SoundHound delays filing annual report, stock plunges

Shares of the voice AI software company, which was a retail trading favorite last year, have dropped over 8% after it filed a notice with the SEC late Tuesday stating that its 10-K annual report would be late.

SoundHound AI cited accounting complexities related to acquisitions over the last year as a reason for the late filing.

“Due to the complexity of accounting for the Acquisitions, the Company requires additional time to prepare the financial statements and the accompanying notes disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (the ‘Form 10-K’). Accordingly, the Company has determined that it is unable to file the Form 10-K without unreasonable effort or expense. As previously disclosed, the Company has identified material weaknesses in its internal control over financial reporting. These material weaknesses continue to exist as of December 31, 2024. The Company expects to file its Form 10-K within the fifteen-day period provided under Rule 12b-25, no later than by March 18, 2025.”

SoundHound has struggled lately. The stock is down more than 50% this year and its quarterly losses exploded in Q4. Its recent filing’s mention of “material weaknesses” in its financial controls isn’t likely to improve investor sentiment — that’s auditor-speak acknowledging there’s an increased risk that the company will have to restate previous earnings results.