EX-99.2 3 soun-20241112ex992financia.htm EX-99.2 Document

SOUNDHOUND AI, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
September 30,
2024		December 31,
2023
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents$135,606 $95,260 
Accounts receivable, net of allowances of $1,874 and $203 as of September 30, 2024 and December 31, 2023, respectively
13,570 4,050 
Contract assets and unbilled receivable, net of allowance for credit losses of $118 and $17 of September 30, 2024 and December 31, 2023, respectively
24,639 11,780 
Other current assets7,394 2,452 
Total current assets181,209 113,542 
Restricted cash equivalents, non-current811 13,775 
Right-of-use assets3,860 5,210 
Property and equipment, net1,541 1,515 
Goodwill111,730 — 
Intangible assets, net182,579 — 
Deferred tax asset30 11 
Contract assets and unbilled receivable, non-current, net of allowance for credit losses of $195 and $177 of September 30, 2024 and December 31, 2023, respectively
14,596 16,492 
Other non-current assets3,298 577 
Total assets$499,654 $151,122 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable$17,758 $1,653 
Accrued liabilities22,599 13,884 
Operating lease liabilities1,832 2,637 
Finance lease liabilities74 121 
Income tax liability2,677 1,618 
Deferred revenue20,096 4,310 
  Other current liabilities5,142 — 
Total current liabilities70,178 24,223 
Operating lease liabilities, net of current portion2,241 3,089 
Deferred revenue, net of current portion7,570 4,910 
Long-term debt39,694 84,312 
Contingent acquisition liabilities (Note 17)74,450 — 
Income tax liability, net of current portion5,004 2,453 
Other non-current liabilities4,530 3,967 
Total liabilities203,667 122,954 
Commitments and contingencies (Note 7)
Stockholders’ equity:  
Series A Preferred Stock, $0.0001 par value; 1,000,000 shares authorized; 0 and 475,005 shares issued and outstanding, aggregate liquidation preference of $0 and $16,227 as of September 30, 2024 and December 31, 2023, respectively
— 14,187 
Class A Common Stock, $0.0001 par value; 455,000,000 shares authorized; 336,481,401 and 216,943,349 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively
33 22 
Class B Common Stock, $0.0001 par value; 44,000,000 shares authorized; 32,735,408 and 37,485,408 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively
3 4 
Additional paid-in capital980,150 606,135 
Accumulated deficit(684,461)(592,379)
Accumulated other comprehensive income 262 199 
Total stockholders’ equity295,987 28,168 
Total liabilities and stockholders’ equity$499,654 $151,122 


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SOUNDHOUND AI, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except share and per share data)
(Unaudited)
Three Months Ended
September 30,		Nine Months Ended
September 30,
2024202320242023
Revenues$25,094 $13,268 $50,150 $28,726 
Operating expenses:
Cost of revenues12,901 3,590 22,550 7,396 
Sales and marketing8,363 4,471 19,560 14,424 
Research and development19,545 12,806 50,161 38,726 
General and administrative17,031 6,931 36,833 20,644 
Change in fair value of contingent acquisition liabilities(1,356)— 1,724 — 
Amortization of intangible assets2,377 — 3,603 — 
Restructuring— — — 3,751 
Total operating expenses58,861 27,798 134,431 84,941 
Loss from operations(33,767)(14,530)(84,281)(56,215)
Other expense, net:
Loss on early extinguishment of debt— — (15,587)(837)
Interest expense(1,109)(5,442)(10,859)(11,273)
Other income (expense), net2,634 1,336 9,087 (302)
Total other expense, net1,525 (4,106)(17,359)(12,412)
Loss before provision for income taxes(32,242)(18,636)(101,640)(68,627)
Provision for income taxes(10,491)1,561 (9,558)2,307 
Net loss$(21,751)$(20,197)$(92,082)$(70,934)
Cumulative dividends attributable to Series A Preferred Stock— (647)(416)(2,206)
Net loss attributable to SoundHound common shareholders$(21,751)$(20,844)$(92,498)$(73,140)
Other comprehensive income:
Unrealized gains on investments57 168 63 197 
Comprehensive loss$(21,694)$(20,029)$(92,019)$(70,737)
Net loss per share:
Basic and diluted$(0.06)$(0.09)$(0.28)$(0.33)
Weighted-average common shares outstanding:
Basic and diluted360,385,812 242,022,268 326,166,633 222,760,880 


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SOUNDHOUND AI, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Nine Months Ended
September 30,
20242023
Cash flows used in operating activities:
Net loss$(92,082)$(70,934)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization8,115 1,941 
Stock-based compensation23,292 20,639 
Loss on change in fair value of ELOC program— 1,901 
Amortization of debt issuance cost1,586 3,532 
Non-cash lease amortization2,218 2,383 
Foreign currency gain/loss from remeasurement(97)— 
Change in fair value of contingent acquisition liabilities1,724 — 
Loss on early extinguishment of debt15,587 837 
Deferred income taxes(11,494)— 
Other, net633 262 
Changes in operating assets and liabilities:
Accounts receivable, net(1,247)38 
Other current assets(3,049)(461)
Contract assets(7,018)(9,987)
Other non-current assets(1,198)690 
Accounts payable823 (635)
Accrued liabilities(2,058)1,906 
Other current liabilities331 — 
Operating lease liabilities(2,612)(2,772)
Deferred revenue(8,993)(5,532)
Other non-current liabilities(216)1,797 
Net cash used in operating activities(75,755)(54,395)
Cash flows used in investing activities:
Purchases of property and equipment(560)(334)
Payment related to acquisitions, net of cash acquired(11,732)— 
Net cash used in investing activities(12,292)(334)
Cash flows provided by financing activities:
Proceeds from the issuance of Series A Preferred Stock, net of issuance costs— 24,942 
Proceeds from sales of Class A common stock under the ELOC program, net of issuance costs— 71,454 
Proceeds from sales of Class A common stock under the Sales Agreement and Equity Distribution Agreement 287,271 — 
Proceeds from exercise of stock options and employee stock purchase plan11,064 8,837 
Payment of financing costs associated with the Sales Agreement and Equity Distribution Agreement (7,182)— 
Proceeds from the issuance of debt, net of issuance costs— 85,087 
Payments on Term Loan and Amelia Debt(175,602)(35,029)
Payment to settle contingent holdback liabilities from SYNQ3 acquisition(17)— 
Payments on finance leases(89)(116)
Net cash provided by financing activities115,445 155,175 
Effects of exchange rate changes on cash(16)— 
Net change in cash, cash equivalents, and restricted cash equivalents27,382 100,446 
Cash, cash equivalents, and restricted cash equivalents, beginning of period109,035 9,475 
Cash, cash equivalents, and restricted cash equivalents, end of period$136,417 $109,921 
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SOUNDHOUND AI, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS – Continued
(In thousands)
(Unaudited)

Reconciliation to amounts on the condensed consolidated balance sheets:
Cash and cash equivalents$135,606 $96,146 
Non-current portion of restricted cash equivalents811 13,775 
Total cash, cash equivalents, and restricted cash equivalents shown in the condensed consolidated statements of cash flows
$136,417 $109,921 
Supplemental disclosures of cash flow information:
Cash paid for interest$4,448 $7,945 
Cash paid for income taxes$1,677 $1,645 
Noncash investing and financing activities:
Conversion of Series A Preferred Stock to Class A common stock$14,187 $10,555 
Issuance of Class A Common Stock to settle commitment shares related to the ELOC program$— $915 
Issuance of Class A Common Stock to settle obligations under Amelia Debt$11,817 $— 
Issuance of Class A Common Stock to settle contingent holdback consideration of SYNQ3 acquisition$189 $— 
Deferred offering costs reclassified to additional paid-in capital $220 $— 
Non-cash debt discount$— $4,136 
Property and equipment acquired under accrued liabilities$62 $— 
Fair value of Class A common stock and deferred equity consideration issued for SYNQ3 acquisition$9,687 $— 
Fair value of contingent earnout consideration under SYNQ3 and Amelia acquisitions$73,236 $— 
Fair value of contingent holdback consideration under SYNQ3 acquisition$427 $— 
Fair value of deferred cash consideration under other acquisition$195 $— 
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