Latest Ratios: P/E Ratio -25.2x · EV/EBITDA N/A · ROE -4.3%. (2019–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Market Cap | $1.8B | $4.0B | $6.7B | $486M | $278M | — | — | — |
| Enterprise Value | $1.5B | $3.8B | $6.5B | $481M | $313M | — | — | — |
| P/E Ratio → | -25.18 | — | — | — | — | — | — | — |
| P/S Ratio | 8.01 | 23.93 | 79.29 | 10.60 | 8.95 | — | — | — |
| P/B Ratio | 3.59 | 8.72 | 36.76 | 17.26 | — | — | — | — |
| P/FCF | — | — | — | — | — | — | — | — |
| P/OCF | — | — | — | — | — | — | — | — |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 22.48 | 77.00 | 10.48 | 10.07 | — | — | — |
| EV / EBITDA | — | 349.77 | — | — | — | — | — | — |
| EV / EBIT | — | — | — | — | — | — | — | — |
| EV / FCF | — | — | — | — | — | — | — | — |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Gross Margin | 42.4% | 42.4% | 48.9% | 75.4% | 69.2% | 68.9% | 55.0% | 41.2% |
| Operating Margin | -13.8% | -13.8% | -403.0% | -149.6% | -339.5% | -308.2% | -507.1% | -841.1% |
| Net Profit Margin | -8.3% | -8.3% | -414.1% | -193.9% | -374.9% | -375.2% | -571.6% | -839.7% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| ROE | -4.3% | -4.3% | -332.7% | -315.7% | — | — | — | -320.1% |
| ROA | -2.3% | -2.3% | -99.5% | -94.1% | -267.7% | -141.0% | -116.4% | -100.5% |
| ROIC | -16.8% | -16.8% | -4328.2% | -481.3% | — | — | — | -2646.5% |
| ROCE | -4.2% | -4.2% | -111.4% | -108.6% | — | -22604.5% | -160.4% | -149.6% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.01 | 0.01 | 0.02 | 3.20 | — | — | — | 0.31 |
| Debt / EBITDA | 0.39 | 0.39 | — | — | — | — | — | — |
| Net Debt / Equity | — | -0.53 | -1.06 | -0.18 | — | — | — | -0.91 |
| Net Debt / EBITDA | -22.50 | -22.50 | — | — | — | — | — | — |
| Debt / FCF | — | — | — | — | — | — | — | — |
| Interest Coverage | -12.84 | -12.84 | -28.58 | -4.08 | -15.51 | -8.48 | -31.47 | — |
Net cash position: cash ($248M) exceeds total debt ($4M)
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Current Ratio | 4.59 | 4.59 | 3.77 | 4.69 | 0.46 | 0.31 | 2.00 | 2.16 |
| Quick Ratio | 4.59 | 4.59 | 3.77 | 4.69 | 0.46 | 0.31 | 2.00 | 2.16 |
| Cash Ratio | 3.46 | 3.46 | 2.93 | 3.93 | 0.24 | 0.25 | 1.78 | 1.82 |
| Asset Turnover | — | 0.25 | 0.15 | 0.30 | 0.82 | 0.43 | 0.20 | 0.12 |
| Inventory Turnover | — | — | — | — | — | — | — | — |
| Days Sales Outstanding | — | 152.39 | 214.64 | 125.96 | 59.62 | 36.40 | 101.45 | 271.81 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Dividend Yield | — | — | — | — | — | — | — | — |
| Payout Ratio | — | — | — | — | — | — | — | — |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Earnings Yield | — | — | — | — | — | — | — | — |
| FCF Yield | — | — | — | — | — | — | — | — |
| Buyback Yield | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | — | — | — |
| Total Shareholder Yield | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | — | — | — |
| Shares Outstanding | — | $405M | $338M | $229M | $157M | $200M | $17M | $12M |
Includes 30+ ratios · 7 years · Updated daily
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10-year return with dividends reinvested.
Compare growth, multiples, and margins vs sector.
Quick answers to the most common questions about buying SOUN stock.
SoundHound AI, Inc.'s current P/E ratio is -25.2x. This places it at the 50th percentile of its historical range.
SoundHound AI, Inc.'s return on equity (ROE) is -4.3%. The historical average is -243.2%.
Based on historical data, SoundHound AI, Inc. is trading at a P/E of -25.2x. This is at the 50th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
SoundHound AI, Inc. has 42.4% gross margin and -13.8% operating margin.
SoundHound AI, Inc.'s Debt/EBITDA ratio is 0.4x, indicating low leverage. A ratio below 2x is generally considered financially healthy.
Key Metrics
Top Statement Risk
Persistent cash burn and dilution
Metrics are mathematically derived from official filings.
Margin Compression Masks Underlying Scale
Gross margin fell to 36.8% in Q2 2026 from 63.0% in Q2 2024, according to reported financials, while operating margin improved to -75.9% from -163.3%, indicating cost pressures persist despite revenue scaling.
The gross margin decline suggests rising cloud infrastructure and professional services costs are eroding the software-like economics, likely reflecting the labor-intensive deployment model. Operating margin improvement, though still deeply negative, indicates that fixed costs are being spread over a larger revenue base, but the pace of improvement is insufficient to reach breakeven soon. Investors should monitor whether gross margin stabilizes as the company automates deployments, as continued compression would undermine the scalability narrative.
Return on Capital Remains Deeply Negative
ROIC swung from -13.0% in Q2 2026 to +18.0% in Q4 2025, based on reported figures, but the positive quarter was driven by one-time gains, obscuring the underlying capital destruction.
Excluding the Q4 2025 anomaly, ROIC has been consistently negative, averaging around -40% over the last ten quarters, indicating that the company is not generating returns on its invested capital. The volatility in ROIC, from -199.8% in Q4 2024 to +132.9% in Q1 2025, suggests that earnings are heavily influenced by non-operating items, making the metric unreliable for assessing operational efficiency. The negative returns imply that the company is still in an investment phase, but the lack of improvement in underlying ROIC warrants caution about the eventual payoff.
Working Capital Efficiency Shows Mixed Signals
DSO improved to 92 days in Q2 2026 from 136 days in Q1 2026, as per quarterly data, while DPO fell to 18 days, indicating faster collections but tighter supplier terms.
The reduction in DSO suggests improved collection efficiency, possibly due to a shift toward subscription revenue with upfront payments, but the decline in DPO indicates the company is paying suppliers faster, which may reflect weaker negotiating power or a change in vendor mix. The cash conversion cycle remains negative, though data is incomplete, but the working capital drag persists as evidenced by negative working capital changes in seven of the last ten quarters. This suggests that despite revenue growth, the company continues to absorb cash in its operations, a trend that could pressure liquidity if growth decelerates.
Minimal Debt Masks Equity Dependence
Debt-to-equity stands at 0.01 with total debt of $5.4M, as reported in Q2 2026, but the company's reliance on equity financing is evident from cumulative dilution and negative retained earnings.
The balance sheet is virtually debt-free, providing ample headroom for borrowing, but the company has funded its operations through equity issuance, as reflected in the expansion of equity to $490.4M despite accumulated losses of -$1.0B. Interest coverage is not meaningful given the minimal debt, but the negative operating margins imply that any future debt would be risky without a clear path to profitability. The low leverage is a positive, but it also indicates that the company has not yet demonstrated the ability to service debt from operations, making equity dilution the primary financing risk.
Strong Liquidity Provides Short-Term Runway
Current ratio of 3.91 and cash of $202.8M, as reported in Q2 2026, provide a substantial buffer, but with FCF burn of -$34.1M quarterly, the runway is roughly six quarters.
The liquidity position is robust, with a current ratio well above 1, indicating that short-term obligations are comfortably covered by current assets. However, the negative free cash flow, which has persisted for ten consecutive quarters, suggests that the cash balance will decline unless growth accelerates or margins improve. The quick ratio equals the current ratio, indicating no inventory dependence, which is typical for a software company, but the cash burn rate warrants monitoring as it could necessitate further equity raises if the runway shortens.
Misapplied EV/EBITDA in a Pre-Profit AI Firm
EV/EBITDA of 264.8, as per current valuation, is misleading for a company with negative EBITDA, as it implies a meaningless multiple that obscures the true cash burn and growth potential.
For SoundHound, EV/EBITDA is not a useful metric because EBITDA is negative, making the multiple uninterpretable and potentially misleading to investors who compare it to profitable peers. A more appropriate metric is EV/Sales, which at 18.47 reflects the market's pricing of future growth, but even this must be adjusted for the company's negative gross margin trend and the one-time gains that distort earnings. Investors should focus on EV/FCF, though FCF is also negative, and instead monitor the trajectory of gross margin and operating leverage to assess whether the current valuation is justified.