SOUN - Earnings call transcript Q4 2023

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Operator

Good day and thank you for standing by. Welcome to the SoundHound Q4 2023 Earnings Conference Call. [Operator Instructions]. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Scott Smith, Head of Investor Relations. Please go ahead.

Scott Smith

you conference our call. thank full quarter and XXXX year afternoon for fourth joining and Good With Mohajer; Nitesh and today our me is CFO, Sharan. our CEO, Keyvan

before would We to could be suggested could risks for making this everyone short differ Please our with on will that will remarks by statements Actual begin our SEC that discussion to we for Q&A. like also call. statements. We forward-looking to and materially remind forward-looking some those statements moving affect results the refer qualify a our and of discussion the forward-looking with filings detailed as uncertainties business that statements. from

details may statements release any the limitations, of and us on to call discuss we non-GAAP. update and to We measures. forward-looking non-GAAP based uses note today's date. required of addition, as to those today's for on Also available Please the as law. by from financial press on detailed measures forward-looking GAAP to refer further except this the statements, In obligation more reconciliations definition, information no certain and that are undertake results

following An this entirety on website. CEO, our in go call Keyvan. webcast will Please would ahead, audio to that, call. With its replay call is be Relations Investor Finally, over to I our being available like today's the audio turn Keyvan Mohajer.

Keyvan Mohajer

you surpassed a year and everyone joining today. $XX for thank XX% was Scott, to record this and up quarterly over new broke Thank for quarter, again, million you, we the call year. revenue Once which

expanding ones. new winning We customers and existing are with

predictions with we an adjusted the year-over-year also future AI. their value customers, create driving efficiencies the important we've same in of for for time, their to are and We At employees improvement SoundHound, X users while delighting technology. customers, made our EBITDA. At with XX% continue our

will The electricity. every necessary as first customer that for as AI WiFi is be service business and

fortunately We us. tiny, products interact interact way These speaking way predictions around the microphone. business is of to the the most can for X-pillar conversation foundation creators, become natural a our with the bring simply devices believe they that will technology, voice adding inexpensive primary product is to and we strategy. by and Second are life with their

first start me power IoT TVs, we our with as pillar products where Let and such devices. cars,

have such history we've X the went brands XX% Pillar just a automotive last over as years. as in mature automotive exciting from added industry, We We a innovators TVs just brands to and These in X. several giants VIZIO in powered from new We few brands legacy to of Telly. represent few XX over the months. such

and devices devices. We are cars, forms of queries TVs, IoT from in millions of other billions process and of

technology and customers and of differentiate large partner language users' choose us models our we the and best, the and believe incredible is The because because Our protect data, them AI something positive in innovate. Then brand, disruption field. they created help a to them with happened. we our generative introduction

integrate the own years, disoriented multiple were able of weeks. generative scrambling which models, big companies and been swiftly tech models could have matter take their to to While a we AI within were make

integration introduced SoundHound our was technology Our to experience of AI product our with clever generative and foundation and Chat due years that AI.

utilize conversation single go domains for query. can a AI session, integrate even with multiple can Chat models models forth SoundHound single is a real-time multiple and and in back and seamlessly to between able

assistant. start request be Launched sightseeing of has referring can first in rapid match of the we the companies car For follow-up show the to could generative questions, driver recommended you navigation recommended? SoundHound adoption. weather by option request then second it, seen real-time ask to the into example, AI conditions, destinations the the one how to that to to voice ask a are AI simply me navigate weather, of you for XXXX, recommendations can early as, Chat one integrated such

we've hallucinations for our with generate generative others that broad to consumers claims the other building applications been are the which making live applications hands mitigate production and helps models, only generative unmanaged are issues our of are AI AI, still in inherent and world. While headlines, already proprietary thanks technology, across in to

the and as The XX go that pilot. Last results, such assistant they in AI Vauxhall, with more have started user significantly. live me AI SoundHound and countries. increase become DS content the opportunities, Opel, announced Let after using performance last engage and brands. generally potential user SoundHound in going year, their range progress just the of to is product. AI. OEM Chat in-car That's proud because with the assistants, in-vehicle passengers We our features with and numerous has vehicles examples the announce increased Peugeot, adding by in automotive language and a experimental it piloted Recently, we integration, such AI due AI. this highlight voice the to not production and brands back auto Stellantis in-car that just and few created our AI between beyond large Immediately the saw to but multiples domains, a simple to increased Chat of available, which Chat became with capabilities our live the brands utilize it first usage SoundHound we as the momentum of high-profile a it world are improve in satisfaction a to API car, capabilities voice found pilot onboard announced to enhanced has forth generative technology a frequency the models, plans year, of for system. Throughout seamless drivers navigation generative and an and Automobiles, voice with experience across incredible

production Stellantis, more to year. Given our we into with strong this partnership many brands go live expect

and that AI automakers rate quality to is but product lead We these enabling their higher Chat very to choose customers the in delight, we also functionality. SoundHound a and manufacturers, for it we SoundHound as drivers' features. for will new believe to Chat to increase new bring SoundHound with opportunities to AI with at user are new expect of increasing we the upsell add drivers adapt, exciting beginning an refresh revenue royalty that is a car experiences value

to to called settings, incredible automakers in and simply means SoundHound voice-enable SoundHound leafing Vehicle we and Chat addition features, the Drawing ask new This and document. manual. special In to through allows time a without car effort a fourth spend to voice product SoundHound's cumbersome Intelligence launched that can and AI conversation drivers use AI, quarter. troubleshoot having more the also on voice printed about easily

that product our revenue. innovation improve and quality SoundHound Vehicle Intelligence will expect is increase another we

EV working traction gaining are well-known and been brands well. brands with We as have strong closely with luxury

their enable fleet we of business example, won vehicles. EV market-leading the For a major to prominent U.S.-based for full voice

is we our Creating automotive. the volume category significantly Pillar and X existing value addition, auto just extended of limited committed until our XXXX. a to in In contract increased with OEM not large

also to We smart IoT our license technology many TVs and devices.

integrated we've a AI smart example, ] with assistant newly-started TV our [ Telly, provider. voice For

the ordering Another monetization an integrated platform most and for smart model typically as home. the screen of in the VIZIO, supplies with largest strong on is commerce customer, cutting-edge such TV, social setting which every our voice a groceries, TVs, using food, is opportunity

appliance companies in multiple coffee are with and are kiosks, manufacturers, cases into to use such endless, wearables, more others. the among devices, areas machines, as robotics, IoT with working telcos, large production printers, we many day every extend For airplanes, and go or

from also are in We we chip contribution have that notable a thrilled AI QX company. revenue preeminent a

value first a the of time we the Although has revenue us years, be this will licensing this this for future. was expect partnership, from for company more partner partnership number been from realized the a we close generated in and

to services. Pillar personal home for services customer and professional on such X AI as offer Moving restaurants, care, where we services, businesses

AI are a and to Today technology customer as scale adoption to models. ago, like necessity, capabilities. all is disruption We generative due affordable are electricity. We applications be XX,XXX the also the beginning and language in to major as live outperforming accessible it. well. interact AI see service Pillar the one choosing will AI predicted service rise year with and we AI to its is reliability merchant As first customer for industry believe WiFi and now about of of increasingly proven a a have commercial large sizes. X merchants is It now locations. extended our in on Businesses in consumers and is User becoming just conversational

We million XX are in engaged with fully businesses in our market. over locations addressable XXX,XXX we over pipeline, have near-term our and

world, use believe cases. as the at we will There what with applications that to are leader emerging reasons are clear by real-world are a beginning generative and offering X bring the We very we we here. are very of leading AI market

we are technology alone on entire solutions built our and stack. own technologies, First, the proprietary

world and scalable from easily favorite automated largest all Second, your to the our serving in brand therefore are solutions brands fully of on shop the of the corner. sizes, and local capable

solutions a make easy-to-implement real easy-to-use, share immediate offering that are and various examples our some across offerings. We impact. I'll

expect SoundHound answering product is date. White we've based voice Targeted Mike's, and went the pace. making live to them that production. partnership store. over our food Castle, staff the goal first at already numerous an Smart answering questions, customers AI locations, free results locations, on ramp calls, to in inbound to up support the Smart X,XXX rolling expand restaurants QX continues reached by focus initial chain a Our allowing and orders offering, out up all businesses we XX food their and Ordering with rapid to solid in with Jersey uses for Ordering taking with a customers' phone to on drive-thru and to today, engaging

XXX of reach pace of our We lanes are end to on by goal the XXXX.

are we located faster including humans. integrate which the help X,XXX processing large seconds, we significantly solution our chains to compared voice of also Church's in into. ordering have AI South, seeing Chicken to which in-store restaurant far, more solution can approximately chose XX In order integrate to So and large automate chain hamburger locations our operations, a QX, under our is

these deals larger for our a to our offerings. number With with also AI look customers seeing solutions, solutions other bundle these voice of we're

for employees. efficiencies new we to example, our and gain called restaurants multiple Assist as ordering product For with in deploy offerings SoundHound Employee look

Assist Employee restaurant headsets. variety a via for voice tasks businesses. is AI their gamechanger to a support conversational uses SoundHound of like across copilot It a employees

is prepared ingredients on can a consult step-by-step provide manual, to allergen ensure can reducing distract significantly correctly customers. ever remove without the the having to staff it and stress product information employees gloves, also another their train the them worker. with or It member, to instructions example, For

product, SoundHound Another duplex our voice incredible multimodal, screen. Interaction, Dynamic drive-thrus, a kiosks, with full for any device or is interface

working growing. are number keeps of a customers with and our pipeline partners We and

Dynamic For has Krispy selected example, Interaction. Kreme

order of restaurant believe improving languages internationally. They of English-speaking process, experience convenience stores solutions same our have taking line. from bottom our all brands, and As states portfolio multinational and we come their have massive solutions go With the XX you are in time their to can notice. to restaurant arsenal, now XX we to at to us while major Today we are U.S. taking accuracy shape order, beyond and restaurant live expanding see, improve we the is a chains, countries. opportunity in

is SMS every this any businesses product, we and ]. business. out solution that any business be goes questions around Smart in important them to on spam answering in saving hours pricing, at filters conveniently while allowing respond to captures It ], by follow-up Next, calls and types Smart policies, any multiple phone, handle intelligent products, mitigating our hours provides for wasted also to once, of that company are the can cost restaurants empowering calls, capture can [ leads addition all used With more. Answering also and of how phone opportunity they with customers beyond services, answers verbal [ messaging asks XX/X, industry. time responses, Answering

We and Smart very, the customers live is positive. are with very with already feedback Answering

approach we Answering this seeing onboarding this Smart touch automated, scale in smaller easily solution we've the any piloting offer self-service the business, and a and Given increase no for and our to product massively to in QX fully businesses can with offer experience have adoption. ecommerce that access, early past wouldn't been is to ability

Let talk SYNQX. about me

and the not use of begun convenience Papa and exceptional acquisition customer Guys. our is multinational autonomous the on rapidly degradation Express, Panda Because are loop also our team voice base. fast with as John's, Casey's, up of any drive-thrus, Chipotle, fully in we've and scale announcement to fast-growing able Examples does in to Applebees, our we perform, AI SYNQX stores deployment X integration quality. SoundHound's well spanning and national dining SoundHound. brings chains segments, casual, of without include Following humans casual to as the XX more their SYNQX, than

also completed For Casey's voice chains recently stores, AI nearly ordering relationships. industry of innovation general expertise pizza which X instance, X,XXX SoundHound are the we in the established with combining and to Jointly, we largest SYNQX one of SYNQX, decades U.S. of rollout decades of is the AI with

Together, deployment of The our provider that generative preserve ensuring we for while the customers, SoundHound capabilities broadly. preeminent reach. market our of works and will combination extending accelerate leading-edge AI to industry global the customers, best significantly the the restaurant, makes interests of more technology AI to our society voice always their

Although at in we are momentum solutions the only synergies with Smart we Interaction, QX and closed customers such pace. Employee ability already rapid as The year, moving already tremendous offer Dynamic Assist. to we hold, taking are the a them Answering, transaction this of and their seeing are additional and

pillars: voice-enabled products; have and those the voice-enabled royalty pillar is services I from services; connecting to earlier, As those products. third X monetization from we subscriptions mentioned from

of a drivers just or example, flight, this able haircut, devices car, can SoundHound-enabled vision ]. the of be We [ a to can voice in to transactions. in get make a do future or will they the to at both food unique use strong and book perform will and to voice appointments and our arriving SoundHound commerce this talking order For create to their types footprint car the realize restaurant, a so their of ecosystem, thanks position believe before services to other is by

fee automakers via new merchants transactions, reach, economy. the Pillar transactions monetization could millions channel powerful devices. significant facilitating we of a of take this We being believe the in get TVs to our an X all convenience With the collect restaurant device acceleration makers for using a and participants. voice will their We of cars, of strategy business direction, leads store a Most add our IoT expanded for in and this is and their model things restaurant done. the new national which generating benefits value or see the the end customers user share and to have importantly, from would

this which of revenue excited using portfolio to to our are over services We to average our ecosystem. In an continue pilot new to grown allow begin of has voice-enabled should us customers see the commercial over grow, to XX% on most we've market technology, and well-known last the X years. This a foundation, is incredible our the for and of strong global growth headwinds during brands some demand challenging times with our world. testament in partnerships built against great closing,

on ourselves our generative us AI in move model, expect our beyond call new timely Going key see have further to forward, major trust data, opportunities and Polaris, year. we to we advantage and AI, of for of even invent our to as AI. With why and IP, that, growth decades this maintain We multimodal, and conversational SoundHound global track leading its been our drivers, unique a important fast and massive I'll the it now over financial and the could creating customers, with as to outlook year. The that of We believe be foundation the another of which own working a era tool performance, AI Nitesh position is experience has of for this talk strong the in remainder we about of forefront of the building one favor. a at this trove growth revolution innovation to accelerate with that's way record forces turn remain forward. X tailwinds multilingual,

Nitesh Sharan

within over revenue increased afternoon, the exceptionally most auto good Keyvan, we XX% are sectors. and accelerating enterprise finished and restaurant interest seeing businesses, you, with year We momentum, notably from year. everyone. strong and XXXX by Thank QX

a is for customers. waitlist of ensure high demand the that restaurant solutions we merchants, to have we resources SoundHound fact, so In we're now our healthy and calibrating for deliver

While on containment. continue demand We with our growth of against cost we we this profitability, focused this to continue year we'll paramount. The pathway to so. delivering mindful coupled past be is discipline do and to was realized cost exceptional

For even by improved XX% were over QX improvement. better and the in results with year, EBITDA XX% adjusted our

us growth target quarter. to necessary out transformation were positive adjusted laid our that fuel to costs last certain the EBITDA and Excluding we QX brings close

X majority midyear near-term our and PwC contributed For these some of impact costs. firm tools upgrading large big while the to audit of accelerated becoming example, filer of switching internal a to the

expense expect We forward. The remainder as these pressures to we lessen go of of are underlying behind the future. the expenses drivers indicators our positive

chose year in the to we in. saw particular. second we the tremendous some saw opportunities invest We that restaurants from of growth significant First, enterprise demand in half

to SYNQX accelerate and as we inorganically portfolio. sizable of leader Second, AI The restaurant meaningful opportunity and customer a the positions a our restaurant capture space. go-to-market us the motion in saw great clearly acquisition

Lastly, functions, around stronger in have long-term controls, expect deliver. We administrative company our fundamentally we we we the internal growth foundation accelerated this processes investments even ensure XXXX. notably in an to sustained for and to rearchitected

focused is and customers as definition remains quarter, plus prior where still from account the X-year bookings the scale fully or current takes provider to X-year exclusive customer account the Cumulative assumes with backlog derived are leading even efficient, revenue new we in previous metric one. Subscription are services. duration. subscription backlog, which reported our nimble, disruption previously We that more growth and bookings include previously backlog Accordingly, new Cumulative have also takes products and to we driving are voice-enabled revenue a what more streams across call bookings we and total and in quarter-end recognized. the shared are updating bookings minus contracts into now on. includes bookings more the committed balance associated ramp cumulative and a we same cumulative a we backlog aggressively subscription this backlog focused, into

auto proof-of-concept are longer. assumptions rollouts combine applying to for the can partners customers. X believe assumptions include businesses for have not with Pillar us faster we Pillar Pillar we much percentages, about to outperform the these with experiencing our and X currently we previous to into definition, lower Similar single given metric. X This allows incorporated unifying customers. renewals to We reasonable and expectation percentages a adoption do work pilot We expected our and these

X communicated backlog stability noted our have annual these businesses. better the represented like contracts, X In that of As while potential we we standardizes ARR mainly Pillar our previously this different different potential. bookings representative subscription manner, full in market. have we building before, financial indicating the medium-term a we on more predictability an figure is our updated model. billion That cumulative believe of our synthesize our growing also said, and X X, Pillar timescales rapidly doesn't potential so easy-to-understand addressing metrics are Ultimately, in revenue greater-than-$XXX

vertical gives in potential have our an X, XXX% of ARR. on thanks of basis, at we customers mentioned the a activity both signed-up backlog to up the Pillar bookings this nearly over separately in combined largest our X,XXX the year $XX I was metric X. customer and at growth also with XXXX, view that locations at backlog and automotive million, million, that million we being X won the you in set. In full end list and the opportunity within X and $XXX So restaurant QX, have cumulative would we bookings the signed new tangible customers added mentioned our constituent. up incredible of of larger scale-out have subscriptions across Pillar in that When Pillars year we roughly look I cumulative $XXX was apples-to-apples

fourth quarter. QX price driven $XX.X of for ultimately the to financial increase outlook higher average was up unit new Revenue offset also there due year. automotive our revenue the licenses think our XX%, results Let decreases volume the have with cloud guidance in get licenses. by a within $XX.X we strong Note royalty some with for slight beginning QX, expansion. generative by and the are quarter selling set royalties, for within in growth with of million than specific and year year. monetization, me predominantly In was edge opportunities meaningful lower AI our particularly now of generally of in that at solutions was Full that full the units our on million, and prices a revenue

a the chipmakers minimum with licensing solution guarantee in benefited quarter of opportunity one with of commitment the also of earlier. We partner preeminent a and edge that new AI our by IP Keyvan volumes an multiyear referenced strong automotive

data Answering, gross in cloud year efficiency like year, and X versus we prior Interaction, and the the XX% annual overall we our expenses Over the XX.X%, same compounded Employee SoundHound the XX%. In corporate continue we throughout year and year, Intelligence, of full our AI. Sales growth XXXX, auto have Chat a disruptive actions last were and units products of to the of rate delivered greater active Smart XX% due innovation were also, restructuring XXX our at Vehicle and margins with by users in XX% increased our Despite the decrease over This to year, year resulting years XX% $X.X than cloud an expenses Dynamic were by in million invest year full over over aforementioned above for our marketing as of up year, over points margins quarter year, year, revenue QX, gross drive points and scale and year restructuring. the over largely Assist, year. from expense XX% expand greater XXX earlier also every million suite we a existing $XX.X solutions largely time improved helped center over up decrease the the the QX, year. R&D reduction, business. resulting sequentially in from in our basis increased basis QX, over

continue customer We go-to-market engagement. invest to and in

As resulting mentioned largely been seeing investments in and marketing. from and tremendous heightened sales the momentum are earlier, we we making have customer demand,

elements, expenses traction. G&A invest reflects G&A contemplated year we X% was continue QX, quarter. last in X $X.X ROI, further which increase of will not to we when an upon demand ensure to increase the over guided some year. high build of and in were The million brand generation, We current awareness in

of First, part of spending of the acquisition our negotiation, closing was diligence, to SYNQX. and related

million total, under processes support SOX additional large as filer. over prior compensation expenses, requirements expenses, became to outlook. Across In and accelerated adjusted XXX(b) a investment amounted accelerated these QX, in EBITDA noncash compared stock were in $X.X nonfinancial to QX. financial provided we we the previously million our fully controls primary internal $X to factors as and Second, was and not employees encompassed in all operating

while our which operating Likewise, full QX a grew previous year amortization, to over was XX% million result, improvement improving year, the year, our the activities year. business year $XX million, as saw QX net discipline. which an in of in was year. used down a XX% loss $X loss which of share quarter $X.XX XXXX of compensation, over an in costs, restructuring in stock and expense QX million for was year for excludes As depreciation XXXX, improvement maintaining noncash compared cost QX we to ended $XX $X.XX we OI&E of over year and improvements a EBITDA, million Net loss was QX, net per was XX%. Adjusted sizable for from $XX.X reflects an in was of for the acquisition year XXXX. roughly the an operating million, reduction, improvement entire and $XX.X of over loss dollar cash $X.X net This XX% about charges the year. in million an and loss operating loss XX% of led a XX% successfully improvement in of year

cash $XXX Our at and was $XX approximately was million, year million equivalents. of which in position end cash

our balance in excess XXXX, total Given current cash million. additional actions is $XXX taken early have in of we

security optionality a unequivocally that, strength we need outlook the us to business is forward. With position drive and me and of gives let source capital discuss our XXXX. the for Our

to fuel with are discipline strong growth, to We and committed focus. continuing cost returns

existing customers. add with X We and partners expect expand to automotive Pillar our

than grow total to We XXXX growing overall million, XX% XXXX. $XX X and in Pillar midpoint our expect see XX% of more revenue to to within in from top million range a our target. with to than We the million $XX $XX less meaningfully as of businesses increase line the

XXXX, million and As we EBITDA we will ahead revenue believe profitability. deliver adjusted look cross in further to we $XXX

the the these to SYNQX, XX% a expect margins range work profile. just gross we to gross margins of been of AI a infrastructure have expenses. to own, while in our providing Our and their some in migrating XX%, of due we Since completed software to indicator have on cloud of we strong decrease temporary our duplicative business acquisition

AI. the their gradually with while also SYNQX's have majority addition, In team of been a center legacy which call is revenue they has AI-driven, operation upgrading

to expect calibrate further accelerate to gross which their over margins this ours migration, ultimately will We time.

the as company Overall, result, this show in of the we beyond. over EBITDA historical part improvement gross expect a XXXX get latter combined and levels a we As beyond. of and steady as half XXXX, XXXX accretive will with our the to onetime margin we decrease early towards see acquisition though, roughly neutral

for Lastly, comment me seasonality let on expected revenue year. the

XXXX. more I of shift just we year, automotive but as as described, business the year greater of the to ended will mix mix Our a through X, Pillar start heavy we will

year sector, remain and see believe Again, be the on lower business we quarter. roughly each QX. back higher automotive through seasonality XX% by in year affected in building in quarterly in QX tends the our our which grow end revenue We we the year such, and As can to we weighted. XXXX,

me out. and excitement ahead. forward. a SoundHound created the our what lies by realizing language help technological generational about shift. large rearticulating Customers partners to old The Generative AI they like way close pave have need Let are way models is increasingly

inherent navigate information bringing through you. products to so and can are with access the goals, the balancing consumers the long-term they we they devices the AI voice services towards most covet to everywhere massive seamlessly opportunity and interact volatility conversational with. Thank they are near-term and our We

will We now move to Q&A.

Operator

Ives [Operator Instructions] Our Dan first with comes question Wedbush. from

Daniel Ives

is X, more you big do next strategic to be a about, from talk a partnerships X happen over you the distribution Can quarter. go-to-market? going expect from a that Good to months? focus perspective And

Keyvan Mohajer

we Yes, that a our see big Pillar definitely, in as X, contributor.

and partnerships and Olo Pillar We large. help us as number of are with, have Square customers And they merchants. partners, reach generally and Oracle very a larger Toast and for example, channel in X, our

very example, extended the an a time, long lot with XXXX deal for That's shows trust. one of a of automakers. signed out to For a of just lot it largest commitment so we

Daniel Ives

customers about could Does It you're Okay. see can Maybe vision changing? on you're restaurants, the feel whether And conversations you X you there, with autos? it like strategic has to how just having, to just conversation compare actually like talk traction. today ago. terms starting months seems of even the conversation but now it's the then is it's more in been

Keyvan Mohajer

The going and ever Dan. with dealing different, the demand roof, through than we totally It's demand are before. more is

of like but a on put bit chains with position for dealing We to it's that locations, bigger, really thousands temporary in. it's a deal someone hold multinational actually to tens be to of with them little have, large good example, very we're problem so customers, we with, a have who's

So months coming months X door. we their XX are to on door. now now even our customers are were them, on knocking knocking actually whereas They ago, going maybe after ago, us,

Operator

from question next Our comes with Gil Luria D.A. Davidson.

Gil Luria

financial does product incorporated type you're Are that sell The a in what's the is one scale into question, getting arrangement? chip once of incorporating that company, it it your a makers they license of one they the when chip have devices, question, revenue, different And then the product revenue? nature or technology? question. I chip? technology And a how

Keyvan Mohajer

it was not was it a actually, revenue. partnership, a Yes, channel direct

of years. us are it, our it company we come time incredibly excited and of to the that's this for in more today. So generated as number expect out first partner, friend, close company They're known from as share and can future, positive things we their for about this relationship, revenue IP, the a much we we've a and but paid the was close so we

Gil Luria

maybe another product question. So then

U.S. of Because that into maker the in over-the-air factor makers, technology ship. new X your microphone They so mean EV in. for that You the mentioned I as gating incorporating thinking based part Does the now been about, updates. a has But they updates? or a least, that cars large EV far high-profile only built the think have can you in U.S. send the over-the-air I'm at already allow

as it software deal type more possible make you to bigger to of little ones this your automobiles, shipped? does a So and deploy that a get for set quickly opposed only the of to

Keyvan Mohajer

or already case, they sometimes new legacy and solution, go In a cars we cars and could don't clouds, would for we that particular replace too. solution, have Especially so older power have for absolutely. Yes, an to this sold. been them be it could cars existing actually our

Nitesh Sharan

question And your part about thing pace of Gil, think, scale. I maybe one a of to add, is

other AI excited remarks, thing super around already we're as prepared existing with Keyvan The about, generative is customers. the mentioned we're that opportunities adding

it's tremendous a many so unlocks really different and top, on cases it demand. and for So us, there's use build

faster per is So opportunity I more a the revenue unit, of big and opportunity think scaling us. for per unit, doing

Gil Luria

want to then the new backlog So sure I I on duration. make metric, understand the

the that as be, sounds it still it X X-year duration. subscription believe, is on define now Is a years. Pillar on to it So other side, booking on the duration side, you duration used duration? X-year side, the are harmonizing, or on X the like years also X the What's the I a you

Nitesh Sharan

great No, basically one current duration. because over The they're contracts is question. committed the

contract. is on whatever we're it's We're the So like actually in not based harmonizing.

that deals some had actually we QX, extended in it. So,

the for actual product -- of average So of device still extended take device the some product. that the I X about think when duration that got the I'd side X.X you full say the the extend years. the But average side, the because we did Pillar portfolio, it's that of deals weighted

So we, cumulative we the books years used the subscription contract we standardize, with that to do the backlog, just to side, it makes on just like like tie is. to Hope said, made whatever length sense. X way, you but

Operator

Co. Wainwright Our from next Buck H.C. & Scott comes question with

Scott Buck

little could you're a and out 'XX putting a was visibility hoping comfortable maybe color today. your get First, more why target I I into on

Nitesh Sharan

it's One is build not quarter, quarters. of a term, even playing and short multi-year to things. roadmap, and to making X couple choices building different quarter we're I we're we're a Yes, think

mile the markers So we're building, into We, this working pipeline the I giving we we're with to up this just only we're making investment think frankly. we're year scale, with beyond with customers thought through until it to year. made And increasing the the confidence mark. getting try year, with, were sense, X-year last

talking in pipeline lot know so more visibility. frankly, of we like today we And traction February, in lot with we're about, that that sitting there's that there's the a the just good early and we're think type and year, bookings I were a metric And gaining. where backlog it's

But read an sentiment of our really from calibrate we early think felt obviously of to forward. it's commitment customers. confidence XXXX, confident we'll a give enough I we So go we're which and as seeing

Scott Buck

That's helpful.

would Now, deal any M&A you or would does future that include potential on be any additional do in the those top of figures?

Nitesh Sharan

require SYNQX bring. say and acquisition can excited Yes, super it will about it I the it. what doesn't we're

more opportunities we'll very future plus terms that a of with think have opportunity point, equals And and of look. vantage we them. it's X than market then X potential lot inorganically. to even X continue the possibly with a then in a lot dynamic So opportunities, We organically from

on horizon do nothing we out talk there, the the on structurally also possibly and it, that out numbers require of know depends M&A If obviously, not changed certainly laid we But size well, as about So you could something and there. have be there. type the it. to flavor the the very

we changes ramp, let you something do know. if So that we'll of that architecture

Scott Buck

give SYNQX, I'm what upselling/cross-selling revenue. or as you synergy could there, legacy curious their maybe if the in And of maybe on revenue is of us then something terms, a percentage dollar opportunity even terms

Nitesh Sharan

Yes.

Let think unpack to way try best to it. me the of

the when certainly customers. this are as acquired We Chipotle, -- thesis some portfolio solutions going more of First Employee we're there's conversations different of tell just could Answering, we articulated Papa I'll what we of all, just can days selling, of that Assist what it's some the the some together. be. conversations. Subs, those to are possibilities exciting bring having bringing they the together on. amazing customers you, great your days so early Applebees, of early voice solutions, had upselling a of them of capabilities, And many Firehouse We Smart do cross John's, likes our point, even To

for AI, a we're opportunity, we're when us annual as of I want I'm term, of faster a work in So to just we're better anytime through that. roadmap long But capturing work in billions on to But of that -- greater will there's at a it. a surface out, I middle SYNQX and share. center little they've and the call tangible a to we've companies clarify evolving integrate, billions later believe business come we'll that. The bit And talking give impact of together, lot X particularly mentioned the just to been visibility. can to and revenue laid There together, is contributor big and you to going be greater margins, of dollars again, that restaurant is the the scratching is definitely an I together. evolution we and we go to space think, punt

most greenfield. in We it's terms people mostly also fully-automated in think seeing there don't exactly what and have they this they the need. They importantly, restaurant demand, solution what when competitive think we look have comparable not certainly out very it's And they service. fits a of the that landscape, cost solutions. labor We pressures, tech, have need at consistency is well. And we're shortage, out of

and upside. your together outlook terms of then confidence opportunity us X. And us tremendous synergies maybe to coming in very you the revenue So with first We're is about and the to SYNC the question, organic gives put think give the are. even of we think we wouldn't on a you, the in put But that we signs it, would we if a, ground early more. what and flag that I do didn't even could XXXX tell out just there call excited

Operator

Glenn Thalmann. comes from Our Mattson Ladenburg question with next

Glenn Mattson

right that a put on in to just side because have is little made terms hold your some of I that on just customers So, was overflowing bit more perhaps a talk little demand it the for been ability to fill the wanted now. restaurant about comment

process both from there's curious equation get And the whereby curve mom-and-pops on faster that to perhaps a smaller a over chains that national implementing whatnot. color of software Maybe the thoughts if hiring involved, more of time just it's or the maybe up learning your as there's you for got thing. more I'm be of So could that more sides will to means process some and learning or you've give scaled there.

Nitesh Sharan

Keyvan I'll on to out start, get top. unless wants

all, growing, disrupting, yes, of day. This improving learning. we're market. is We're we're we're new constantly First a every

we're lot, frankly, think, I learning with a the also acquisition.

other at ingestion, And is improvement has really things systems, our of we scale to good it every you expands I coupled SYNQX one And can really the the scaling with we new those of go integration quickly the think quickly. solutions, very together time very with really of rapidly can accelerate. get been and software, some could add things being a point-of-sale of market customers beauties drive that menu get of once right. it can really customer, done we we the One come --

a build with. there's continue here forward we and So can effect build that of lot positive we can

thoughtful no the On the to any customer. the there, is We definitely to want roadmap. When want of we investment we go yes, don't growth. to demand after the side, say want be to

jump before absolutely So like put hiring to And at of we're very to calibrating be to discipline by the my imagination. and shortchange be that and We're look point our stretch Keyvan, there. not and the I cost we I wanted just going it's will view, make of any always we forth, judicious. so in sure to going we'll know it opportunity focused But that think it.

the sure going certainly invest we're on demand. to capitalizing to So we're make

Keyvan Mohajer

that about all hold would really talking the add that. are not and that's mentioned, weeks, days just Yes, or I I months anything that. we And that beyond

Glenn Mattson

the me for model last just then And side. on

I higher million auto. north to will or of the theoretically the you've than the side said I think, if XX%, you target SaaS get restaurant historically you that today, side, gross been And I margin. margin growth out the guess theoretically, which would $XXX XXXX Nitesh, a revenue on that think, XX% be, lot you of be put that

towards So you XXXX? higher the that us range for model would end have of

Nitesh Sharan

commentary XXXX. color guide you gross won't the as guidance I'll I it. but laid to leave some I will out, give for margin I it dimensionalize

fully as it's business, don't margin a your think it the are certainly think we margins. I XX%, X, software north at I'd are on solutions margin X gross I want clean of because profile plus. And So, margin, the road. years near within question sure multiple say should versus then edge term. as depends. would absolutely, also we're X, high Pillar investing in term, to say some specific Even and the down of Pillar that's should and Pillar very And We our so to penetrated, long well EBIT XX% be the we scale, make be

it both. But range, think, the of also we'll back be, marching be So new across will be major then this mix I is look depends part where disruption on business, continue as the yes, the call to which it and we'll think to XX% first I the service. across at do -- we gate Pillar center bring on we customer X on and the to restaurants going

enable access said I in is prepared areas the very information of to conversations generative just natural service, want. we've that AI disruptive with think they to seamlessly and major particular, consumers one in customer remarks, the services

our we So model. that interactions with believe center customer and scale call and mentioned can can leverage that, that help live the the capability reason quickly, that the we data really is, to get the we that improve I actual will and production,

different and customer is little to call a extend to right into So between, because the demands going of be verticals of really finding journey like, there's that do some base restaurants as XX% answering a from, But are isn't. into Pillar can and maybe bit things the a there an we advantage we beyond maybe part on. X those the calibrate as if support we'll grow center you mix go

XX% will the what So an give absolutely on going long you line will but tell you, to answer and right through in though, can't range, finish to you I growing we be. to closer that's should be the back that give I term, need now. work get XXXX exact yes, precise a we why keep

Glenn Mattson

parts. I understand. moving a of I lot Right. know

Operator

question next Our Latimore Mike Instructions] with Capital [Operator Markets. Northland from comes

Mike Latimore

here. year excellent an on Congrats

to lot it's internal do or what Krispy you get opportunities So White work wins those deployed by whether like of might think parties? keys And getting you Kreme. What restaurant Jersey Mike's, highlighted leveraging you of end? percent there, Castle, quarter are third last the year a

Nitesh Sharan

depends Yes, the customer. on

points. the corporate full gating, locations set over gating drive-thru the scale with to I phone so Get into ownership, phone type the an Mike's a side, on went our announcement company of that franchisees, They're opportunity XX has locations the opportunity of think, that's so at in publicly, into hardware Castle joint of we're to little And drive-thru So about that this easier little different with year pacing. than a a is of requirements and customer has White up a the XXX have, We've out ordering. Jersey another pace. and fully gate has that's bit through. made of that ordering. locations some the deploy. one They is bit we're year, last X,XXX and that's again, scale that pushing on

really rapidly. move can this so And

shape So it Every to too much, week the faster. on guess we depends it I pacing we're are and but and not and And faster answer of [ getting customer. ] faster. flavor your goes we're the question that by, learning

that ramp answer why maybe use estimate subscriptions we the hopeful that used over will X believe would of conservatively X-year, years, the dimensionality the and we the which gave duration. in one is assumptions X year So be we we we're this

expectations So We're early. conveyed high X year want to that's too probably think. the the to measure, safe again. not use set faster think conservative, a than maybe if you as I But going I that. that That's place too that's to

Mike Latimore

happy percent And I locations, that's is believe. like apply or sense. a makes with think XX,XXX something that they feel Yes, could what those on I like your locations, SYNQX, tech you Do they you have? had there to all already

Keyvan Mohajer

an and those. The we there existing And is what Employee have. what then they customers. both we're but Assist upsell opportunities is have Smart pursuing with offering And by things of to already upgrade by Answering solution like there's opportunity combining great,

Nitesh Sharan

add, an efficiency the for And I'll us Mike, systems opportunity back our there's as cloud systems, also also technology. migrate end migrate to their we

also backend for us. only a cost end, that's front it's our So not just and opportunity

Mike Latimore

do What what you a just and in think guess, I basic 'XX financial share is question. current contributes count? SYNQX

Nitesh Sharan

upgrade. is reason center depends we're of have The it we're AI we're and AI. synergies but call it a a on that is going business 'XX, so center, in forth, hedging bit to some We're book of that migrate call good to the going and the growing. So they the to

few probably we partners Class together have even I of a is Again, all we're that we the could the we and A have mostly Share we fleet faster the still about me, I choices million-ish, the excited count, integration. they alone. accelerate we're integration the process, it's of can in number build. and than it's there's in our have on really think So pretty early think side could we contemplated But front through in that but where think the guidance, we are. don't about probably XXX synergies right

million we've mentioned I remark, some get this year cash. the to have, over done raising prepared in capital We $XXX think, sheet that the I of balance

that where about So are. we is

Operator

question Knoblauch Brett comes next from Cantor Our Fitzgerald. with

Brett Knoblauch

I and many embedded on, year that year in frequent It devices I more auto maybe foresee if basis going was was nice over type the is gave give wondering some how guess, units a us that's some you growth us could you if you info units. forward. or for us something of giving could indication your on technology currently in

Keyvan Mohajer

We are in the millions.

so is makes device difficult We number. measure. more don't IDs, that have us challenge unique give of considered disclosing exact One our it then it the to customers accurately some

are devices. might but the like but IoT it definitely of might cars devices. device, we ways in and all TVs interpolate be it and look one There millions on many So to are that,

Nitesh Sharan

couple that indication queries, run increases an the usage now been growing. in is We've billion put years also been excited has been the about. indicator rate another X.X release, give, is and growing. It's and activity. it's usage of The for we other curve just it press the a measure we're we number do the and crossing and that giving of which but an of breadth And that

Brett Knoblauch

many And think, I I Castle year, broadly this to you're be and this currently the speaking, restaurant in more by of north to Pillar units business, but end of XX% over maybe business updates the expect X guess, XXX the you're given in expecting of of the of year. you targeting be any deployed you then guys year, are on end what White maybe how for

Nitesh Sharan

We will now deals can we're massive that working you big thousands customer arsenal and you're gave I opportunities. And these SYNQX of tens per of range, be have if right? likes the restaurants, hundreds a on in little we're ordering, earlier. the break They have that the And of in brought thousands of with names currently I'll do thousands, say then and growing are a the of always dollars it's location. Yes, pricing I phone could potential apart.

more drive-thru, in north could thousands. you're If be it of

So tech. that really on could be our more advanced state well beyond of

unpacking So addressing and units and We we a by thousands are location locations. pace. integration has of be hundreds believe going that to of driven the market are

have is a alone, And it's fraction. globally, I'd of the and small what food say a in So that. million multiples today establishments U.S. we

hopefully and end So revenue year be the then XX,XXX we follow. meaningfully. from will of about by are And range the the thousands going talking to hundreds grow of we're quite numbers we'll the soon that in

Operator

Thank you for participating. call. today's no Showing this conference you. at Thank further This questions concludes time.

disconnect. now may You

SoundHound AI (SOUN) 29 Feb 242023 Q4 Earnings call transcript