What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-03-02 compared with 2025-03-11 · 192 added, 214 removed, 409 unchanged (50% of the section changed)

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Information concerning the fiscal year ended December 31, 2023 (“2023”) and a comparison of 2024 and 2023 may be found under “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10‑K for 2023, filed with the SEC on March 1, 2024.

Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10‑K for the fiscal year ended December 31, 2024, filed with the SEC on March 11, 2025.

Some of the information contained in this discussion and analysis or set forth elsewhere in this report, including information with respect to SoundHound’s plans and strategy for its business and related financing, includes forward-looking statements that involve risks and uncertainties.

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Unless otherwise indicated or the context otherwise requires, references in this section to “SoundHound,” “we,” “us,” “our” and other similar terms refer to SoundHound AI, Inc.

and our subsidiaries.

Company Overview

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The Voice AI offerings from big tech companies are primarily an extension of their more core services and offerings.

Rather than strengthening a customer’s product, it can take over the entire experience, thus disintermediating the company’s brand, users and data.

Rather than strengthening a customer’s product, it can take over the entire experience, thus disintermediating our brand, users and data.

As a result, brands relying on big tech may lose their ability to innovate, differentiate and customize.

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The first pillar is Product Royalties, where we voice enable a product and the product creator pays us a royalty based on volume, usage or duration.

SoundHound collects royalty revenue when your technology is placed in a car, smart speaker or an appliance, for example.

SoundHound collects royalty revenue when our technology is placed in a car, smart speaker or an appliance, for example.

The second pillar is Service Subscription.

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Recent Developments

Amelia Acquisition

On August 6, 2024, we completed the acquisition of Amelia, a privately-held conversational AI software company involved in the development and delivery of AI and automation solutions and related services to improve customer experience and optimize business outcomes.

We expect Amelia will bring together decades of experience in conversational AI, and highly complementary product portfolios, to offer best-in-class, scalable customer service support to a vast spectrum of businesses.

These include some of the very largest multinational enterprise brands, top 15 global banks, and Fortune 500 organizations, with the combined company spanning nearly 200 marquee customers.

We believe the acquisition of Amelia is expected to strengthen SoundHound’s position in voice and conversational AI and allow us to enter new industries such as healthcare, insurance, financial services, energy and retail, expanding our market reach.

Refer to the "Liquidity and Capital Resources" section for discussion on the purchase price and the Acquisition's impact on SoundHound's liquidity.

We have incurred certain significant costs relating to the SYNQ3 and Amelia Acquisitions, such as legal, accounting, financial advisory and other professional services fees, as well as other customary payments.

Interactions Acquisition

On September 3, 2025 (the “Interactions Acquisition Date”), we acquired all of the issued and outstanding equity of Interactions Corporation (the “Interactions Acquisition”), a pioneer in AI for customer service and workflow orchestration.

This strategic deal is expected to strengthen and extend SoundHound’s growing leadership in Agentic AI and accelerate its market penetration in customer service across enterprise businesses.

The combination also introduces certain new major powerhouse brands to the SoundHound customer portfolio, including global consumer icons, large technology device brands, insurers, automakers, and other preeminent Fortune 100 companies across industries.

We have incurred certain significant costs relating to the SYNQ3, Amelia and Interactions acquisitions, such as legal, accounting, financial advisory and other professional services fees, as well as other customary payments.

Refer to "Item 1A.

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Our business model since inception has been to invest in our technology in the form of dedicated research and development.

We will continue to invest in the development of our software platform to

deliver consumers with continually improving value and delight.

We will continue to invest in the development of our software platform to deliver consumers with continually improving value and delight.

Our investments include continuous enhancements to our technology we've developed over the last two decades or acquired from acquisitions, investments in data to help refine and improve our underlying algorithms and other costs to attract and retain a world-class technical workforce.

• Revenue Growth.

Our commercial success, including acceptance and use of our applications, will depend on a number of factors, some of which are beyond our control, such as size of the market opportunity, successful integration with original equipment manufacturers (“OEM”), competition and demand from the public and members of the conversational AI community.

Our product offerings, including those offerings that we have acquired, have disruptive effects in the ways human interact with computers and we are developing new, innovative economic models and acquiring companies such as SYNQ3 and Amelia which have synergistic businesses to ours that we believe will enhance value to customers, partners and shareholders.

Our commercial success, including acceptance and use of our applications, will depend on a number of factors, some of which are beyond our control, such as size of the market opportunity, successful integration with OEM, competition and demand from the public and members of the conversational AI community.

Our product offerings, including those offerings that we have acquired, have disruptive effects in the ways human interact with computers and we are developing new, innovative economic models and acquiring companies such as SYNQ3, Amelia, and Interactions which have synergistic businesses to ours that we believe will enhance value to customers, partners and stockholders.

For our revenue growth to continue, we will need to invest in sales and marketing to ensure our messaging, capabilities and offerings are well understood and valued by customers.

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As we build new customer relationships, we continually focus on maintaining and growing our existing relationships through long-term partnerships through significant upfront investment in customer specific engineering projects.

Additionally, in addition to our acquisitions of SYNQ3 and Amelia, we may look to acquire other companies in the industry to develop synergies with our existing business.

Additionally, in addition to our acquisitions of SYNQ3, Amelia, and Interactions, we may look to acquire other companies in the industry to develop synergies with our existing business.

• Cost of Revenues.

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We anticipate that we will experience fluctuations in customer and user demand based on seasonality.

For example, in the past, we have seen approximately one third of our revenue in the first half of the year with the remaining two thirds in the second half.

For example, in the past, we have seen approximately 40% of our revenue in the first half of the year with the remaining 60% in the second half.

Additionally, given that we address markets across several different industry verticals, the associated overall seasonality impact to us may not be consistent year-to-year.

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“Houndified Products,” meaning products of our customers that employ SoundHound technology, and “Houndified Services,” meaning services provided to customers related to SoundHound technology, provide our customers with access to our Houndify platform over a contractual period without taking possession of the software.

This generally includes revenues derived from up-front services (“professional services”) that develop and customize the Houndify platform to fit customers’ specific needs.

This generally includes revenues derived from implementation services (“professional services”) that develop and customize the Houndify platform to fit customers’ specific needs.

These professional services are included in both our Product Royalties and Service Subscriptions revenues.

Non-distinct professional services are recognized over the contractual life of the contract, whereas

revenues from distinct professional services are recognized as the services are performed or when the services are complete depending on the arrangement.

“Amelia Software Platform” meaning our AI-based digital resource solution that enables AI in our customers’ services, ranging across multiple industries.

This generally includes revenue from hosted services if the customer elects our SaaS offering, or from licensing revenue if the customer requires an on-premise solutions.

Professional services are also offered and included within professional services revenue.

The revenues from Amelia Software Platform are included within Service Subscriptions, and are recognized point in time or over time depending on the arrangement.

Non-distinct professional services are recognized over the contractual life of the contract, whereas revenues from distinct professional services are recognized as the services are performed or when the services are complete depending on the arrangement.

“Amelia Software Platform” and “Virtual Assistance” meaning our AI-based digital resource solution that enables AI in our customers’ services, ranging across multiple industries.

This generally includes revenue from hosted services if the customer elects our SaaS offering, or from licensing revenue if the customer requires an on-premise solution.

services are also offered and included within professional services revenue.

The revenues from Amelia Software Platform and Virtual Assistance are included within Service Subscriptions, and are recognized point in time or over time depending on the arrangement.

We have and may continue to experience volatility for our remaining performance obligations and deferred revenue as a result of the timing for completing our performance obligations.

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This primarily includes costs and depreciation related to hosting for cloud-based services, such as data centers, electricity charges, content fees and certain personnel-related expenses including personnel costs under call centers that are directly related to these revenue streams.

Additionally, our cost of revenues also includes the amortization of developed technology acquired from SYNQ3, Amelia and other acquisition as intangible assets.

Additionally, our cost of revenues also includes the amortization of developed technology acquired from SYNQ3, Amelia, Interactions and other acquisition as intangible assets.

Sales and Marketing

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Change in Fair Value of Contingent Acquisition Liabilities

The change in fair value of contingent acquisition liabilities is related to contingent consideration from the SYNQ3 and Amelia acquisitions.

The change in fair value of contingent acquisition liabilities is related to contingent consideration from the SYNQ3, Amelia, and Interactions acquisitions.

The contingent consideration was determined to be liability classified and is remeasured as of each reporting period with a corresponding change in fair value recorded.

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If the estimated future cash flows from the use of the asset are less than the carrying value, an impairment charge would be recorded to write down the asset to its estimated fair value.

Restructuring

Restructuring expenses consisted of employee severance payments, employee benefits and share-based compensation related to reduced headcount from our restructuring plan ("Restructuring Plan") announced in January 2023.

The Restructuring Plan was complete as of December 31, 2023.

Loss on Extinguishment of Debt

Loss on extinguishment of debt represents the loss associated with the repayment of the Amelia Debt in December 2024, the repayment of the Senior Secured Term Loan Credit Agreement with ACP Post OAK Credit II LLC (the "Term Loan") in June 2024 and the repayment of the 2021 note payable ("SVB March 2021 Note") and 2021 convertible note ("SCI June 2021 Note") in April 2023.

See Note 10 of our notes to the consolidated financial statements for more information.

Interest Expense

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Direct transaction costs consist of various transaction fees and third-party costs, such as bank and legal fees, that are incurred upon issuance.

We expect the impact of the discounts from debt issuance costs to the interest expense will decrease due to the repayment of Amelia Debt in December 2024 and the repayment of Term Loan in June 2024.

Other Income (Expense), Net

Other income (expense), net consists of the change in fair value related to our derivative liability, interest income and other income (expense).

Provision for Income Taxes

No interest expense was incurred during the year ended December 31, 2025 due to the repayment of Amelia Debt in December 2024 and the repayment of Term Loan in June 2024.

Other Income, Net

Other income, net consists of the change in fair value related to our derivative liability, interest income and other income (expense).

Provision (benefit) for Income Taxes

Income tax expense includes federal, state and foreign taxes and is based on reported income before income taxes.

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federal and $379.7 million of state net operating loss carryforwards available to reduce future taxable income.

The federal and state net operating loss carryforwards will start to expire in 2025 and 2028, respectively, with the

exception of $403.3 million federal net operating loss carryforwards and $11.0 million state net operating loss carryforwards, which can be carried forward indefinitely.

The federal and state net operating loss carryforwards will start to expire in 2026 with the exception of $691.0 million federal net operating loss carryforwards and $18.5 million state net operating loss carryforwards, which can be carried forward indefinitely.

We had federal and state research and development credit carryforwards of $27.2 million and $15.4 million, respectively, as of December 31, 2025.

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Amortization of intangible assets 15,872 7,116 8,756 123 %

Restructuring — 4,557 (4,557) (100) %

Total operating expenses 192,192 426,046 (233,854) (55) %

Loss from operations (23,272) (341,353) 318,081 (93) %

Other expense, net:

Other income (expense), net:

Loss on early extinguishment of debt — (15,629) 15,629 (100) %

Interest expense (670) (12,168) 11,498 (94) %

Other income (expense), net 9,222 1,155 8,067 698 %

Total other expense, net (18,575) (16,415) (2,160) 13 %

Other income, net 14,668 9,222 5,446 59 %

Total other income (expense), net 13,998 (18,575) 32,573 (175) %

Loss before provision (benefit) for income taxes (9,274) (359,928) 350,654 (97) %

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Total revenues increased by 99% in 2025 compared to 2024.

Service subscription revenue increased to $56.3 million, primarily based in the Americas, and was driven by the contribution of revenue from acquisitions.

This was offset by a decrease in product royalties revenue, primarily in the Asia region, due to the minimum guarantee licensing or point in time revenue relating to Houndify Edge recognized in the previous period.

The increase of $77.2 million in service subscription revenue, primarily based in the Americas, was driven by the contribution of revenue from acquisitions.

The increase of $6.9 million in product royalties revenue was due to the increase in license revenue in the Asia region.

Cost of Revenues

Cost of revenues increased by $54.1 million, or 125%, in 2025 compared to 2024.

Gross margin decreased to 49% in 2024 compared to 75% in 2023 primarily due to the acquisitions of Amelia and SYNQ3, which included a mix of lower margin call center agent business from SYNQ3 and amortization of acquired intangible assets.

Gross margin decreased to 42% in 2025 compared to 49% in 2024 primarily due to the acquisition of Amelia in 2024, which included a amortization of acquired intangible assets in the amount of $14.1 million for the year ended December 31, 2025, and the acquisition of Interactions in 2025, which included a amortization of acquired intangible assets in the amount of $0.8 million for the year ended December 31, 2025.

In the past, our gross margin has fluctuated and may continue to fluctuate from quarter to quarter due to revenue contributions from varying product mixes.

However, we expect to gradually improve gross margins in the mid-term, especially as it relates the integration of Amelia and SYNQ3.

However, we expect to gradually improve gross margins in the mid-term, especially as it relates the integration of Amelia, Interactions and SYNQ3.

Sales and Marketing

Sales and marketing expenses increased by $10.2 million, or 54%, from $29.1 million in 2024 compared to $18.9 million in 2023, primarily due to an increase in 2024 of $7.8 million in personnel-related cost, $0.9 million in advertising expense, $0.8 million in consulting fees, $0.8 million in legal and professional fees, $0.4 million in travel expense, and $0.3 million in office expense.

The increase was partially offset by reduction of $0.9 million in information technology and facility expenses.

Included in the sales and marketing expense is an increase of $4.3 million arising from the Amelia acquisition and $0.7 million arising from the SYNQ3 acquisition, stemming from increased personnel-related costs.

Sales and marketing expenses increased by $32.5 million, or 112%, from $61.6 million in 2025 compared to $29.1 million in 2024, primarily due to increases in 2025 of $27.6 million in personnel-related costs caused by Amelia and Interactions acquisitions, $3.3 million in office expense, $1.1 million in consulting fees, $0.8 million in advertising expenses, $0.8 million in travel expenses, $0.2 million in legal and professional fees, and $0.2 million in meal and entertainment, which were partially offset by a decrease of $1.5 million incurred for information technology and facility allocations.

We expect our sales and marketing expenses to remain stable in the short term.

However, in the long term, we expect sales and marketing expenses to grow at a rate below that of our revenue, aligning with our strategic emphasis on cost effectiveness and sustainable financial performance.

Research and Development

Research and development expenses increased by $19.1 million, or 37%, in 2024 compared to 2023, primarily due to an increase in 2024 of $14.0 million in personnel-related cost, $6.4 million in cloud computing, $0.6 million in consulting fees, and $0.2 million in travel expense.

The increase was partially offset by reduction of $1.8 million in information technology and facility expenses, and $0.3 million in legal expense.

Included in the research and development expense is an increase of $2.3 million arising from the Amelia acquisition and $3.6 million arising from the SYNQ3 acquisition, stemming from increased personnel-related costs.

Research and development expenses increased by $27.7 million, or 39%, in 2025 compared to 2024, primarily due to increases in 2025 of $25.6 million in personnel-related costs caused by Amelia and Interactions acquisitions, $2.7 million in legal and professional fees, $2.7 million in office expense, $1.8 million in consulting fees, $0.2 million in utilities, $0.2 million in travel expense, and $0.1 million in hardware cost, which were partially offset by a decrease of $4.5 million incurred for information technology and facility allocations, $0.6 million in rent expense and $0.5 million in cloud computing services.

We expect our research and development expenses to remain stable in the short term.

However, in the long term, we expect research and development expenses to grow at a rate below that of our revenue, aligning with our strategic emphasis on cost effectiveness and sustainable financial performance.

General and Administrative

General and administrative expenses increased by $25.0 million, or 88%, in 2024 compared to 2023, primarily due to an increase in 2024 of $11.9 million in legal and professional fees, $10.1 million in personnel-related cost, $2.7 million in information technology and facility expenses, $0.9 million in office expense, $0.6 million in consulting fees, $0.5 million in cloud computing, $0.2 million in bad debt expense, and $0.1 million in travel expense.

The SYNQ3 and Amelia Acquisitions led to increases in personnel-related costs and office expenses.

This increase was partially offset by reduction of $0.9 million in property-related expense, $0.7 million in equipment rental expense, and $0.4 million in insurance expense.

Included in the general and administrative expense is an increase of $3.0 million arising from the Amelia acquisition and $1.2 million arising from the SYNQ3 acquisition, stemming from increased personnel-related costs.

General and administrative expenses increased by $28.9 million, or 54%, in 2025 compared to 2024, primarily due to increases in 2025 of $16.3 million in personnel-related costs caused by Amelia and Interactions acquisitions, $6.0 million in information technology and facility allocations, $2.5 million in legal and professional fees, $1.5 million in bad debt expense, $0.9 million in office expense, $0.5 million in insurance expense, $0.5 million in hardware and software cost, $0.4 million in taxes and licenses, $0.2 million in tax and payroll processing fees, $0.1 million in rent expense, $0.1 million in utilities, and other immaterial increase totaling $0.1 million including virtual services, meals and entertainment, and consulting fees, which were partially offset by a decrease of $0.2 million in cloud computing services.

We expect our general and administrative expenses to increase in the short term as we invest in our control environment.

However, in the long term, we expect general and administrative expenses to grow at a rate below that of our revenue, aligning with our strategic emphasis on cost effectiveness and sustainable financial performance.

Change in Fair Value of Contingent Acquisition Liabilities

The change in fair value of acquisition related liabilities, which is driven by the movements in our stock price and changes in the assessed probability of achieving certain future revenue targets, was a loss of $222.7 million for the year ended December 31, 2024.

The Company's year-end stock price increase resulted in an increase in its fair value of contingent acquisition liabilities where future Contingent Earnout Consideration and Contingent Holdback Consideration are marked-to-market on a quarterly basis, significantly impacting net loss and EPS during the year ended December 31, 2024.

The change in fair value of acquisition related liabilities, which is marked-to-market based on the movements in our stock price and changes in the assessed probability of achieving certain future revenue targets, was a gain of $163.1 million for the year ended December 31, 2025, compared to a loss of $222.7 million for the year ended December 31, 2024.

The decrease of the Company's stock price as of December 31, 2025 compared to the stock price as of December 31, 2024, resulted in a decrease in its fair value of contingent acquisition liabilities during the year ended December 31, 2025.

The fluctuation is non-operating and non-cash in nature.

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Amortization of Intangibles Assets

Amortization of acquired developed technology is included within cost of revenues, while the amortization of other intangible assets, including acquired customer relationships, tradename and conversation data, are included within cost of revenues and amortization of intangible assets in the Company’s consolidated statement of operations and comprehensive loss.

All intangible assets are amortized on a straight-line basis over their estimated useful lives.

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Total amortization $ 33,047 $ 14,812 $ 18,235 123 %

Restructuring

There were no restructuring expenses resulting from the Restructuring Plan recorded in the year ended December 31, 2024 as the Restructuring Plan was complete as of December 31, 2023, compared to $4.6 million of expenses incurred in the year ended December 31, 2023.

Refer to "Liquidity and Capital Resources" for additional information.

Amortization of intangibles increased by $18.2 million during the year ended December 31, 2025 compared to the same period in 2024.

The increase in amortization of intangibles was primarily attributable to the Amelia Acquisition that was closed during the third quarter of 2024 and Interaction Acquisition that was closed during the third quarter of 2025.

Loss on Extinguishment of Debt

The $15.6 million increase in loss on extinguishment of debt during the year ended December 31, 2024 was attributable to a loss on the repayment of Amelia Debt in December 2024 and the repayment of Term Loan in June 2024.

The $15.6 million decrease in loss on extinguishment of debt during the year ended December 31, 2025 was attributable to a loss on the repayment of Amelia Debt in December 2024 and the repayment of Term Loan in June 2024.

See Note 10 to our consolidated financial statements included within this report for more information.

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Interest expense decreased by $11.5 million, or 94%, in 2025 compared to 2024.

The decrease in interest expense was primarily attributable to the early repayment of Term Loan in June, 2024 and the interest expense from on our SVB March 2021 Note and SCI June 2021 Note in the year ended December 31, 2023, which were terminated at the time that the Term Loan was obtained in April 2023.

The decrease in interest expense was partially offset by the increased interest expense of $2.0 million from Amelia Debt in the year ended December 31, 2024.

We expect interest expense will decrease as a result of the extinguishment of Term Loan and Amelia Debt.

Other Income (Expense), Net

The following table summarizes our other income (expense), net by type ($ in thousands):

The decrease in interest expense was primarily attributable to the early repayment of Term Loan in June, 2024 and Amelia Debt in December, 2024, resulting in the decrease in interest expense.

Other Income, Net

The following table summarizes our other income, net by type ($ in thousands):

Year Ended December 31, Change

2025 2024 $ %

Other income, net

Interest income $ 9,799 $ 8,370 $ 1,429 17 %

Loss on change in fair value of ELOC program — (1,901) 1,901 *

Change in fair value of derivative

4,676 — 4,676 100 %

Gain on bargain purchase

— 1,223 (1,223) (100) %

Other income (expense), net 193 (371) 564 (152) %

Total other income (expense), net $ 9,222 $ 1,155 $ 8,067 699 %

* Not meaningful

Total other income, net $ 14,668 $ 9,222 $ 5,446 59 %

Interest Income

Interest income increased by $1.4 million, or 17%, in 2025 compared to 2024.

The increase was primarily attributable to interest earned on greater money market and treasury bond balances during 2024 as we engaged in significant transactions that increased our liquidity.

The increase was primarily attributable to interest earned on greater money market and treasury bond balances during the year ended December 31, 2025, as we engaged in significant transactions that increased our liquidity.

Refer to "Liquidity and Capital Resources" for a discussion of the changes in our business that led to an increase in cash for the year ended December 31, 2025.

Loss on Change in Fair Value of Equity Line of Credit Program

We recorded losses on changes in the fair value of the derivative liability associated with the ELOC (as defined below) of $1.9 million for the year ended December 31, 2023.

There was no change in fair value of the derivative liability associated with the ELOC for the year ended December 31, 2024 as we sold the entirety of the 25,000,000 shares under the ELOC during the year ended December 31, 2023.

Gain on Bargain Purchase

The gain on bargain purchase of $1.2 million was recorded within other income (expense), net in the consolidated statements of operations and comprehensive loss in the year ended December 31, 2024 as a result of a favorable fair value of identifiable net assets acquired from an immaterial acquisition at the date of acquisition as compared with the purchase price.

The gain on bargain purchase of $1.2 million was recorded within other income, net in the consolidated statements of operations and comprehensive loss in the year ended December 31, 2024 as a result of a favorable fair value of identifiable net assets acquired from an immaterial acquisition at the date of acquisition as compared with the purchase price.

See Note 3 to our consolidated financial statements included within this report for more information.

Change in Fair Value of Derivative

Change in fair value of derivative increased by $4.7 million or 100% in the year ended December 31, 2025 compared to the same period in 2024.

The increase was primarily attributable to the remeasurement gain from the change in fair value

of a derivative assumed from Amelia acquisition.

See Note 12 to our consolidated financial statements included within this report for more information.

Provision (benefit) for Income Taxes

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Provision (benefit) for income taxes $ 4,732 $ (9,247) $ 13,979 (151) %

Provision (benefit) for income taxes decreased by $13.2 million, or 336%, in 2024 compared to 2023.

This decrease was primarily attributed to increased tax benefit from acquisitions.

Provision (benefit) for income taxes increased by $14.0 million, or 151%, in 2025 compared to 2024.

This increase was primarily attributable to decreased tax benefit from acquisitions.

Liquidity and Capital Resources

Total unrestricted cash and cash equivalents on hand as of December 31, 2025 was $248.5 million.

Although we have incurred recurring losses each year since its inception, we expect we will be able to fund our operations for at least the next twelve months.

We believe we will meet longer-term expected future cash requirements and obligations through a combination of cash flows from operating activities, available cash balances and expected cash proceeds from the future at-the-market equity program.

See Note 23 to our consolidated financial statements included within this report for more information on the cash proceeds from the at-the-market equity program launched subsequent to December 31, 2024.

Although we have incurred recurring losses each year since our inception, except for a net income of $129.9 million reported for the three months ended March 31 2025, $55.2 million reported for the six months ended June 30, 2025 and $40.1 million reported for the three months ended December 31, 2025, primarily due to the change in fair value of acquisition related liabilities, we expect we will be able to fund our operations for at least the next twelve months.

Our consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business.

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Total material cash requirements $ 2,414 $ 66,371 $ 68,785

Equity Distribution Agreement

We entered into the Equity Distribution Agreement with Citigroup Global Markets Inc., Barclays Capital Inc., Wedbush Securities Inc., Northland Securities, Inc.

and Ladenburg Thalmann & Co.

on April 9, 2024 with regards to an at-the-market equity program.

Under this program, we were able to offer and sell up to $150.0 million of shares of our Class A Common Stock from time to time through the managers.

Sales of Class A Common Stock under the Equity Distribution Agreement were made at market prices by any method that is deemed to be an “at the market offering” as defined in Rule 415 under the Securities Act.

The managers were entitled to commission at a fixed rate of 2.5% of the gross sales price per share for their services in acting as agents in the sale of our Class A Common Stock.

During the year ended December 31, 2024 , we sold a total of 31,694,198 shares of our Class A common stock under the Equity Distribution Agreement, at a weighted-average price of $4.73 per share and raised $150.0 million of gross proceeds.

After deducting approximately $3.7 million, of commissions and offering costs incurred by us , th e net proceeds from sales of Class A common stock was $146.2 million during the year ended December 31, 2024.

As of December 31, 2024, we had no remaining capacity to sell our Class A common stock under the Equity Distribution Agreement.

Execute Equity Distribution Agreement

On November 12, 2024, the Company entered into an Execute Equity Distribution Agreement (the “Execute Equity Distribution Agreement”) with Barclays Capital Inc., Piper Sandler & Co., D.A.

Davidson & Co., H.C.

Wainwright & Co., LLC, and Joseph Gunnar & Co., LLC with respect to an at-the-market equity program under which we were able to offer and sell up to $120.0 million of shares of our Class A Common Stock from time to time through the agents.

Sales of Class A Common Stock under the Execute Equity Distribution Agreement were made at market prices by any method that is deemed to be an “at the market offering” as defined in Rule 415 under the Securities Act.

The agents were entitled to commission at a fixed rate of 2.5% of the gross sales price per share for their services in acting as agent in the sale of the Company's Class A Common Stock.

During the year ended December 31, 2024 , we sold a total of 16,224,989 shares of our Class A common stock under the Execute Equity Distribution Agreement, at a weighted-average price of $7.40 per share and raised $120.0 million of gross proceeds.

After deducting approximately $3.0 million of commissions and offering costs incurred by us , th e net

proceeds from sales of Class A common stock was $117.0 million during the year ended December 31, 2024.

As of December 31, 2024, the Company had no remaining capacity to sell the Company's Class A common stock under the Execute Equity Distribution Agreement.

Second Equity Distribution Agreement

On January 24, 2025, we entered into an Equity Distribution Agreement (the "Second Equity Distribution Agreement") with Cantor Fitzgerald & Co., Guggenheim Securities, LLC, Oppenheimer & Co.

Inc., Wedbush Securities Inc., Ladenburg Thalmann & Co.

and Northland Securities, Inc.

with respect to an ATM program.

Under this program, we may offer and sell up to $250.0 million of shares of our Class A Common Stock from time to time through the sales managers.

Sales of our Class A Common Stock, if any, under the Second Equity Distribution Agreement will be made at market prices by any method that is deemed to be an “at the market offering” as defined in Rule 415 under the Securities Act.

The sales managers are entitled to commission at a fixed rate of 2.0% of the gross sales price per share for their services in acting as agent in the sale of our Class A Common Stock.

During the year ended December 31, 2025, we sold an aggregate of 13,913,014 shares of our common stock under the Second Equity Distribution Agreement, at an average price of $14.48 per share and raised $201.5 million of gross proceeds.

The commissions and offering costs borne by us were approximately $4.0 million.

As of December 31, 2025, the Company had a remaining capacity to sell up to an additional $48.5 million of our common stock under the Second Equity Distribution Agreement.

SYNQ3 Acquisition

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We also withheld purchase consideration of $0.5 million in cash and 1,179,514 shares of our Class A Common Stock, subject to customary net working capital adjustments, to partially secure the indemnification obligations of SYNQ3's former stockholders under the merger agreement and agreed to pay up to $0.8 million in cash and 1,434,936 in shares of our Class A Common Stock to certain former stockholders of SYNQ3 based upon the achievement of specified future milestones.

We also issued 2,033,156 restricted shares of our Class A Common Stock subject to time and performance-based vesting conditions.

We incurred $2.1 million in acquisition related expenses, of which $1.0 million were incurred during the year ended December 31, 2024 and recorded as general and administration expenses in its consolidated statements of operations and comprehensive loss.

The $0.5 million in cash and 1,179,514 shares of our Class A Common Stock is being withheld for a period of 15 months (the “Holdback Amount”).

We determined that there are two components to the Holdback Amount related to deferred consideration and contingent consideration, each comprised of cash and shares.

On the SYNQ3 Acquisition Date, we also issued 2,033,156 restricted shares of our Class A Common Stock subject to time and performance-based vesting conditions.

The fair value of the purchase consideration was $15.8 million.

We incurred $2.2 million in acquisition related expenses, of which $0.1 million, $1.0 million, and $1.1 million were incurred during the years ended December 31, 2025, 2024 and 2023, respectively, and recorded as general and administration expenses in its consolidated statements of operations and comprehensive loss.

SYNQ3 Holdback

The $0.5 million in cash and 1,179,514 shares of our Class A Common Stock were withheld for a period of 15 months (the “SYNQ3 Holdback Amount”).

We determined that there are two components to the SYNQ3 Holdback Amount related to deferred consideration and contingent consideration, each comprised of cash and shares.

The deferred cash holdback consideration of $0.1 million and the deferred share holdback consideration of 361,145 shares of our Class A Common Stock (collectively, the “Deferred Consideration”) were not recognized as of the SYNQ3 Acquisition Date as such amounts were offset by the indemnification obligations of SYNQ3's former stockholders.

The contingent cash and share holdback consideration to be issued is variable (“Contingent Holdback Consideration”).

The contingent cash and share holdback consideration to be issued is variable (“Contingent SYNQ3 Holdback Consideration”).

Final amounts to be issued will be reduced based upon future actions and settlements with third parties to resolve assumed contingent sales tax liabilities and certain other assumed contingent liabilities of SYNQ3 in connection with the SYNQ3 Acquisition.

We accounted for the Contingent Holdback Consideration as a liability on the consolidated balance sheet.

As of the SYNQ3 Acquisition Date, the Contingent Holdback Consideration was estimated to be $0.6 million in aggregate and to be settled in $0.1 million cash and the remainder in shares of our Class A Common Stock.

During the year ended December 31, 2024, we issued 38,277 shares of our Class A Common Stock and paid an immaterial amount in cash from the Contingent Holdback Consideration to SYNQ3's former stockholders as a result of the net working capital adjustments settled during the year.

The Contingent Holdback Consideration will be subsequently remeasured at each reporting date with changes in fair value recognized as a component of operating expense on our consolidated statement of operations and comprehensive loss.

For the year ended December 31, 2024, we recognized a loss of $3.7 million related to the Contingent Holdback Consideration.

We accounted for the Contingent SYNQ3 Holdback Consideration as a liability on the consolidated balance sheet.

As of the SYNQ3 Acquisition Date, the Contingent SYNQ3 Holdback Consideration was estimated to be $0.6 million in aggregate and to be settled in $0.1 million cash and the remainder in shares of our Class A Common Stock.

During the year ended December 31, 2024, we issued 38,277 shares of our Class A Common Stock and paid an immaterial amount in cash from the Contingent SYNQ3 Holdback Consideration to SYNQ3's former stockholders as a result of the net working capital adjustments settled during the year.

The Contingent SYNQ3 Holdback Consideration will be subsequently remeasured at each reporting date with changes in fair value recognized as a component of operating expense on our consolidated statement of operations and comprehensive loss.

For the year ended December 31, 2025, we recognized a loss of less than $0.1 million related to the Contingent SYNQ3 Holdback Consideration.

In April 2025, the Contingent SYNQ3 Holdback Consideration was settled by issuing 472,501 shares of the Company’s Class A Common Stock and paying $0.2 million in cash.

After the holdback settlement, any remaining indemnifications by the sellers to cover unsettled claims was offset against the Contingent SYNQ3 Earnout Consideration to the extent of its fair value as of June 30, 2025.

See Note 12 to our consolidated financial statements included within this report for more information on the fair value measurement of Contingent SYNQ3 Holdback Consideration.

Contingent SYNQ3 Earnout Consideration

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As of the SYNQ3 Acquisition Date, the Contingent SYNQ3 Earnout Consideration was estimated to be $1.7 million in aggregate and to be settled in $0.2 million cash and the remainder in shares of our Class A Common Stock.

For the year ended December 31, 2024, we recognized a loss of $7.0 million related to the Contingent SYNQ3 Earnout Consideration, reflected in the change in fair value of contingent acquisition liabilities in the consolidated statement of operations and comprehensive loss.

As of December 31, 2024, the

2024 revenue target was not met but we assessed the 2025 and 2026 revenue target were probable of being met, and no earnout consideration was issued during the year ended December 31, 2024.

See Note 12 to our consolidated financial statements included within this report for more information on the fair value measurement of Contingent SYNQ3 Earnout Consideration.

For the years ended December 31, 2025 and December 31, 2024, we recognized a gain of $6.9 million and a loss of $7.0 million, respectively, related to the Contingent SYNQ3 Earnout Consideration, reflected in the change in fair value of contingent acquisition liabilities in the consolidated statement of operations and comprehensive loss.

As of December 31, 2025, the 2024 revenue target was not met, but the 2025 revenue target was met and the related earnout consideration is expected to be settled in the first quarter of 2026.

The Company assessed the 2026 revenue target as probable of being met.

No earnout consideration was issued as of December 31, 2025.

Restricted stock awards

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As a result, we determined that these awards should be accounted for separately from the SYNQ3 Acquisition and therefore are excluded from purchase consideration.

During the year ended December 31, 2024, we recorded measurement period adjustments to decrease the deferred revenue by $0.1 million as the revenue recognition criteria had been met at the acquisition date and to increase the accrued liabilities by $1.8 million resulting from a pre-acquisition legal settlement, and to decrease the deferred tax liability assumed by $0.2 million.

Refer to Note 8 to these consolidated financial statements for more information on the legal proceedings.

These measurement period adjustments resulted in a decrease of $0.1 million in deferred cash consideration, $0.6 million in deferred equity consideration, and $0.4 million in contingent holdback consideration in accordance with the merger agreement.

As a result of the adjusted acquisition-date fair value of assets acquired and liabilities assumed, we recorded an increase of $0.2 million to the goodwill recognized.

The measurement period adjustments were recorded in the consolidated financial statements as of and for the year ended December 31, 2024 and were made to reflect facts and circumstances that existed as of the SYNQ3 Acquisition Date.

The purchase price allocation has been finalized as of December 31, 2024.

The purchase price allocation was finalized as of December 31, 2024.

Amelia Acquisition

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We agreed to issue up to 16,822,429 shares to the selling shareholders based on achievement of certain revenue targets in fiscal years 2025 and 2026.

The fair value of the preliminary purchase consideration was $98.6 million.

The fair value of the purchase consideration was $98.6 million.

In connection with the Amelia Acquisition, we assumed the amended senior secured term loan facility from Amelia in an aggregate principal amount of $121.5 million (“Amelia Debt”).

See Note 10 to our consolidated financial statements included within this report for more information on the Amelia Debt.

On December 3, 2024, we entered into a letter agreement (the “Amelia Debt Payoff Letter”) to prepay in full all indebtedness and other amounts outstanding and owing under the Amelia Debt Credit Agreement and the Amelia Debt was subsequently paid in full.

Escrow Consideration

On the Amelia Acquisition Date, we issued and deposited 2,149,530 shares of our Class A Common Stock into and escrow account in order to partially secure the indemnification obligations of the selling shareholders under the purchase agreement.

On the Amelia Acquisition Date, we issued and deposited 2,149,530 shares of our Class A Common Stock into an escrow account in order to partially secure the indemnification obligations of the selling shareholders under the purchase agreement.

We accounted for the escrow consideration as equity issued as part of consideration transferred.

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This derivative did not have a material impact to the financial statements for the year ended December 31, 2024.

For the years ended December 31, 2025 and 2024, we recognized a gain of $4.7 million and zero, respectively, related to remeasurement of the derivative, reflected in the other income, net in the consolidated statement of operations and comprehensive loss.

Upon the expiration of the escrow period, any remaining shares in the escrow account will be released to the selling shareholders.

See Note 12 to our consolidated financial statements included within this report for more information on the fair value measurement of the derivative related to indemnification rights.

Upon the expiration of the escrow period, any remaining shares within the escrow account will be released to the selling shareholders.

Contingent Amelia Earnout Consideration

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As of the Amelia Acquisition Date, the Contingent Amelia Earnout Consideration had an estimated fair value of $66.3 million and will be settled in shares of our Class A Common Stock.

For the year ended December 31, 2024, we recognized a $211.9 million loss related to the Contingent Amelia Earnout Consideration, reflected in the change in fair value of contingent acquisition liabilities in the consolidated statement of operations and comprehensive loss.

See Note 12 to our consolidated financial statements included within this report for more information on the fair value measurement of Contingent Amalia Earnout Consideration.

As of December 31, 2024, we assessed the 2025 and 2026 revenue target were probable of being met.

The preliminary purchase price allocation has not been finalized as of December 31, 2024 primarily due to the final assessment of the fair values of the intangible assets, contingent tax liability assumed and fair value of the contingent acquisition liabilities.

The fair value estimates of assets acquired and liabilities assumed is pending the completion of various items, including obtaining further information regarding the identification and valuation of all assets acquired and liabilities assumed.

Any adjustments to the estimates of purchase price allocation will be made in the periods in which the adjustments are determined, and the cumulative effect of such adjustments will be calculated as if the adjustments had been completed as of the acquisition date.

We expect to finalize the purchase price allocation within 12 months from the Amelia Acquisition Date.

During the year ended December 31, 2024, we recorded measurement period adjustments to increase the cash consideration by $12.8 thousand, to decrease the accounts receivable by $0.2 million, increase the accrued liabilities by $0.9 million due to additional payroll taxes identified, to decrease the non-current income tax liabilities by $1.8 million due to the change of pre-acquisition tax exposures subsequent to the acquisition.

As a result of the adjusted acquisition-date fair value of cash consideration, assets acquired and liabilities assumed, we recorded a decrease of $0.7 million to the goodwill recognized.

For the years ended December 31, 2025 and 2024, we recognized a $157.6 million gain and a $211.9 million loss related to the Contingent Amelia Earnout Consideration, respectively, reflected in the change in fair value of contingent acquisition liabilities in the consolidated statement of operations and comprehensive loss.

See Note 12 to our consolidated financial statements included within this report for more information on the fair value measurement of Contingent Amelia Earnout Consideration.

As of December 31, 2025, the 2025 revenue target was met and the related earnout consideration is expected to be settled in the first quarter of 2026.

We assessed the 2026 revenue target as probable of being met.

During the year ended December 31, 2025, we recorded measurement period adjustments to decrease the accrued liabilities by $0.1 million and other current liabilities by $0.4 million due to true-up of the accrued payroll taxes and sales taxes subsequent to the acquisition.

As a result of the adjusted acquisition-date fair value of liabilities assumed, we recorded a decrease of $0.5 million to the goodwill recognized.

The measurement period adjustments were recorded in the consolidated financial statements as of and for the year ended December 31, 2025 and were made to reflect facts and circumstances that existed as of the Amelia Acquisition Date.

In addition to the measurement period adjustments, we also recorded adjustments to correct certain errors in the preliminary purchase price allocation that existed as of the acquisition date during the year ended December 31, 2024, which decreased the contingent earnout consideration by $5.3 million, decreased the accounts payable by $3.7 million, decreased the accrued liabilities by $1.2 million, increased deferred revenue by $0.3 million and increased the deferred tax liabilities by $0.7 million.

As a result of the adjusted acquisition-date fair value of contingent earnout consideration recognized, assets acquired and liabilities assumed, we recorded a decrease of $9.3 million to the goodwill recognized.

The identified error related to the contingent earnout consideration had an immaterial impact to the change in fair value from the acquisition date through September 30, 2024, which would have been recorded in change in fair value of contingent acquisition liabilities in the consolidated statements of operations and comprehensive loss.

The purchase price allocation was finalized as of September 30, 2025.

We incurred $6.7 million in acquisition related expenses, of which $0.9 million and $5.8 million were incurred during the years ended December 31, 2025 and December 31, 2024, respectively, and recorded as general and administration expenses in its consolidated statements of operations and comprehensive loss.

Interactions Acquisition

This strategic deal is expected to strengthen and extend SoundHound’s growing leadership in Agentic AI and accelerate its market penetration in customer service across enterprise businesses.

The transaction also expands SoundHound’s customer portfolio across various industries, including global consumer icons, large technology device brands, insurers, automakers, and other preeminent Fortune 100 companies across industries.

The fair value of the preliminary purchase consideration was $76.1 million.

The preliminary purchase consideration includes $19.4 million of cash paid to the selling shareholders.

We also paid $4.1 million of cash for seller transaction expenses in connection with the closing of the Interactions Acquisition.

In connection with the Interactions Acquisition, we paid the debt held by Interactions (the “Interactions Debt”) on the Interactions Acquisition Date in an aggregate principal amount of $41.5 million as part of the purchase consideration under the merger agreement.

We have also withheld purchase consideration of $1.2 million in cash, subject to customary net working capital adjustments, to partially secure the indemnification obligations of Interactions' former stockholders under the merger agreement and agreed to pay up to $25.0 million in cash to certain former stockholders of Interactions based upon the

achievement of specified future milestones in fiscal years 2026 and 2027 (the "Contingent Interactions Earnout Consideration).

Interactions Holdback

As of the Interactions Acquisition Date, the $1.2 million in cash withheld (the "Deferred Interactions Holdback Consideration") consisted of two components, adjustment holdback consideration and indemnity holdback consideration.

The adjustment holdback consideration of $1.0 million was recorded within other current liabilities at fair value as of the Interactions Acquisition Date (the "Interactions Adjustment Holdback Consideration"), and is estimated to be paid within 120 days subsequent to the Interactions Acquisition Date to Interactions' former stockholders for the settlement of net working capital adjustments.

The indemnity holdback consideration of $0.2 million was recorded within other current liabilities, which was withheld for a period of 12 months subsequent to the Interactions Acquisition Date (the "Interactions Indemnity Holdback Consideration").

Payment will occur after the sellers complete their review of the closing statement which must be submitted by the acquirer within 120 days of the Interactions Acquisition Date.

Contingent Interactions Earnout Consideration

We also agreed to pay up to $25.0 million in cash to the selling shareholders based on achievement of certain annual revenue targets in fiscal years 2026 and 2027 and renewal or extension of an existing contract with a specific customer on or before March 31, 2026.

We accounted for the Contingent Interactions Earnout Consideration as a liability within contingent acquisition liabilities on the consolidated balance sheets and will subsequently remeasure the liability at each reporting date with changes in fair value recognized as a component of operating expense in the consolidated statement of operations and comprehensive loss.

As of the Interactions Acquisition Date, the Contingent Interactions Earnout Consideration had an estimated fair value of $9.9 million.

For year ended December 31, 2025, we recognized a loss of $1.3 million related to the Contingent Interactions Earnout Consideration, reflected in the change in fair value of contingent acquisition liabilities in the consolidated statement of operations and comprehensive loss.

As of December 31, 2025, we assessed the 2026 and 2027 revenue targets were probable of being met, and an existing contract with a specific customer was probable of being renewed or extended on or before March 31, 2026.

The purchase accounting is not yet complete as of December 31, 2025 and as such, the final allocation among purchase consideration, intangible assets, net assets acquired and goodwill may be subject to change.

Any adjustments to the preliminary purchase price allocation will be made in the periods in which the adjustments are determined, and the cumulative effect of such adjustments will be calculated as if the adjustments had been completed as of the acquisition date.

The Company expects to finalize the purchase price allocation within 12 months from the Interactions Acquisition Date.

We incurred $5.0 million in acquisition related expenses during the year en ded December 31, 2025 and recorded as general and administration expenses in its consolidated statements of operations and comprehensive loss .

Other Acquisition

On June 14, 2024, we completed an immaterial acquisition for total preliminary purchase consideration of $1.0 million .

As part of the acquisition, we acquired net assets of $2.2 million , including intangible assets of $2.6 million , and recognized a preliminary gain on bargain purchase of $1.2 million within other income (expense), net in the consolidated statements of operations and comprehensive loss during the year ended December 31, 2024, resulting from a favorable fair value of identifiable net assets acquired at the date of acquisition as compared with the purchase price.

On June 14, 2024, we completed an immaterial acquisition for total purchase consideration of $1.0 million .

As part of the acquisition, we acquired net assets of $2.2 million , including intangible assets of $2.6 million , and recognized a gain on bargain purchase of $1.2 million within other income, net in the consolidated statements of operations and comprehensive loss during the year ended December 31, 2025, resulting from a favorable fair value of identifiable net assets acquired at the date of acquisition as compared with the purchase price.

We were able to negotiate a bargain purchase price as a result of the recurring losses and pre-filing bankruptcy status of the selling entity.

Th e preliminary purchase price allocation has not been finalized as of December 31, 2024 primarily due to the final assessment of the f air values of the intangible assets .

Any adjustments to the estimates of purchase price allocation will be m ade in the periods in which the adjustments are determined, and the cumulative effect of such adjustments will be calculated as if

the adjustments had been completed as of the acquisition date.

We expect to finalize the purchase price allocation within 12 months from the acquisition date.

We incurred $0.1 million in acquisition related expenses during the year ended December 31, 2024 and recorded as general and administration expenses in its consolidated statements of operations and comprehensive loss.

Sales Agreement

On July 28, 2023 , we entered into the Sales Agreement with Cantor Fitzgerald & Co., H.C.

Wainwright & Co., LLC, and D.A.

Davidson & Co., pursuant to which we were able to offer and sell up to $150.0 million of shares of our Class A Common Stock from time to time through or to the sales agents acting as agent or principal.

Sales of our Class A Common Stock under the Sales Agreement were made at market prices by any method that is deemed to be an “at the market offering” as defined in Rule 415 under the Securities Act.

The sales agents were entitled to aggregate compensation at a fixed commission rate of 2.5% of the gross sales price per share sold under the Sales Agreement.

We agreed to reimburse the sales agents for certain specified expenses, including the reasonable and documented fees and disbursements of its legal counsel in an amount of $75 thousand in the aggregate in connection with the execution of the Sales Agreement.

During the year ended December 31, 2024, we sold a total of 37,907,219 shares of our Class A common stock under the Sales Agreement at a weighted-average price of $3.62 per share and raised $137.3 million of gross proceeds, which resulted in complete utilization of the Sales Agreement as of March 31, 2024.

After deducting approximately $3.4 million of commissions and offering costs incurred by us, the net proceeds from sales of Class A common stock was $133.8 million.

Debt Financing

On April 14, 2023 (the “Term Loan Closing Date”), we entered into a Senior Secured Term Loan Credit Agreement (the “Credit Agreement”) with ACP Post Oak Credit II LLC, as Administrative Agent and Collateral Agent for the Lenders (the “Agent”), and the lenders from time to time party thereto (the “Lenders”).

The Credit Agreement provided for a term loan facility in an aggregate principal amount of up to $100.0 million , the entirety of which was funded on the Term Loan Closing Date.

As of June 30, 2024, the interest rate was approximately 14.0% .

Subject to certain exceptions as set forth in the Credit Agreement, interest on the Term Loan is payable quarterly in arrears on the last business day of each fiscal quarter.

The Term Loan was set to mature on April 14, 2027 (the “Maturity Date”).

The Credit Agreement provided for no scheduled principal payments prior to the Maturity Date.

Refer to Note 10 of the consolidated financial statements for further information regarding the Credit Agreement, and amortization of the debt issuance cost and debt discount.

On June 7, 2024, we entered into a letter agreement (the “Payoff Letter”) to prepay in full all indebtedness and other amounts outstanding and owing under the Credit Agreement.

In connection with the Term Loan prepayment, we paid a total of $105.6 million on June 7, 2024, which consisted of (i) the remaining principal amount outstanding of $100.0 million , (ii) a prepayment premium of $5.0 million , (iii) transaction expenses of $0.6 million , resulting in a loss on debt extinguishment of $15.6 million .

Accordingly, the accrued and unpaid interest of $2.6 million was waived under the Payoff Letter.

In connection with the Amelia Acquisition, we assumed the amended senior secured term loan facility from Amelia in an aggregate principal amount of $121.5 million (“Amelia Debt”) and on August 7, 2024, we paid $70.0 million in cash to pay down a portion of the outstanding principal balance and issued 2,943,917 shares of Class A common stock to settle certain fees associated with the Amelia Debt.

The remaining outstanding balance of $39.7 million had a maturity date of June 30, 2026 (the “Maturity Date”) and provided, at our election, for payment of a portion of interest in cash or in kind ("PIK"), in which case interest would be capitalized and added to the outstanding principal amount, with principal and accrued interest due at the Maturity Date.

On December 3, 2024 , we entered into a letter agreement (the “Amelia Debt Payoff Letter”) to prepay in full all indebtedness and other amounts outstanding and owing under the Amelia Debt Credit Agreement.

In connection with the Amelia Debt prepayment, we paid a total of $39.8 million on December 4, 2024, which consisted of the remaining principal amount outstanding of $39.8 million and transaction expenses of $42 thousand, resulting in a loss on debt

extinguishment of $42 thousand.

Refer to Note 10 of the consolidated financial statements for further information regarding the Amelia Debt .

Equity Line of Credit (ELOC)

On August 16, 2022, we entered into a common stock purchase agreement (the “Common Stock Purchase Agreement”) and related registration rights agreement (the “CFPI Registration Rights Agreement”) with CF Principal Investments LLC (the “Counterparty”).

Pursuant to the Common Stock Purchase Agreement, we had the right to sell to the Counterparty up to the lesser of (i) 25,000,000 shares of Class A Common Stock and (ii) the Exchange Cap (as defined in the Common Stock Purchase Agreement), subject to certain limitations and conditions set forth in the Common Stock Purchase Agreement (the "ELOC Shares").

On February 14, 2023, our Registration Statement on Form S-1 registering the resale of the ELOC Shares (the "ELOC Registration Statement") was declared effective.

On March 31, 2023, a post-effective amendment to the ELOC Registration Statement was declared effective.

During the year ended December 31, 2023, we sold the entirety of the 25,000,000 shares under the ELOC program for aggregate proceeds of approximately $71.7 million.

Series A Preferred Stock

On or around January 20, 2023, we entered into Preferred Stock Purchase Agreements with certain investors (the "Investors"), pursuant to which we issued and sold to the Investors an aggregate of 835,011 shares of our newly designated Series A Convertible Preferred Stock for an aggregate issue price of approximately $25.0 million.

Each share of Series A Preferred Stock was convertible, at the option of the holder, into such number of shares of Class A Common Stock equal to the liquidation preference per share ("Liquidation Preference") at the time of conversion divided by $1.00 (the “Conversion Price”).

In addition, each share of Series A Preferred Stock would automatically convert into shares of Class A Common Stock at the Conversion Price on or after January 20, 2024 if and when the daily volume-weighted average closing price per share of Class A Common Stock is at least 2.5 times the Conversion Price for each of any 90 trading days during any 120 consecutive trading day period, which 120-trading day period may commence (but may not end) prior to January 20, 2024.

During the year ended December 31, 2024, 475,005 shares of preferred stock were converted into 16,624,215 shares of Class A Common Stock.

The conversion was pursuant to the original terms of the agreement and therefore the carrying value of Series A Preferred Stock was converted into Class A Common Stock with no gain or loss upon conversion.

As of December 31, 2024, all the Series A Preferred Stock have been converted to Class A Common Stock.

The holders of Series A Preferred Stock were entitled to cumulative dividends payable for such share at the rate of 14% per annum, compounding semi-annually to Liquidation Preference on January 1 and July 1 of each year.

Total cumulative dividends attributable to Series A Preferred Stock for the year ended December 31, 2024 were $0.4 million.

Contractual and Other Obligations

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These requirements generally include funding for the research and development of software, the development of applications that enable voice interaction, marketing programs and personnel-related costs.

The primary types of obligations into which we enter include contractual obligations, operating and finance lease obligations and a diversified spread of debt instruments.

The primary types of obligations into which we enter include contractual obligations, operating and

finance lease obligations and a diversified spread of debt instruments.

See Note 8, Note 10 and Note 16 to our consolidated financial statements included within this Annual Report on Form 10-K for more information.

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Cash Flows Used in Operating Activities

Net cash used in operating activities was $108.9 million during 2024 compared to $68.3 million during 2023.The $40.6 million decrease in cash used in operating activities was primarily due to our increased net loss of $261.7 million, a net decrease in changes in operating assets and liabilities of $15.8 million, an increase in deferred income taxes of $12.2 million resulting from the tax benefit from acquisitions, a decrease in amortization of debt issuance cost of $3.8 million, a decrease in loss on change in fair value of ELOC program of $1.9 million, and a decrease in non-cash lease amortization of $0.7 million, a net increase in other non-cash loss of $0.7 million, and an increase in foreign currency gain from remeasurement of $0.2 million.

This was partially offset by an increase of $222.7 million in change in the fair value of contingent acquisition liabilities, $14.8 million in loss on early extinguishment of debt, $13.7 million in depreciation and amortization, and $5.2 million in stock-based compensation.

The main driver for the increased operating cash outflow was the acquisitions closed during 2024, which resulted in the higher operating expenses, such as personnel related costs and acquisition related costs, compared to the prior year.

Net cash used in operating activities was $98.2 million during 2025 compared to $108.9 million during 2024.The $10.7 million decrease in cash used in operating activities was primarily due to decreases of $336.7 million in net loss, and increases of $47.5 million in stock-based compensation, $18.1 million in depreciation and amortization, $13.5 million in deferred income taxes, $2.5 million in other non-cash loss, $1.6 million in amortization of capitalized commissions and non-cash lease amortization of $0.3 million, which were partially offset by the movement of $385.8 million in change in fair value of contingent acquisition liabilities, decrease of $15.6 million in loss on early extinguishment of debt, $4.7 million from change in the fair value of derivatives, $1.6 million in amortization of debt issuance cost, $0.9 million in changes in operating assets and liabilities, and $0.9 million in foreign currency gain from remeasurement.

Within the increase of $47.5 million in stock-based compensation, $3.8 million was related to accelerated vesting of RSAs during the year ended December 31, 2025 as part of our integration plan of SYNQ3.

Cash Flows Used in Investing Activities

Net cash used in investing activities was $59.5 million during 2025 compared to $12.4 million during 2024.

The $12.0 million increase in cash used in investing activities was primarily driven by the payments related to acquisitions of $11.7 million and an increase in purchases of property and equipment of $0.2 million.

The $47.1 million increase in cash used in investing activities was primarily driven by the increases of payments related to acquisitions of $42.9 million and software development costs of $4.0 million and payments related to purchases of property and equipment of $0.3 million.

Cash Flows Provided by Financing Activities

Net cash provided by financing activities was $208.1 million during 2025 compared to $210.9 million during 2024.

The $42.7 million increase in cash provided by financing activities was primarily due to the $384.5 million increase in net proceeds from sales of Class A Common Stock under the Sales Agreement, Equity Distribution Agreement and Execute Equity Distribution Agreement, and an increase of $29.7 million in proceeds from exercise of stock options and employee stock purchase plan.

This was partially offset by the $215.4 million of the repayment of Term Loan and Amelia Debt during the year ended December 31, 2024 compared to the $35.0 million of the repayment of SVB March 2021 Note and the SCI June 2021 Note during the year ended December 31, 2023, $71.6 million decrease in net proceeds from sales of Class A Common Stock under the ELOC program during the year ended December 31, 2023, a decrease of $85.1 million in net proceeds from the issuance of Term Loan, a decrease of $24.9 million in net proceeds from the one-time issuance of Series A Preferred Stock, and a decrease of $9.4 million in net proceeds from the issuance of common stock during the year ended December 31, 2024.

The $2.8 million decrease in cash provided by financing activities was primarily due to decreases of $199.4 million in net proceeds from sales of Class A Common Stock under the Sales Agreement and Second Equity Distribution Agreement and $18.9 million in proceeds from exercise of stock options and employee stock purchase plan, which is partially offset by decreases of $215.4 million in the payment of notes payable.

Off-Balance Sheet Arrangements

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We enter into standard indemnification arrangements in the ordinary course of business.

Pursuant to these arrangements, we indemnify, hold harmless and agree to reimburse the indemnified parties for losses suffered or incurred

by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third party with respect to its technology.

Pursuant to these arrangements, we indemnify, hold harmless and agree to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third party with respect to its technology.

The term of these indemnification agreements is generally perpetual any time after the execution of the agreement.

The maximum potential amount of future payments we could be required to make under these arrangements is not determinable.

Additionally, we have, and may in the future, indemnify third parties in connection with our issuance of securities (including pursuant to our at-the-market offering program) and in connection with acquisitions of other companies.

The maximum potential amount of future payments we could be required to

make under these arrangements is not determinable.

Additionally, we have, and may in the future, indemnify third parties in connection with our issuance of securities (including pursuant to our ATM offering program) and in connection with acquisitions of other companies.

Our liability is generally limited to the aggregate amount of consideration actually received in these instances.

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The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosures of contingent assets and liabilities at the date of the financial statements, as well as the reported income (loss) generated and expenses incurred during the reporting periods.

Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgement about the carrying value of assets and liabilities that are not readily apparent from other sources.

Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgment about the carrying value of assets and liabilities that are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions or conditions and any such differences may be material.

Historically, our assumptions, judgments and estimates relative to our critical accounting policies have not differed materially from actual results.

We believe that the assumptions, judgments and estimates involved in the accounting for revenue recognition, derivative liabilities, warrant liabilities, stock-based compensation, business combinations, contingent consideration, goodwill, and intangible assets with definite lives, have the greatest potential impact on our consolidated financial statements.

We believe that the assumptions, judgments and estimates involved in the accounting for revenue recognition, derivative liabilities, warrant liabilities, stock-based compensation, business combinations, contingent consideration, goodwill, intangible assets with definite lives, and capitalized software development costs, have the greatest potential impact on our consolidated financial statements.

These areas are key components of our results of operations and are based on complex rules requiring us to make judgments and estimates, and consequently, we consider these to be our critical accounting policies.

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We recognize revenue with customers in accordance with ASC Topic 606, Revenue from Contracts with Customers.

We recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

Revenues are generally recognized upon the transfer of control of promised products or services provided to customers, reflecting the amount of consideration we expect to receive for those goods or services.

Our arrangements with customers may contain multiple performance obligations.

Individual services are accounted for separately if they are distinct — that is, if a customer can benefit from it on its own or with other resources that are readily available to the customer and if the service is separately identifiable from other promised obligation in the contract.

We primarily derive revenue from the following performance obligations:

(1) hosted services, (2) professional services, (3) monetization, and (4) licensing.

We apply significant judgement in identifying and evaluating any terms and conditions in contracts which may impact revenue recognition.

Revenues are reported net of applicable sales and use taxes that are passed through to customers.

We apply significant judgment in identifying and evaluating any terms and conditions in contracts which may impact revenue recognition.

Hosted Services

Hosted services, along with non-distinct customization, integration, maintenance and support professional services, allow customers to access the Houndify and Amelia software platform over the contract period without taking possession of the software.

Hosted services, along with non-distinct customization, integration, maintenance and support professional services, allow customers to access the Houndify, Amelia Software Platform, and Virtual Assistance applications over the contract period without taking possession of the software.

We have determined that the hosted services arrangements are a single performance obligation comprised of a series of distinct services, since each day of providing access to hosted services is substantially the same and the customer simultaneously receives and consumes the benefits as access is provided.

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We recognize revenue as each distinct service period is performed.

Hosted services generally include up-front services to develop and/or customize the application to each customer’s specification.

Judgement is required to determine whether these professional services are distinct from the hosted services.

In making this determination, factors such as the degree of integration, the customers’ ability to start using the software prior to customization, and the availability of these services from other independent vendors are considered.

In instances where we concluded that the up-front services are not distinct performance obligations, revenue for these activities is recognized over the period which the hosted services are provided and is included within hosted services revenue.

All revenues derived as a result of the SYNQ3 Acquisition, and substantial revenues derived as a result of the Amelia Acquisition are categorized as hosted services revenue.

Hosted services may include implementation services to develop and/or customize the applications to each customer’s specification.

Judgment is required to determine whether these professional services are distinct from the hosted services.

In making this determination, factors such as the degree of integration, the significance of enhancement to existing

functionality, the customers’ ability to start using the software prior to customization, the evaluation as to whether the services extend the economic life of the application, and the availability of these services from other independent vendors are considered.

In instances where we concluded that the implementation services are not distinct performance obligations, revenues for these activities are recognized over the period which the hosted services are expected to be provided and is included within hosted services revenue.

All revenues derived as a result of the SYNQ3 Acquisition, and substantial revenues derived as a result of the Amelia Acquisition and Interactions Acquisition are categorized as hosted services revenue.

Professional Services

Revenue from distinct professional services, such as non-integrated development services and other professional services, are either recognized over time based upon the progress towards completion of the project, or at a point in time at project completion, depending on the nature of the arrangement.

Measuring the stage of completion of a project requires significant judgement and estimates, including actual efforts spent in relation to estimated total costs, and percentage of completion based on input and output measures.

Revenues from distinct professional services, such as non-integrated development services and other professional services, are either recognized over time based upon the progress towards completion of the project, or at a point in time at project completion.

The Company assesses distinct professional services to determine whether the transfer of control is over-time or at a point in time.

The Company considers three criteria in making their assessment including (1) the customer simultaneously receives and consumes the benefits;

(2) the Company’s performance creates or enhances an asset that the customer controls as the asset is created or enhanced;

or (3) the Company’s performance does not create an asset with an alternative use to the entity and the entity has an enforceable right to payment for performance completed to date.

If none of the criteria are met, revenues are determined to be recognized at a point in time.

Monetization revenues are primarily derived from advertising payments associated with ad impressions placed on the SoundHound music identification application.

The amount of revenue is based on actual monetization generated or usage, which represents variable consideration with the constrained estimate.

Therefore, we recognize the related revenues when advertisements are placed, when commissions are paid, or when the SoundHound application is downloaded.

The amount of revenue is based on actual monetization generated or usage, which represent a variable consideration with constrained estimates.

Therefore, we recognize the related revenues at a point in time when advertisements are placed, when commissions are paid, or when the SoundHound application is downloaded.

The determination of whether revenue should be reported on a gross or net basis is based on an assessment of whether we are acting as a principal or an agent in the transaction.

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Based on these factors, we report revenue on a net basis.

We license voice and Amelia's software solutions that are embedded in customers' products or services.

We license Amelia's software solutions, Virtual Assistance applications, and other voice solutions that are embedded in customers' products or services.

Licensing revenue is a distinct performance obligation that is recognized when control is transferred to the customer, which is at a point in time for non-customized solutions.

For licenses with non-distinct customized solutions, revenues are recognized over time based on the progress towards completion of the customized solution.

Revenues generated from licensing are on usage-based arrangements with a per unit pricing or on fixed considerations.

Revenues generated from licensing are on royalty arrangements with a per unit pricing or on fixed considerations.

The Company records licensing revenue relating to usage-based royalty arrangements in the same period in which the underlying usage occurs.

Licensing revenue on fixed considerations including fixed fee and minimum guarantee from usage-based arrangements are recognized when the Company grants the customer the right to use and benefit from the license at the start of the licensing period.

Licensing revenue on fixed considerations including fixed fee and minimum guarantee from royalty arrangements are recognized when the Company grants the customer the right to use and benefit from the license at the start of the licensing period.

Licenses may include post-contract support, which is a distinct performance obligation and revenue from post-contract support is recognized ratably over the licensing period.

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We enter into certain agreements to sell common stock with counterparties to further support our growth strategy through initiatives such as accretive acquisitions and internal investments, to bolster working capital and for general corporate purposes.

We evaluate our common stock purchase agreements to determine whether they are indexed to our own

common stock, and therefore whether they should be accounted for as derivatives with changes in fair value as other income (expense), net in the consolidated statement of operations and comprehensive loss in the period in which they occur.

We evaluate our common stock purchase agreements to determine whether they are indexed to our own common stock, and therefore whether they should be accounted for as derivatives with changes in fair value as other income, net in the consolidated statement of operations and comprehensive loss in the period in which they occur.

We subsequently assess the changes in the fair value of the derivative liability and record these changes through profit or loss in the consolidated statements of operations and comprehensive loss.

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As a result, during the measurement period of up to one year from the acquisition date, we may make adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill.

Upon the measurement period's conclusion or final determination of the fair value of the purchase price of an

acquisition, whichever comes first, any subsequent adjustments are recorded to our consolidated statements of operations in the period they are identified.

Upon the measurement period's conclusion or final determination of the fair value of the purchase price of an acquisition, whichever comes first, any subsequent adjustments are recorded to our consolidated statements of operations in the period they are identified.

Acquisition-related expenses are recognized separately from the business combination and expensed as incurred.

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There were no intangible asset impairments in any of the periods presented.

Capitalized Software Development Costs

We capitalizes qualifying internal-use software development costs under Accounting Standards Codification Topic 350-40, Internal-use Software ("ASC 350-40").

The costs consist of personnel costs, including related benefits and stock-based compensation, and cloud costs that were incurred during the application development stage.

Capitalization of costs begins when two criteria are met:

(1) the preliminary project stage is completed, and (2) it is probable that the software will be completed and used for its intended function.

Capitalization ceases when the software is substantially complete and ready for its intended use, including the completion of all significant testing.

Costs related to preliminary project activities and post-implementation operating activities are expensed as incurred.

We also capitalize qualifying software development costs under Accounting Standards Codification Topic 985-20, Costs of Software to be Sold, Leased or Marketed ("ASC 985-20").

All costs to establish technological feasibility are expensed as incurred.

Costs incurred subsequent to establishing technological feasibility are capitalized until the software product is available for general release to customers.

Capitalized software development costs under ASC 350-40 and ASC 985-20 are included in other non-current assets, net of amortization, on the consolidated balance sheets.

These costs are amortized over the estimated useful life of the software, which is estimated to be three years.

The amortization of capitalized software development costs is included in cost of revenue in the consolidated statement of operations and comprehensive loss.

Recent Accounting Pronouncements

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis