaining performance obligations related to customer contracts that were unsatisfied or partially unsatisfied was $20.7 million. Given the applicable contract terms, $8.1 million is expected to be recognized as revenue within one year, $9.3 million is expected to be recognized between two five five -based -based The Company’s long -term The Company elected the practical expedient to not adjust promised amounts of consideration for the effects of a significant financing component if the Company expects, at contract inception, that the period between when the Company transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less. |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | 5. PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of the following (in thousands): December 31, December 31, Computer equipment $ 20,946 $ 20,571 Software and voice recordings 9,420 8,687 Leasehold improvements 3,850 3,567 Furniture and fixtures 761 729 Total property and equipment, at cost 34,977 33,554 Less: accumulated depreciation and amortization (31,530 ) (27,399 ) Total property and equipment, net $ 3,447 $ 6,155 Property and equipment, net includes assets under finance lease obligations (see Note 14 for additional information) with an aggregate cost of approximately $0.6 million and $16.6 million and accumulated depreciation of approximately $0.3 million and $13.9 million as of December 31, 2022 and 2021, respectively. Depreciation and amortization expense totaled approximately $4.0 million and $5.5 million for the years ended December 31, 2022 and 2021, respectively. |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Accrued Liabilities [Abstract] | |
ACCRUED LIABILITIES | 6. ACCRUED LIABILITIES Accrued liabilities consisted of the following (in thousands): December 31, December 31, Accrued compensation expenses $ 6,134 $ 3,802 Accrued interest 236 1,369 Accrued vendor payables 1,002 1,109 Accrued professional services 89 934 Other accrued liabilities 1 84 $ 7,462 $ 7,298 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 7. COMMITMENTS AND CONTINGENCIES Contracts In August 2021, the Company entered into an exclusive agreement with a cloud service provider to host its voice artificial intelligence platform pursuant to which the Company committed to pay a minimum of $98.0 million in cloud costs over a seven -year Aggregate non -cancelable 2023 $ 7,000 2024 11,000 2025 14,000 2026 16,000 2027 24,000 Thereafter 24,000 Total $ 96,000 Legal Proceedings From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of its business activities. The Company accrues contingent liabilities when it is probable that future expenditures will be made, and such expenditures can be reasonably estimated. In the opinion of management, there are no pending claims for which the outcome is expected to result in a material adverse effect on the financial position, results of operations or cash flows of the Company. Other Matters The Company has not historically collected U.S. state or local sales and use tax, or other similar taxes, in any jurisdiction. On June 21, 2018, the U.S. Supreme Court decided, in South Dakota v. Wayfair, Inc. -by-state |
Warrants
Warrants | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
WARRANTS | 8. WARRANTS As a result of the Business Combination (see Note 3), the Company has retroactively adjusted the Legacy SoundHound warrants outstanding and corresponding strike price prior to April 26, 2022 to give effect to the Conversion Ratio used to determine the number of shares of common stock into which they were converted. Series C Warrants In connection with the issuance of the April 2013 Note and November 2013 Note, the Company issued detachable warrants to purchase 248,408 and 496,827 shares of Legacy SoundHound Series C Preferred Stock (“Series C Warrants”), respectively, at $1.21 per share to the lenders, which were immediately exercisable. In December 2021, all outstanding 745,235 shares of warrants related to April 2013 Note and November 2013 were net exercised, leading to a net issuance of 645,356 shares of Legacy SoundHound Series C Preferred Stock. Warrants Related to Convertible Notes and Note Payable In connection with the issuance of the Company’s 2021 note payable (“SVB March 2021 Note”) and 2021 convertible note (“SCI June 2021 Note”), the Company issued detachable warrants to purchase 708,808 and 354,404 The Company recorded the warrants initially at fair value as paid -in-capital a discount. The fair value in relation to the SCI June 2021 Note was capitalized as an asset, as the underlying debt bears similarity to a revolving commitment. As the warrants were classified as equity, they are not subject to remeasurement at the end of each reporting period. The initial allocated fair value of the warrants as of March 31, 2021 and June 14, 2021 was $2.3 million and $1.5 million, respectively. The warrants had a ten -year On the Closing Date, all outstanding warrants issued in connection to the SVB March 2021 Note and the SCI June 2021 Note were fully net exercised by their respective lenders, leading to a net issuance of 673,416 Warrants Related to the Business Combination Public Warrants Prior to the Business Combination, ATSP issued Public Warrants. Each Public Warrant entitles the holder to the right to purchase one share of common stock at an exercise price of $11.50 per share. No fractional shares were issued upon exercise of the Public Warrants. The Company may redeem the outstanding warrants, for $0.01 per warrant, upon not less than 30 days’ prior written notice of redemption given after the warrants become exercisable, if the reported last sale price of the common stock equals or exceeds $18.00 per share (as adjusted for stock dividends, sub -divisions -trading Subsequent to the closing of the Business Combination, the Company’s Public Warrants continue to be classified as equity instruments, as they are indexed to the Company’s stock. As of December 31, 2022, there were 3,457,996 Public Warrants issued and outstanding. Private Warrants Prior to the Business Combination, ATSP issued Private Warrants. The Private Warrants were initially issued in the same form as the Public Warrants with the exception that the Private Warrants: (i) would not be redeemable by the Company and (ii) may be exercised for cash or on a cashless basis, so long as they are held by the initial purchasers or any of their permitted transferees. If the Private Warrants are held by holders other than the initial purchasers or any of their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by the holders on the same basis as the Public Warrants. Pursuant to ASC 815, the Private Warrants were initially considered a liability instrument as they met the definition of a derivative. Upon the Closing of the Business Combination, the Company modified its Private Warrants to be identical to its Public Warrants. Therefore, the Private Warrants met requirements for classification as equity instruments, as they are indexed to the Company’s stock. As of December 31, 2022, there were 208,000 Private Warrants issued and outstanding. |
Convertible Notes and Note Paya
Convertible Notes and Note Payable | 12 Months Ended |
Dec. 31, 2022 | |
Convertible Notes and Note Payable [Abstract] | |
CONVERTIBLE NOTES AND NOTE PAYABLE | 9. CONVERTIBLE NOTES AND NOTE PAYABLE SNAP June 2020 Note In June 2020, the Company issued a promissory note, the SNAP June 2020 Note, to a Lender in exchange for $15.0 million in cash proceeds. This note has an annual interest rate of 5% and a maturity date of June 26, 2022, if not converted earlier pursuant to conversion terms and change in control events as described below. All unpaid interest and principal are due and payable upon request of the Lender on or after the SNAP June 2020 Note’s maturity date. The outstanding principal balance and unpaid accrued interest of the SNAP June 2020 Note are convertible pursuant to the following terms (“SNAP June 2020 Note Conversion Feature” or “Conversion Feature”): automatic conversion into equity shares in the next equity financing round (“SNAP June 2020 Note Qualified Financing,” or “Qualified Financing”) at a conversion price equal to either (a) the lowest cash price per share paid by investors in such qualified financing (which will reflect at least a 20% discount to the price per share paid by other investors purchasing securities in additional closings), or (b) if there are no additional closings, 0.80 times the price per share paid by investors purchasing equity securities in the Qualified Financing. The SNAP June 2020 Note Qualified Financing shall be at least $30.0 million, which excludes the conversion of the SNAP June 2020 Note and any other indebtedness. Furthermore, upon a change of control event, the Company shall settle the SNAP June 2020 Note in cash, pursuant to the following terms (“Redemption Feature”): • • The Company evaluated whether the SNAP June 2020 Note contains embedded features that meet the definition of derivatives under ASC 815, Derivatives and Hedging. The Conversion Feature qualifies as a derivative as it continuously resets as the underlying stock price increases or decreases so as to provide a variable number of shares for a fixed value of equity to the holders at any conversion date. As such, the Conversion Feature is bifurcated and accounted for as a derivative liability to be remeasured at the end of each reporting period. The Company recorded the bifurcated Conversion Feature initially at fair value with the residual value being allocated to the SNAP June 2020 Note as a debt discount. The fair value of the Conversion Feature upon issuance in September 2020 was $2.5 million, which was recorded as a derivative liability on the Company’s consolidated balance sheet. The Redemption Feature of the SNAP June 2020 Note does not meet the definition of a derivative. Therefore, the Redemption Feature is not bifurcated. The total amount of debt discount at issuance for the SNAP June 2020 Note was $2.5 million. The Company amortized the aggregate debt discount using the effective interest method. The Company recognized total interest expense of $0.7 million associated with the SNAP June 2020 Note for the year ended December 31, 2022, out of which $0.4 relates to amortization of the debt discount. The Company recognized total interest expense of $2.0 million associated with the SNAP June 2020 Note for the year ended December 31, 2021, out of which $1.3 million relates to amortization of the debt discount. The debt discount related to the SNAP June 2020 Note is amortized over the life of the instrument, beginning at note issuance and ending on April 26, 2022, the date on which the note was converted. The SNAP June 2020 Note contains a conversion feature in which outstanding principal and any unpaid accrued interest automatically converts into equity securities. This conversion occurs when the Company issues and sells equity securities in a bona fide equity financing with total proceeds to the Company totaling more than $30.0 million, excluding the face value of the SNAP June 2020 Note (“SNAP June 2020 Note Qualified Financing”). As a result of the Business Combination, on the Closing Date, the SNAP June 2020 Note conversion feature was triggered, as total proceeds from the Business Combination exceeded the minimum amount to qualify as a SNAP June 2020 Note Qualified Financing. As a result, on the Closing Date, all outstanding principal of $15.0 million and accrued interest of $1.4 million were converted into 368,384 The following table summarizes the unamortized debt discount, fair value of conversion feature, and accrued interest as of April 26, 2022 and December 31, 2021 (in thousands). April 26, December 31, Unamortized debt discount $ 230 $ 657 Fair value of conversion feature $ 4,094 $ 3,488 Accrued interest $ 1,375 $ 1,136 Accrued interest is included in accrued liabilities on the consolidated balance sheets to reflect the classification of the SNAP June 2020 Note as short -term SVB March 2021 Note In March 2021, the Company entered into a loan and security agreement with a commercial bank to borrow $30.0 million along with the issuance of warrants to purchase 127,570 The loan bears interest at an annual rate equal to the greater of 9.00% or 5.75% above the Prime Rate. As of December 31, 2022, the interest rate was 13.25%. Payments were interest -only The original term loan amortization date was April 1, 2022, with an opportunity for a six -month SCI June 2021 Note In June 2021, the Company entered into a loan and security agreement with a lender to obtain credit extensions to the Company. Extensions may be requested in $5.0 million increments up to a total commitment amount of $15.0 million. The Company drew an initial $5.0 million on June 14, 2021 and the remaining $10.0 million on December 1, 2021. The SCI June 2021 Note also contains a final payment provision of 3.5% on each draw or $0.5 million in total. Additionally, warrants were issued alongside the convertible note to purchase 63,785 The loan bears interest at an annual rate equal to the greater of 9.00% or 5.75% above the Prime Rate. As of December 31, 2022, the interest rate was 13.25%. Payments were interest -only As the warrants and discounts of $2.2 million are directly attributable to the total commitment of $15.0 million, the Company has presented its unamortized debt issuance cost associated with this note as a current asset, recorded as debt issuance cost on the consolidated balance sheets. The Company is amortizing the cost on a straight -line The loan amortization date was June 1, 2022, with an opportunity for a six -month As a result of the Business Combination, the SNAP June 2020 Note converted into the Company’s securities on the Closing Date. As the SNAP June 2020 Note was not paid in full and did not mature on June 26, 2022 due to its conversion, the maturity date of the SCI June 2021 Note is May 31, 2025. Additionally, as the Company and its Agent did not mutually consent to the equity conversion that could have been triggered by the Business Combination, the conversion feature no longer existed subsequent to the Closing Date. As of December 31, 2022, the SCI June 2021 Note was classified as a note payable. The below tables summarize the Company’s debt balances (in thousands): December 31, 2022 SVB March 2021 Note SCI June 2021 Note Total Notes payable, current portion $ 12,000 $ 4,718 $ 16,718 Notes payable, net of current portion 10,050 8,261 18,311 Unamortized loan discount (62 ) — (62 ) Total $ 21,988 $ 12,979 $ 34,967 Unamortized debt issuance cost recorded as an asset $ — $ 295 $ 295 December 31, 2021 SVB March 2021 Note Note payable, current portion $ 31,050 Unamortized loan discount (1,086 ) Carrying value $ 29,964 December 31, 2021 SNAP June 2020 Note SCI June 2021 Note Total Convertible notes, current portion $ 15,000 $ 15,525 $ 30,525 Unamortized loan discount (657 ) — (657 ) Total $ 14,343 $ 15,525 $ 29,868 Unamortized debt issuance cost recorded as an asset $ — $ 1,132 $ 1,132 Additionally, interest expense on the consolidated statements of operations and comprehensive loss is inclusive of stated interest incurred on the Company’s debt instruments during the relevant periods, as well as the amortization of debt discounts and issuance costs. The life of each instrument may be shortened if a lender demands payment if certain events occur that are outside the control of the Company. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | 10. FAIR VALUE MEASUREMENTS The following tables present the fair value of the Company’s financial instruments that are measured or disclosed at fair value on a recurring basis (in thousands): Fair Value Measurements as of December 31, 2021 Level 1 Level 2 Level 3 Assets: Cash equivalents $ 4,863 $ — $ — Liabilities: Derivative liability — — (3,488 ) Total $ 4,863 $ — $ (3,488 ) The fair values of the derivative liabilities were determined based on significant inputs not observable in the market, which represent Level 3 measurements within the fair value hierarchy. Series C Warrants (April 2013 and November 2013) In December 2021, the Series C Warrants were fully exercised. Immediately prior to their exercise, the Company revalued the warrants to their intrinsic value, resulting in a change in fair value of $3.8 million. This change in fair value was recorded as a component of other expense, net, in the accompanying consolidated statements of operations and comprehensive loss. The warrants were recorded as Series C Preferred Stock at their fair value of $5.8 million upon net share settlement. Common Stock Warrants (SVB March 2021 Note and SCI June 2021 Note) The Company issued common stock warrants in connection with the SVB March 2021 Note and SCI June 2021 Note (See Note 8 for additional information). The SVB March 2021 Note and SCI June 2021 Note warrants were recorded based on the allocation of its relative fair of the debt proceeds of $2.3 million and $1.5 million, respectively. The warrants were classified as equity instruments at inception with a corresponding discount recorded at issuance against the outstanding notes in connection with the SVB March 2021 Note or as an asset in connection with the SCI June 2021 Note. The common stock warrants are not subject to remeasurement at each subsequent balance sheet date due to their classification as equity instruments as they are considered indexed to the Company’s stock. The SVB March 2021 Note warrants expire in March 2031 and the SCI June 2021 Note warrants expire in June 2031. The Company determined the fair value of the SVB March 2021 Note and SCI June 2021 Note common stock warrants at issuance using the Black -Scholes -pricing SVB March 2021 Note Common Stock Warrants Expected dividend rate 0 % Risk-free interest rate 1.74 % Expected volatility 47 % Expected term (in years) 10.00 SCI June 2021 Note Common Stock Warrants Expected dividend rate 0 % Risk-free interest rate 1.51 % Expected volatility 47 % Expected term (in years) 10.00 Upon the Closing of the Business Combination, all outstanding warrants associated with the SVB March 2021 Note and SCI June 2021 Note were exercised, leading to a net issuance of 673,416 Derivative Liability (SNAP June 2020 Note) To determine the fair value of the embedded derivative associated with the SNAP June 2020 Note, the Company utilized the income approach model using the With and Without method. Using the With and Without method, the Company modeled expected cash flows to the noteholder under Next Equity Financing, Change in Control, SPAC/Private Investment in Public Equity, and IPO scenarios. The value of the embedded derivative was determined as the differential value from the perspective of the With and Without Method. The Company utilized the following assumptions at the valuation date: December 31, 2021 Probability of Next Equity Financing 3 % Probability of SPAC/PIPE 95 % Probability of IPO 2 % 100 % Weighted average term (years) 0.27 Weighted average discount rate 25.00 % The significant unobservable inputs used in the fair value measurement of the derivative liability are the remaining expected term, the discount rate, and the probability of financing for each scenario. Significant increases (decreases) in the term would result in significantly lower (higher) fair value measurements. Significant increases (decreases) in the discount rate would result in significantly lower (higher) fair value measurements. On April 26, 2022, the Closing of the Business Combination, the embedded derivative was valued at fair value which was equivalent to its intrinsic value. The embedded derivative had a fair value of $4.1 million. As the Closing of the Business Combination triggered the Conversion Feature contained within the SNAP June 2020 Note, therefore converting the note’s principal to equity, the embedded derivative associated with the note was extinguished. The Company recorded the remeasurement of derivative liabilities in other expense, net on the consolidated statements of operations and comprehensive loss. The fair value of the embedded derivative was recorded as additional paid -in The following table summarizes the fair value remeasurement of the embedded derivative for the years ended December 31, 2022 and 2021 (in thousands): Year Ended 2022 2021 Remeasurement of conversion feature – loss $ (606 ) $ (1,108 ) The following table sets forth a summary of changes in fair value of the Company’s derivative liability and warrant liability for which fair value was determined by Level 3 inputs: Derivative Liability Warrant Liability Balance as of December 31, 2020 $ 2,380 $ 2,004 Change in fair value 1,108 3,812 Exercise of warrants — (5,816 ) Balance as of December 31, 2021 3,488 — Change in fair value 606 — Extinguishment of embedded derivative upon conversion of convertible note (4,094 ) — Balance as of December 31, 2022 $ — $ — There were no transfers of financial instruments between the three levels of the fair value hierarchy during the years ended December 31, 2022 and 2021. |
Preferred stock
Preferred stock | 12 Months Ended |
Dec. 31, 2022 | |
Preferred Stock [Abstract] | |
PREFERRED STOCK | 11. PREFERRED STOCK A summary of the Legacy SoundHound Preferred Stock authorized, issued and outstanding as of the date of the Business Combination is as follows : Shares Authorized Shares Liquidation Preference Carrying Value Series A 19,106,048 19,106,048 $ 28,239 $ 4,967 Series B 33,702,134 33,702,134 66,360 11,038 Series C 5,687,525 5,687,525 38,163 11,837 Series C-1 4,436,090 4,436,090 89,298 16,061 Series D 20,258,299 20,258,299 527,992 85,648 Series D-1 8,418,535 8,418,535 277,812 49,957 Series D-2 8,418,530 8,418,530 277,811 49,949 Series D-3 6,922,165 6,922,165 276,887 50,046 Series D-3A 20,835,869 — — — 127,785,195 106,949,326 $ 1,582,562 $ 279,503 Upon the closing of the Business Combination, the outstanding shares of Series A, B, C, C -1 -1 -2 -3 Upon the consummation of the Business Combination, the Company is authorized to issue 1,000,000 -outstanding |
Common Stock
Common Stock | 12 Months Ended |
Dec. 31, 2022 | |
Common Stock [Abstract] | |
COMMON STOCK | 12. COMMON STOCK The Company had 250,030,433 On April 26, 2022, the Company consummated a Business Combination which was accounted for as a reverse recapitalization (refer to Note 3 for additional information). Pursuant to the Company’s restated certificate of incorporation, the Company is authorized to issue 500,000,000 -assessable As a result of the Business Combination, 73,561,334 Each share of Class B Common Stock shall automatically convert into one fully paid and nonassessable share of Class A Common Stock. Shares of Class B Common Stock will be convertible into shares of Class A Common Stock and will be automatically convert into shares of Class A Common Stock upon the occurrence of certain future events, generally including transfers, subject to limited excepts set forth in the amended charter. The conversion of Class B Common Stock to Class A Common Stock will have the effect, over time, of increasing the relative voting power of those holders of Class B Common Stock who retain their shares in the long term. As a result, it is possible that one or more of the persons or entities holding our Class B Common Stock could gain significant voting control as other holders of Class B Common Stock sell or otherwise convert their shares into Class A Common Stock. |
Stock Incentive Plans
Stock Incentive Plans | 12 Months Ended |
Dec. 31, 2022 | |
Stock Incentive Plans [Abstract] | |
STOCK INCENTIVE PLANS | 13. STOCK INCENTIVE PLANS In April 2016, we adopted the 2016 Equity Incentive Plan (the “2016 Plan”) as a successor and continuation of the 2006 Plan. Under the 2016 Plan, the Company was permitted to grant awards of stock options and RSUs, as well as stock appreciation rights and other stock awards. During the year ended December 31, 2021, the Company amended the 2016 Plan to increase the number of shares of common stock reserved for issuance by 6,667,478 to an aggregate of 48,347,329. As of the Closing Date of the Business Combination, the Company no longer has shares available for issuance under the 2016 Plan. The 2016 Plan provides for incentive stock options to be granted to employees at an exercise price not less than 100% of the fair value at the grant date as determined by the Board of Directors, unless the optionee is a 10% stockholder, in which case the option price will not be less than 110% of such fair market value. Options granted generally have a maximum term of 10 years from grant date, are exercisable upon vesting unless otherwise designated for early exercise by the Board of Directors at the time of grant, and generally vest over a four -year -year On April 26, 2022, the stockholders of the Company approved the SoundHound AI, Inc. 2022 Incentive Award Plan (the “2022 Incentive Plan”)(collectively, with the 2006 Plan and the 2016 Plan, the “Plans”), which became effective upon the Closing. The Company initially reserved 19,650,371 -year -statutory -based On April 26, 2022, the stockholders of the Company approved the SoundHound AI, Inc. 2022 Employee Stock Purchase Plan (the “ESPP”), which became effective upon the Closing. An aggregate of 3,930,074 -year -month -back Option Activity Stock option activity under the Plans was as follows for the years ended December 31, 2022 and 2021: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in Thousands) Outstanding, December 31, 2020 28,772,180 $ 2.38 Granted 6,303,953 7.22 Exercised (2,590,780 ) 0.96 Forfeited or cancelled (2,123,948 ) 3.13 Outstanding, December 31, 2021 30,361,405 3.45 Granted 391,619 6.17 Exercised (3,595,706 ) 1.16 $ 22,534 Forfeited or cancelled (1,736,893 ) 4.63 Outstanding, December 31, 2022 25,420,425 $ 3.74 6.32 $ 1,448 Exercisable, December 31, 2022 18,952,826 3.04 5.65 1,448 Options exercised early are subject to the vesting provisions mentioned above, and any unvested shares are subject to repurchase at the original price upon termination of employment, death, or disability. There were no option exercises during the year ended December 31, 2022 and 2021 that were subject to repurchase. The weighted average grant date fair value per option granted was $3.11 and $3.06, during the years ended December 31, 2022 and 2021, respectively. The total fair value of options vested was approximately $9.9 million and $5.4 million, during the years ended December 31, 2022 and 2021, respectively. As of December 31, 2022, the unamortized expense related to outstanding options was $15.3 million. The weighted average remaining amortization period over which the balance as of December 31, 2022 is to be amortized is 2.33 years. For the purpose of determining the estimated fair value of share -based -Scholes -pricing -Scholes -pricing Year Ended December 31, 2022 2021 Dividend yield 0 % 0 % Expected volatility 51 % 42 % Expected term (years) 5.88 6.01 Risk free interest rate 2.58 % 1.14 % For the purpose of determining the estimated fair value of ESPP shares, the Company uses the Black -Scholes -pricing -Scholes -pricing Year Ended December 31, Dividend yield 0 % Expected volatility 77 % Expected term (years) 0.52 Risk free interest rate 4.53 % Restricted Stock Unit Activity Restricted stock unit activity under the Plans was as follows for the year ended December 31, 2022: Number of Weighted Outstanding, December 31, 2021 — $ — Granted 20,416,417 4.26 Vested (2,515,851 ) 4.99 Forfeited (1,184,183 ) 4.46 Outstanding, December 31, 2022 16,716,383 $ 4.14 The Company recorded stock -based -Based -Based To derive the fair value of Market -Based -based The assumptions under the Monte Carlo simulation model and the calculated fair value of the Market -Based Year Ended Expected volatility 52 % Expected term (years) 4 Drift rate 2.9 % The weighted average grant date fair value of the Market -Based -based -Based -Based During the year ended December 31, 2022, the fair value of RSUs that vested was $12.0 million. During the year ended December 31, 2022, the Company recorded $19.0 million, of stock -based Compensation Costs The Company’s founders held 7,270,503 of Legacy SoundHound common stock pre -conversion -based Stock -based Year Ended December 31, 2022 2021 Cost of revenue $ 99 $ — Sales and marketing 2,794 509 Research and development 13,986 4,434 General and administrative 11,913 1,379 Total $ 28,792 $ 6,322 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
LEASES | 14. LEASES The Company leases certain facilities under non -cancelable Aggregate non -cancelable Operating Lease Finance Lease Year Ending December 31: 2023 $ 3,758 $ 189 2024 3,234 122 2025 914 8 2026 458 — 2027 458 — Thereafter 1,225 — Total 10,047 319 Less: imputed interest (1,050 ) (31 ) Present value of lease liabilities 8,997 288 Less: current portion (3,282 ) (160 ) Lease liabilities, net of current portion $ 5,715 $ 128 The components of lease cost were as follows during the years ended December 31, 2022 and 2021 (in thousands): Year Ended December 31, 2022 2021 Operating lease cost $ 3,423 $ 3,654 Short-term lease cost $ 466 $ 524 Finance lease cost: Amortization of finance leased assets $ 995 $ 2,575 Interest on lease liabilities $ 79 $ 472 The table below presents additional information related to our leases as of December 31, 2022: Operating Lease Finance Lease Weighted average remaining lease term (years) 3.83 1.82 Weighted average discount rate 5.89 % 10.80 % The Company’s rent expense totaled approximately $3.9 million and $4.2 million during the years ended December 31, 2022 and 2021, respectively. |
Other Expense, Net
Other Expense, Net | 12 Months Ended |
Dec. 31, 2022 | |
Other Expense, Net [Abstract] | |
OTHER EXPENSE, NET | 15. OTHER EXPENSE, NET Other expense, net on the consolidated statements of operations and comprehensive loss is comprised of the following for the years ended December 31, 2022 and 2021 (in thousands): Year Ended December 31, 2022 2021 Other expense, net: Interest income $ 390 $ 7 Change in fair value of derivative and warrant liability (606 ) (4,920 ) Other income (expense), net 32 (502 ) Total other expense, net $ (184 ) $ (5,415 ) |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Dec. 31, 2022 | |
Net loss per share [Abstract] | |
NET LOSS PER SHARE | 16. NET LOSS PER SHARE The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders for the years ended December 31, 2022 and 2021: Year Ended December 31, 2022 2021 Numerator: Net loss (in thousands) $ (115,373 ) $ (79,540 ) Denominator: Weighted average shares outstanding – basic and dilutive 157,317,695 67,255,538 Basic and diluted net loss per share $ (0.73 ) $ (1.18 ) For the years ended December 31, 2022 and 2021, the diluted earnings per share is equal to the basic earnings per share as the effect of potentially dilutive securities would have been antidilutive. The following table summarizes the outstanding shares of potentially dilutive securities that were excluded from the calculation of diluted earnings per share because their inclusion would have been anti -dilutive Year Ended 2022 2021 Stock options 25,420,425 30,361,405 Restricted stock units 16,716,383 — Estimated ESPP stock units 476,636 — Common stock warrants 3,665,996 1,063,214 Redeemable convertible preferred stock — 106,949,326 Total 46,279,440 138,373,945 |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 17. INCOME TAXES The following is a geographical breakdown of loss before income taxes: Year Ended December 31, 2022 2021 Domestic $ (115,624 ) $ (79,962 ) Foreign 3,140 878 $ (112,484 ) $ (79,084 ) The provision for income taxes consisted of the following: Year Ended December 31, 2022 2021 Current provision: Federal $ — $ — State 7 5 Foreign 755 339 Total current provision $ 762 $ 344 Deferred provision: Federal $ — $ — State — — Foreign 2,127 112 Total deferred provision $ 2,127 $ 112 Total provision for income taxes $ 2,889 $ 456 Effective income tax expense rate (2.6 )% (0.6 )% The Company has incurred net pre -tax The provision for income taxes differed from the amount computed by applying the federal statutory rate to our income before income taxes as follows: Year Ended December 31, 2022 2021 Federal statutory income tax rate 21.00 % 21.00 % Tax provision at statutory rate $ (23,622 ) $ (16,608 ) State income tax rate 7 5 Foreign withholding and income tax 2,298 388 Foreign rate differential (115 ) — Research and development credits (1,731 ) (1,605 ) Change in valuation allowance 24,272 15,804 Stock based compensation 1,540 728 Permanent book tax differences 470 996 Other (230 ) 748 $ 2,889 $ 456 The components of our deferred tax assets and liabilities were as follows: Year Ended December 31, 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 79,060 $ 70,808 Research and development credits 13,809 10,650 Property and equipment and intangible assets 178 91 Deferred revenue 1,612 3,662 Contract liability — 1,154 Share-based compensation 3,062 1,235 Operating lease liabilities 2,106 2,861 Section 174 research and development capitalization 13,319 — Accruals and reserves 888 863 Other 23 — Total deferred tax assets 114,057 91,324 Valuation allowance (112,204 ) (86,695 ) Total deferred tax assets, net 1,853 4,629 Deferred tax liabilities: Right-of-use assets (1,811 ) (2,460 ) Total deferred tax liabilities (1,811 ) (2,460 ) Net deferred tax assets $ 42 $ 2,169 Recorded as: Non-current deferred tax assets $ 55 $ 2,169 Non-current deferred tax liabilities (included as a component of Other liabilities) (13 ) — Net deferred tax assets $ 42 $ 2,169 Based on available objective evidence, management believes it is more -likely-than-not The Company capitalized research and development expenditures incurred during the year ended December 31, 2022 and amortizes such expenditures over 5 or 15 years, as applicable, pursuant to Section 174 of the Internal Revenue Code as required by the 2017 Tax Cuts and Jobs Act. The mandatory capitalization requirement did not have a material impact on our net deferred tax assets or cash tax liabilities. The Company is not asserting permanent reinvestment of its unrepatriated foreign earnings. As of December 31, 2022, the Company anticipated that the tax liability associated with any potential repatriation of foreign earnings is not material. As of December 31, 2022, the Company had net operating loss carry forwards of approximately $344.6 million and $106.9 million available to reduce future taxable income, if any, for both federal and state income tax purposes, respectively. The federal and state net operating loss carry forwards will start to expire in 2025 and 2028, respectively, with the exception of $256.0 million in federal net operating loss carryforwards, which can be carried forward indefinitely. The Company also had federal and state research and development credit carry forwards of approximately $11.4 million and $9.1 million, respectively, at December 31, 2022. The federal credits will expire starting in 2029 if not utilized. State research and development tax credits can be carried forward indefinitely. Under Sections 382 and 383 of the Internal Revenue Code of 1986 and similar state tax laws, utilization of net operating loss carryforwards and tax credits may be subject to annual limitations due to certain ownership changes. The Company’s net operating loss carryforwards and tax credits could expire before utilization if subject to annual limitations. The Company files U.S. federal income tax returns as well as income tax returns in many U.S. states and foreign jurisdictions. As of December 31, 2022, the tax years 2006 through the current period remain open to examination by the major jurisdictions in which the Company is subject to tax. Fiscal years outside the normal statute of limitation remain open to audit by tax authorities due to tax attributes generated in those early years, which have been carried forward and may be audited in subsequent years when utilized. Changes in gross unrecognized tax benefits during the periods presented were as follows (in thousands): Balance as of December 31, 2020 $ 4,301 Increase for tax positions of prior years 36 Increase for tax positions of current year 731 Balance as of December 31, 2021 5,068 Increase for tax positions of current year 1,062 Balance as of December 31, 2022 $ 6,130 These unrecognized tax benefits, if recognized, would not affect the effective tax rate and would be offset by the reversal of related deferred tax assets which are subject to a full valuation allowance. As of December 31, 2022, the Company has not accrued any interest or penalties. The Company does not anticipate any significant change in the Company’s uncertain tax positions within 12 months of this date. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 18. RELATED PARTY TRANSACTIONS The Company entered into revenue contracts to perform professional services for certain companies who are also investors in the Company. These companies are holders of the Company’s Class A Common Stock. As a result of the Business Combination during the second quarter of 2022, each company’s ownership interest in us was reduced to less than 5%. Consequently, considering all aspects of our relationships with the companies, as of June 30, 2022, we no longer consider the companies related parties. Below we provide our disclosures for transactions with the companies through June 30, 2022. During the six months ended June 30, 2022, we recognized revenue from the companies of $5.2 million. During the year ended December 31, 2021, we recognized revenue from the companies of $7.0 million. As of December 31, 2021, we had accounts receivable and deferred revenue balances related to the companies of $0.6 million and $15.2 million, respectively. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 19. SUBSEQUENT EVENTS Restructuring On January 5, 2023, SoundHound announced a restructuring plan (the “Restructuring Plan”) intended to reduce operating costs, improve operating margins, improve cash flows and accelerate the Company’s path to profitability. The Restructuring Plan included a reduction of the Company’s then -current The Company estimates that it will incur approximately $4.5 million to $5.5 million in charges in connection with the Restructuring Plan, of which the majority is expected to be incurred in the first quarter of 2023 and consists of severance payments, employee benefits and share -based Issuance of Preferred Stock On or around January 20, 2023, the Company entered into Preferred Stock Purchase Agreements (the “Purchase Agreements”) with certain investors (the “Investors”) pursuant to which the Company issued and sold to the Investors an aggregate of 835,011 The Purchase Agreements contain customary representations, warranties and covenants. The shares of Series A Preferred Stock were issued and sold in a private placement exempt from the registration requirements of the Securities Act. The Company does not intend to register the shares of Series A Preferred Stock or the underlying Common Stock for resale under the Securities Act. Equity Line of Credit On August 16, 2022, the Company entered into a common stock purchase agreement (the “Common Stock Purchase Agreement”) and related registration rights agreement (the “CFPI Registration Rights Agreement”) with CF Principal Investments LLC (“CFPI”). Pursuant to the Common Stock Purchase Agreement, the Company, has the right to sell to CFPI up to the lesser of (i) 25,000,000 -1 The purchase price of the shares that the Company elects to sell to CFPI pursuant to the Common Stock Purchase Agreement will be the volume weighted average price of the Common Stock during the applicable purchase date on which the Company has timely delivered written notice to CFPI directing it to purchase the shares under the Common Stock Purchase Agreement. The Company will receive 97% of the volume weighted average price of the Common Stock so sold. In connection with the execution of the Common Stock Purchase Agreement, the Company issued CFPI 250,000 |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Basis of Presentation and Significant Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding annual financial reporting. Any reference in these notes to applicable accounting guidance is meant to refer to the authoritative U.S. GAAP included in the Accounting Standards Codification (“ASC”), and Accounting Standards Update (“ASU”) issued by the Financial Accounting Standards Board (“FASB”). |
Principles of Consolidation | Principles of Consolidation The Company’s consolidated financial statements include the accounts of the Company and its wholly -owned We consolidate any variable interest entity (“VIE”) where we have determined we are the primary beneficiary. The primary beneficiary is the entity which has both: (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance; and (ii) the obligation to absorb losses or receive benefits of the entity that could potentially be significant to the VIE. |
Reclassification | Reclassification Certain prior period balances have been reclassified to conform to the current year presentation. Such changes include reclassifications or combinations of certain accounts on the consolidated balance sheets. |
Foreign Currency | Foreign Currency The functional currency of the Company and its subsidiaries is the U.S. dollar. Foreign currency denominated transactions are converted into U.S. dollars at the average rates of exchange prevailing during the period. Assets and liabilities denominated in foreign currency are remeasured into U.S. dollars at current exchange rates at the balance sheet date for monetary assets and liabilities and at historical exchange rates for non -monetary |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and judgments that affect the amounts reported and disclosures in the consolidated financial statements and accompanying notes. Such estimates include revenue recognition, allowance for doubtful accounts, accrued liabilities, derivative and warrant liabilities, calculation of the incremental borrowing rate, financial instruments recorded at fair value on a recurring basis, valuation of deferred tax assets and uncertain tax positions and the fair value of common stock and other assumptions used to measure stock -based |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of 90 days or less from the date of purchase to be cash equivalents. The Company’s cash equivalents consist of mutual funds, commercial paper and certificates of deposit. The deposits exceed federally insured limits. |
Restricted Cash Equivalents | Restricted Cash Equivalents The Company’s restricted cash equivalents were established according to the requirements under the leases for the Company’s corporate headquarters, data center and sales office and are subject to certain restrictions under the leases. All amounts in restricted cash equivalents as of December 31, 2022 and 2021 represent funds held in certificates of deposit, have original maturities of six months to one year and are recorded at cost plus accrued interest, which approximates fair value as of December 31, 2022 and 2021. Restricted cash equivalents are classified as current or non -current |
Accounts Receivable, Net | Accounts Receivable, Net Accounts receivable consist of current trade receivables due from customers recorded at invoiced amounts, net of allowance for doubtful accounts. Accounts receivable do not bear interest and the Company generally does not require collateral or other security in support of accounts receivable. The Company has established an allowance for doubtful accounts and evaluates the collectability of its accounts receivable based on known collection risks and historical experience. Uncollectible receivables are written off when all efforts to collect have been exhausted and recoveries are recognized when received. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is provided using the straight -line The estimated useful lives of the Company’s property and equipment are as follows: Computer equipment 3 – 4 years Software 3 years Furniture and fixtures 5 years Leasehold improvements Lesser of useful life or the term of the lease Maintenance and repairs that do not extend the life or improve the asset are expensed as incurred. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company evaluates property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. An impairment loss is recognized when the total of estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount. Impairment, if any, would be assessed using discounted cash flows or other appropriate measures of fair value. Through December 31, 2022, there have been no such impairments. |
Leases | Leases We determine if an arrangement is a lease at its inception. Operating lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. We generally use our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of future payments, because the implicit rate of the lease is generally not known. ROU assets related to our operating lease liabilities are measured at lease inception based on the initial measurement of the lease liability, plus any prepaid lease payments and less any lease incentives, as applicable. Our lease terms that are used in determining our operating lease liabilities at lease inception may include options to extend or terminate the leases when it is reasonably certain that we will exercise such options. We amortize our ROU assets as operating lease expense generally on a straight -line |
Segment Information | Segment Information The Company has determined that the Chief Executive Officer is its chief operating decision maker. The Company’s Chief Executive Officer reviews financial information on a consolidated basis for purposes of allocating resources and evaluating financial performance. The Company’s property and equipment is primarily located in the United States. Accordingly, the Company has determined that it operates as a single reportable segment. The Company’s property and equipment is primarily located in the United States. As of December 31, 2022, the Company’s property and equipment is located in the United States, except for 11.4% of assets located in Canada and 7.0% in other foreign jurisdictions. |
Emerging Growth Company Status | Emerging Growth Company Status The Company is an emerging growth company (“EGC”) as defined in the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”) and may take advantage of reduced reporting requirements that are otherwise applicable to public companies. Section 107 of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with those standards. This means that when a standard is issued or revised and it has different application dates for public and nonpublic companies, the Company has the option to adopt the new or revised standard at the time nonpublic companies adopt the new or revised standard and can do so until such time that the Company either (i) irrevocably elects to “opt out” of such extended transition period or (ii) no longer qualifies as an emerging growth company. The Company has elected to use the extended transition period for complying with new or revised accounting standards unless the Company otherwise early adopts select standards. |
Concentrations of Credit Risk and Other Risks and Uncertainties | Concentrations of Credit Risk and Other Risks and Uncertainties Financial instruments that potentially subject the Company to potential significant concentrations of credit risk consist principally of cash and cash equivalents. The Company regularly monitors its credit risk exposure and takes steps to mitigate the likelihood of these exposures resulting in actual loss. As of December 31, 2022, accounts receivable balances due from two customers collectively totaled 75% of the Company’s consolidated accounts receivable balance. As of December 31, 2021, accounts receivable balances due from five customers collectively totaled 86% of the Company’s consolidated accounts receivable balance. For the year ended December 31, 2022, the Company had three customers that accounted for 67% of revenue. For the year ended December 31, 2021, the Company had three customers that accounted for 61% of revenue. |
Equity Issuance Costs | Equity Issuance Costs The Company capitalizes certain legal, professional, accounting and other third -party -process |
Revenue Recognition | Revenue Recognition The Company recognizes revenue under Accounting Standards Codification Topic 606 (“ASC 606”), Revenue from Contracts with Customers (i) (ii) (iii) (iv) (v) Contracts are accounted for when both parties have approved and committed to the contract, the rights of the parties and payment terms are identifiable, the contract has commercial substance and collectability of consideration is probable. Any payments received from customers that do not meet criteria for having a contract are recorded as deposit liabilities on the consolidated balance sheet. Under ASC 606, assuming all other revenue recognition criteria have been met, the Company recognizes revenue for arrangements upon the transfer of control of the Company’s performance obligations to its customers. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer and is the unit of account in ASC 606. Revenues are recognized when control of the promised goods or services are transferred to a customer in an amount that reflects the consideration that the Company expects to receive in exchange for those services. The Company currently generates its revenues through the following performance obligations: (1) hosted services, (2) professional services (3) monetization and (4) licensing. |
Research and Development | Research and Development The Company’s research and development costs are expensed as incurred. These costs include salaries and other personnel related expenses, contractor fees, facility costs, supplies, and depreciation of equipment associated with the design and development of new products prior to the establishment of their technological feasibility. |
Warrants | Warrants The Company determines whether to classify contracts, such as warrants, that may be settled in its own stock as equity of the entity or as a liability. An equity -linked |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. A valuation allowance is established when, in management’s estimate, it is more -likely-than-not -likely-than-not The Company classifies interest and penalties related to uncertain tax positions in income tax expense, if applicable. There has been no interest expense or penalties related to unrecognized tax benefits recorded through December 31, 2022. |
Stock-Based Compensation | Stock-Based Compensation The Company measures and records the expense related to stock -based -based -line -based -Scholes -pricing -Scholes -pricing -Scholes -pricing Expected Volatility Expected Term -based -vesting Risk -Free Interest Rate -free -coupon Expected Dividend Yield |
Restricted Stock Units | Restricted Stock Units The Company issues restricted stock unit awards (“RSUs”) to grantees as compensation for services. The fair value of the RSUs is determined at the grant date based on the fair value of the Company’s Class A Common Stock and for RSUs with service conditions only, is recognized straight -line The Company issues RSUs with vesting conditions tied to certain performance criteria (“Performance -Based -based -Based The Company issues RSUs with vesting conditions tied to certain market conditions (“Market -Based -Based -based -Based |
Fair Value Measurements | Fair Value Measurements The Company defines fair value as the exchange price that would be received from an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The Company follows a three -level • Level 1 — • Level 2 — • Level 3 — The Company’s derivative liabilities and warrants are measured at fair value on a recurring basis and are classified as Level 3 liabilities. The Company records subsequent adjustments to reflect the increase or decrease in estimated fair value at each reporting date on the consolidated statements of operations and comprehensive loss. |
Redeemable Convertible Preferred Stock | Redeemable Convertible Preferred Stock Legacy SoundHound Preferred Stock did not have a mandatory redemption date and are assessed at issuance for classification and redemption features requiring bifurcation. The Company presents as temporary equity any stock which (i) the Company undertakes to redeem at a fixed or determinable price on the fixed or determinable date or dates; (ii) is redeemable at the option of the holders, or (iii) has conditions for redemption which are not solely within the control of the Company. Legacy SoundHound Preferred Stock was redeemable upon a deemed liquidation event which the Company determined was not solely within its control and thus has classified shares of Legacy SoundHound Preferred Stock as temporary equity until such time as the conditions are removed or lapse. Since the occurrence of a deemed liquidation event was not probable, the carrying values of the shares of Legacy SoundHound Preferred Stock were not being accreted to their redemption values. As a result of the Business Combination, the shares of Legacy SoundHound Preferred Stock outstanding immediately prior to the effective time of the Business Combination (the “Effective Time”) were converted into 106,949,326 |
Convertible Notes and Derivative Liabilities | Convertible Notes and Derivative Liabilities The Company evaluates its convertible notes, and other contracts, if any, to determine if those contracts or embedded components of those contracts qualify as derivatives requiring bifurcation. The Company accounts for conversion features that meet the criteria for bifurcation as liabilities at fair value and adjusts the derivative instruments to fair value at each reporting period. The conversion features qualify as derivatives, as they continuously reset as the underlying stock price increases or decreases to provide a fixed value of equity to the holders at any conversion date. The conversion features are subject to remeasurement at each balance sheet date until exercised, and any change in fair value is recognized as a component of other expense, net in the consolidated statements of operations and comprehensive loss. The fair value of the conversion features has been estimated using a probability -weighted The Company held its convertible notes at amortized cost and amortized the associated debt discount created from bifurcated derivatives and issuance costs under the effective interest or straight -line |
Net Loss Per Share | Net Loss Per Share Basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted -average Diluted net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted -average Accordingly, in periods in which the Company reports a net loss, diluted net loss per share is the same as basic net loss per share, since dilutive common stock is not assumed to have been issued if their effect is anti -dilutive |
Recent Accounting Pronouncements — Adopted | Recent Accounting Pronouncements — Adopted In February 2016, the FASB issued Accounting Standards Update 2016 -02 Leases -13 -10 -11 -20 -01 -of-use -line payments. Topic 842 is effective for the Company for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. A modified retrospective application is required with an option to not restate comparative periods in the period of adoption. The Company adopted Topic 842 on January 1, 2021 using the modified retrospective approach, and financial information for the comparative period was not updated. In addition, the Company elected the transition package of three practical expedients which allow companies not to reassess (i) whether agreements contain leases, (ii) the classification of leases, and (iii) the capitalization of initial direct costs. Further, the Company elected to separate lease and non -lease -lease -line The Company’s lease portfolio consists primarily of real estate assets and computer equipment. Some of these leases also require the Company to pay maintenance, utilities, taxes, insurance, and other operating expenses associated with the leased space. Based upon the nature of the items leased and the structure of the leases, the Company’s leases classified as operating leases continue to be classified as operating leases and capital leases will be accounted for as financing leases under the new accounting standard. As a result of the adoption of the new lease accounting guidance, the Company recognized on January 1, 2021: • -by-lease • • See Note 14 for additional information. |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Basis of Presentation and Significant Accounting Policies [Abstract] | |
Schedule of estimated useful lives company' s property and equipment | Computer equipment 3 – 4 years Software 3 years Furniture and fixtures 5 years Leasehold improvements Lesser of useful life or the term of the lease |
Business Combination (Tables)
Business Combination (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination [Abstract] | |
Schedule of net proceeds from the business combination and the PIPE investment | Cash – ATSP trust and cash (net of redemption) $ 5,357 Cash – PIPE Investment 113,000 Less: transaction costs (27,668 ) Net proceeds from Business Combination and PIPE Investment $ 90,689 |
Schedule of number of shares of common stock issued | Class A Common Stock – conversion of Legacy SoundHound Common Stock and Legacy SoundHound Preferred Stock outstanding prior to Business Combination 140,114,060 Class B Common Stock – conversion of Legacy SoundHound Common Stock and Legacy SoundHound Preferred Stock outstanding prior to Business Combination 40,396,600 Class A Common Stock – PIPE Investment 11,300,000 Class A Common Stock – issuance to ATSP shareholders 532,050 Class A Common Stock – issuance to Legacy SoundHound founders and representatives 4,161,000 Total shares of common stock immediately after Business Combination 196,503,710 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue Recognition [Abstract] | |
Schedule of revenues under each performance | Year Ended 2022 2021 Hosted services $ 17,743 $ 12,764 Professional services 4,220 7,142 Monetization 844 1,291 Licensing 8,322 — Total $ 31,129 $ 21,197 |
Schedule of disaggregates revenue by geographic location | Year Ended 2022 2021 Korea $ 14,530 $ 2,460 Germany 4,134 7,526 United States 3,344 4,030 Japan 3,866 3,797 France 4,023 2,616 Other 1,232 768 Total $ 31,129 $ 21,197 |
Schedule of revenue recognition pattern | Year Ended 2022 2021 Over time revenue $ 19,955 $ 15,210 Point-in-time 11,174 5,987 Total $ 31,129 $ 21,197 |
Schedule of service | Year Ended 2022 2021 Product royalties $ 28,447 $ 18,356 Service subscriptions 1,838 1,550 Monetization 844 1,291 Total $ 31,129 $ 21,197 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment, net | December 31, December 31, Computer equipment $ 20,946 $ 20,571 Software and voice recordings 9,420 8,687 Leasehold improvements 3,850 3,567 Furniture and fixtures 761 729 Total property and equipment, at cost 34,977 33,554 Less: accumulated depreciation and amortization (31,530 ) (27,399 ) Total property and equipment, net $ 3,447 $ 6,155 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accrued Liabilities Table [Abstract] | |
Schedule of accrued liabilities | December 31, December 31, Accrued compensation expenses $ 6,134 $ 3,802 Accrued interest 236 1,369 Accrued vendor payables 1,002 1,109 Accrued professional services 89 934 Other accrued liabilities 1 84 $ 7,462 $ 7,298 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of aggregate non-cancelable future minimum payments | 2023 $ 7,000 2024 11,000 2025 14,000 2026 16,000 2027 24,000 Thereafter 24,000 Total $ 96,000 |
Convertible Notes and Note Pa_2
Convertible Notes and Note Payable (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Convertible Notes and Note Payable [Abstract] | |
Schedule of unamortized debt discount, fair value of conversion feature, and accrued interest | April 26, December 31, Unamortized debt discount $ 230 $ 657 Fair value of conversion feature $ 4,094 $ 3,488 Accrued interest $ 1,375 $ 1,136 |
Schedule of convertible notes, debt balances | December 31, 2022 SVB March 2021 Note SCI June 2021 Note Total Notes payable, current portion $ 12,000 $ 4,718 $ 16,718 Notes payable, net of current portion 10,050 8,261 18,311 Unamortized loan discount (62 ) — (62 ) Total $ 21,988 $ 12,979 $ 34,967 Unamortized debt issuance cost recorded as an asset $ — $ 295 $ 295 December 31, 2021 SVB March 2021 Note Note payable, current portion $ 31,050 Unamortized loan discount (1,086 ) Carrying value $ 29,964 December 31, 2021 SNAP June 2020 Note SCI June 2021 Note Total Convertible notes, current portion $ 15,000 $ 15,525 $ 30,525 Unamortized loan discount (657 ) — (657 ) Total $ 14,343 $ 15,525 $ 29,868 Unamortized debt issuance cost recorded as an asset $ — $ 1,132 $ 1,132 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial instruments that are measured or disclosed at fair value | Fair Value Measurements as of December 31, 2021 Level 1 Level 2 Level 3 Assets: Cash equivalents $ 4,863 $ — $ — Liabilities: Derivative liability — — (3,488 ) Total $ 4,863 $ — $ (3,488 ) |
Schedule of common stock warrants at issuance | SVB March 2021 Note Common Stock Warrants Expected dividend rate 0 % Risk-free interest rate 1.74 % Expected volatility 47 % Expected term (in years) 10.00 SCI June 2021 Note Common Stock Warrants Expected dividend rate 0 % Risk-free interest rate 1.51 % Expected volatility 47 % Expected term (in years) 10.00 |
Schedule of embedded derivative was determined | December 31, 2021 Probability of Next Equity Financing 3 % Probability of SPAC/PIPE 95 % Probability of IPO 2 % 100 % Weighted average term (years) 0.27 Weighted average discount rate 25.00 % |
Schedule of fair value remeasurement of embedded derivative | Year Ended 2022 2021 Remeasurement of conversion feature – loss $ (606 ) $ (1,108 ) |
Schedule of changes in fair value of the company’s derivative liability and warrant liability | Derivative Liability Warrant Liability Balance as of December 31, 2020 $ 2,380 $ 2,004 Change in fair value 1,108 3,812 Exercise of warrants — (5,816 ) Balance as of December 31, 2021 3,488 — Change in fair value 606 — Extinguishment of embedded derivative upon conversion of convertible note (4,094 ) — Balance as of December 31, 2022 $ — $ — |
Preferred stock (Tables)
Preferred stock (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Preferred Stock [Abstract] | |
Schedule of preferred stock authorized, issued and outstanding | Shares Authorized Shares Liquidation Preference Carrying Value Series A 19,106,048 19,106,048 $ 28,239 $ 4,967 Series B 33,702,134 33,702,134 66,360 11,038 Series C 5,687,525 5,687,525 38,163 11,837 Series C-1 4,436,090 4,436,090 89,298 16,061 Series D 20,258,299 20,258,299 527,992 85,648 Series D-1 8,418,535 8,418,535 277,812 49,957 Series D-2 8,418,530 8,418,530 277,811 49,949 Series D-3 6,922,165 6,922,165 276,887 50,046 Series D-3A 20,835,869 — — — 127,785,195 106,949,326 $ 1,582,562 $ 279,503 |
Stock Incentive Plans (Tables)
Stock Incentive Plans (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stock Incentive Plans [Abstract] | |
Schedule of stock options outstanding and exercisable | Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in Thousands) Outstanding, December 31, 2020 28,772,180 $ 2.38 Granted 6,303,953 7.22 Exercised (2,590,780 ) 0.96 Forfeited or cancelled (2,123,948 ) 3.13 Outstanding, December 31, 2021 30,361,405 3.45 Granted 391,619 6.17 Exercised (3,595,706 ) 1.16 $ 22,534 Forfeited or cancelled (1,736,893 ) 4.63 Outstanding, December 31, 2022 25,420,425 $ 3.74 6.32 $ 1,448 Exercisable, December 31, 2022 18,952,826 3.04 5.65 1,448 |
Schedule of weighted average calculated fair value of the options granted to employees | Year Ended December 31, 2022 2021 Dividend yield 0 % 0 % Expected volatility 51 % 42 % Expected term (years) 5.88 6.01 Risk free interest rate 2.58 % 1.14 % Year Ended December 31, Dividend yield 0 % Expected volatility 77 % Expected term (years) 0.52 Risk free interest rate 4.53 % |
Schedule of restricted stock unit activity | Number of Weighted Outstanding, December 31, 2021 — $ — Granted 20,416,417 4.26 Vested (2,515,851 ) 4.99 Forfeited (1,184,183 ) 4.46 Outstanding, December 31, 2022 16,716,383 $ 4.14 |
Schedule of assumptions under the monte carlo simulation model and the calculated fair value of the market-based RSUs granted to employees | Year Ended Expected volatility 52 % Expected term (years) 4 Drift rate 2.9 % |
Schedule of operations and comprehensive loss | Year Ended December 31, 2022 2021 Cost of revenue $ 99 $ — Sales and marketing 2,794 509 Research and development 13,986 4,434 General and administrative 11,913 1,379 Total $ 28,792 $ 6,322 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of operating and finance leases | Operating Lease Finance Lease Year Ending December 31: 2023 $ 3,758 $ 189 2024 3,234 122 2025 914 8 2026 458 — 2027 458 — Thereafter 1,225 — Total 10,047 319 Less: imputed interest (1,050 ) (31 ) Present value of lease liabilities 8,997 288 Less: current portion (3,282 ) (160 ) Lease liabilities, net of current portion $ 5,715 $ 128 |
Schedule of the components of lease cost | Year Ended December 31, 2022 2021 Operating lease cost $ 3,423 $ 3,654 Short-term lease cost $ 466 $ 524 Finance lease cost: Amortization of finance leased assets $ 995 $ 2,575 Interest on lease liabilities $ 79 $ 472 |
Schedule of additional information related to our leases | Operating Lease Finance Lease Weighted average remaining lease term (years) 3.83 1.82 Weighted average discount rate 5.89 % 10.80 % |
Other Expense, Net (Tables)
Other Expense, Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Expense, Net [Abstract] | |
Schedule of net on the consolidated statements of operations and comprehensive loss | Year Ended December 31, 2022 2021 Other expense, net: Interest income $ 390 $ 7 Change in fair value of derivative and warrant liability (606 ) (4,920 ) Other income (expense), net 32 (502 ) Total other expense, net $ (184 ) $ (5,415 ) |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Net loss per share [Abstract] | |
Schedule of basic and diluted net loss per share | Year Ended December 31, 2022 2021 Numerator: Net loss (in thousands) $ (115,373 ) $ (79,540 ) Denominator: Weighted average shares outstanding – basic and dilutive 157,317,695 67,255,538 Basic and diluted net loss per share $ (0.73 ) $ (1.18 ) |
Schedule of outstanding shares of potentially dilutive securities | Year Ended 2022 2021 Stock options 25,420,425 30,361,405 Restricted stock units 16,716,383 — Estimated ESPP stock units 476,636 — Common stock warrants 3,665,996 1,063,214 Redeemable convertible preferred stock — 106,949,326 Total 46,279,440 138,373,945 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of geographical breakdown of loss before income taxes | Year Ended December 31, 2022 2021 Domestic $ (115,624 ) $ (79,962 ) Foreign 3,140 878 $ (112,484 ) $ (79,084 ) |
Schedule of provision for income taxes | Year Ended December 31, 2022 2021 Current provision: Federal $ — $ — State 7 5 Foreign 755 339 Total current provision $ 762 $ 344 Deferred provision: Federal $ — $ — State — — Foreign 2,127 112 Total deferred provision $ 2,127 $ 112 Total provision for income taxes $ 2,889 $ 456 Effective income tax expense rate (2.6 )% (0.6 )% |
Schedule of provision for income taxes | Year Ended December 31, 2022 2021 Federal statutory income tax rate 21.00 % 21.00 % Tax provision at statutory rate $ (23,622 ) $ (16,608 ) State income tax rate 7 5 Foreign withholding and income tax 2,298 388 Foreign rate differential (115 ) — Research and development credits (1,731 ) (1,605 ) Change in valuation allowance 24,272 15,804 Stock based compensation 1,540 728 Permanent book tax differences 470 996 Other (230 ) 748 $ 2,889 $ 456 |
Schedule of net deferred tax assets | Year Ended December 31, 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 79,060 $ 70,808 Research and development credits 13,809 10,650 Property and equipment and intangible assets 178 91 Deferred revenue 1,612 3,662 Contract liability — 1,154 Share-based compensation 3,062 1,235 Operating lease liabilities 2,106 2,861 Section 174 research and development capitalization 13,319 — Accruals and reserves 888 863 Other 23 — Total deferred tax assets 114,057 91,324 Valuation allowance (112,204 ) (86,695 ) Total deferred tax assets, net 1,853 4,629 Deferred tax liabilities: Right-of-use assets (1,811 ) (2,460 ) Total deferred tax liabilities (1,811 ) (2,460 ) Net deferred tax assets $ 42 $ 2,169 Recorded as: Non-current deferred tax assets $ 55 $ 2,169 Non-current deferred tax liabilities (included as a component of Other liabilities) (13 ) — Net deferred tax assets $ 42 $ 2,169 |
Schedule of changes in gross unrecognized tax benefits | Balance as of December 31, 2020 $ 4,301 Increase for tax positions of prior years 36 Increase for tax positions of current year 731 Balance as of December 31, 2021 5,068 Increase for tax positions of current year 1,062 Balance as of December 31, 2022 $ 6,130 |
Organization (Details)
Organization (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Apr. 26, 2022 | Dec. 31, 2021 | |
Organization (Details) [Line Items] | |||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | |
Net loss | $ 115.4 | ||
Accumulated deficit | 502.1 | ||
Total cash and cash equivalents | $ 9.2 | ||
Class A Common Stock [Member] | |||
Organization (Details) [Line Items] | |||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | 0.0001 |
Class B Common Stock [Member] | |||
Organization (Details) [Line Items] | |||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 26, 2022 shares | Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 USD ($) | Jan. 01, 2021 USD ($) | |
Basis of Presentation and Significant Accounting Policies (Details) [Line Items] | ||||
Net loss related to foreign currency (in Dollars) | $ 700 | $ 500 | ||
Property and equipment percentage | 11.40% | |||
Assets in other foreign jurisdictions percentage | 7% | |||
Number of customers | 3 | |||
Concentration risk, percentage | 61% | |||
Percentage of revenue | 67% | |||
Operating lease liabilities (in Dollars) | $ 11,400 | |||
Operating lease right-of-use asset (in Dollars) | $ 8,119 | $ 10,291 | 9,800 | |
Deferred rent (in Dollars) | 800 | |||
Lease incentives or tenant improvement allowance (in Dollars) | 1,100 | |||
Prepaid rent (in Dollars) | 300 | |||
Common Class A [Member] | ||||
Basis of Presentation and Significant Accounting Policies (Details) [Line Items] | ||||
Converted shares (in Shares) | shares | 140,114,060 | 106,949,326 | ||
Accounts Receivable [Member] | ||||
Basis of Presentation and Significant Accounting Policies (Details) [Line Items] | ||||
Number of customers | 2 | 5 | ||
Concentration risk, percentage | 75% | 86% | ||
Revenue Benchmark [Member] | ||||
Basis of Presentation and Significant Accounting Policies (Details) [Line Items] | ||||
Number of customers | 3 | |||
Operating Leases [Member] | ||||
Basis of Presentation and Significant Accounting Policies (Details) [Line Items] | ||||
Operating lease liabilities (in Dollars) | $ 11,400 |
Basis of Presentation and Sig_4
Basis of Presentation and Significant Accounting Policies (Details) - Schedule of estimated useful lives company' s property and equipment $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Computer equipment [Member] | Minimum [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Estimated useful lives | $ 3 |
Computer equipment [Member] | Maximum [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 4 |
Software [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 |
Furniture and fixtures [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Estimated useful lives | $ 5 |
Leasehold improvements [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Estimated useful lives, description | Lesser of useful life or the term of the lease |
Business Combination (Details)
Business Combination (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended |
Apr. 26, 2022 | Dec. 31, 2022 | |
Business Combination (Details) [Line Items] | ||
Common stock and preferred stock, shares authorized | 500,000,000 | |
Preferred stock, shares authorized | 1,000,000 | |
Preferred stock shares outstanding | ||
Preferred stock shares issued | ||
Conversion ratio | 5.5562 | |
Net proceeds (in Dollars) | $ 90.7 | |
Transaction cost (in Dollars) | 27.7 | |
Net redemptions (in Dollars) | $ 4.1 | |
Class A Common Stock [Member] | ||
Business Combination (Details) [Line Items] | ||
Capital stock consisting of shares | 455,000,000 | |
Par value of per share (in Dollars per share) | $ 0.0001 | |
Vote per share | one | |
Aggregate shares | 11,300,000 | |
Aggregate shares price (in Dollars) | $ 113 | |
Converted into aggregate shares | 140,114,060 | |
Class A Common Stock [Member] | PIPE Investment [Member] | ||
Business Combination (Details) [Line Items] | ||
Purchase price per share (in Dollars per share) | $ 10 | |
Class B Common Stock [Member] | ||
Business Combination (Details) [Line Items] | ||
Capital stock consisting of shares | 44,000,000 | |
Vote per share | ten | |
Converted into aggregate shares | 40,396,600 | |
ATSP [Member] | Class A Common Stock [Member] | IPO [Member] | ||
Business Combination (Details) [Line Items] | ||
Aggregate shares | 12,767,950 | |
Purchase price per share (in Dollars per share) | $ 10 | |
Aggregate shares price (in Dollars) | $ 127.7 | |
PIPE Investment [Member] | ||
Business Combination (Details) [Line Items] | ||
Net proceeds (in Dollars) | 86.6 | |
Sound Hound Transaction [Member] | ||
Business Combination (Details) [Line Items] | ||
Transaction cost (in Dollars) | $ 4.1 |
Business Combination (Details)
Business Combination (Details) - Schedule of net proceeds from the business combination and the PIPE investment $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Schedule of Net Proceeds from the Business Combination and the Pipe Investment [Abstract] | |
Cash – ATSP trust and cash (net of redemption) | $ 5,357 |
Cash – PIPE Investment | 113,000 |
Less: transaction costs | (27,668) |
Net proceeds from Business Combination and PIPE Investment | $ 90,689 |
Business Combination (Details_2
Business Combination (Details) - Schedule of number of shares of common stock issued | 12 Months Ended |
Dec. 31, 2022 shares | |
Schedule of Number of Shares of Common Stock Issued [Abstract] | |
Class A Common Stock – conversion of Legacy SoundHound Common Stock and Legacy SoundHound Preferred Stock outstanding prior to Business Combination | 140,114,060 |
Class B Common Stock – conversion of Legacy SoundHound Common Stock and Legacy SoundHound Preferred Stock outstanding prior to Business Combination | 40,396,600 |
Class A Common Stock – PIPE Investment | 11,300,000 |
Class A Common Stock – issuance to ATSP shareholders | 532,050 |
Class A Common Stock – issuance to Legacy SoundHound founders and representatives | 4,161,000 |
Total shares of common stock immediately after Business Combination | 196,503,710 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue Recognition (Details) [Line Items] | ||
Professional service revenue | $ 2.2 | $ 2.4 |
Recognized revenue | 2 | 4.7 |
Licensing revenue | 7.6 | |
Deferred revenue | 6.4 | $ 14.9 |
Related to customer contracts unsatisfied amount | 20.7 | |
Recognized revenue | $ 8.1 | |
Revenue recognized term | 1 year | |
Expected to recognized revenue | $ 9.3 | |
Contractual term | 5 years | |
Long term period | 1 year | |
Short term period | 1 year | |
Minimum [Member] | ||
Revenue Recognition (Details) [Line Items] | ||
Contract terms of hosted services range | 1 year | |
Revenue recognized term | 2 years | |
Maximum [Member] | ||
Revenue Recognition (Details) [Line Items] | ||
Contract terms of hosted services range | 20 years | |
Revenue recognized term | 5 years | |
Revenue [Member] | ||
Revenue Recognition (Details) [Line Items] | ||
Remaining recognized amount | $ 3.3 |
Revenue Recognition (Details) -
Revenue Recognition (Details) - Schedule of revenues under each performance - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule Of Revenues Under Each Performance Abstract | ||
Hosted services | $ 17,743 | $ 12,764 |
Professional services | 4,220 | 7,142 |
Monetization | 844 | 1,291 |
Licensing | 8,322 | |
Total | $ 31,129 | $ 21,197 |
Revenue Recognition (Details)_2
Revenue Recognition (Details) - Schedule of disaggregates revenue by geographic location - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||
Total | $ 31,129 | $ 21,197 |
Korea [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total | 14,530 | 2,460 |
Germany [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total | 4,134 | 7,526 |
United States [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total | 3,344 | 4,030 |
Japan [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total | 3,866 | 3,797 |
France [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total | 4,023 | 2,616 |
Other [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total | $ 1,232 | $ 768 |
Revenue Recognition (Details)_3
Revenue Recognition (Details) - Schedule of revenue recognition pattern - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue Recognition (Details) - Schedule of revenue recognition pattern [Line Items] | ||
Total | $ 31,129 | $ 21,197 |
Over time revenue [Member] | ||
Revenue Recognition (Details) - Schedule of revenue recognition pattern [Line Items] | ||
Total | 19,955 | 15,210 |
Point-in-time [Member] | ||
Revenue Recognition (Details) - Schedule of revenue recognition pattern [Line Items] | ||
Total | $ 11,174 | $ 5,987 |
Revenue Recognition (Details)_4
Revenue Recognition (Details) - Schedule of service - Revenue [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue Recognition (Details) - Schedule of service [Line Items] | ||
Total | $ 31,129 | $ 21,197 |
Product royalties [Member] | ||
Revenue Recognition (Details) - Schedule of service [Line Items] | ||
Total | 28,447 | 18,356 |
Service subscriptions [Member] | ||
Revenue Recognition (Details) - Schedule of service [Line Items] | ||
Total | 1,838 | 1,550 |
Monetization [Member] | ||
Revenue Recognition (Details) - Schedule of service [Line Items] | ||
Total | $ 844 | $ 1,291 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Aggregate cost | $ 0.6 | $ 16.6 |
Accumulated depreciation | 0.3 | 13.9 |
Depreciation and amortization expense | $ 4 | $ 5.5 |
Property and Equipment, Net (_2
Property and Equipment, Net (Details) - Schedule of property and equipment, net - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, at cost | $ 34,977 | $ 33,554 |
Less: accumulated depreciation and amortization | (31,530) | (27,399) |
Total property and equipment, net | 3,447 | 6,155 |
Computer equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, at cost | 20,946 | 20,571 |
Software and voice recordings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, at cost | 9,420 | 8,687 |
Leasehold improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, at cost | 3,850 | 3,567 |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, at cost | $ 761 | $ 729 |
Accrued Liabilities (Details) -
Accrued Liabilities (Details) - Schedule of accrued liabilities - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule Of Accrued Liabilities Abstract | ||
Accrued compensation expenses | $ 6,134 | $ 3,802 |
Accrued interest | 236 | 1,369 |
Accrued vendor payables | 1,002 | 1,109 |
Accrued professional services | 89 | 934 |
Other accrued liabilities | 1 | 84 |
Total | $ 7,462 | $ 7,298 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) $ in Millions | 1 Months Ended | ||
Aug. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Exclusive agreement, description | the Company entered into an exclusive agreement with a cloud service provider to host its voice artificial intelligence platform pursuant to which the Company committed to pay a minimum of $98.0 million in cloud costs over a seven-year period subject to variable increases based on usage. | ||
Estimated and recorded liability | $ 1.1 | $ 1.1 |
Commitments and Contingencies_3
Commitments and Contingencies (Details) - Schedule of aggregate non-cancelable future minimum payments $ in Thousands | Dec. 31, 2022 USD ($) |
Schedule Of Aggregate Non Cancelable Future Minimum Payments Abstract | |
2023 | $ 7,000 |
2024 | 11,000 |
2025 | 14,000 |
2026 | 16,000 |
2027 | 24,000 |
Thereafter | 24,000 |
Total | $ 96,000 |
Warrants (Details)
Warrants (Details) $ / shares in Units, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2022 $ / shares shares | Dec. 31, 2021 shares | Apr. 26, 2022 shares | Jun. 14, 2021 USD ($) | Mar. 31, 2021 USD ($) | |
Warrants (Details) [Line Items] | |||||
Exercise price per share (in Dollars per share) | $ / shares | $ 11.5 | ||||
Redemption price (in Dollars per share) | $ / shares | $ 0.01 | ||||
Warrant trigger price | 18 | ||||
Warrant [Member] | |||||
Warrants (Details) [Line Items] | |||||
Fair value of warrants (in Dollars) | $ | $ 1.5 | $ 2.3 | |||
April 2013 Series C Warrants [Member] | |||||
Warrants (Details) [Line Items] | |||||
Number of common stock purchase by warrants | 248,408 | ||||
November 2013 Series C Warrants [Member] | |||||
Warrants (Details) [Line Items] | |||||
Number of common stock purchase by warrants | 496,827 | ||||
Series C Warrants [Member] | |||||
Warrants (Details) [Line Items] | |||||
Exercise price per share (in Dollars per share) | $ / shares | $ 1.21 | ||||
Warrants exercised | 745,235 | ||||
Public Warrants [Member] | |||||
Warrants (Details) [Line Items] | |||||
Warrants issued and outstanding | 3,457,996 | ||||
Private Warrants [Member] | |||||
Warrants (Details) [Line Items] | |||||
Warrants issued and outstanding | 208,000 | ||||
Series C Preferred Stock [Member] | |||||
Warrants (Details) [Line Items] | |||||
Net issuance | 645,356 | ||||
Class A Common Stock [Member] | |||||
Warrants (Details) [Line Items] | |||||
Net issuance | 455,000,000 | ||||
Net issuance of shares | 673,416 | ||||
Legacy Sound Hound [Member] | |||||
Warrants (Details) [Line Items] | |||||
Exercise price per share (in Dollars per share) | $ / shares | $ 3.67 | ||||
Legacy Sound Hound [Member] | SVB March 2021 Note [Member] | |||||
Warrants (Details) [Line Items] | |||||
Number of common stock purchase by warrants | 708,808 | ||||
Legacy Sound Hound [Member] | SCI June 2021 Note [Member] | |||||
Warrants (Details) [Line Items] | |||||
Number of common stock purchase by warrants | 354,404 |
Convertible Notes and Note Pa_3
Convertible Notes and Note Payable (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | ||||||
Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 01, 2021 | Jun. 14, 2021 | Sep. 30, 2020 | |
Convertible Notes and Note Payable (Details) [Line Items] | ||||||||
Outstanding principal percentage | 100% | |||||||
SNAP June 2020 Note [Member] | ||||||||
Convertible Notes and Note Payable (Details) [Line Items] | ||||||||
Cash proceeds | $ 15 | |||||||
Annual interest rate | 5% | |||||||
Maturity date | Jun. 26, 2022 | May 31, 2025 | ||||||
Discount rate | 20% | |||||||
Price per share (in Dollars per share) | $ 0.8 | |||||||
Conversion amount | $ 30 | |||||||
Outstanding principal percentage | 200% | |||||||
Derivative liability | $ 2.5 | |||||||
Total amount of debt discount at issuance | $ 2.5 | |||||||
Total interest expense | 0.7 | $ 2 | ||||||
Debt discount | 0.4 | 1.3 | ||||||
Total proceeds | 30 | |||||||
Outstanding principal amount | 15 | |||||||
Accrued interest | 1.4 | |||||||
Remaining debt discount | 0.2 | |||||||
Derivative liability at fair value | $ 4.1 | |||||||
SVB March 2021 Note [Member] | ||||||||
Convertible Notes and Note Payable (Details) [Line Items] | ||||||||
Maturity date | Sep. 01, 2024 | |||||||
Total interest expense | $ 1 | 2.4 | ||||||
Borrowings | $ 30 | |||||||
Issuance of warrants to purchase (in Shares) | 127,570 | |||||||
Fair value issuance | $ 2.3 | |||||||
Final payment provision | $ 1.1 | |||||||
Loan bears interest rate | 9% | |||||||
Prime rate | 5.75% | |||||||
Interest rate | 13.25% | |||||||
Comprehensive loss | $ 2.8 | 4.5 | ||||||
Accrued interest | 0.2 | 0.2 | ||||||
Amortization of the debt discount | $ 3.5 | 3.5 | ||||||
Maturity date, description | The original maturity date of the loan was April 26, 2022 (“Early Maturity Date”), with an opportunity for extension to September 2024 or March 2025 if certain performance milestones are met, including the conversion of the SNAP June 2020 Note. In April 2022, the Company entered into a loan modification agreement with Silicon Valley Bank, which extended the note’s Early Maturity Date to May 26, 2022 which also extended the period of amortization of the discount. | |||||||
SCI June 2021 Note [Member] | ||||||||
Convertible Notes and Note Payable (Details) [Line Items] | ||||||||
Maturity date | May 31, 2025 | |||||||
Total interest expense | $ 0.8 | 1 | ||||||
Final payment provision | $ 0.5 | |||||||
Prime rate | 5.75% | |||||||
Interest rate | 13.25% | |||||||
Maturity date, description | As the SNAP June 2020 Note was not paid in full and did not mature on June 26, 2022 due to its conversion, the maturity date of the SCI June 2021 Note is May 31, 2025. | |||||||
Increments amount | 5 | |||||||
Total commitment amount | $ 15 | |||||||
Initial amount | $ 5 | |||||||
Remaining amount | $ 10 | |||||||
Final payment provision percentage | 3.50% | |||||||
Convertible note to purchase (in Shares) | 63,785 | |||||||
Fair value of issuance | $ 1.5 | |||||||
Loan bears interest rate | 9% | |||||||
Incurred and paid stated interest amount | $ 1.5 | $ 0.3 | ||||||
Warrants and discounts | 2.2 | |||||||
Total commitment amount | $ 15 | |||||||
SCI June 2021 Note [Member] | IPO [Member] | ||||||||
Convertible Notes and Note Payable (Details) [Line Items] | ||||||||
Maturity date | Jun. 26, 2022 | |||||||
Class A Common Stock [Member] | SNAP June 2020 Note [Member] | ||||||||
Convertible Notes and Note Payable (Details) [Line Items] | ||||||||
Converted shares (in Shares) | 368,384 |
Convertible Notes and Note Pa_4
Convertible Notes and Note Payable (Details) - Schedule of unamortized debt discount, fair value of conversion feature, and accrued interest - USD ($) $ in Thousands | Apr. 26, 2022 | Dec. 31, 2021 |
Schedule of Unamortized Debt Discount Fair Value of Conversion Feature and Accrued Interest [Abstract] | ||
Unamortized debt discount | $ 230 | $ 657 |
Fair value of conversion feature | 4,094 | 3,488 |
Accrued interest | $ 1,375 | $ 1,136 |
Convertible Notes and Note Pa_5
Convertible Notes and Note Payable (Details) - Schedule of convertible notes, debt balances - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | ||
Notes payable, current portion | $ 16,718 | |
Notes payable, net of current portion | 18,311 | |
Unamortized loan discount | (62) | $ (657) |
Convertible notes, current portion | 30,525 | |
Total | 34,967 | 29,868 |
Unamortized debt issuance cost recorded as an asset | 295 | 1,132 |
SVB March 2021 Note [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable, current portion | 12,000 | 31,050 |
Notes payable, net of current portion | 10,050 | |
Unamortized loan discount | (62) | (1,086) |
Carrying value | 29,964 | |
Total | 21,988 | |
Unamortized debt issuance cost recorded as an asset | ||
SCI June 2021 Note [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable, current portion | 4,718 | |
Notes payable, net of current portion | 8,261 | |
Unamortized loan discount | ||
Convertible notes, current portion | 15,525 | |
Total | 12,979 | 15,525 |
Unamortized debt issuance cost recorded as an asset | $ 295 | 1,132 |
SNAP June 2020 Note [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized loan discount | (657) | |
Convertible notes, current portion | 15,000 | |
Total | 14,343 | |
Unamortized debt issuance cost recorded as an asset |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Apr. 26, 2022 | |
Fair Value Measurements (Details) [Line Items] | |||
Change in fair value | $ 3.8 | ||
Embedded derivative had a fair value | $ 4.1 | ||
Series C Preferred Stock [Member] | Warrant [Member] | |||
Fair Value Measurements (Details) [Line Items] | |||
Preferred stock fair value | $ 5.8 | ||
Class A Common Stock [Member] | |||
Fair Value Measurements (Details) [Line Items] | |||
Net issuance (in Shares) | 673,416 | ||
SVB March 2021 Note [Member] | |||
Fair Value Measurements (Details) [Line Items] | |||
Fair of debt proceeds | $ 2.3 | ||
SCI June 2021 Note [Member] | |||
Fair Value Measurements (Details) [Line Items] | |||
Fair of debt proceeds | $ 1.5 |
Fair Value Measurements (Deta_2
Fair Value Measurements (Details) - Schedule of financial instruments that are measured or disclosed at fair value $ in Thousands | Dec. 31, 2021 USD ($) |
Level 1 [Member] | |
Assets: | |
Cash equivalents | $ 4,863 |
Liabilities: | |
Derivative liability | |
Total | 4,863 |
Level 2 [Member] | |
Assets: | |
Cash equivalents | |
Liabilities: | |
Derivative liability | |
Total | |
Level 3 [Member] | |
Assets: | |
Cash equivalents | |
Liabilities: | |
Derivative liability | (3,488) |
Total | $ (3,488) |
Fair Value Measurements (Deta_3
Fair Value Measurements (Details) - Schedule of common stock warrants at issuance | 12 Months Ended |
Dec. 31, 2022 | |
SVB March 2021 Note Common Stock Warrants [Member] | |
Fair Value Measurements (Details) - Schedule of common stock warrants at issuance [Line Items] | |
Expected dividend rate | 0% |
Risk-free interest rate | 1.74% |
Expected volatility | 47% |
Expected term (in years) | 10 years |
SCI June 2021 Note Common Stock Warrants [Member] | |
Fair Value Measurements (Details) - Schedule of common stock warrants at issuance [Line Items] | |
Expected dividend rate | 0% |
Risk-free interest rate | 1.51% |
Expected volatility | 47% |
Expected term (in years) | 10 years |
Fair Value Measurements (Deta_4
Fair Value Measurements (Details) - Schedule of embedded derivative was determined | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Derivative liability measurement input (percent) | 100% |
Weighted average term (years) | 3 months 7 days |
Weighted average discount rate | 25% |
Probability of Next Equity Financing [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Derivative liability measurement input (percent) | 3% |
Probability of SPAC/PIPE [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Derivative liability measurement input (percent) | 95% |
Probability of IPO [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Derivative liability measurement input (percent) | 2% |
Fair Value Measurements (Deta_5
Fair Value Measurements (Details) - Schedule of fair value remeasurement of embedded derivative - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Fair Value Remeasurement of Embedded Derivative [Abstract] | ||
Remeasurement of conversion feature – loss $ | $ (606) | $ (1,108) |
Fair Value Measurements (Deta_6
Fair Value Measurements (Details) - Schedule of changes in fair value of the company’s derivative liability and warrant liability - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Derivative [Member] | ||
Fair Value Measurements (Details) - Schedule of changes in fair value of the company’s derivative liability and warrant liability [Line Items] | ||
Balance beginning | $ 3,488 | $ 2,380 |
Balance ending | 3,488 | |
Change in fair value | 606 | 1,108 |
Extinguishment of embedded derivative upon conversion of convertible note | (4,094) | |
Exercise of warrants | ||
Warrant [Member] | ||
Fair Value Measurements (Details) - Schedule of changes in fair value of the company’s derivative liability and warrant liability [Line Items] | ||
Balance beginning | 2,004 | |
Balance ending | ||
Change in fair value | 3,812 | |
Extinguishment of embedded derivative upon conversion of convertible note | ||
Exercise of warrants | $ (5,816) |
Preferred stock (Details)
Preferred stock (Details) | Dec. 31, 2022 $ / shares shares | Apr. 26, 2022 shares |
Preferred stock (Details) [Line Items] | ||
Converted preferred stock | 106,949,326 | |
Preferred stock, shares authorized | 1,000,000 | |
Preferred stock, par value (in Dollars per share) | $ / shares | $ 0.0001 | |
Preferred Stock [Member] | ||
Preferred stock (Details) [Line Items] | ||
Preferred stock, shares authorized | 1,000,000 | |
Class A Common Stock [Member] | ||
Preferred stock (Details) [Line Items] | ||
Preferred stock conversion ratio | 5.5562 |
Preferred stock (Details) - Sch
Preferred stock (Details) - Schedule of preferred stock authorized, issued and outstanding | Dec. 31, 2022 USD ($) $ / shares shares |
Schedule of preferred stock authorized, issued and outstanding [Abstract] | |
Shares Authorized | 127,785,195 |
Shares Issued | 106,949,326 |
Liquidation Preference (in Dollars per share) | $ / shares | $ 1,582,562 |
Carrying Value (in Dollars) | $ | $ 279,503 |
Series A Preferred Stock [Member] | |
Schedule of preferred stock authorized, issued and outstanding [Abstract] | |
Shares Authorized | 19,106,048 |
Shares Issued | 19,106,048 |
Liquidation Preference (in Dollars per share) | $ / shares | $ 28,239 |
Carrying Value (in Dollars) | $ | $ 4,967 |
Series B Preferred Stock [Member] | |
Schedule of preferred stock authorized, issued and outstanding [Abstract] | |
Shares Authorized | 33,702,134 |
Shares Issued | 33,702,134 |
Liquidation Preference (in Dollars per share) | $ / shares | $ 66,360 |
Carrying Value (in Dollars) | $ | $ 11,038 |
Series C Preferred Stock [Member] | |
Schedule of preferred stock authorized, issued and outstanding [Abstract] | |
Shares Authorized | 5,687,525 |
Shares Issued | 5,687,525 |
Liquidation Preference (in Dollars per share) | $ / shares | $ 38,163 |
Carrying Value (in Dollars) | $ | $ 11,837 |
Series C-1 Preferred Stock [Member] | |
Schedule of preferred stock authorized, issued and outstanding [Abstract] | |
Shares Authorized | 4,436,090 |
Shares Issued | 4,436,090 |
Liquidation Preference (in Dollars per share) | $ / shares | $ 89,298 |
Carrying Value (in Dollars) | $ | $ 16,061 |
Series D Preferred Stock [Member] | |
Schedule of preferred stock authorized, issued and outstanding [Abstract] | |
Shares Authorized | 20,258,299 |
Shares Issued | 20,258,299 |
Liquidation Preference (in Dollars per share) | $ / shares | $ 527,992 |
Carrying Value (in Dollars) | $ | $ 85,648 |
Series D-1 Preferred Stock [Member] | |
Schedule of preferred stock authorized, issued and outstanding [Abstract] | |
Shares Authorized | 8,418,535 |
Shares Issued | 8,418,535 |
Liquidation Preference (in Dollars per share) | $ / shares | $ 277,812 |
Carrying Value (in Dollars) | $ | $ 49,957 |
Series D-2 Preferred Stock [Member] | |
Schedule of preferred stock authorized, issued and outstanding [Abstract] | |
Shares Authorized | 8,418,530 |
Shares Issued | 8,418,530 |
Liquidation Preference (in Dollars per share) | $ / shares | $ 277,811 |
Carrying Value (in Dollars) | $ | $ 49,949 |
Series D-3 Preferred Stock [Member] | |
Schedule of preferred stock authorized, issued and outstanding [Abstract] | |
Shares Authorized | 6,922,165 |
Shares Issued | 6,922,165 |
Liquidation Preference (in Dollars per share) | $ / shares | $ 276,887 |
Carrying Value (in Dollars) | $ | $ 50,046 |
Series D-3A Preferred Stock [Member] | |
Schedule of preferred stock authorized, issued and outstanding [Abstract] | |
Shares Authorized | 20,835,869 |
Shares Issued | |
Liquidation Preference (in Dollars per share) | $ / shares | |
Carrying Value (in Dollars) | $ |
Common Stock (Details)
Common Stock (Details) - $ / shares | 1 Months Ended | 12 Months Ended | |
Apr. 26, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Common Stock (Details) [Line Items] | |||
Common stock shares authorized | 500,000,000 | 250,030,433 | 250,030,433 |
Common stock par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | |
Preferred stock shares issued | |||
Preferred stock shares authorized | 1,000,000 | ||
Legacy Sound Hound [Member] | |||
Common Stock (Details) [Line Items] | |||
Common stock shares authorized | 73,561,334 | ||
Preferred stock shares authorized | 106,949,326 | ||
Legacy Sound Hound [Member] | Business Combination [Member] | |||
Common Stock (Details) [Line Items] | |||
Common stock shares authorized | 250,030,433 | ||
Preferred Stock [Member] | |||
Common Stock (Details) [Line Items] | |||
Preferred stock shares issued | 1,000,000 | ||
Preferred stock par value (in Dollars per share) | $ 0.0001 | ||
Class A Common Stock [Member] | |||
Common Stock (Details) [Line Items] | |||
Common stock shares authorized | 455,000,000 | 455,000,000 | 455,000,000 |
Common stock par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Converted shares | 140,114,060 | 106,949,326 | |
Class B Common Stock [Member] | |||
Common Stock (Details) [Line Items] | |||
Common stock shares authorized | 44,000,000 | 44,000,000 | 44,000,000 |
Common stock par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Converted shares | 40,396,600 | ||
Common Stock [Member] | |||
Common Stock (Details) [Line Items] | |||
Converted shares | 180,510,660 |
Stock Incentive Plans (Details)
Stock Incentive Plans (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | |
Apr. 26, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Stock Incentive Plans (Details) [Line Items] | |||
Stock option, description | The 2016 Plan provides for incentive stock options to be granted to employees at an exercise price not less than 100% of the fair value at the grant date as determined by the Board of Directors, unless the optionee is a 10% stockholder, in which case the option price will not be less than 110% of such fair market value. Options granted generally have a maximum term of 10 years from grant date, are exercisable upon vesting unless otherwise designated for early exercise by the Board of Directors at the time of grant, and generally vest over a four-year period, with a 25% cliff vesting after one year and then ratably on a monthly basis for the remaining three years. RSUs granted generally vest over a four-year period, with 25% cliff vesting after one year and then ratably on a quarterly basis for the remaining three years. | ||
Share percentage | 10% | ||
Fair market value, percentage | 85% | ||
Weighted average grant date fair value (in Dollars per share) | $ 3.11 | $ 3.06 | |
Fair value of options vested | $ 9.9 | $ 5.4 | |
Unamortized expense | $ 15.3 | ||
Weighted average remaining amortization period | 2 years 10 months 2 days | ||
Stock based compensation expense | $ 19 | ||
Employee Stock Purchase Plan [Member] | |||
Stock Incentive Plans (Details) [Line Items] | |||
Aggregate shares (in Shares) | 3,930,074 | ||
Share percentage | 2% | ||
Class A Common Stock [Member] | |||
Stock Incentive Plans (Details) [Line Items] | |||
Common stock reserved for issuance (in Shares) | 19,650,371 | ||
Class B Common Stock [Member] | |||
Stock Incentive Plans (Details) [Line Items] | |||
Stock based compensation expense | $ 1 | ||
Founders held of legacy (in Shares) | 7,270,503 | ||
Exchange for shares (in Shares) | 40,396,600 | ||
2016 Plan [Member] | |||
Stock Incentive Plans (Details) [Line Items] | |||
Common stock reserved for issuance (in Shares) | 2,640,309 | 6,667,478 | |
Aggregate shares (in Shares) | 48,347,329 | ||
2022 Incentive Plan [Member] | |||
Stock Incentive Plans (Details) [Line Items] | |||
Common stock reserved for issuance (in Shares) | 1,929,334 | ||
Restricted Stock Units (RSUs) [Member] | |||
Stock Incentive Plans (Details) [Line Items] | |||
Unamortized expense | $ 55.6 | ||
Weighted average remaining amortization period | 2 years 3 months 29 days | ||
Performance-Based RSUs [Member] | |||
Stock Incentive Plans (Details) [Line Items] | |||
Unamortized expense | $ 7.1 | ||
Stock based compensation expense | $ 0.4 | ||
Market-Based RSUs [Member] | |||
Stock Incentive Plans (Details) [Line Items] | |||
Weighted average grant date fair value (in Dollars per share) | $ 3.91 | ||
Fair value of options vested | $ 12 | ||
Unamortized expense | 2.6 | ||
Stock based compensation expense | $ 1.1 |
Stock Incentive Plans (Detail_2
Stock Incentive Plans (Details) - Schedule of stock options outstanding and exercisable - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Stock Options Outstanding and Exercisable [Abstract] | ||
Number of Shares, Outstanding, Beginning Balance | 30,361,405 | 28,772,180 |
Weighted Average Exercise Price, Beginning Balance | $ 3.45 | $ 2.38 |
Aggregate Intrinsic Value , Beginning Balance | ||
Number of Shares, Granted | 391,619 | 6,303,953 |
Weighted Average Exercise Price, Granted | $ 6.17 | $ 7.22 |
Number of Shares, Exercised | (3,595,706) | (2,590,780) |
Weighted Average Exercise Price, Exercised | $ 1.16 | $ 0.96 |
Aggregate Intrinsic Value, Exercised | $ 22,534 | |
Number of Shares, Forfeited or cancelled | (1,736,893) | (2,123,948) |
Weighted Average Exercise Price, Forfeited or cancelled | $ 4.63 | $ 3.13 |
Number of Shares, Outstanding, Ending Balance | 25,420,425 | 30,361,405 |
Weighted Average Exercise Price, Outstanding, Ending Balance | $ 3.74 | $ 3.45 |
Weighted Average Remaining Contractual Term (Years), Outstanding, Ending Balance | 6 years 3 months 25 days | |
Aggregate Intrinsic Value, Outstanding, Ending Balance | $ 1,448 | |
Number of Shares, Exercisable Balance | 18,952,826 | |
Weighted Average Exercise Price, Exercisable Balance | $ 3.04 | |
Weighted Average Remaining Contractual Term (Years), Exercisable Balance | 5 years 7 months 24 days | |
Aggregate Intrinsic Value, Exercisable Balance | $ 1,448 |
Stock Incentive Plans (Detail_3
Stock Incentive Plans (Details) - Schedule of weighted average calculated fair value of the options granted to employees | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
ESPP Activity [Member] | ||
Stock Incentive Plans (Details) - Schedule of weighted average calculated fair value of the options granted to employees [Line Items] | ||
Dividend yield | 0% | 0% |
Expected volatility | 51% | 42% |
Expected term (years) | 5 years 10 months 17 days | 6 years 3 days |
Risk free interest rate | 2.58% | 1.14% |
Restricted Stock Unit Activity [Member] | ||
Stock Incentive Plans (Details) - Schedule of weighted average calculated fair value of the options granted to employees [Line Items] | ||
Dividend yield | 0% | |
Expected volatility | 77% | |
Expected term (years) | 6 months 7 days | |
Risk free interest rate | 4.53% |
Stock Incentive Plans (Detail_4
Stock Incentive Plans (Details) - Schedule of restricted stock unit activity | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Schedule of Restricted Stock Unit Activity [Abstract] | |
Number of Shares, Outstanding Beginning balance | shares | |
Weighted Average Grant Date Fair Value, Outstanding Beginning balance | $ / shares | |
Number of Shares, Granted | shares | 20,416,417 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | $ 4.26 |
Number of Shares, Vested | shares | (2,515,851) |
Weighted Average Grant Date Fair Value, Vested | $ / shares | $ 4.99 |
Number of Shares, Forfeited | shares | (1,184,183) |
Weighted Average Grant Date Fair Value, Forfeited | $ / shares | $ 4.46 |
Number of Shares, Outstanding Ending balance | shares | 16,716,383 |
Weighted Average Grant Date Fair Value, Outstanding Endiing balance | $ / shares | $ 4.14 |
Stock Incentive Plans (Detail_5
Stock Incentive Plans (Details) - Schedule of assumptions under the monte carlo simulation model and the calculated fair value of the market-based RSUs granted to employees | 12 Months Ended |
Dec. 31, 2022 | |
Schedule of assumptions under the monte carlo simulation model and the calculated fair value of the market-based RSUs granted to employees [Abstract] | |
Expected volatility | 52% |
Expected term (years) | 4 years |
Drift rate | 2.90% |
Stock Incentive Plans (Detail_6
Stock Incentive Plans (Details) - Schedule of operations and comprehensive loss - Operating Expenses [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of operations and comprehensive loss [Abstract] | ||
Cost of revenue | $ 99 | |
Sales and marketing | 2,794 | 509 |
Research and development | 13,986 | 4,434 |
General and administrative | 11,913 | 1,379 |
Total | $ 28,792 | $ 6,322 |
Leases (Details)
Leases (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | ||
Total rent expense | $ 3.9 | $ 4.2 |
Leases (Details) - Schedule of
Leases (Details) - Schedule of operating and finance leases $ in Thousands | Dec. 31, 2022 USD ($) |
Operating Lease [Member] | |
Leases (Details) - Schedule of operating and finance leases [Line Items] | |
2023 | $ 3,758 |
2024 | 3,234 |
2025 | 914 |
2026 | 458 |
2027 | 458 |
Thereafter | 1,225 |
Total | 10,047 |
Less: imputed interest | (1,050) |
Present value of lease liabilities | 8,997 |
Less: current portion | (3,282) |
Lease liabilities, net of current portion | 5,715 |
Financing Lease [Member] | |
Leases (Details) - Schedule of operating and finance leases [Line Items] | |
2023 | 189 |
2024 | 122 |
2025 | 8 |
2026 | |
2027 | |
Thereafter | |
Total | 319 |
Less: imputed interest | (31) |
Present value of lease liabilities | 288 |
Less: current portion | (160) |
Lease liabilities, net of current portion | $ 128 |
Leases (Details) - Schedule o_2
Leases (Details) - Schedule of the components of lease cost - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule Of The Components Of Lease Cost Abstract | ||
Operating lease cost | $ 3,423 | $ 3,654 |
Short-term lease cost | 466 | 524 |
Finance lease cost: | ||
Amortization of finance leased assets | 995 | 2,575 |
Interest of lease liabilities | $ 79 | $ 472 |
Leases (Details) - Schedule o_3
Leases (Details) - Schedule of additional information related to our leases | Dec. 31, 2022 |
Operating Lease [Member] | |
Leases (Details) - Schedule of additional information related to our leases [Line Items] | |
Weighted average remaining lease term (years) | 3 years 9 months 29 days |
Weighted average discount rate | 5.89% |
Finance Lease [Member] | |
Leases (Details) - Schedule of additional information related to our leases [Line Items] | |
Weighted average remaining lease term (years) | 1 year 9 months 25 days |
Weighted average discount rate | 10.80% |
Other Expense, Net (Details) -
Other Expense, Net (Details) - Schedule of net on the consolidated statements of operations and comprehensive loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Other expense, net: | ||
Interest income | $ 390 | $ 7 |
Change in fair value of derivative and warrant liability | (606) | (4,920) |
Other income (expense), net | 32 | (502) |
Total other expense, net | $ (184) | $ (5,415) |
Net Loss Per Share (Details) -
Net Loss Per Share (Details) - Schedule of basic and diluted net loss per share - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Numerator: | ||
Net loss | $ (115,373) | $ (79,540) |
Denominator: | ||
Weighted average shares outstanding – basic and dilutive | 157,317,695 | 67,255,538 |
Basic and diluted net loss per share | $ (0.73) | $ (1.18) |
Net Loss Per Share (Details) _2
Net Loss Per Share (Details) - Schedule of basic and diluted net loss per share (Parentheticals) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Basic And Diluted Net Loss Per Share [Abstract] | ||
Weighted average shares outstanding – dilutive | 157,317,695 | 67,255,538 |
Diluted net loss per share | $ (0.73) | $ (1.18) |
Net Loss Per Share (Details) _3
Net Loss Per Share (Details) - Schedule of outstanding shares of potentially dilutive securities - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 46,279,440 | 138,373,945 |
Stock options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 25,420,425 | 30,361,405 |
Restricted stock units (RSUs) [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 16,716,383 | |
Series C warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 476,636 | |
Common stock warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 3,665,996 | 1,063,214 |
Redeemable convertible preferred stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 106,949,326 |
Income taxes (Details)
Income taxes (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income taxes (Details) [Line Items] | ||
Income tax expense | $ 2.9 | $ 0.5 |
Valuation allowance | 25.5 | $ 17.9 |
Federal net operating loss | $ 256 | |
Minimum [Member] | ||
Income taxes (Details) [Line Items] | ||
Amortizes expenditure | 5 years | |
Net operating loss | $ 106.9 | |
Research and development credit carry forwards | $ 9.1 | |
Maximum [Member] | ||
Income taxes (Details) [Line Items] | ||
Amortizes expenditure | 15 years | |
Net operating loss | $ 344.6 | |
Research and development credit carry forwards | $ 11.4 |
Income taxes (Details) - Schedu
Income taxes (Details) - Schedule of geographical breakdown of loss before income taxes - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income taxes (Details) - Schedule of geographical breakdown of loss before income taxes [Line Items] | ||
Total | $ (112,484) | $ (79,084) |
Domestic [Member] | ||
Income taxes (Details) - Schedule of geographical breakdown of loss before income taxes [Line Items] | ||
Total | (115,624) | (79,962) |
Foreign [Member] | ||
Income taxes (Details) - Schedule of geographical breakdown of loss before income taxes [Line Items] | ||
Total | $ 3,140 | $ 878 |
Income taxes (Details) - Sche_2
Income taxes (Details) - Schedule of provision for income taxes - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current provision: | ||
Federal $ | ||
State | 7 | 5 |
Foreign | 755 | 339 |
Total current provision $ | 762 | 344 |
Deferred provision: | ||
Federal $ | ||
State | ||
Foreign | 2,127 | 112 |
Total deferred provision $ | 2,127 | 112 |
Total provision for income taxes $ | $ 2,889 | $ 456 |
Effective income tax expense rate | (2.60%) | (0.60%) |
Income taxes (Details) - Sche_3
Income taxes (Details) - Schedule of federal statutory rate to the loss before taxes - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Federal Statutory Rate to the Loss Before Taxes [Abstract] | ||
Federal statutory income tax rate | 21% | 21% |
Tax provision at statutory rate $ | $ (23,622) | $ (16,608) |
State income tax rate | 7 | 5 |
Foreign withholding and income tax | 2,298 | 388 |
Foreign rate differential | (115) | |
Research and development credits | (1,731) | (1,605) |
Change in valuation allowance | 24,272 | 15,804 |
Stock based compensation | 1,540 | 728 |
Permanent book tax differences | 470 | 996 |
Other | (230) | 748 |
Total | $ 2,889 | $ 456 |
Income taxes (Details) - Sche_4
Income taxes (Details) - Schedule of net deferred tax assets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule of Net Deferred Tax Assets [Abstract] | ||
Net operating loss carryforwards $ | $ 79,060 | $ 70,808 |
Research and development credits | 13,809 | 10,650 |
Property and equipment and intangible assets | 178 | 91 |
Deferred revenue | 1,612 | 3,662 |
Contract liability | 1,154 | |
Share-based compensation | 3,062 | 1,235 |
Operating lease liabilities | 2,106 | 2,861 |
Section 174 research and development capitalization | 13,319 | |
Accruals and reserves | 888 | 863 |
Other | 23 | |
Total deferred tax assets | 114,057 | 91,324 |
Valuation allowance | (112,204) | (86,695) |
Total deferred tax assets, net | 1,853 | 4,629 |
Right-of-use assets | (1,811) | (2,460) |
Total deferred tax liabilities | (1,811) | (2,460) |
Net deferred tax assets $ | 42 | 2,169 |
Non-current deferred tax assets $ | 55 | 2,169 |
Non-current deferred tax liabilities (included as a component of Other liabilities) | $ (13) |
Income taxes (Details) - Sche_5
Income taxes (Details) - Schedule of changes in gross unrecognized tax benefits - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Changes in Gross Unrecognized Tax Benefits [Abstract] | ||
Balance | $ 5,068 | $ 4,301 |
Increase for tax positions of prior years | 36 | |
Increase for tax positions of current year | 1,062 | 731 |
Balance | $ 6,130 | $ 5,068 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Related Party Transactions (Details) [Line Items] | ||
Recognized revenue | $ 7 | |
Accounts receivable | 0.6 | |
Deferred revenue | $ 15.2 | |
Related Party Transactions [Member] | ||
Related Party Transactions (Details) [Line Items] | ||
Recognized revenue | $ 5.2 | |
Ownership Interest [Member] | ||
Related Party Transactions (Details) [Line Items] | ||
Ownership interest | 5% |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Jan. 05, 2023 | Mar. 17, 2023 | Jan. 20, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 16, 2022 | |
Subsequent Events (Details) [Line Items] | ||||||
Aggregate issue price | $ 3,843,000 | |||||
Weighted average price rate | 97% | |||||
Commitment shares, description | In connection with the execution of the Common Stock Purchase Agreement, the Company issued CFPI 250,000 shares as consideration for its irrevocable commitment to purchase the shares upon the terms and subject to the satisfaction of the conditions set forth in the Common Stock Purchase Agreement. | |||||
Cash payments | $ 250,000 | |||||
Expenses | $ 75,000 | |||||
Class A Common Stock [Member] | ||||||
Subsequent Events (Details) [Line Items] | ||||||
Shares issued (in Shares) | 673,416 | |||||
Shares of common stock (in Shares) | 25,000,000 | |||||
Shares sold (in Shares) | 11,300,000 | |||||
Aggregate proceeds | $ 113,000,000 | |||||
Subsequent Event [Member] | ||||||
Subsequent Events (Details) [Line Items] | ||||||
Restructuring plan profitability percentage | 40% | |||||
Shares sold (in Shares) | 8,800,000 | |||||
Aggregate proceeds | $ 24,900,000 | |||||
Subsequent Event [Member] | Minimum [Member] | ||||||
Subsequent Events (Details) [Line Items] | ||||||
Charges in connection with the restructuring plan | $ 4,500,000 | |||||
Cash expenditures | 2,000,000 | |||||
Subsequent Event [Member] | Maximum [Member] | ||||||
Subsequent Events (Details) [Line Items] | ||||||
Charges in connection with the restructuring plan | 5,500,000 | |||||
Cash expenditures | $ 3,000,000 | |||||
Subsequent Event [Member] | Series A Preferred Stock [Member] | ||||||
Subsequent Events (Details) [Line Items] | ||||||
Aggregate of shares (in Shares) | 835,011 | |||||
Par value per share (in Dollars per share) | $ 0.0001 | |||||
Aggregate issue price | $ 25,000,000 | |||||
Shares issued (in Shares) | 3,334 | |||||
Subsequent Event [Member] | Series A Preferred Stock [Member] | ||||||
Subsequent Events (Details) [Line Items] | ||||||
Shares issued for value | $ 100,000 |