Traders reward strong quarterly results and guidance from SoundHound AI and Unity, while Datadog falls despite beating estimates due to valuation concerns.
SoundHound AI and Unity Software shares jumped 12% and 11%, respectively, after reporting better-than-expected earnings and raising guidance. SoundHound AI posted Q2 revenue of $61.9 million, surpassing the $52.4 million estimate, while its adjusted EBITDA loss narrowed to $9.6 million. The company also raised its 2026 revenue outlook to a range of $230 million to $260 million, pending the LivePerson acquisition.
Unity Software’s CEO called the quarter “arguably the best in Unity’s history as a public company,” driving its stock higher. Meanwhile, Datadog shares fell 15% to $239.71 despite beating estimates, as its 108% year-to-date gains raised valuation concerns. The NASDAQ 100-tracking QQQ ETF remained flat, highlighting the stock-specific nature of the moves.
Traders are distinguishing between winners and losers based on performance and expectations, with SoundHound AI and Unity outperforming while Datadog faces pressure after its strong run.