SOUN - Earnings call transcript Q1 2024

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Operator

Good day, and thank you for standing by. Welcome to SoundHound Q1 2024 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

Good afternoon, and thank you for joining our first quarter 2024 conference call.With me today is our CEO, Keyvan Mohajer; and our CFO, Nitesh Sharan.We will begin with some short remarks before moving to Q&A. everyone call. will remind statements making to this on like that be we forward-looking We'd could materially results Actual differ forward-looking by statements. our from those suggested a statements. risks to discussion for affect discussion refer our qualify with and SEC Please as that forward-looking filings our business of uncertainties and for the statements that could the detailed

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

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

Keyvan Mohajer

thank Scott, are we the joining today. call growth. you, everyone for you again, Thank very Once strong reporting to and

First was quarter up XX%. revenue

Just a of X a milestone reached few we for company ago, the years. public being days

its of leveraging And high X-pillar have our we to is sheet.Our better last X weakened the tough external have position more revenue just to the nearly working. expenses. while our quarter in conditions doubled of years, eliminated $XXX tripled X years We've While record have many strategy million balance X stronger. years the cash or approximately become we organizations, on our first than

pipeline. businesses. from XX% customer Pillar with in X, XX,XXX Pillar service locations and in of for our was quarter solutions we where our our was XXX,XXX This offer over special X production live over revenue quarter AI About for a

expectation. the these was global AI with results challenge next-generation could were customers up and is pace. negligible. the on QSR our Just the that one fast of the Dynamic of not top face time, Dynamic our Interaction ago, first a was that orders main service, beyond so for live day with the drive-thru kitchen with first taking The AI brands their year And are keep being Interaction live at incredible numbers our now

on like Of are results expand proactively of are their its interfaces the side adding for as and course, revenue they upsells. said more increases addressing before, and the that impact technological Dynamic other. improves We touch interfaces. Interaction with SoundHound save voice our our offering their solutions locations.As decided and and the AI believe on pleased and we've to to breakthrough customers, on multi-touch immediately by costs users technology meaningful also no throughputs conversational Apple as is a be will experience

the check in our not out videos website. you action, seen If it have on

moat a in service. built proprietary our that a with have is customer We technology creating competitive massive opportunity

and its locations executed next have drive-thru other been years their continues brands several White more Chicken.The to of Church's to next World. We few the locations for be version footprint AI earlier example, of with deploying that for one live Dynamic continues agreements in will our Castle with has opening, to Interaction experience months, thrive. busiest including large expand Disney several QSR

Noodles for and drive-thru more such strong and answering more engaging and Ordering its they're continues Smart existing successful, on calls with inbound millions uses with The drive-thru our food store. to voice per locations adding capabilities AI in-store and major to brands power to customer up and calls Guys. our pilot over expand free their was continues staff Smart takeout Ordering focus Another offering they locations uses quarter, Chipotle, to to our as making questions, their food we of Mike's. all phone services.Next, Five and QSR X,XXX month, Jersey Casey's, We AI Last pilot take national for locations. numerous answer to we in announced allowing with more our Firehouse, the customers restaurants and to handle orders adoption. add as offering

our million offer models X growth companies affordable, service We X. our customers, with to now this addresses rapid AI also calls brands voice technology fast and X Last growing total that the at Pillar Smart their Pillar that all spam alone.We of small provide services, like importantly, believe proprietary about easy-to-implement and customer we offering their up already science we behind will this across And restaurants copilot Answering already across our to with data conveniently be market variety machine new we expanded with once messaging beyond actions, addressable additional have configurable such Assist, year, leads Pillar businesses an in single of product service, a soon. which resulting language to alone from a policies, customers and $XXX large and uses Pillar most We locations dozens to. and Smart expanded headsets. tasks X of via capturing America languages employees plan and questions our Employee our our location more million We introduced and from have more. is we several with SoundHound a franchisees, our XXX support that AI Applebee's voice AI SMS of benefiting calls, is offering with Planet we billion to solutions filtering hundreds verbal in can locations Very responses, as time multiple over signed also go and quarter XX/X, providing in to solution to products, restaurants and software, generative X the a learning AI approximately within sizes answering pricing businesses called and over Answering, conversational product few taking and needs. businesses offer and have share multiple intelligent has with handles hours, already showing Fitness.We out can international now. North XX estimate

their call we automated vendors already tech. own therefore trying are We offerings our legacy point and fully evolve AI, solution. to center other solution easily a have scalable include providers While to and

feature represents models of quarter, AI more more run was that will making talked it increase which the announced is its Automobiles we have experience. we year, about help years brand products of royalties year-over-year. in to we our differentiate to large with dozens cars, as powerful. a We SoundHound upsell X our assistant, quality them us rate choose Within billion of an This is nearly over data from and annual queries run XX unprecedented with to and of such power car we run from being us new of and millions and the than devices we winning.Moving Chat why and best, devices. X, IoT existing We it customers.Last AI, quarter, big believe unmatched capable which live our Last an innovate. power in first customers languages. language And DS technology helping growth we win trial XX% because real on are a is we manufacturers. this production, category, is with This interactions Pillar users' because where quickly combines their they of power QX, and data the them partner protect and and reached customers this TVs to

Lancia. have AI, add their due brands Peugeot, We to pleased Opel, Romeo quarter, new including and the for Alfa of signed now And up to SoundHound this Chat and success Vauxhall are launch. we

company live into went ChatGPT into production the to first We also vehicles launch we with Stellantis, Japan.With world in our in vehicles. voice an integrated AI anywhere customer, the have assistant been Stellantis with

customers our Latin is win America awarded a with We Stellantis. competitive a automobile are have also in first to pleased brand-new been win. design for This

and continue also with progress to We gain interest EV manufacturers. make

a prominent a production fleet deal their a This For to will later EV in means of gone market-leading U.S.-based to have voice-enable SoundHound's and quarter products. of from matter we months, full capabilities signing market-ready last summer. in maker, thanks won this example, industry-leading vehicles we with

powerful a the for required. seamless announced DRIVE we we with AI are manufacturer aims Chat collaboration bring solution large the generative SoundHound electric on automaker on leading we The with no we interaction. vehicle software responses embed our quarter, Asian connectivity brand-new Conference. with with have during Additionally, combines Together car NVIDIA announced and This partnering a a affordable we cars with engines. to in voice not won NVIDIA, AI to GTC electric before.This luxury language deliver NVIDIA deal with that is models in-vehicle now running can

partnering been and We ARM partner on are that their with More come also program. to added officially now later year. this to have

complexity IoT to us the up-to-date leverage bring will to assistant a accurate cars answer, next-generation This today. voice platform the market the integration, quickly makes are AI, seamlessly on We AI most our be type advanced available to to with Chat responses LLMs provide announced able static combining allows to web-based cannot multifaceted Chat the with provide this we offer to AI. SoundHound partnership able third-party which we of that SoundHound answer. The AI today, the devices.SoundHound assistant a will Just phones, unified and questions expanding and is offline to only to cutting-edge LLMs technology the currently move voice Chat assistant own believe providers. queries online truly Perplexity, voice Perplexity

a big a foundation percentage continue a by its important recognition model. Polaris, AI. cast model the speech customers, is our live now and an the We tech.Polaris have milestone opportunity believe run [ in in of AI We AI Polaris our bigger which against reached models provided than provide benchmarked size, now will with beats our of we also and updates progress. vendors on already beat model other voice margin, state-of-the-art conversational by generative is we multimodal, to terms large multilingual including just accuracy, speed, production latest with ], growing

in and of will continued investment our in data a know-how as with Our R&D leader position our level our space. strengthen this along

many As commerce is while and from significantly get I monetization monetization Pillar that creating from this we connecting this customers up the and of mentioned one this and names step new, accessible third we addressable convenient pillars: experiences. we will we us X different, quarter is of Pillar anticipation consumer the are X X no services in to earlier, our increasing pillar services, X eager believe from market and voice third signing strategy. rolling royalties every products, subscription mobilizing and products.As notable in increase more We future, voice-enabled the create the to quarter, ecosystem sign those voice-enabled out Pillar closer have pillar,

while us are closing, ecosystem.In gaining praise commercial market business We we of to should all and voice-enabled more the see strong high pleased using our allow demand continue couldn't to to this We which we're continue begin customers grow, a with new the be share. seeing excited offer portfolio financial services growth another do, in to we are years our from are the not fortify to position, about strong build look wins, to serving. continues for we what and receiving our momentum the We quarter With since and our to customer notable continued grow. the customers forward creating value we We we has company. strong remain stakeholders. passionate XX founded that and changed of growth and

We over our outlook amazing are talk drivers the the growth year. to now customers, that possible, about our call team key as to remainder and for well this of shareholders.With makes performance, investors to the and that, partners, our all I'll as Nitesh financial grateful turn

Nitesh Sharan

and year-over-year. everyone. QX excited We our The in marker about like million of the afternoon, year. and increased in quickly exceeded revenue are quarter smallest Thank XX% which becoming. where results $XX indicate we we journey good we mile on our another revenue by in seasonally you, growth are today, positive we what are Keyvan,

Our in extend demand generative persistent consumer AI and value for convenience many in coverage this this a and recent the tech increase further. our solutions of acquisition integrating customer have AI pioneering high of the result now the innovations up automation speed massively customers proposition for factors wage attractively clear. in Macro are intersection years of benefits voice restaurant critical pressures of restaurant intersection. fully breadth is to throughput with our consumer showing and is in reside activity. exciting increased accelerate so inflation SYNQX revenue. seamlessly our and drive interest customers With mix, now our we penultimate organization at AI towards drive and sector like The automation overflowing towards connects And productivity.Concurrently, the SoundHound. AI the

approximately and One to XX% we about a year-over-year is we bookings gauge metric traction X that of Pillar X QX, saw backlog.In use I cumulative an $XXX X the years. subscriptions Last combined million backlog. measures called introduced duration customer growth Pillar with demand and quarter, of average to

various methodology includes royalty and the new contracts Pillar reminder, committed period contracts. only this contract in streams total has contracts traditional volumes, target capture value X arrangements. commitments, for facets We minimum provisions. until renewal and construct. not if our include and takes of customer include the contract other our of include a The contracts We renewal include do facets deal auto subscription revenue not even professional like changed. measure As These renewals exactly the place, duration for services the

better roughly For backlog subscriptions, with over not financials, or Pillar well with a combining cumulative positive for a from gross aspects quarter, we relevant This percentages the XX% acquisition investors is our exclusive QX have of the $X introducing pilot approximately with up metric medium-term duration.We sections was does the context opportunities, We takes assumes metric subscriptions GAAP and the across and assumptions X-year are acquisition I and total adoption customers, intended EPS non-GAAP lower in impact leading which to X contributions how measures to X-year share to growth walk of about categories. ramp have given major XX% where the applying percentages alone. and million I'll below.QX include all fully industry $XX.X incorporated first X we operationally. margins of X bookings account revenue more prospects.Before Pillar location of into for new to of the to revenue the saw manage provider financial pipeline are the proof-of-concept we through Furthermore, scale the business financial year-over-year. in SYNQX. various help the we directionally revenue quarter, represented in the growth results organic for track million, convey growth XXX,XXX for reasonable opportunity customers. this

and quarter We expanded the volume increases also year-over-year. had strong both a units strong up X with in as automotive double-digits Auto Pillar in royalties went users cloud quarter.

we Additionally, our and we growing opportunities accelerated see demand are in unit continue realized expansion. seeing solutions, price be to meaningful to AI for generative starting

amortization growth QX, signed devices from double-digit We margins of led the to Adjusted notably, basis, in multiyear and margin been impacts, strong center were TVs agent have up from commitment that gross On non-GAAP quarter.In mix down is gross category, of margins business. largely stand-alone intangibles, in purchased call lower-margin gross the resulting also the XX.X%. were and This would margins our year-over-year, acquisition including metric above. a the year-over-year. for devices the a XX%, noncash the acquisition, gross I introduced

While margins broader excited for to so the do data said, and are what term, this can modernize. does opportunities it our capacity our provides pressure in goal call business for models.That valuable we near center new equally and the is the time AI training business over about automate

an increase through improvements QX, in were gross expenses million the levels. X% expect year of margin back we ultimately R&D So to $XX.X premerger and year-over-year.

costs, expand efficiencies, products suite investments address to a of our and are R&D needs. our customer streamlined wider of in disruptive have prioritizing innovation array We to increased

an foundation ASR solutions, arbitrate models, partner and voice QX, XX% and through We more own and and marketing value thoughtful million were enabling including training continue said, to capabilities our large opportunistic year-over-year. and language a and emphasis are the open wide models of that with AI to value many variety intermediate even LLMs. $X.X best-of-breed of conversational generative deployment unique doors large models, customers, be will of greater increase to new Sales expenses multilingual bringing models us and language AI on to AI use in we cases.That accelerating provide between

engagement the reach are customer demand, we to capture to heightened expanding brand continue generation go-to-market momentum and and invest strong marketing, demand We strategies. industry lead-gen through and and ROI in and high

team quarter, of increases and Our best reflect were of through talked continues to The amazing partners.We QX, year-over-year. And were strategic management the increase in the customers that worked ever expand go-to-market executive G&A an us. reach partners XX% sales we with QSRs, in with from $XX.X about ROI team this best their introduced know sales one as main direct with. quarter. elements last G&A X both their largest ecosystem loving million an the we of to channel comes expenses has

as items also QX. acquisition continues investments All support comparison and and tax were $X SYNQX the to factors we impacted costs year-over-year quarter controls internal year. impacted million financial as in acquisition-related requirements operating employer-related and in last be to accelerated SOX increased Our processes by as compensation XXX(b) expense large employee well line a this nonfinancial compensation.Noncash in costs. under stock higher became was by filer And

$XX M&A results loss upon EPS about result, for the included loss $XX foreseeable the the accounting in other net to cash result per loss This million is activities million. $XX.X future. a $X.XX in the was to compared loss related a in of XXXX EBITDA acquisition our will as measure to adjustments, stock-based for Adjusted fair we acquisition purchased $X.XX a was and X million the of normalizes year. Net OI&E operating was The future the the business. $XX.X line items, transaction impacts noncash months given acquisition in ongoing of amortization costs, report QX that mentioned of the value was quarters quarter.This net As SYNQX of XX, to in to it ended previously non-GAAP for comp operating noncash will continue introduce better higher share the likely this year-over-year operating QX volatility million was our previous and for $XX.X impact. prior the $X.XX loss operating March $X.X million. QX in was value year into led was related for net well QX. fair expense period. a intangibles, noncash quarter, decrease the This million compared in a in of Adjusting used as costs

cash optionality be million strength at to structure drive economic end remainder to forward and only this to and merited balance equivalents. flexibility, committed capital, position don't the where necessitated further was quarter It have capital discuss take projections All another have raising financial this acquisition quarter strong sustainable great With long-term although the Our some we given needs. attractive forward that million, any we position, raising cash if which indicate $XXX value our don't presented was growth our provide improve new of capital would our business that, outlook cash in $XXX let and us strategically purposes are itself, said, the for opportunity and in for of program XXXX. capital a granted ATM with on either profile.We sheet entered ourselves of for or time-sensitive it. optimization focusing prudent being me stewards and creating profitability.With the we

excited we performance, driving in We about X. ahead are And we new with X the X. in the line Pillar are our with are and and top opportunities pleased coupled opportunities seeing demand Pillars

having We in go XXXX. X are increasing mix into revenue this XX% mix we of total Pillar see pace exceed we of ahead as that and year,

million. range, revenue our midpoint the QX full guidance the the up our million is end to $XX Given year our our narrowing initial are performance, lower guidance which we and million.Therefore, $XX now $XX to for raising steps of

stage, XXXX. believe profitability year-on-year and to we is to subsequent is $XXX We quarters still We but million at expectation EBITDA this adjusted expect this right appropriate growth. roughly cross expectation. revenue in the Furthermore, for deliver continue to hope in the XX% outperform, we believe

move noted expect impact increased we as is on As forward. margins adjusted cost and gross both to EBITDA and quarter, I improve we temporary, last the

upgrading working so some and the their the SYNQX while which AI revenue cloud duplicative is they infrastructure immediate also their have have center of call team we on to term, migrating portion with SoundHound, AI. are in costs.In has AI-driven, legacy operation, addition, a been a SYNQX's gradually acquisition, With we

making which Overall the to great with progress, time. business and ours we the accelerate migration, value and further is initial with even for further building. are over close ultimately margins are we customers.I'll based expect gross of note partners, conversations will we We on increase calibrate interest this there to another strong though, their conviction to create customers in

for isn't our the said part there's forward disruptive at our force before, a As transformational record falling not and of achievements start and to and the proven don't the pieces progress, is always In we strong each far, to boundaries our gravitational every I've of for path creating everyone, persistently.Thank With granted, but success play. we though, Despite innovation push When particular, measurably quarter we get passes, together track a SoundHound's it's linear. aim fight day further closer take it our for as escape higher velocity. you. so DNA.

now We Q&A. to will move

Operator

Luria from from [Operator Instructions] comes of Davidson. D.A. Our first question line the Gil

Gil Luria

lot of announcement A Yes. product advances. and

on focus that the me a intriguing. ones couple most Let seem of

for I'll bundle automotive it to the second on the the first line sounds one the in-vehicle. around be around one. your this the for connectivity. can without the would SoundHound which Perplexity the Is on AI product, down there technology leveraging to whole to SoundHound customers? that one to like Perplexity, app. front-end NVIDIA technology the do going AI app? road Perplexity big that's you deliver a in AI be step Chat be a The potential you're What's think the It of is, inferencing for So one the the forward time do you

Keyvan Mohajer

Thanks for questions. the great

models so edge, we large. lot very these the able a to the language them announcement, you of functionality are and on AI don't are they NVIDIA milestone this the cloud. So fit will on generative as with edge, the not on because but large partnership, big -- Typically, the need run noted, very

weather general you things things that knowledge hardware need information done device, connectivity. talking We you inside for take beyond getting you're lot longer, a connectivity. some of especially the cases use cloud a automotive.In don't when But sports automotive, change. think a about real-time cloud to need or actually car the whether from the functionalities, are cloud, you You or if still need like want scores, it's

when I one you to you of QSR, as the -- for the could in bring in hardware production the that earlier, think some about actually For we we when it's my But had to comments few to actually we takes mentioned deal case a months. Dynamic change, we went from drive-thru just edge. are signing going software, a Interaction, just But automotive, not that even about longer. talk of automation, matter

So we excited about that that faster can are partnership. happen things with

Perplexity, app. For not just AI it's Chat about our

Our our and -- -- So be of customers Chat the have AI also on a already it's offer is an pre-LLM again it customers, they And feature. will upsell. I upgraded will like Chat the versions upgraded offer already we to have lot beyond.We a upgrade an earlier automotive and platform call, right? mentioned as additional them from to well, to them it our that's feature, as AI for add

we royalty, it go our up. expect will So

Now it to online will access upgrade the LLM, to be moment us. another for

So on phone. it's beyond that's the Chat much the application AI very

a we're would we asked anything Perplexity power but about. properties, it's partnership beginning haven't announced of also yet, you excited we a if Now

are We both NVIDIA NVIDIA then are complementary. invested companies, like and in us very we portfolio

a there's do them. can we with we So more think lot

Gil Luria

profitability. picture. for overall a cost one at needed to path markets frankly, do, structure you show capital changing very which to to the is fit, Nitesh, what Last a you, clear you to year, your little big effective were

that did effectively. You very

or the we potential and is a you discussed, of opportunities, reached point. You profitability? much bit you of there of and way say, technology cash that of more burn little have today, those here which to rates, the couple lever long an just a a opportunity with opportunities sheet, on to significant we series many to But so move your that that hey, sit little and fund for lower balance the front the we relax maybe on bit a other shift need as

Nitesh Sharan

we the Yes. and we're with how Thanks, the and to principally, long-term conversation value customers. consumer And by customers, drive and Gil. seeding for with opportunity frankly, every technology create demand. and that I'll intersecting saying we're expanding, real-time hearing is demand start trying have we're seeing

the is think in of us I opportunity So front tremendous.

directionality do spend, And us I carte go that pathway think to conveyed spend. blanche don't need so be the our I spend, to getting about year.But conversations in to gives have a really seeing day We your just profile next thoughtful solutions. active to with and a towards point, of customers more that to terms in opportunity the breakeven to every invest go there think we're is faster

traction ecosystem there, the going question [ of especially first to ] short we're dynamic, we certainly, speed QSRs so certainly opportunities we're tremendous innovation able the could for very also of the there a the players. demand. larger of technologies in on I of broadly, is and bit larger that to a the lot that, auto on on, prize revenue, new particular, with need are recurring our so lot restaurant in -- customer that the know EV pace move side much and given just prepared highlighted with around very advancing players, new We so that quickly, But The seeing think, a remarks in the service, and more we some we is with QSRs. of your in we're the the stay in that with the at agile. getting larger see is millions be us scale size term.And them hundreds of of annual larger revenue

our so for us balance And the arsenal in pocket have thoughtful. back to be this is to sheet super real why that's important

with that. We very a balance judiciously in there's prudently all capital returns. will do and mindfulness But around of strong driving it

that to unidirectional echoes that, it investments going get we're our as govern the value of know principle on ultimately, I the sort a and serve for really hearing And choices give can't that? I statement. around creating interests. consumer for is louder those are we So and we customers, louder and go

not think of opaque too that's how but we that's for about hope I answer it. you, an So

Operator

Northland Markets. next from [Operator the question Capital Our from Latimore of Instructions] Mike comes line

Mike Latimore

data can Congrats you are to Yes. just developments some cross-sell train to with kind have you and on synergies you you are What their use to to help seeing here. the leverage deployments? opportunities had? talk about able bit Maybe the able of some a Are their then of seeing models? And little far? all of resources with so your you're SYNQX

Keyvan Mohajer

Yes, I'll But we start and see more. the maybe Nitesh synergy. add absolutely, can

be it We fantastic everything. offering a integration, already better. had have have They we acquisition. data, to are it. -- of it's are a They lot and was that of that of more they AI does couldn't using not day, ton model proud we make just our a about We models -- magical a and feel Every it.

systems. systems have lot needed that but accelerate then that they to company. operators, automation -- identified And go nearly of organic we are AI, POS started experience restaurant a we and came of and own data a restaurant as as into. to -- started experience XX menu identified integrate have we restaurants, AI as improve they is -- analytics right they an they with They more the We have synergy very really technology that using companies as business we side.But to their terms understand And to between in in-house forward. years on. started -- to into our into. that scale industry get with good ago and a that, what as you scale go our have well. They business the they go to and And became and You each, we integrate customers were customers and with well management lot have and to so -- enterprise so our the X a of they on as these we

Nitesh Sharan

on that. just I'll a couple add And of Yes. points

acquisition from excited the bring with cross-sell, is of with in happening would kind I thesis there's is than also Keyvan along their customers I'd ability just conversations from think core already the That's sort break what up revenue relationships of the terms to. to this built, standpoint, medium the upsell they own bring I with of they've the months pace. the the that, into just opportunities. were an accelerant do engines relationships.So even top some at on much multi then had new categories. and just been it. several Revenue, we We happening of alluded say faster of think a I X get but more opportunities longer-term lot into have a able our to it And extended what accelerating into going of we alone. customer

On the things we're these -- journey, are than again, cost software say cloud we we've of the were we faster in learnings doing, architectural go Mike, there middle we're back-end are what of some can in capabilities couple costs both midst bring own, these, and I'd the of in learn of on that this about that sides. side, There talked our but from are in, migration terms driving. the stack a in

a cost what but that We margins doing the the margin, gross plan. think more a this depressed not structure, of they we're in quarter, the over you'll business I This even that that's stuff, on gold to certainly production So lot transactional also there's to be real-time is to cost prepared have our you'd gross automation. models. the acquisition efficiency center next didn't remarks. okay. commented cost know improve numbers data leverage migrating through. this the in but and able numbers be just see side.And that able and call of both of is in is sort but reflect to a that's One But on call word, over elements will I the specific is the drive unsynergized QX were about because we, QX time, the so see it, quarters, that the, Be thing

more what we're locations are attuned restaurant to able to our we're improving just driving excited own. on year-over-year basis of you XX,XXX is margin that come was to in in matters SYNQX. process points then over products data. and stand-alone to the being innovation it, be the say their to Data really need, in SoundHound's but make those the And models. gross just types And they boy, say have to our transition And to but a profile, here, we're ask lastly, up there, out to this operators I'll data to this ecosystem the points.So of still to on so what is important with again, talk just again, able so about. together very going driving XXX customers, our this opportunity terms and some we're matters to real-time, margin synergies didn't And and go, great basis of things put notably,

go about. it's we're could longer So I'll a but excited this, we lot stop on I so there's a know call, much but short there,

Mike Latimore

leader Yes. All quick what's does right. between between here? to just very It there sounds ordering vertical. out in in progress and here of the to great like of much of drive-thrus? just -- the restaurant real Is ordering pipeline? yes, it it sounds like phone versus other terms gate. a the then kind the on it clear skew phone like one Does Or drive-thrus And balance

Nitesh Sharan

is It's well, pretty extend short-term, long-term balanced question. and to answer bit drive-thru, with of would balanced, in-store that but program it I on it we're employees. is simply not phone to Employee in-app of excited going excited which the restaurants versus about. -- opportunities, a It's are having other Assist, we on There's about -- a conversations some a helping lot call conversations we're that it's

is front-end Smart lot Our else. something a on Answering of capability sort is this of vehicle

there's there's So part time sort we've I on opportunities.And are those said sort of here. line my before, then suite of last getting And as of a things of that innovation, of a mean, are incubated deployment. answer

certainly, many with else now disparage is and could to there mean, greenfield. we it's we that Nobody partnerships is that don't other come.But we faster are competition. move that standardize great are There there players drive We're hardware is providers But We the hardware There So are doing know we know go right there. know requirements. to requirement. -- through. breakthrough. is I that thru, -- building with cycles hardware need

so that proposition space. want a value And go have unique we're phone fast. to a even growing they have we're that driving, in ordering, great really on We and and then we lot partners, of

what so in phone going front. so service that more in and And cuisine types, types a cuisine to heavier is volume, see particular certain -- of that those we're weighting we some you find

balanced, little So but excited on multiple fronts.

Operator

from [Operator the Ladenburg. from line of Instructions] Our next Mattson Glenn question comes

Glenn Mattson

part quickly this some in in. equipment has of the retail, like just apologize Yes. Nitesh, -- you the is offering of a customers best kind you some kind And of to talked the think bit demand about But you everything. that guys talked of remarks. like out like just the also handle kind hold I any given that in if of gating about little serve factors put of are and because I placed some Keyvan's I at been while call, on of higher of to last And decide the prepared repetitive and time rolling be who and how the kind missed than you could

some somewhat of an caught that get understand spot So trying demand or to of out there's you that or some you up if if of are need I point guess where been if change investment if to on that view. you there's more -- from figure that I'm make there just just update to or kind and to to

Nitesh Sharan

Thanks, Yes. Glenn. hard. We're working

out. talking not also, making are about -- for it's like we last -- and by months months I progress we're don't time, and We clarify sure. that -- We even to want that

need where trying we through of to with We a work are some really customers. to of bit we've a these pipeline that those got things address

been there's of a progress. So lot

seasonal little it it inclusion acquisition, one into with apart costs see complicated this I a be is kind pieces, know if the X Gil's going of break is time, one the unpacking getting plus and You'll that profitability year. acquisition will one-time we to our of just I other things, still like will things, but back transitional there's and sort to of acquisition with this, target investments next question to of of continue sort dynamics make.Again, then

to in consumer accelerating investment and the customer demand are serve pockets that We demand. right

people, capabilities customers we we the investing we quickly to that that get right are making sure can serve Glenn, way. to so the So your right in and are question, hiring the right

so And challenge quickly, progress, restaurant actually. word maybe too.Every a meaningful around hitting good more that. are The side. gets we're that and challenge the progress lot particularly say, silver I'd innovation is excited have demand in really lining We're and making we on time the pretty a we

out. show think get and our word Chicago, coming it's up soon, to in largest go big I showcase just restaurant got there to we've very conference a ready the

are the that to prepared existing in the in We and more QSRs, mentioned really the we to laurels. moving one those customer relationships, while but with serving well, we our the more don't making about make dynamic -- we're good is challenge demand. So a to remarks, demand.And with sit have, invest faced can't we're feedback technology rest fact, sure us, got could I largest of so a the back, problem getting building. that's we're we progress progress make. on comments the hearing keep the And cycle the with we together That's obviously, handle. the orders work for of the back what that technology situation keep situation them And that's quickly to to know was taking hearing was that with that's our then in with a to good sign about virtuous Dynamic Interaction of working that too we -- to ameliorated. can But from customers positivity preparation get fueling. ordering that's want want We we

it. trying to -- we're to of demand faced lot I trying we're will with And hard acknowledge with a serving investing consumer sure -- pace We're that keep So demand. make really customer we're I think to we're through. still demand work but

Glenn Mattson

problem a have, Great. That's of to helpful very course. and good

this Second in past about what question The future for for the thinking SYNQX. me. and the in you've I call feel But just as -- or just like further maybe this at beyond hinted acquisitions for well. outlook you're

guess? I you're appetite still. attributes -- how your for Now of what is what what kind big of in your looking future do And you have some acquisition SYNQX in to here realize But terms is that digestion Thanks. I curious acquisitions? thought process for

Nitesh Sharan

Sure.

have organically things. excited just about So But know great address. with I'll our of to is a can SYNQX we're capabilities what tremendous, right We're just able we start about with, now, we what we're excited meaning lot we opportunity the bringing. -- is do

on it's --- build the it two, and business. people. us focused think great long-term amazing macro Number ecosystem. could disrupting were into and the an is of growth a and of bringing is we landscape So organization the what lot recent multiple AI new we're seeing and driving a I The from fuel around XXX%, ecosystem there's lot shift, things other happening.First, Gen players players, the that,

agenda. are mindful, acquisition head we story, with partnerships, kind learning We're of going sit it's our about just from sand an one, very it's to our certainly because going others. the to be drive not and about just it's So not own in number

take And dedicated team a very being players. new this going very the time. being have to are a to thoughtful on who so all top we're we the of view holistic And of of

organic any or about think we our X-pillar opportunity investment inorganic architecture, the so And is through framework.

We Keyvan through around and We IoT, scale with our agencies but aggressively need real ever expanding when ] now mentioned forth, the of a some products. have, are great many, call restaurants, organically.And those. are them. that opportunities voice-enabled is of fitness in for estate across And pocket, we there a other journey things the prepared driving great lot, with sense, servicing. they're things -- [ a autos, are to leading salons, few and we the is now, generating because to makes who we're seeing particular line great integrating those going we M&A And momentum devices.We're find is Answering doing others. make in services then companies to we the remarks up of businesses to today. we're different Smart centers, so on talk many voice-enabled with which scaling in service, mentioned And but we're certainly, XX partnerships out going opportunity products, if customer starting frankly, sense aggressively voice-enabled drive that a we to when beauty types see doing and monetization, are

going Having the thoughtful. And again, be strong opportunity to stewards. to to a us sheet open-minded. we're we're be going affords yet us gives be prudent So and balance

terms it's to then cost not disruptive that I me, also math guess so But dollar sign, on you in are disrupt strategy, works it's moving, small always above to also and needs a as to a open customers as world is -- So to it. want to on is fast about we'll needs appetite, risk-adjusted.And We allowing, the speed to tech return aggressively. your of want. out, a go where the long like continue And company, capital, of be be be we sign. it's all everything capital asked, it's what on what

sort the thing. if the things down, that that So will thing. not right right an of seems would If opportunity that slow that's go that's us us make there's faster, like

that's So frame the use. we

Operator

Cantor Instructions] Fitzgerald. Our question line [Operator of from next Knoblauch comes from Brett the

Brett Knoblauch

very Square side. the Or strategy and you? it On you be the that motion? is like demand the to talk go-to-market got deployed it's your is the Are maybe there. on you lead Is restaurant about to outbound Olo? demand of they front more coming nice the partnerships that seems business, increase For just Can example, like gen it it about side that from, to that quickly. POS with where of see kind sales restaurant continue from have perspective? with coming Applebee's, a on Just curious

Keyvan Mohajer

Thanks Yes. question. for the

So combination. it's a

that like that's We awareness, coming up, Restaurant we one National participate increases ] Association. have the in [ events that

about to are move Like, we on XX knock We value ago, But automation. our them door. sales The acquisition now knock the coming voice But maybe to see doors that of have these we a to, us and we dream they and door, lot them augmented that shift AI have want SYNQX now a used on seen our that. to now about brands talking big on to good-sized these they knocking a fast. we months of educate had team.

a been big the has change very there dynamic the of in market. So

Brett Knoblauch

most are Would opportunity into about Perfect. how translating we should side, thinking Would excited over term? I partnership ARM, near And NVIDIA? then be guess I be on guess, Perplexity? the partnership be it monetization a financials? about from it those into you any insights what the

Keyvan Mohajer

going more top the take partnership customers. really complementary Like can think is it those a on channel very very example, adoption then are their complementary. same when it channel can Those for it's we them and know And partnerships there improve our us of when to more impactful and that, Olo, has are opportunities they product, are very or excited is stuff that take about. something revenue. else I bring to to can we Yes, partnerships be our business offering that we customers a our key. translate But service

So Perplexity the those that lines. along announced today partnership was we

Operator

questions. this Instructions] you. for This concludes call. conference At [Operator showing Thank I'm no participating. today's you Thank time, further

may You disconnect. now

SoundHound AI (SOUN) 9 May 242024 Q1 Earnings call transcript