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The zones of discrimination for M-Score is as such:
An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.
Warning Sign:
Beneish M-Score 0.6 higher than -1.78, which implies that the company might have manipulated its financial results.
The historical rank and industry rank for SoundHound AI's Beneish M-Score or its related term are showing as below:
During the past 4 years, the highest Beneish M-Score of SoundHound AI was 1.14. The lowest was -2.03. And the median was -0.66.
The historical data trend for SoundHound AI's Beneish M-Score can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
SoundHound AI Annual Data | |||||||||
Trend | Dec20 | Dec21 | Dec22 | Dec23 | |||||
Beneish M-Score | - | - | - | -1.34 |
SoundHound AI Quarterly Data | |||||||||||||||
Dec20 | Jun21 | Sep21 | Dec21 | Mar22 | Jun22 | Sep22 | Dec22 | Mar23 | Jun23 | Sep23 | Dec23 | Mar24 | Jun24 | Sep24 | |
Beneish M-Score | Get a 7-Day Free Trial |
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-2.03 | -1.34 | -0.09 | -1.22 | 0.60 |
For the Software - Application subindustry, SoundHound AI's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
For the Software industry and Technology sector, SoundHound AI's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where SoundHound AI's Beneish M-Score falls into.
The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.
The M-Score Variables:
The M-score of SoundHound AI for today is based on a combination of the following eight different indices:
M | = | -4.84 | + | 0.92 * DSRI | + | 0.528 * GMI | + | 0.404 * AQI | + | 0.892 * SGI | + | 0.115 * DEPI |
= | -4.84 | + | 0.92 * 2.281 | + | 0.528 * 1.2104 | + | 0.404 * 3.3481 | + | 0.892 * 1.7605 | + | 0.115 * 0.6366 | |
- | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI | |||||||
- | 0.172 * 0.7903 | + | 4.679 * -0.012078 | - | 0.327 * 0.2981 | |||||||
= | 0.60 |
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
This Year (Sep24) TTM: | Last Year (Sep23) TTM: |
Total Receivables was $38.21 Mil. Revenue was 25.094 + 13.462 + 11.594 + 17.147 = $67.30 Mil. Gross Profit was 12.193 + 8.482 + 6.925 + 13.236 = $40.84 Mil. Total Current Assets was $181.21 Mil. Total Assets was $499.65 Mil. Property, Plant and Equipment(Net PPE) was $5.40 Mil. Depreciation, Depletion and Amortization(DDA) was $11.83 Mil. Selling, General, & Admin. Expense(SGA) was $68.50 Mil. Total Current Liabilities was $70.18 Mil. Long-Term Debt & Capital Lease Obligation was $41.94 Mil. Net Income was -21.751 + -37.322 + -33.009 + -18.003 = $-110.09 Mil. Non Operating Income was 1.727 + -12.351 + -4.498 + 0.697 = $-14.43 Mil. Cash Flow from Operations was -35.315 + -18.492 + -21.948 + -13.87 = $-89.63 Mil. |
Total Receivables was $9.52 Mil. Revenue was 13.268 + 8.751 + 6.707 + 9.501 = $38.23 Mil. Gross Profit was 9.678 + 6.921 + 4.731 + 6.746 = $28.08 Mil. Total Current Assets was $109.37 Mil. Total Assets was $144.01 Mil. Property, Plant and Equipment(Net PPE) was $7.69 Mil. Depreciation, Depletion and Amortization(DDA) was $5.97 Mil. Selling, General, & Admin. Expense(SGA) was $49.24 Mil. Total Current Liabilities was $21.41 Mil. Long-Term Debt & Capital Lease Obligation was $87.01 Mil. |
1. DSRI = Days Sales in Receivables Index
Measured as the ratio of Revenue in Total Receivables in year t to year t-1.
A large increase in DSR could be indicative of revenue inflation.
DSRI | = | (Receivables_t / Revenue_t) | / | (Receivables_t-1 / Revenue_t-1) |
= | (38.209 / 67.297) | / | (9.515 / 38.227) | |
= | 0.567767 | / | 0.248908 | |
= | 2.281 |
2. GMI = Gross Margin Index
Measured as the ratio of gross margin in year t-1 to gross margin in year t.
Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.
GMI | = | GrossMargin_t-1 | / | GrossMargin_t |
= | (GrossProfit_t-1 / Revenue_t-1) | / | (GrossProfit_t / Revenue_t) | |
= | (28.076 / 38.227) | / | (40.836 / 67.297) | |
= | 0.734455 | / | 0.606803 | |
= | 1.2104 |
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
Asset quality is measured as the ratio of non-current assets other than Property, Plant and Equipment to Total Assets.
AQI | = | (1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) | / | (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1) |
= | (1 - (181.209 + 5.401) / 499.654) | / | (1 - (109.373 + 7.689) / 144.01) | |
= | 0.626522 | / | 0.187126 | |
= | 3.3481 |
4. SGI = Sales Growth Index
Ratio of Revenue in year t to sales in year t-1.
Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.
SGI | = | Sales_t | / | Sales_t-1 |
= | Revenue_t | / | Revenue_t-1 | |
= | 67.297 | / | 38.227 | |
= | 1.7605 |
5. DEPI = Depreciation Index
Measured as the ratio of the rate of Depreciation, Depletion and Amortization in year t-1 to the corresponding rate in year t.
DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.
DEPI | = | (Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) | / | (Depreciation_t / (Depreciaton_t + PPE_t)) |
= | (5.97 / (5.97 + 7.689)) | / | (11.833 / (11.833 + 5.401)) | |
= | 0.437074 | / | 0.686608 | |
= | 0.6366 |
Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.
6. SGAI = Sales, General and Administrative expenses Index
The ratio of Selling, General, & Admin. Expense(SGA) to Sales in year t relative to year t-1.
SGA expenses index > 1 means that the company is becoming less efficient in generate sales.
SGAI | = | (SGA_t / Sales_t) | / | (SGA_t-1 /Sales_t-1) |
= | (68.503 / 67.297) | / | (49.24 / 38.227) | |
= | 1.017921 | / | 1.288095 | |
= | 0.7903 |
7. LVGI = Leverage Index
The ratio of total debt to Total Assets in year t relative to yeat t-1.
An LVGI > 1 indicates an increase in leverage
LVGI | = | ((LTD_t + CurrentLiabilities_t) / TotalAssets_t) | / | ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1) |
= | ((41.935 + 70.178) / 499.654) | / | ((87.005 + 21.408) / 144.01) | |
= | 0.224381 | / | 0.752816 | |
= | 0.2981 |
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
TATA | = | (IncomefromContinuingOperations_t | - | CashFlowsfromOperations_t) | / | TotalAssets_t |
= | (NetIncome_t - NonOperatingIncome_t | - | CashFlowsfromOperations_t) | / | TotalAssets_t | |
= | (-110.085 - -14.425 | - | -89.625) | / | 499.654 | |
= | -0.012078 |
An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.
SoundHound AI has a M-score of 0.60 signals that the company is likely to be a manipulator.
Thank you for viewing the detailed overview of SoundHound AI's Beneish M-Score provided by GuruFocus.com. Please click on the following links to see related term pages.
Keyvan Mohajer | director, 10 percent owner, officer: CEO | 5400 BETSY ROSS DRIVE, SANTA CLARA CA 95054 |
Lawrence Marcus | director | 2105 WOODSIDE RD., WOODSIDE CA 94062 |
Diana Sroka | director | 5400 BETSY ROSS DRIVE, SANTA CLARA CA 95054 |
Michael Zagorsek | officer: Chief Operating Officer | 5400 BETSY ROSS DRIVE, SANTA CLARA CA 95054 |
Timothy Stonehocker | officer: Chief Technology Officer | 5400 BETSY ROSS DRIVE, SANTA CLARA CA 95054 |
Nitesh Sharan | officer: Chief Financial Officer | 5400 BETSY ROSS DRIVE, SANTA CLARA CA 95054 |
Majid Emami | 10 percent owner, officer: VP, Engineering | 5400 BETSY ROSS DRIVE, SANTA CLARA CA 95054 |
James Ming Hom | director, officer: VP, Products | 5400 BETSY ROSS DRIVE, SANTA CLARA CA 95054 |
Eric R. Ball | director | C/O GLU MOBILE INC., 45 FREMONT STREET, SUITE 2800, SAN FRANCISCO CA 94105 |
Global Catalyst Partners Iii L P | 10 percent owner | 6239 MOJAVE DRIVE, SAN JOSE CA 95120 |
Zubin Irani | officer: Chief Revenue Officer | 5400 BETSY ROSS DRIVE, SANTA CLARA CA 95054 |
Global Catalyst Venture Management Iii, Llc | 10 percent owner | 6239 MOJAVE DRIVE, SAN JOSE CA 95120 |
Stephen N Cannon | director, 10 percent owner, officer: Chief Executive Officer | 13/F TOWER 2, NEW WORLD TOWER, 18 QUEENS ROAD CENTRAL, HONG KONG K3 K3 00000 |
Bryant B Edwards | director | 25/28 OLD BURLINGTON STREET, LONDON X0 W1S 3AN |
Daniel L Sheehan | officer: Chief Operating Officer | 38 KEYES AVENUE SUITE 204, SAN FRANCISCO CA 94129 |
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