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SoundHound Adds 3 Restaurant Chains: Can Its QSR Footprint Expand?
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Key Takeaways
SoundHound signed three major U.S. restaurant chains as key-account renewal rates reached 100%.
A major pizza chain now has SoundHound technology live in more than 75% of its thousands of stores.
SOUN's QSR momentum comes as second-quarter revenues rose 45% year over year to $61.9 million.
SoundHound AI (SOUN - Free Report) is strengthening its position in restaurant automation as demand for voice AI expands across quick-service restaurants (QSRs). During the second quarter of 2026, the company signed three major U.S. restaurant chains, while restaurant renewal rates reached 100% for key accounts. Location counts also increased across customers including Jersey Mike’s, Five Guys and IHOP. A major pizza chain with thousands of stores now has SoundHound technology live in more than 75% of its locations.
The broader restaurant pipeline remains encouraging. SoundHound disclosed new deals with a large seafood QSR, Ruby Tuesday, a major American-style Mexican QSR and a sushi restaurant. It also renewed agreements with Habit Burger, Red Lobster and Torchy’s Tacos, while Lazy Dog expanded its use of Smart Answering and Smart Ordering. This combination of new customer wins, renewals and store-level expansion supports SoundHound’s land-and-expand strategy.
Importantly, management said a well-known QSR customer continues to see higher revenues at drive-thru locations using SoundHound AI compared with comparable locations without the technology. Improving performance metrics could encourage broader deployments across existing restaurant chains. SoundHound also sees cross-selling opportunities through OASYS, including IT help desk and guest-relations services.
The restaurant momentum comes as SoundHound’s overall business scales rapidly. Second-quarter revenues increased 45% year over year to $61.9 million, while GAAP gross margin improved to 45.1%. Continued QSR wins and wider rollouts could therefore make restaurants an increasingly important contributor to SoundHound’s long-term growth.
Competitive Pressure in Restaurant AI
SoundHound faces competition from Toast (TOST - Free Report) and PAR Technology (PAR - Free Report) as restaurant operators increasingly adopt AI-enabled ordering and automation.
Toast has strengthened its QSR presence with Toast Drive-Thru, an enterprise solution combining hardware, restaurant software and AI voice-ordering integrations. Toast also supports AI-powered ordering through partners such as Incept AI, while its broad POS ecosystem can make Toast attractive to restaurant chains seeking an integrated technology stack.
PAR Technology is another relevant competitor given its deep exposure to large restaurant chains. PAR Technology provides POS, digital ordering, loyalty, drive-thru and AI-powered restaurant tools, with more than 140,000 restaurant locations using PAR ordering technology. PAR Technology is also embedding AI across its restaurant platform to deliver real-time operational insights and automation. While Toast and PAR Technology have broader restaurant ecosystems, SoundHound’s specialization in conversational and voice AI could help differentiate its offering as QSR chains expand automated ordering.
SOUN’s Price Performance, Valuation & Estimates
SoundHound’s shares have lost 41.4% year to date (YTD), underperforming the industry, as shown below.
SOUN’s YTD Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, SOUN trades at a forward price-to-sales (P/S) multiple of 9.26, slightly lower than the industry’s average.
SOUN’s P/S Ratio (Forward 12-Month) vs. Industry
Image Source: Zacks Investment Research
Over the past 60 days, the Zacks Consensus Estimate for SoundHound’s 2026 and 2027 loss per share has narrowed to 19 cents and 14 cents, respectively, as shown below. The expected loss for 2026 remains wider than the previous year’s loss of 13 cents per share.
View the Zacks #1 Rank List
Image: Shutterstock
SoundHound Adds 3 Restaurant Chains: Can Its QSR Footprint Expand?
Key Takeaways
SoundHound AI (SOUN - Free Report) is strengthening its position in restaurant automation as demand for voice AI expands across quick-service restaurants (QSRs). During the second quarter of 2026, the company signed three major U.S. restaurant chains, while restaurant renewal rates reached 100% for key accounts. Location counts also increased across customers including Jersey Mike’s, Five Guys and IHOP. A major pizza chain with thousands of stores now has SoundHound technology live in more than 75% of its locations.
The broader restaurant pipeline remains encouraging. SoundHound disclosed new deals with a large seafood QSR, Ruby Tuesday, a major American-style Mexican QSR and a sushi restaurant. It also renewed agreements with Habit Burger, Red Lobster and Torchy’s Tacos, while Lazy Dog expanded its use of Smart Answering and Smart Ordering. This combination of new customer wins, renewals and store-level expansion supports SoundHound’s land-and-expand strategy.
Importantly, management said a well-known QSR customer continues to see higher revenues at drive-thru locations using SoundHound AI compared with comparable locations without the technology. Improving performance metrics could encourage broader deployments across existing restaurant chains. SoundHound also sees cross-selling opportunities through OASYS, including IT help desk and guest-relations services.
The restaurant momentum comes as SoundHound’s overall business scales rapidly. Second-quarter revenues increased 45% year over year to $61.9 million, while GAAP gross margin improved to 45.1%. Continued QSR wins and wider rollouts could therefore make restaurants an increasingly important contributor to SoundHound’s long-term growth.
Competitive Pressure in Restaurant AI
SoundHound faces competition from Toast (TOST - Free Report) and PAR Technology (PAR - Free Report) as restaurant operators increasingly adopt AI-enabled ordering and automation.
Toast has strengthened its QSR presence with Toast Drive-Thru, an enterprise solution combining hardware, restaurant software and AI voice-ordering integrations. Toast also supports AI-powered ordering through partners such as Incept AI, while its broad POS ecosystem can make Toast attractive to restaurant chains seeking an integrated technology stack.
PAR Technology is another relevant competitor given its deep exposure to large restaurant chains. PAR Technology provides POS, digital ordering, loyalty, drive-thru and AI-powered restaurant tools, with more than 140,000 restaurant locations using PAR ordering technology. PAR Technology is also embedding AI across its restaurant platform to deliver real-time operational insights and automation. While Toast and PAR Technology have broader restaurant ecosystems, SoundHound’s specialization in conversational and voice AI could help differentiate its offering as QSR chains expand automated ordering.
SOUN’s Price Performance, Valuation & Estimates
SoundHound’s shares have lost 41.4% year to date (YTD), underperforming the industry, as shown below.
SOUN’s YTD Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, SOUN trades at a forward price-to-sales (P/S) multiple of 9.26, slightly lower than the industry’s average.
SOUN’s P/S Ratio (Forward 12-Month) vs. Industry
Image Source: Zacks Investment Research
Over the past 60 days, the Zacks Consensus Estimate for SoundHound’s 2026 and 2027 loss per share has narrowed to 19 cents and 14 cents, respectively, as shown below. The expected loss for 2026 remains wider than the previous year’s loss of 13 cents per share.
Image Source: Zacks Investment Research
SOUN currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.