Comparison between SoundHound and Cerence in the voice AI market, with SoundHound showing more promise

From Nasdaq.: 2025-06-26 10:17:00

Voice-driven artificial intelligence is a key tech battleground, with SoundHound and Cerence leading the charge. SoundHound spans industries, while Cerence focuses on automotive voice assistants. Both operate in voice AI, but SoundHound’s industry reach gives it an edge. SoundHound’s strong Q1 results show revenue growth and partnerships with key players.

SoundHound’s Polaris AI engine powers natural voice interactions, gaining traction in restaurants, automotive, and enterprise sectors. Revenue surged 151% year over year to $29.1 million in Q1 2025, with a strong gross margin of 51%. Despite competition from tech giants, SoundHound’s diversified platform and growth potential stand out.

Cerence dominates the automotive voice AI market, with its technology in over 500 million vehicles. Recent results show revenue growth and profitability, with a strong gross margin of 77%. While facing challenges like OEM pricing pressure, Cerence’s focus on innovation, partnerships, and profitability sets it apart in voice-driven mobility solutions.

SoundHound stock has risen 7.7% in the past three months, while Cerence shares have rallied 10.6%. Both stocks underperformed the Computer and Technology sector. SoundHound’s market cap is around $3.85 billion, with a forward price-to-sales ratio of 20X. Cerence’s market cap is around $407.5 million, trading at 1.61X trailing 12-month sales.

SoundHound and Cerence offer different investment profiles in the voice AI market. SoundHound’s broad industry exposure, revenue growth, and innovation potential position it for long-term growth. Cerence, focused on autos, faces growth constraints. SoundHound’s expanding customer base and versatility make it a promising long-term investment compared to Cerence.

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Read more at Nasdaq.: SoundHound AI vs. Cerence: Which Voice AI Stock Holds More Promise?