SoundHound AI: Riding the Wave of Voice AI Amid Market Volatility

What's Going On With SoundHound AI (SOUN) Stock? - SoundHound AI (NASDAQ:SOUN)

SoundHound AI Inc SOUN shares climbed 7.0% to $9.37 Thursday afternoon amid a broader surge in technology stocks, fueled by strong U.S. durable goods data and signs of easing U.S.-China trade tensions. What To Know: The voice AI company, known for its advanced speech recognition and natural language processing technology, benefited from investor optimism across the tech sector, particularly as markets anticipate strong earnings from Alphabet Inc after the bell. SoundHound's gains align with Thursday's bullish sentiment around AI and software companies, with the Nasdaq-100 jumping 2.5% and tech outperforming other sectors. Positive corporate earnings and guidance from tech peers like ServiceNow also buoyed expectations for companies like SoundHound, which has been expanding its partnerships in automotive, hospitality and smart device markets. Read Also: Why Odyssey Marine Exploration Stock Is Exploding Higher How To Buy SOUN Stock By now you're likely curious about how to participate in the market for SoundHound AI - be it to purchase shares, or even attempt to bet against the company. Buying shares is typically done through a brokerage account. You can find a list of possible trading platforms here. Many will allow you to buy "fractional shares," which allows you to own portions of stock without buying an entire share. In the case of SoundHound AI, which is trading at $9.37 as of publishing time, $100 would buy you 10.67 shares of stock. If you're looking to bet against a company, the process is more complex. You'll need access to an options trading platform, or a broker who will allow you to "go short" a share of stock by lending you the shares to sell. The process of shorting a stock can be found at this resource. Otherwise, if your broker allows you to trade options, you can either buy a put option, or sell a call option at a strike price above where shares are currently trading - either way it allows you to profit off of the share price decline. According to data from Benzinga Pro, SOUN has a 52-week high of $24.98 and a 52-week low of $3.82. SOUNSoundHound AI Inc$9.356.80%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum97.15Growth83.04Quality-Value7.77Price TrendShortMediumLongOverviewGot Questions? AskWhich tech stocks could benefit from AI growth?How will automotive partnerships impact SOUN?What other voice AI companies might see gains?Could hospitality tech investments rise due to SOUN's growth?How will Nasdaq-100 performance affect tech investments?Which software firms may follow SoundHound's lead?Is there potential for smart device companies now?What does easing U.S.-China trade tensions mean for tech?Could strong earnings from Alphabet boost SOUN?How will investor sentiment shift in the tech sector?Powered ByMarket News and Data brought to you by Benzinga APIs

1 Growth Stock Down 67% to Buy Right Now | The Motley Fool

SoundHound AI (SOUN 7.80%) was in red-hot form toward the end of last year, hitting a 52-week high on Dec. 26, 2024, as investors capitalized on the fast-growing demand for the company's services and bought up shares of this voice-focused artificial intelligence (AI) solutions provider. SoundHound was identified as an emerging player in the conversational AI market last year, while the customers' rapid adoption of the company's offerings also added to the stock's momentum. Since hitting that high, however, the stock price has dropped a whopping 67%. The drop can be attributed to factors such as the overall weakness in the stock market in 2025, tariff-related uncertainty, an expensive valuation, and the news that Nvidia sold its entire stake in the company. SoundHound's sharp decline could be cause for concern, or it could be an opportunity for savvy investors to buy a fast-growing AI company at a relatively cheaper valuation. Let's look at the reasons why buying this AI stock looks like a smart thing to do right now. SoundHound AI clocked phenomenal growth rates in recent quarters, and it's improving with each passing quarter (see chart below). The company is still quite small, expecting to generate $167 million in revenue this year at the midpoint of its guidance range. That will almost double its 2024 revenue, when its top line increased 84% from the prior year. The demand for SoundHound AI's voice AI solutions is increasing at a healthy pace, evidenced by the growth in the company's customer base each quarter. For instance, SoundHound AI added multiple customers in the healthcare space in the fourth quarter of 2024, expanded its presence in the automotive niche by landing new customers such as Lucid Motors, while winning more business from existing customers such as Stellantis, and also gained traction with federal customers. However, these are just some of the customers that SoundHound added during the quarter. The company is also expanding into more markets, including financial services, insurance, and travel. It is also pushing the envelope on the product development front by offering agentic AI voice solutions. CEO Keyvan Mohajer said on the company's February earnings call that SoundHound is seeing "exciting results in the agentic AI tools we've created" and that it's "building and testing agentic use cases in every major vertical." SoundHound plans to commercially launch its agentic AI voice solutions soon. It believes that the reach of its existing platform and presence across several verticals in multiple industries puts it in a solid position to capitalize on the impending adoption of agentic AI solutions. A third-party estimate projects that the market for voice AI agents could clock a compound annual growth rate (CAGR) of almost 35% through 2034, generating $47.5 billion in revenue at the end of the forecast period. So, agentic AI could unlock a whole new growth opportunity for SoundHound AI. The company's diversified customer base means that it already has clients to whom it can cross-sell its upcoming voice AI agentic tools. As a result, there is a solid chance that SoundHound AI's remarkable growth could continue for a long time. Another reason to be upbeat is the company's outstanding revenue pipeline. SoundHound ended 2024 with a cumulative subscriptions and bookings backlog of $1.2 billion. That figure is up 75% year over year. SoundHound points out that the cumulative bookings backlog refers to the balance of the committed customer contracts at the end of a period. The subscription backlog measures the "potential revenue achievable for the company with current customers where the company is the leading or exclusive provider" over a five-year period. So, the cumulative subscriptions and bookings backlog gives investors a peek into SoundHound's revenue pipeline, and the size of this metric suggests that the company is at the beginning of a tremendous growth curve. As such, SoundHound AI's impressive growth rate seems sustainable over the long run. SoundHound AI stock trades at 31 times sales, which is five times the average sales multiple of stocks in the U.S. technology sector. So, the stock remains quite expensive to buy even after its recent price pullback. But it is worth noting that its sales multiple is now a third of what it was at the end of 2024. There are AI companies, such as Palantir, which are growing at a slower pace than SoundHound but are much more expensive. Moreover, we have seen that SoundHound is in a position to justify its valuation thanks to its massive revenue pipeline and the advent of its agentic AI solutions. So, growth-oriented investors looking to add an AI stock to their portfolios can consider accumulating SoundHound AI following its big drop this year, as the points discussed above suggest that it can become a much bigger company in the long run.

Where Will SoundHound AI Be in 1 Year? | The Motley Fool

The stock soared in February 2024 as Nvidia (NVDA 4.11%) bought a few shares. It cooled down a bit when the artificial intelligence (AI) chip giant didn't follow up with a larger investment or a tight partnership. Then the meme stock community stepped in, driving SoundHound AI's share price skyward in an attempt to cause a lucrative short squeeze. But short-sellers largely held on to their negative bets on the stock, and the broader market's volatility also weighed on these high-priced shares. Today, SoundHound AI is trading 62% below last December's record price. Where will SoundHound AI go from here? Is this a good time to buy into a hot growth story, or is the stock still overpriced? Let's see what the company might do over the next year, and how investors should treat this promising but unpredictable investment right now. Let's start with the basics. The most optimistic SoundHound AI bulls argue that the stock price should be calculated from that beefy order backlog, resulting in a hypothetical price-to-sales ratio (P/S) of 3.2. However, the average deal in that order book is about six years, so the average annual value over that period works out to $200 million. Then I'm back to an adjusted P/S ratio of 19.1, and the revenue conversion will be a gradual increase rather than a crisp jump. To be fair, the order backlog also keeps growing. It's up from about $1 billion in the previous quarter and $661 million in the year-ago report. So the annual revenue value of this growing contract list should account for some continued growth, too. But the whole discussion only gets more theoretical and less realistic with these extra adjustments. At the end of the day, I think it's fair to call the stock "very expensive" and leave the exact sales-based calculations alone. Some investors will be ready to take the high-priced risk of buying into SoundHound AI's long-term growth story at a lofty price. Others will stay away until one of two things happens: The stock price could drop to a more reasonable level, or the underlying business performance could rise. Both of these value-boosting trends could very well play out simultaneously, and that idea looks likely to me. If so, today's SoundHound AI buyers will be fine in the long run -- but those who wait for a better entry price will probably enjoy even stronger returns. 2025 could go down as a transformative year in SoundHound AI's history. Management expects full-year revenues to land near $167 million, about double the $84.7 million seen in 2024. Earnings before interest, taxes, depreciation, and amortization (EBITDA) is also supposed to turn positive this year, compared to a $61.9 million EBITDA loss last year. Of course, these targets were set in February and the global economy looks very different two months later. Whether you plan to buy now or wait for a better entry point, you should probably wait for May 8's first-quarter report. Management will probably provide more accurate full-year targets, either underlining or undermining your investment thesis.

Better Artificial Intelligence (AI) Stock: SoundHound AI vs. C3.ai | The Motley Fool

SoundHound has developed a voice-activated AI that understands human speech with uncanny precision. C3.ai built an enterprise platform encompassing both turnkey and custom AI software for organizations. This pair of AI specialists is positioned to benefit as the AI industry grows from $184 billion in 2024 to $826 billion by 2030. But is SoundHound or C3.ai the better choice to invest in the AI market? The answer requires taking a closer look at each company. SoundHound aspires to make technology easy for consumers to use. That's why the company focuses on voice-activated AI, a natural way of engaging with tech. Its AI is embedded into a variety of consumer devices, such as in cars, televisions, and at drive-thrus to automate taking restaurant orders. Customers include Stellantis, Walmart-owned Vizio, and Chipotle Mexican Grill. The next evolution of SoundHound's tech involves voice-enabled commerce in cars, set to launch this year. The new feature allows drivers to order food through SoundHound's AI agent, which also assesses a convenient pick-up location. The company wrapped up 2024 with no debt and $84.7 million in sales. This represented 85% year-over-year revenue growth. SoundHound expects its sales success to extend into 2025. The company forecast revenue to come in between $157 million and $177 million this year. That means SoundHound could repeat or exceed the 85% sales growth seen in 2024. Although revenue is rising, the company isn't profitable. It exited 2024 with a net loss of $350.7 million. On an encouraging note, management believes SoundHound will attain profitability on an adjusted EBITDA basis in 2025. The company ended 2024 with an adjusted EBITDA loss of $61.9 million. While SoundHound's voice-enabled AI is about simplifying consumer interactions with technology, C3.ai's platform is about solving complex organizational challenges. Examples include using AI to help financial institutions identify money laundering, and utility companies to proactively catch equipment issues. The company also used its AI to deliver a portion of the results for its fiscal third quarter, ended Jan. 31. The AI walked through some Q3 highlights, such as closing agreements with the U.S. Air Force and Navy. This was the first time AI participated on an earnings call, according to C3.ai. The company's offerings brought in customers such as the U.S. Department of Defense, ExxonMobil, and the New York Power Authority. In addition, C3.ai built a network of partners to help with selling its solutions, which includes tech luminaries Microsoft and Amazon. This approach propelled C3.ai's fiscal Q3 revenue to $98.8 million, a 26% year-over-year increase. The company anticipates closing out fiscal 2025 with revenue between $383.9 million to $393.9 million. That would be solid growth from fiscal 2024's $310.6 million. But like SoundHound, C3.ai is unprofitable. The company ended fiscal Q3 with a net loss of $80.2 million, up from a net loss of $72.6 million in the previous fiscal year. Making a choice to invest in SoundHound or C3.ai is not easy. Each company shows different strengths in its respective area within the artificial intelligence market, making either one a compelling AI investment. And although SoundHound and C3.ai aren't profitable, fast-growing tech companies commonly sacrifice profits in favor of business expansion. The strong year-over-year sales growth exhibited by both companies is a sign the strategy is paying off. One investment consideration is stock valuation. Here's a look at the price-to-sales (P/S) ratio for both companies, a commonly used metric that measures how much investors are willing to pay for every dollar of revenue. SoundHound's P/S multiple was sky-high around the start of 2025, but has since dropped. Even so, it remains far higher than C3.ai's, indicating C3.ai is the better value. However, one factor to weigh is C3.ai's dependence on partnerships. The company has limited influence on partner performance. If partners deliver weak sales or decide to leave, C3.ai's revenue can take a hit. For example, its joint venture with energy giant Baker Hughes expires at the end of April, and at the time of this writing, a renewal has yet to emerge. The uncertainty around C3.ai's partner network is one reason SoundHound wins out as the better AI investment at this time. Moreover, SoundHound demonstrated fiscal prudence by eliminating debt, and by striving for adjusted EBITDA profitability by the end of this year, the company shows movement toward an eventual positive bottom line. For these reasons, SoundHound looks like the more desirable AI investment for the long term. That said, since SoundHound's price-to-sales ratio is elevated, look for its share price to drop before deciding to buy.

Should You Buy SoundHound AI Stock Before May 8? This Recent Move by Nvidia Might Hold the Answer | The Motley Fool

Nvidia (NVDA 0.12%) has added an eye-popping $2.3 trillion to its market capitalization since the beginning of 2023, thanks to soaring demand for its data center chips that are the best in the industry for powering and training artificial intelligence (AI). Nvidia has put some of its incredible wealth to work by investing in a small portfolio of other AI stocks. SoundHound AI (SOUN -2.82%) was one of them, but the chip giant sold its entire stake during 2024's fourth quarter, according to its latest quarterly 13-F filing with the Securities and Exchange Commission. SoundHound is a conversational AI specialist, and it's experiencing strong demand for its software from some of the largest brands in the world. But its stock lost its momentum after investors learned of Nvidia's exit, and it's currently down 60% from its record high. SoundHound is scheduled to report its financial results for the first quarter on May 8. Could its dip represent a buying opportunity for investors ahead of the report? Chatbots like OpenAI's ChatGPT were originally designed to interpret text-based prompts, whereas SoundHound has always focused on conversational AI, which parses voice-based prompts and responds in kind. Conversational AI is more practical for a range of uses in everyday life, which is why SoundHound AI's client list includes some of the world's biggest restaurant chains and car manufacturers. Its technology is active in more than 10,000 quick-service restaurant locations from operators like Chipotle, Krispy Kreme, White Castle, and more. They use it to automate food ordering in-store, over the phone, and in the drive-thru lane, which reduces the number of employees those businesses require. Plus, SoundHound also offers a tool called Employee Assist that can give workers detailed instructions for making menu items or maintaining critical equipment. Leading automotive manufacturers like Kia, Hyundai, and Stellantis (owner of the Chrysler, Jeep, and Dodge marques) are also using SoundHound's Chat AI in-car assistant. It can do various tasks from locating the nearest restaurant to explaining what a particular warning light means on the vehicle's dashboard -- and it's controlled entirely with voice prompts. Manufacturers can customize Chat AI with different voices and personalities to suit their brands. SoundHound is now marrying its restaurant segment with its automotive segment with its new in-vehicle commerce platform. The software enables drivers to place food orders while they are on the move without picking up a phone. It plugs into the car's GPS navigation system to locate the most suitable vendors, so the driver can ask their in-car assistant to order them a meal from the nearest Chinese restaurant (for example). In August, the company acquired AI developer Amelia, which is helping it break into new industries like healthcare, financial services, and insurance. In fact, SoundHound's largest customer accounted for just 14% of its total revenue in 2024, which was down from more than half in 2023. Having a more diversified revenue base can drive steadier growth and reduce risk in the long run. SoundHound AI generated $84.7 million in revenue during 2024, which was an 85% increase from the previous year. Management believes its growth could accelerate to a whopping 97% in 2025, as it's forecasting revenue of $167 million (at the midpoint of its guidance range). The company's first-quarter result could dictate whether or not management increases that guidance, so this is something investors should pay attention to on May 8. The second metric to watch is SoundHound's order backlog. It stood at $1.2 billion at the end of 2024, which was an eye-popping 75% year-over-year increase. The company expects to convert that figure into actual revenue over the next six years, so it could be a great predictor of future results. If its backlog continues to grow at a rapid pace, it's reasonable to expect SoundHound's revenue growth to maintain its strong momentum. However, SoundHound's rapid top-line expansion is coming at a steep cost. The company lost $350.7 million during 2024 on a GAAP (generally accepted accounting principles) basis, which was 295% more than its loss in 2023. Even after excluding one-off outlays and non-cash expenses like stock-based compensation, SoundHound still took a $69.1 million non-GAAP loss for the year. With just $198 million in cash and equivalents on its balance sheet as of the end of 2024, SoundHound can't afford to keep losing money at that pace for long. The company might have to sacrifice some revenue growth to staunch the bottom-line bleeding. Otherwise, shareholders are likely to face significant dilution through further secondary stock offerings. Despite its 60% decline from its all-time high, the stock is still expensive. It trades at a price-to-sales (P/S) ratio of 38.1, which is nearly twice the P/S ratio of Nvidia. That doesn't make much sense, considering Nvidia is arguably the highest-quality AI company in the world. SoundHound AI stock looks a little cheaper valued based on its expected future revenue. For example, assuming the company will generate $167 million in revenue this year as management expects, its forward P/S ratio would be 22.7 -- but that's still a premium valuation, especially considering the risks associated with its steep losses. Nvidia never disclosed why it sold its stake in SoundHound, so it's impossible to know whether valuation played a role. Nvidia only held 1.73 million shares, which would be worth around $16.5 million at the current price, so even a complete loss wouldn't have affected the $2.7 trillion chip giant's finances meaningfully. However, Nvidia's absence on the share register certainly took some of the shine off the bull case for SoundHound stock. Plus, given its valuation, SoundHound doesn't look like a great buy at the current price, even if you think the upcoming financial report will be a total blockbuster. Therefore, it might be better to wait for a further pullback before investing in this story.

Better Artificial Intelligence Stock: Palantir vs. SoundHound AI | The Motley Fool

Despite the market's recent volatility, artificial intelligence (AI) continues to be a driving theme on Wall Street. In fact, AI has the potential to be one of the most important technological innovations of our generation. There are numerous ways to invest in AI, and within that space, the growth of the AI software platform niche is still in its early days. Two companies showing some of the most promise on this front are Palantir Technologies (PLTR -1.69%) and SoundHound AI (SOUN -3.80%). While both Palantir and SoundHound are emerging AI software companies, their businesses are quite different. Palantir is a data-gathering and analytics company that got its start by helping U.S. intelligence and defense agencies with mission-critical tasks. Within the government sector, its software is used for such things as helping fight terrorism by recognizing difficult-to-discern patterns in big data sets. Its solutions are also used on the battlefield. Palantir's AIP integrates data from diverse sources to provide commanders with real-time movement tracking, help them visualize asset positions, and support their strategic decision-making with AI-driven recommendations. The company has since branched out to the commercial sector, where it uses its AI platform to help customers identify and solve real-world problems in their businesses. It has focused on the application and workflow software layers, where it gathers data from different sources and structures it into an "ontology," connecting data to real-world objects and processes. Palantir does not have its own AI models -- instead, it lets customers import models into its secure platform so that they can be used in their operational processes to not only give actionable insights but also execute actions. For example, its platform can be used for such tasks as supply chain optimization. It can collect data from various sources into a single integrated view; simulate different scenarios; propose an action such as finding an alternative supplier; recommend alternate suppliers based on criteria like lead times and price; and then help predict future supply chain risks before they happen. SoundHound AI, on the other hand, is a voice-interface company. Its platform uses speech-to-meaning and deep-meaning-understanding technology to process speech in real time and ascertain a user's intent, while providing a more conversational tone in its replies as it answers complex questions. Its revenue model is based on a combination of royalties and subscription payments. For physical products into which its solutions are embedded, it receives royalties that can be based on things such as usage, unit sales, or transactions. Meanwhile, for more service-based businesses, its solutions are generally sold via subscriptions. SoundHound has made initial strong inroads into the automotive and restaurant industries. It provides in-vehicle voice assistants to several automobile brands, and it has a number of restaurant-based solutions, including smart ordering, employee assistance, and drive-thru solutions. With its acquisition of enterprise AI voice company Amelia last year, it has expanded into the healthcare, retail, and financial service industries as well. Both Palantir and SoundHound have been generating strong revenue growth. Palantir's revenue rose by 36% in Q4, while SoundHound's revenue soared by 101%, though that was off a much smaller base and was also boosted by the Amelia acquisition. For 2025, Palantir is guiding for revenue growth of about 31%, while SoundHound forecasts that its revenue will approximately double. Palantir has been experiencing significant sales growth with U.S. commercial customers, but this is merely the tip of the iceberg. A major factor is that much of its early work with new customers involves proof-of-concept solutions, presenting a substantial revenue opportunity as it transitions these customers to wider use of its solutions. The company has also been expanding its relationship with the U.S. government. Additionally, it recently secured a major contract with NATO. SoundHound, meanwhile, has a significant opportunity to become a leading voice commerce company, offering solutions across industries. It is leveraging AI agents to drive its next phase of growth, enabling its software to handle complex, industry-specific tasks. For example, it can assist a patient who has called a medical practice by identifying the right specialist for them to see, collecting insurance information, and scheduling an appointment. Both Palantir and SoundHound trade at premium forward price-to-sales multiples. However, Palantir's multiple is more than three times that of SoundHound, despite the latter's much faster revenue growth. That said, I think Palantir likely has the much bigger market opportunity over the long term. Its solutions are also much more complex, and it faces less competition. So between the two, I'd lean toward Palantir, despite its higher valuation. However, both stocks are more on the speculative side given their valuations, so if you choose to open a position in either of them, I'd suggest keeping its sizing within your portfolio on the smaller size.

Better Artificial Intelligence Stock: SoundHound AI vs. Palantir

Which of these volatile AI stocks is a better investment right now? SoundHound AI (SOUN -1.90%) and Palantir Technologies (PLTR 2.15%) are both well-positioned to profit from the rapid growth of the artificial intelligence (AI) market. SoundHound develops AI-powered speech and audio recognition tools, while Palantir's AI-driven data mining services help government agencies and large companies make faster and smarter decisions. SoundHound went public by merging with a special purpose acquisition company (SPAC) on April 28, 2022, and the combined company's stock started trading at $8.72 per share. Palantir went public via a direct listing on Sept. 30, 2020, and its stock opened at $10. SoundHound's stock now trades just below $10, but Palantir's stock has surged to nearly $115. Let's see why Palantir outperformed SoundHound AI by such a wide margin -- and if it's still the better AI play right now. SoundHound could struggle to justify its high valuations SoundHound's namesake app can identify a song by hearing a recorded clip or a few hummed bars. But its core growth engine is actually Houndify, its development platform for custom AI-powered voice, audio, and conversational applications. That's an appealing choice for companies that don't want to share their data with a tech giant like Alphabet's Google or Microsoft. Its customers include automakers like Hyundai, smart TV makers like Walmart's Vizio, and fast food chains like Church's Chicken. Nvidia also uses Houndify in its Drive operating system for connected vehicles. SoundHound's revenue rose 47% in 2022, 47% in 2023, and 85% in 2024. That recent acceleration was partly driven by its acquisitions of the restaurant AI company Synq3, the online food ordering platform Allset, and the conversational AI company Amelia. It also partnered with the chatbot maker Perplexity to upgrade its own large language models (LLMs). Analysts expect SoundHound's revenue to surge 96% to $166 million as it narrows its net loss from $351 million to $97 million. That outlook seems bright, but a few issues are likely preventing its stock from taking off. With a market cap of $3.9 billion, SoundHound still looks expensive at 23 times this year's sales. It's also expected to stay unprofitable for the foreseeable future, and it even postponed its 10-K filing by 10 days in March to deal with the "complexity" of its acquisitions of Synq3 and Amelia. To make matters worse, Nvidia -- which once owned a minor stake in SoundHound -- liquidated its entire stake earlier this year. As it faces those issues in this wobbly and unpredictable market, it could struggle to justify its high valuations. But Palantir is trading at even bubblier valuations Palantir operates two main platforms: Gotham for its government clients and Foundry for its commercial clients. Gotham serves most of America's government agencies and military branches, while Foundry serves big companies like Morgan Stanley and Airbus. Both platforms provide integrated AI tools for building custom AI applications. Palantir's revenue rose 24% in 2022 and 17% in 2023. Its growth decelerated as the macro headwinds drove its commercial customers to rein in their spending, and it struggled with the uneven timing of its new U.S. government contracts. However, it turned profitable in 2023 as it reined in its spending and reduced its stock-based compensation expenses. In 2024, Palantir's revenue increased 29% as its EPS more than doubled. That acceleration was fueled by the rapid growth of its U.S. commercial business, which bounced back as interest rates declined; geopolitical conflicts, which fed new government contracts; and the increased adoption of its AI tools to craft customized AI applications. Its growing market cap and stable profits led to its addition to both the S&P 500 and Nasdaq-100 in the fourth quarter of 2024. In 2025, analysts expect Palantir's revenue and EPS to soar 31% and 35%, respectively, as its core markets keep growing. That outlook is rosy, but it's getting overvalued. At $115 per share with a market cap of $270.5 billion, Palantir trades at 213 times its forward adjusted earnings and 72 times this year's sales. In other words, any bad news -- including reductions to government spending and tariff-induced headwinds for its top commercial clients -- could pop those bubbly valuations. So, which stock is the better AI play right now? I wouldn't rush to buy either of these stocks right now. SoundHound is still expanding, but its growing dependence on acquisitions and its lack of profits indicate its business isn't sustainable yet. Palantir's business looks a lot healthier, but it's trading at meme stock valuations. But if I had to pick one over the other, I'd stick with Palantir. I wouldn't go all-in on its stock at these prices, but I'd be willing to dollar-cost average into the stock over the next few quarters or years to smooth out its volatile swings. I'm not as confident in SoundHound's long-term growth potential yet.