Agentic AI's Rising Momentum: Kyndryl and SoundHound AI as Strategic Entry Points

The agentic AI market is experiencing a seismic shift, driven by enterprises seeking scalable automation and intelligent decision-making tools. Two companies-SoundHound AI and Kyndryl-are emerging as pivotal players in this transformation, each leveraging agentic AI to address distinct but complementary market needs. For investors, the question is no longer whether agentic AI will reshape industries but how to position for its accelerating adoption.

SoundHound AI: Scaling Voice-First Innovation in the Restaurant Sector

SoundHound AI's recent performance underscores its potential as a high-conviction agentic AI investment. In Q3 2025, the company reported revenue of $42.1 million, a 67.6% year-over-year increase, surpassing Wall Street estimates by $1.6 million. This growth is fueled by strategic diversification, with no single customer accounting for more than 12% of revenue-a stark contrast to the 72% concentration in prior years according to SoundHound AI. The restaurant sector has become a cornerstone of this strategy, particularly through its partnership with Red Lobster.

By deploying an AI-powered phone ordering agent across all Red Lobster locations, SoundHound has demonstrated the practical value of agentic AI in high-volume environments. The system, trained on Red Lobster's full menu, handles multiple calls simultaneously, streamlines order intake and reduces staff workload. This collaboration not only validates SoundHound's technology but also positions it to capture market share in the $1.2 trillion U.S. restaurant industry according to market analysis.

However, challenges remain. Despite raising full-year revenue guidance to $165–180 million, SoundHound reported a non-GAAP loss of $0.03 per share in Q3 2025. For investors, the key metric is whether the company can scale its restaurant partnerships while improving margins-a goal it claims to be addressing through its acquisition of Interactions to enhance Agentic AI capabilities as reported in investor materials.

Kyndryl: Mainframe Modernization and Enterprise Trust

While SoundHound targets consumer-facing applications, Kyndryl is redefining agentic AI's role in enterprise infrastructure. The IT services provider, spun off from IBM in 2021, has introduced the Kyndryl Agentic AI Digital Trust framework to secure and scale AI deployments in hybrid and multi-cloud environments according to company announcements. This initiative addresses a critical pain point: as 68% of organizations invest heavily in AI, demand for governance and ROI transparency is surging as reported in investor communications.

Kyndryl's Q3 FY 2025 results highlight its strategic advantages. Revenue reached $3.7 billion, with adjusted EBITDA rising 14% year-over-year to $704 million and margins expanding to 18.8% according to financial reports. These gains are driven by hyperscaler partnerships with Microsoft, AWS, and Google Cloud, which contributed $300 million in Q3 revenue and are projected to exceed $1 billion for FY 2025 according to market analysis. The company's Kyndryl Bridge platform further strengthens its value proposition, generating $725 million in annualized cost savings and freeing up 12,300 delivery professionals.

Kyndryl's focus on mainframe modernization is particularly compelling. By integrating agentic AI into legacy systems, the company enables enterprises to optimize operations without full system replacement-a critical differentiator in cost-conscious markets. Its long-term targets-tripling adjusted free cash flow and doubling pretax income-underscore confidence in its AI-driven transformation strategy according to company projections.

Strategic Investment Considerations

The agentic AI market is bifurcating: SoundHound AI represents the consumer-facing wave, while Kyndryl leads the enterprise infrastructure shift. For investors, this duality offers a balanced approach. SoundHound's high-growth trajectory and restaurant-sector traction align with near-term scalability, whereas Kyndryl's enterprise focus and profitability metrics provide stability.

However, risks persist. SoundHound's unprofitability and reliance on sector-specific adoption could limit its long-term appeal. Kyndryl, while profitable, faces competition from hyperscalers and must prove its AI frameworks can sustain margin expansion.

Conclusion: Positioning for Agentic AI's Next Phase

As agentic AI transitions from experimentation to enterprise adoption, companies like SoundHound AI and Kyndryl are building the infrastructure and use cases that will define the next decade. For investors, the opportunity lies in capitalizing on these divergent yet complementary strategies. SoundHound's restaurant-sector innovation and Kyndryl's enterprise trust framework together illustrate the breadth of agentic AI's potential-and the urgency to act before the market consolidates.