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SoundHound Lays Off Nearly Half of Its Workforce

SoundHound Lays Off Nearly Half of Its Workforce – Last week, SoundHound, a voice AI company, laid off 200 employees, about half of its workforce, as part of a major downsizing operation, according to Gizmodo. Three laid-off employees who spoke to Gizmodo said the severance package offered is only two weeks and does not include healthcare. The severance is also contingent on SoundHound raising more funds, and it is uncertain what will happen if the company is unable to secure additional funding.

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SoundHound, a Santa Clara-based company founded in 2005 by Stanford graduate Keyvan Mohajer, who remains its CEO, is a major provider of AI voice software for companies such as Pandora, Snap, Mercedes-Benz, and Netflix. An employee who spoke to Gizmodo described the layoffs and the severance package as “pitiful” and expressed disappointment that a company that has been in business for 17 years and is now a public company would not provide a minimum level of severance.

In an email to staff regarding the layoffs, SoundHound’s CEO Keyvan Mohajer attributed the downsizing to “changing economic conditions, including high-interest rates, rising inflation, and fears of recession” which he said has made companies like SoundHound less attractive. The layoffs represent a significant change for the voice AI company, which had been experiencing rapid growth in 2021 and went public last year. 

The first indication of trouble emerged in November 2022, when the company laid off 10% of its staff and reduced current staff’s pay. That layoff combined with this one means that in the past three months, SoundHound has lost over 50% of the 450 employees it had in October 2022. One of the employees told Gizmodo that pay cuts instated in November were as high as 20%, though it is unknown how many employees were affected.


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