You can create phonemic transcriptions as a back-off for unknown words (at least in WFST based setups), but with things like "sequel" this won't help much.
AssemblyAI is apparently using their own TensorFlow implementation, not weighted finite-state transducers like e.g. Kaldi.
Speaking about WFSTs, why wouldn't it work for "sequel"? I have only done the "Kaldi for Dummies" tutorial (i.e. digit recognition), but from what I understand, you could add an utterance "s iy k w eh l"/"SQL" and add phrases like "SQL query" to the corpus and this would make it more likely than "sequel query".
Speaking about WFSTs, why wouldn't it work for "sequel"? I have only done the "Kaldi for Dummies" tutorial (i.e. digit recognition), but from what I understand, you could add an utterance "s iy k w eh l"/"SQL" and add phrases like "SQL query" to the corpus and this would make it more likely than "sequel query".