SoundHound AI: Soaring Stock and Ambitious Growth Plans Amid Valuation Concerns

SoundHound AI Stock Is Up 1,051% in 2024. Where Could It Be at the End of 2025? | The Motley Fool

SoundHound AI (SOUN -5.30%) is a leading developer of conversational artificial intelligence (AI). Its stock came public in 2022, but it flew under the radar until February 2024, which is when Nvidia (NASDAQ: NVDA) revealed that it had acquired a small stake in the company. SoundHound stock quadrupled shortly after that news hit the wires, and it's now sitting on a tenfold gain for 2024 on the final trading day of the year. Nvidia's share purchase isn't the only thing behind the incredible gains. SoundHound is delivering solid operating results, and the company's most recent forecast suggests its revenue could double in 2025. That's great news for investors, but there is one caveat: SoundHound stock is extremely expensive right now, and its valuation could be a barrier to further upside in the New Year. So where could the stock be in 12 months from now? SoundHound's conversational AI technology is popular among quick-service restaurant chains, hospitality venues, and some of the world's largest automotive manufacturers, thanks to its ability to understand voice prompts and respond in kind. SoundHound's AI applications are used in more than 10,000 restaurant locations to automate drive-through ordering, phone ordering, and even in-store ordering. Plus, restaurant workers can call upon SoundHound's employee-assist technology any time for instructions on how to make menu items, or for help with handling customer queries. Leading chains such as Chipotle, Krispy Kreme, and Papa John's are just some of the company's customers. On the automotive side, SoundHound's Chat AI software allows brands to install voice assistants into their vehicles, so drivers can instantly access everything from sports scores to information on their upcoming flight. Giants such as Mercedes-Benz, Hyundai, and Stellantis, the parent company of Chrysler, Jeep, and Dodge, are some of SoundHound's top customers in this space. SoundHound is quickly expanding into other industries, including financial services, healthcare, and insurance, thanks to its recent acquisition of Amelia. It's another AI specialist that allows businesses to create virtual agents to serve their customers and employees. Ninety percent of SoundHound's revenue came from the automotive industry alone during the third quarter of 2023, but in the recent third quarter of 2024, ended Sept. 30, five different industries accounted for between 5% and 25% of its total revenue. That highlights how much Amelia helped SoundHound diversify its customer base. SoundHound generated a record $25.1 million in revenue during the third quarter. That was an 89% increase from the year-ago period, mostly thanks to the inclusion of Amelia's revenue for the first time. The strong result prompted management to increase its revenue forecast for both 2024 and 2025. The company now expects to bring in between $82 million and $85 million once this year is officially in the books, which would be an 82% increase over 2023 at the midpoint of the range. In 2025, SoundHound expects to generate between $155 million and $175 million in revenue, which would be a whopping 97% jump from 2024 at the midpoint of the range. SoundHound told investors that its order backlog exceeded $1 billion at the end of Q3, which it expects to convert into revenue over the next six years. That figure doubled year over year, which bodes very well for the company's future sales growth. However, SoundHound is losing significant amounts of money while it scales its business. It lost over $92 million on the basis of generally accepted accounting principles (GAAP) through the first three quarters of 2024 alone. Since the company has only $136 million in cash on hand, it can't afford to continue burning money at that pace. SoundHound recently announced a new at-the-market equity facility, which enables it to issue new shares to investors to raise an additional $120 million as needed. While it will help to secure the company's future, it will also dilute existing shareholders. Plus, it's unclear whether a further $120 million will see the company to profitability, so it might require even more cash in the future. SoundHound's market capitalization has ballooned to $8.8 billion following the 1,051% increase in its stock this year. Based on its trailing-12-month revenue, that places the stock at a price-to-sales (P/S) ratio of 109. For context, Nvidia stock trades at a P/S ratio of 30, which makes SoundHound stock three times as expensive. Considering Nvidia is on track to generate over $129 billion in revenue during its current fiscal year, is highly profitable, and has a stellar track record of success that spans decades, SoundHound's premium valuation is very difficult to justify. With that said, SoundHound's revenue is growing so quickly that its stock appears much cheaper even if we look just one year into the future. If we assume the company generates $175 million in revenue during 2025, the high-end of management's guidance, that places the stock at a forward P/S ratio of 50.3. It's still one of the most expensive AI stocks in the market today even on a forward basis, so investors might have to hold on to it for two years or more before its valuation looks attractive. That opens the door to lots of uncertainty, because nobody truly knows what SoundHound's business will look like beyond management's forecast for 2025. As a result, I think its lofty valuation could put a lid on further upside from here. In fact, I think it's entirely plausible that SoundHound stock loses ground in 2025, unless the company significantly boosts its revenue guidance throughout the year. Investors should be cautious buying it at the current price -- but if they do, they should be prepared to hold it for several years to maximize their chances of earning a positive return.

SoundHound AI: Buy or Sell in 2025? | The Motley Fool

Smaller artificial intelligence stocks have seemingly gone parabolic at the close of 2024, especially those that have been backed by Nvidia (NVDA -2.09%) in the form of an investment. Although Nvidia invested a mere $3.7 million in voice-AI start-up SoundHound AI (SOUN -1.16%) about a year ago, that investment put SoundHound squarely on the map as a potential AI winner. After making several accretive acquisitions and racking up an impressive customer list, SoundHound's stock has soared in recent weeks. Is this price increase a signal that SoundHound could be the next "killer app" AI platform? Or is it a sign of a bubble waiting to burst? SoundHound appears to have achieved escape velocity as the go-to voice-enabled AI system outside big tech, especially within the automotive and quick-serve restaurant (QSR) verticals. SoundHound has landed seven of the top 20 QSR brands, including heavyweight Chipotle, for things like phone and drive-through ordering. In automotive, SoundHound's voice AI is now embedded in many leading auto brands such as those owned by car giant Stellantis, as well as four major electric vehicle manufacturers as of last quarter. In addition to those two big verticals, this past summer's acquisition of Amelia, another voice-based start-up for enterprises, has boosted SoundHound's enterprise platforms both for customer service applications and employee-facing IT AI applications. While the generative AI craze has only been happening for two years, SoundHound has actually been around since 2005, and first released its Houndify voice AI platform 10 years later in 2015. So, the company has been developing this technology for a long time. While SoundHound does incorporate other third-party large language models into its products when necessary, it has distinguished itself by building its own proprietary model called Polaris. Polaris is built on its two decades of experience spanning billions of conversations and millions of hours of audio in dozens of languages. SoundHound has only been building Polaris since LLM training was available, but the platform is already in use for one-third of the company's restaurant ordering transactions, while management aims to eventually use Polaris in all of SoundHound's interactions across its platform. In the age of AI, having proprietary data to build one's own model or augment a general-purpose LLM -- in this case, SoundHound's billions of voice transaction data going back decades -- should be a competitive advantage. On its mid-November third-quarter earnings report, SoundHound boasted impressive 89% revenue growth. But what was especially encouraging was its increase to the 2024 and 2025 outlook. Management increased full-year revenue guidance to between $82 million and $85 million, and 2025 guidance to a range of $155 million to $175 million. That was an increase from the prior quarter's guidance of $80 million for 2024 and $150 million for 2025. Certainly, the 100% projected growth shows SoundHound has a lot of momentum -- possibly accelerating momentum. While operating losses also more than doubled from $14 million to $33 million last quarter, that's a relatively manageable level of investment for a company with that kind of top-line business growth. Of course, just because SoundHound has an early lead in this vertical doesn't mean you should buy the stock right now. The biggest reason for caution is the company's valuation. After all, the stock has gone up five times, or 400%, in just the span of two months! Today, SoundHound's market cap is an eye-watering $9 billion as of this writing. So, even if SoundHound exceeds its 2025 guidance by 25% and reaches $200 million in revenue next year, that would put the stock at 45 times next year's sales. That's a crazy valuation, anticipating extremely high growth for many years. Moreover, the rapid increase in price doesn't appear to be totally driven by fundamentals. Over the past two months, there has been a mania in a lot of next-generation technology stocks in AI software, quantum computing, and cryptocurrency. While a lot of these stocks have compelling stories and technology, it will be years, in some cases many years, before they begin to earn any substantial profits. Specifically, there could be a bit of meme stock trading pushing shares. As of the end of November, SoundHound had a 22.1% short interest, which is very high. Meme-style investors on message boards may be taking advantage of the high short interest by bidding shares up higher into the end of the year, forcing short-sellers to cover their position. As shares have rocketed higher, sell-side analysts have also weighed in, increasing their share-price targets accordingly. While that shouldn't be ignored, it is sometimes the case that analysts follow the stock price rather than lead it. One only has to look back to the software bubble of 2021 to find a similar phenomenon, before that bubble burst in the next year. A high valuation driven in part by short-covering is a dangerous setup, as meme stocks can often crash once the party is over. From a longer-term perspective, a high valuation is a risk to investors if anything should go wrong, such as an unexpected slowdown, unanticipated competition, or a rise in interest rates. While SoundHound appears to have big lead, one can be sure large tech giants will aim to compete with the company if the voice AI sector is that large and attractive. SoundHound has impressed recently by diversifying and growing its customer base while also developing its own proprietary voice AI model. That makes the stock worth knowing. However, a sky-high valuation perhaps pushed by nonfundamental factors over the past month makes the stock a no-go for now. If shares fall significantly while the business continues to improve, SoundHound may be an attractive buy one day. However, investors should be cautious with the stock and be patient for a (much) better entry point to present itself.

Where Will SoundHound AI Stock Be in 2 Years? | The Motley Fool

SoundHound AI (SOUN -0.93%) has simply taken off in the past couple of years. Shares of the voice artificial intelligence (AI) solutions provider shot up a phenomenal 1,940% during this period thanks to the growing AI craze, an investment in the company by Nvidia, and solid results from the company in recent quarters. So, if you bought just $100 worth of SoundHound AI stock two years ago, your investment would now be worth an impressive $2,000. The stock witnessed wild swings during this period, though it won't be surprising to see SoundHound sustaining its impressive run over the next couple of years as well. Let's take a closer look at SoundHound's catalysts and determine if this fast-growing AI company could be primed for more upside over the next two years. SoundHound AI is a small company with a market cap of $7.5 billion as of this writing. Additionally, the company's financials tell us that it is currently in the early phases of its growth. For instance, SoundHound AI is on track to deliver revenue of $82 million to $85 million in 2024. The midpoint of the guidance would translate to an 82% year-over-year increase in SoundHound's top line, better than the 47% revenue growth that the company delivered last year. This acceleration in growth that SoundHound is on track to deliver in 2024 clearly indicates that the company's voice AI solutions are gaining traction in the market. That's also evident from SoundHound's impressive customer base, which includes multiple restaurants and automakers. The company is adding new customers to its portfolio while also expanding its relationships with existing customers. It is also looking to move into additional verticals to make the most of the fast-growing adoption of voice AI technology, driven by the recent acquisition of enterprise conversational AI solutions provider Amelia that will expand its presence in markets such as insurance, healthcare, retail, and financial services. These are probably the reasons why certain Wall Street analysts are turning bullish on SoundHound. Dan Ives of Wedbush Securities raised his price target on SoundHound to $22 from $10 earlier this month, pointing out that it is an underappreciated AI stock that could win big in the long run thanks to the growing integration of voice AI solutions across multiple industries. Similarly, investment banking firm H.C. Wainwright raised its price target on SoundHound from $8 to $26, stating that its scalable platform should drive solid enough growth in the long run to help the stock justify its rich valuation. These positive endorsements rubbed off positively on SoundHound's stock this month, with shares of the company up a remarkable 128% in December. However, there is one factor that may keep new investors from buying the stock -- the valuation. The stock's red-hot surge has brought its price-to-sales ratio to a whopping 93. That's extremely expensive when we consider that the S&P 500 index has a sales multiple of 3.11. SoundHound AI will have to keep delivering eye-popping growth quarter after quarter so that it can justify its rich valuation. The good part is that the company seems to have a solid enough pipeline that could help it generate robust long-term growth. Its cumulative subscriptions and bookings backlog doubled year over year in the third quarter of 2024. This metric is a mix of SoundHound's committed customer contracts and the potential revenue that it expects to achieve from its current customers over a five-year period. SoundHound's cumulative subscriptions and bookings backlog stood at $723 million in the second quarter of 2024, with the metric doubling on a year-over-year basis. The company didn't report a number for the third quarter as it is adjusting the metric to reflect the acquisition of Amelia, but it did point out on the earnings call that the number doubled from the year-ago period. Even if SoundHound's backlog stood at $700 million at the end of the third quarter, it would be strong enough to help drive outstanding growth over the next couple of years. The company is expecting its top line to jump to $165 million in 2025 at the midpoint, which would be almost double this year's level and points toward further acceleration in its growth. Meanwhile, analysts are expecting SoundHound's annual revenue to cross $200 million in 2026. Don't be surprised to see SoundHound exceeding that mark in 2026 as its estimated backlog of $700 million is big enough to help it deliver stronger growth than what analysts are expecting. If that's indeed the case, it won't be surprising to see SoundHound stock head higher over the next couple of years as well. But investors who haven't bought this stock and are looking to jump onto the SoundHound bandwagon shouldn't miss the fact that it is expensively valued right now and would be prone to volatility. There are cheaper options to capitalize on the AI boom.

Is SoundHound AI a Millionaire-Maker Stock? | The Motley Fool

With shares rocketing higher so far this year, SoundHound AI (SOUN -6.09%) demonstrates the millionaire-making potential of stock market investing. A $10,000 investment made at the start of 2024 would be worth $97,300 today. But can this explosive rally continue? Let's dig deeper to see if this artificial intelligence (AI) software stock still has gas left in the tank. Since the launch of OpenAI's ChatGPT in late 2022, generative AI has been the hottest hype cycle on Wall Street. However, until recently, most of the winning companies seemed to be operating on the hardware side of the industry, supplying the graphics processing units (GPUs) and other data center equipment to train and run AI algorithms. Over the long term, the industry will probably shift to consumer-facing software to generate the cash flow and profits needed to justify hardware purchases. Companies like SoundHound AI could represent the next phase of industry growth because of their potential for real-world utility. SoundHound has been developing sound and voice recognition technology since its founding in 2005, initially focusing on a music discovery app. However, management quickly realized the synergy between this technology and large language models (LLMs) like ChatGPT. By combining the two technologies, humans can interact with machines in truly lifelike ways, potentially allowing businesses to replace human labor. SoundHound's offerings include a restaurant voice assistant designed to automate small business phone lines by taking orders, providing menu information, and other services. The company also offers drive-thru automation services, boasting deals with high-profile restaurant clients like White Castle, Church's Texas Chicken, and Jersey Mike's Subs. SoundHound's massive rally can be explained by its software's monetization potential. For most investors, it isn't much of a stretch to see how AI voice assistants could create value for restaurants or other applications. The market also expects interest rates to come down over the next few years, which could make it easier for small, unprofitable companies like SoundHound to access the financing needed to grow. Third-quarter revenue jumped 89% year over year to $25.1 million as SoundHound continues to add more clients from restaurants to financial services. The company's sales mix is also increasingly diversified, with each industry contributing between 5% and 25% of total sales. That said, SoundHound isn't without challenges. Operating losses are expanding relentlessly (up 132% to $33.8 million in the third quarter), and with just $135.6 million in cash and equivalents on its balance sheet, management may eventually need to rely on equity dilution to raise the capital needed to continue growing the business. However, while SoundHound's financing situation is tense, its biggest problem may come from competition. Voice recognition is common -- most of us are familiar with examples like Apple's Siri, a technology provided by Microsoft subsidiary Nuance Communications. Competitors can easily integrate their existing technology with LLMs and encroach on SoundHound's moat. Microsoft is likely the biggest threat because of its partial ownership of OpenAI, an advanced LLM developer. While SoundHound is an exciting way to bet on the software side of the AI industry, investors should tread with caution. With a price-to-sales (P/S) ratio of 99, most of the company's growth potential is likely already priced in. For context, the S&P 500 has an average P/S ratio of just 2.8. In 2025 and beyond, the market will have to reckon with SoundHound's relentless cash burn and weak economic moat. And shares could give back much of their recent gains. Investors looking to make millions in the stock market should probably avoid SoundHound shares for now.

SoundHound AI Stock Could Soar to $26 in 2025, According to a Wall Street Analyst. Is It a Buy at Around $20? | The Motley Fool

These days, you can't find an investment bank analyst who's not excited about a handful of artificial intelligence (AI) stocks. Since ChatGPT exploded in popularity in late 2022, businesses of all sizes have been hurling money at new AI solutions with both hands to avoid getting left behind. One stock that's benefited immensely from the AI revolution is SoundHound AI (SOUN -6.09%). Enterprise customers license its technology to support their voice-activated AI agents, which are like chatbots that can behave autonomously in a specific environment. From the end of 2023 through Dec. 22, the stock has shot 926% higher. However, what goes up often comes down, but H.C. Wainwright analyst Scott Buck thinks SoundHound stock has enough fuel in the tank to climb higher. On Dec. 23, he raised his bank's price target to $26 per share and maintained his buy rating. The new target implies a gain of 19.5% from SoundHound's closing price on Dec. 22. Wall Street analysts are pounding the table on this stock because it's been pulling in new customers left and right. Around a year ago, SoundHound's customers were nearly all automobile manufacturers. Now, five industries -- auto, restaurants, financial services, healthcare, and insurance -- contribute between 5% and 25% of total revenue. Third-quarter revenue soared 89% year over year, and actual usage of the voice-recognition services it sells is growing even faster than sales. The company delivered an annualized run rate of over 6 billion queries in the third quarter, a gain of more than 100% year over year. SoundHound expects another big year in 2025. The midpoint of management's guidance ranges suggests revenue will grow 98% in 2025. SoundHound lost $22 million in the third quarter, but profits on a GAAP basis could be coming in a couple of years. Management expects adjusted earnings before interest, taxes, depreciation, and amortization to turn positive in 2025. SoundHound says voice is becoming the preferred way for users to interact with their devices, but I don't know many people who aren't selling AI tools that agree. I have a whole drawer full of unplugged yet fully functional smart speakers, and it makes me nervous about this company's ability to maintain its sales trajectory. SoundHound is also operating under the assumption that AI-powered customer service will become as necessary to all businesses as Wi-Fi and electricity. Adding a thicker layer of automation between customers and a real person who can help them is the sort of solution that only makes sense to managers eager to lower payroll expenses. I'm worried that SoundHound's upward growth trajectory will flatten out in a year or two as fear of missing out on the AI revolution subsides. This would be a disaster for investors who buy the stock at recent prices because expectations are extremely high. SoundHound AI stock has been trading for 91.5 times trailing sales. With expectations this high, investors who buy at recent prices could suffer heavy losses if the revenue guidance management issues next year isn't equally impressive. Finally, SoundHound AI probably doesn't have an economic moat to keep competition at bay. Sooner or later, a competitor offering AI agent support that's good enough for SoundHound's clients could gain a large share of the market for voice-driven AI agent technology. Sooner or later, I'll have a good experience with a voice-driven AI agent. Until that day comes, I'm going to avoid SoundHound stock. If you're more confident than I am about the future adoption of voice-driven AI agents and you have a high risk tolerance, this could be a stock to consider buying. As a multiple of sales, it's expensive, but its market cap is a modest $7.4 billion at recent prices. The overall market for AI agents is expected to rise from a value of about $5.1 billion this year to $47.1 billion by 2030, according to research from Markets and Markets. If you believe voice-activated agents are going to be the most popular type of AI agent in the years ahead, adding shares of this stock to a diversified portfolio could be the right move.

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

SoundHound AI (SOUN -0.93%) emerged as one of the hottest technology sector growth stocks on Wall Street. At the time of this writing, shares have skyrocketed an astonishing 870% year to date, powered by mounting market enthusiasm for the company's innovative artificial intelligence (AI) solutions that may just be at the beginning of transformative long-term growth. Shareholders have plenty to celebrate as 2024 comes to an end but can this historic rally keep going? Let's explore where SoundHound AI stock might be in one year. A key breakthrough of artificial intelligence lies in its capacity to understand and generate natural language. Human speech is quickly becoming the preferred way for people and AI-powered devices to interact for many applications, as intuitive voice communications offer significant advantages compared to a text-based experience. SoundHound AI is a leader in this field of conversational intelligence, backed by its proprietary platform. From early success partnering with major automakers that are integrating the company's in-vehicle intelligence with voice assist and generative AI capabilities, a major development this year is the expanding number of use cases. The company is optimistic about its AI-enabled customer service solutions, in which AI agents can answer complex user inquiries in a wide range of industry verticals with a conversational voice. Comments by CEO Keyvan Mohajer highlighted how the technology is advancing. During a recent earnings conference call with investors, Mohajer said: AI customer service will become as necessary to all businesses as Wi-Fi and electricity. And thanks to the incredible strides voice AI has made in recent years, we believe users will prefer to have their questions and transactions handled by a consistent, accurate conversational AI agent than by a human. Ultimately, this opportunity helps explain the market enthusiasm toward SoundHound AI stock. In the third quarter (for the period ended Sept. 30), SoundHound AI posted revenue of $25.1 million, an 89% year-over-year increase. The company now serves more than 200 enterprise-level customers, showcasing its diversifying business mix. For the full year, SoundHound AI expects revenue of around $84 million, marking an 83% jump from 2023. A key revelation from the quarterly report came in the form of new guidance for 2025, with the company targeting revenue between $155 million and $175 million next year. This forecast suggests an accelerating growth rate of 96% at the midpoint estimate compared to the 2024 estimate. While profitability isn't expected in the foreseeable future, management aims to achieve positive adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) by the end of 2025. Following the spectacular rally in SoundHound AI stock, investors must contend with an objectively pricey valuation. At a current $9 billion market capitalization, shares of SoundHound AI are trading at an eye-watering 90 times this year's revenue forecast as a forward price-to-sales (P/S) ratio. This level is well beyond other AI stocks like Palantir Technologies at a forward P/S ratio of 66 or Nvidia at 26, which in contrast to SoundHound AI are both profitable and generate positive free cash flow. The market can often overlook those metrics and reward disruptive and high-growth companies with a premium valuation. Nevertheless, there is a case to be made that the market has gone too far with SoundHound AI, pricing in many of the positives in its outlook for many years to come. The risk is that results begin to underwhelm. Longer term, it's unclear if the company can maintain its technological advantage or how the conversational AI market will evolve in a highly competitive environment. SoundHound AI stands out as a unique pure-play AI software company and the latest results speak for themselves. That being said, I believe it's just too expensive at the current level to buy with conviction. I predict shares will be lower by this time next year, with the silver lining that a correction could present an opportunity for patient investors to buy SoundHound AI at a lower and more attractive price.

Could This Artificial Intelligence (AI) Stock Be the Next Palantir? | The Motley Fool

Can this AI stock become the next Wall Street favorite after Palantir? SoundHound AI's (SOUN -0.93%) shares surged by nearly 875% in 2024 mainly due to record third-quarter revenue performance and increasing adoption of the company's conversational AI solutions by major brands across industries. The stock also benefited significantly from a bullish report from Wedbush analyst Dan Ives, who raised the company's target price from $10 to $22. Palantir Technologies' (PLTR 2.09%) stock posted remarkable gains of almost 385% in 2024, driven by unprecedented demand for its Artificial Intelligence Platform (AIP), strong financial performance, lucrative partnerships, and inclusion in the benchmark S&P 500 index. While SoundHound AI recorded a much stronger share price performance than Palantir, is it a better or even a comparable investment on a risk-adjusted basis? Let's find out. SoundHound AI dramatically reduced its overreliance on a small customer base. While the largest customer accounted for 72% of revenue in 2023, the revenue exposure was reduced to only 12% in the third quarter of 2024. Furthermore, the top five customers now account for less than 33% of the company's revenue, far lower than the 90% revenue exposure in 2023. SoundHound is seeing increasing momentum in the automotive sector, especially in the electric vehicle (EV) space. The company signed contracts with four new EV players in the third quarter, two of which are using conversational intelligence solutions in real time. SoundHound expanded its contract with Stellantis across multiple markets, with seven of the latter's brands using its generative AI-enhanced digital assistant, SoundHound Chat AI. SoundHound AI is also making its presence felt in the Chinese market through partnerships with DayinTec and a major Chinese multinational technology company. Being the largest EV market with an estimated size of $376.4 billion in 2024, the Chinese EV market can be a major growth catalyst for SoundHound AI in the coming years. SoundHound is a market leader for phone ordering solutions in the restaurant industry. The company's phone ordering solutions handled over 100 million customer interactions. Multiple prominent brands are adopting SoundHound's drive-thru and phone ordering system. Finally, SoundHound's AI agent customer service solutions found a solid footing across industries like financial services, healthcare, insurance, and retail. This business segment accounts for over half of the company's revenue. SoundHound AI built its multimodal, multilingual Polaris foundation model and trained it on billions of real conversations and over 1 million hours of audio across multiple languages. The model has helped improve accuracy and reduce hosting costs -- a solid competitive advantage for a conversational artificial intelligence company. Polaris is already powering almost one-third of all AI interactions for the company's restaurant customers. This trend is expected to strengthen in the coming quarters. SoundHound AI's financial numbers speak volumes about its improving business momentum. The company expects its 2024 revenue to be between $82 million and $85 million and 2025 revenue to be in the range of $155 million to $175 million. The company expects to be adjusted EBITDA profitable by the end of fiscal 2025. SoundHound AI also boasts a strong balance sheet with $136 million in cash and $43.8 million in debt at the end of the third quarter. Although SoundHound is an exceptional AI-powered company, its financial strength and target addressable markets differ significantly from Palantir's. SoundHound's revenue jumped by 89% year over year to $25.1 million, while Palantir's revenue was up by 30% year over year to $726 million. While the top-line growth rate of the former is higher, revenue is also much smaller on an absolute basis. Hence, it is obvious that SoundHound is a company experiencing early growth, while Palantir has entered a more stable and mature growth phase. SoundHound is not yet profitable and reported a generally accepted accounting principles (GAAP) operating loss of $33.7 million in the third quarter. On the other hand, Palantir is profitable and posted a GAAP operating income of $113.1 million in the third quarter. From an operational perspective, government agencies and large commercial organizations deploy Palantir's advanced data analytics and mining offerings mainly for complicated and mission-critical applications. Subsequently, these solutions are deeply entrenched in the client's operations, making it difficult to switch to the competition. The sticky customer base is a major competitive edge for Palantir. Contrarily, SoundHound's voice AI and conversational intelligence applications are used for cases such as restaurant ordering, automotive interface, and customer support. Although important, these are not integral to the functioning of the business. Hence, some clients can opt for competitors such as Amazon's Alexa, Alphabet's Google Assistant, Apple's Siri, and Microsoft's Cortana. While there is huge growth potential for SoundHound AI, it may not be able to replace Palantir in a smart investor's portfolio anytime soon.

Could SoundHound AI Be Your Ticket to Becoming a Millionaire by 2035? | The Motley Fool

More than a few people are taking on this risky stock bet of late, but there's much more to consider than just the premise of its business. Risk-tolerant investors hunting for growth often gravitate toward technology stocks -- and for good reason. These companies are driving some of the world's top social, economic, and cultural changes, after all. That's why so many of these tickers experience great gains (and a select few see outright massive ones). Indeed, the right tech stock can make you a millionaire with just a relatively small investment. Is SoundHound AI (SOUN -1.16%) such a millionaire-making name? Maybe. The stock's 300% price spike since late October certainly suggests at least some investors see big things in its foreseeable future. Before you take the same plunge in anticipation of becoming a millionaire within the next 10 years, however, there are a few things you'll want to consider. SoundHound is an artificial intelligence (AI) technology company. Its specialty is voice-based solutions, like turning a spoken drive-thru order into a written prep list for the fast-food restaurant staff, or hands-free activation (or deactivation) of an automobile's features. By leveraging the full potential of modern large language model (or LLM) AI, it can even support assistance-minded conversations with users of its tech. And customers are paying for access to its solutions. Restaurant management software provider Toast has integrated SoundHound's voice ordering technology into its offerings, while hamburger chain White Castle has directly secured access to it as a means of streamlining its drive-thrus. Carmaker Stellantis -- parent to Jeep, Dodge, Chrysler, Fiat, and others -- has utilized SoundHound's in-car solutions in some of its more driver-interactive vehicles. Streaming music platform Pandora (owned by SiriusXM) can now be managed by subscribers' voices thanks to SoundHound AI. All told, this company monetized its technology to the tune of $25 million during the quarter ending in September, up 89% year over year. There's more growth on the horizon, too. Market research outfit Straits Research believes the global speech recognition industry is poised to grow at an annualized pace of 17% through 2032, jibing with outlooks from Technavio as well as Polaris Market Research. This business being its sole focus, SoundHound AI is seemingly well-positioned to capture at least its fair share of this growth. This possibility is the top reason at least a small handful of investors are piling in, perhaps in anticipation of riding the stock's coattails to reach the millionaire mark in the relatively near future. If you're thinking of doing the same, though, know that there's a fairly low likelihood of this stock actually making you a millionaire by 2035 no matter how much capital you commit to it today. In fact, there's arguably more risk than reward. There's no denying this company has significantly raised the bar on the voice-based artificial intelligence front. It's successfully monetizing its technology, too. Indeed, as Wedbush Securities analyst Daniel Ives recently noted, "SoundHound represents an underappreciated pure-play AI company" that's likely to report accelerated growth and new market prospects over the course of 2025. There are legitimate concerns about its longer-term growth prospects, however. Chief among them is the fact that, while impressive, there's nothing particularly unique about its technology. Take OpenAI's ChatGPT and Alphabet Google's Gemini as examples. Both are capable of offering text-based AI-generated conversations, and Google has already developed a serviceable speech-to-text tool for some of its offerings. Microsoft's AI assistant, Copilot, can also be voice-based. Tweaking any of these solutions into a tool that's akin to SoundHound AI's wouldn't be a great leap. It's just that these companies have thus far opted not to. Microsoft, Google, and ChatGPT owner OpenAI all certainly enjoy access to deeper developmental pockets though. If and when any of them attempt to step onto SoundHound's turf, they could easily topple the smaller outfit. This fragility makes the second concern surrounding this stock all the more troubling. That's the stock's valuation. SoundHound AI shares are incredibly expensive. Never even mind the company's current lack of profits. It's obviously difficult to value any company operating in the red. You own a stock based on where the organization is going rather than where it is, but the future isn't always clear. Investors simply believe SoundHound will be fiscally viable at some point in time even with no real clarity as to when that might be. And maybe it will eventually swing to a profit. Even by the most forgiving valuation standards, though, at roughly 100 times its trailing-12-month revenue, this stock's still wildly expensive. For the sake of comparison, the S&P 500's current price-to-sales ratio is in the ballpark of 3.1. Said in more practical terms, SoundHound AI's top line could grow more than 30-fold from here and shares would still be priced in line with its peers where it stands right now. The stock's really not any more promising in the near term, either. Analysts' current consensus price target of $14.36 is 40% below SoundHound shares' present price. Sure, target prices can and do rise over time. It could be a long time before the analyst community's consensus catches up with the stock's current level, however, if it ever does. The company continues to issue new stock to raise funds in the meantime, diluting existing shareholders. It's not clear when this practice is set to slow down. Never say never. SoundHound could make you a millionaire by 2035. It might acquire or develop a new marketable tech with a wider defensive moat than its voice-based AI currently has, for instance. From an odds-making perspective though, that's a very low-likelihood prospect. There are just too many short-term headwinds already blowing, and too many long-term headwinds waiting in the wings. Don't sweat it too much if you're looking for millionaire-making stocks, however. They're out there. It's just that SoundHound AI isn't one of them. Check out these tickers if you can stomach the risk required of promising millionaire-making prospects.

Should You Forget SoundHound AI and Buy These 2 Millionaire-Maker Stocks Instead? | The Motley Fool

It was just over a year ago in the final week of December 2023 that I wrote an article on SoundHound AI (SOUN -1.16%), discussing whether the voice artificial intelligence (AI) solutions provider could help investors become millionaires in the long run. I had assumed that an investment of $100,000 in SoundHound stock at the end of December 2023 could be worth $530,000 by the end of 2030. However, the stock has significantly outpaced those expectations, jumping more than 1,000% in the past year as of this writing and turning a $100,000 investment into more than a million dollars. While that's impressive, investors should note that SoundHound is now trading at a whopping 109 times sales. That's way higher than its price-to-sales ratio of 12 a year ago, which was justifiable at that time thanks to the outstanding growth that it was clocking. So, investors looking to add another potential millionaire-maker stock to their portfolios may want to look elsewhere considering SoundHound's expensive valuation. Let's take a closer look at the prospects of two other AI-focused stocks that seem like solid candidates for investors looking to build a million-dollar portfolio. These stocks may not deliver SoundHound-like returns in a short period, but they could deliver robust gains over the long term and can become a part of a diversified portfolio. The demand for application-specific integrated circuits (ASICs) deployed in data centers for handing AI workloads is growing at a remarkable pace, and this explains why Marvell Technology (MRVL -1.81%) has been witnessing a significant jump in its data center revenue in recent quarters. When the company released its fiscal 2025 third-quarter results (for the three months ended Nov. 2, 2024), it reported a terrific 98% year-over-year increase in data center revenue to $1.1 billion. This impressive growth was enough to offset the weakness in other segments such as enterprise networking and carrier infrastructure, helping Marvell boost its overall top line by 7% from the prior-year period to $1.51 billion. The demand for Marvell's custom AI processors is so strong that the company believes it could significantly exceed its $1.5 billion revenue estimate from the sales of these chips for the current fiscal year. More importantly, management also points out that its AI business is tracking ahead of the fiscal 2026 revenue target of $2.5 billion. That's not surprising because of a couple of reasons. First, the size of the custom AI processor market is set to grow rapidly in the coming years. Marvell's peer Broadcom recently pointed out that the addressable market for custom processors and networking chips could be worth $60 billion to $90 billion after three years. Second, Marvell seems to be cornering a bigger share of this market. While Broadcom is the dominant player in ASICs, Marvell is the second-largest company in this segment with an estimated market share of 13% to 15%. On its December 2024 earnings conference call, Marvell management remarked that it currently has two different customers for its custom AI processors and networking chips, along with "other programs going into production next year, and then we have our third large customer coming in the future." So, there is a good chance that Marvell may be able to corner a bigger share of the custom AI chip market going forward. Assuming the company's share of this space increases to even 20% after three years and the addressable opportunity hits $75 billion (based on the midpoint of Broadcom's range), Marvell's AI revenue could jump to $7.5 billion. That would be a significant increase from the $1.5 billion AI revenue that Marvell is anticipating in the current fiscal year. Based on this impressive growth opportunity, analysts are expecting Marvell's earnings to jump by a solid 77% in the next fiscal year to $2.76 per share, up significantly from just 3% growth expected in the current fiscal year. That's expected to be followed by another solid performance after a couple of fiscal years. The market could reward this growth with outstanding gains going forward, making Marvell an ideal pick for investors looking to build a diversified million-dollar portfolio. And given that it is trading at 42 times forward earnings as compared to the U.S. tech sector's average earnings multiple of 51, investors are getting a good deal on this AI stock right now. Though Cloudflare (NET -1.78%) has been primarily known for providing cloud-based services to customers that help them secure their internet connections while also improving their performance and reliability, it is now looking to leverage its existing infrastructure to move into the cloud AI services space. The company is equipping its data center locations with graphics processing units (GPUs) to help them develop and deploy AI applications with the help of popular large language models (LLMs) without having to invest in expensive hardware. The fact that Cloudflare's data center network spans 330 cities in more than 120 countries means that it can scale up its AI network significantly. Cloudflare's AI offerings are gaining traction among customers and driving solid growth in the company's revenue, as pointed out by management on the November 2024 earnings conference call. The company raised its fiscal 2024 guidance to just over $1.66 billion from the earlier expectation of just over $1.65 billion, which would translate to 28% sales growth for the current fiscal year. At the same time, stronger spending by Cloudflare's customers on its offerings, driven by the addition of new products related to AI, explains why its earnings are expected to grow at a much faster pace of 51% in fiscal 2024. The number of large paying customers with an annualized revenue of more than $100,000 increased 28% year over year to 3,265 last quarter. The dollar-based net retention rate of 110% suggests that existing customers increased their spending on Cloudflare's offerings, as this metric compares the spending by customers in a quarter to the spending by those same customers in the year-ago period. Moreover, the company's paying customer base also increased by 22% year over year. That could pave the way for stronger growth at Cloudflare, especially considering that the company pegs its total addressable market at an impressive $222 billion in 2027. Cloudflare's revenue forecast for the current year suggests that it is scratching the surface of a big market opportunity, and its potential growth for the next couple of years suggests that it is expected to maintain healthy growth levels. As such, Cloudflare looks like an ideal growth stock for investors looking to construct a million-dollar portfolio. Of course, the stock does seem richly valued considering its sales multiple of 24, but the huge market opportunity that it is sitting on and its massive data center network could help it justify that valuation in the long run.

Will These 2 Artificial Intelligence (AI) Stocks Continue Their Meteoric Rise in 2025? | The Motley Fool

If you are sick of hearing about artificial intelligence (AI) on Wall Street, I have some bad news. This theme is unlikely to go away anytime soon. The market is incredibly broad, spanning technologies like voice recognition, robotics, machine learning (ML), natural language processing, autonomous vehicles, and more. The field of artificial intelligence could have a combined annual market of over $800 billion by 2030, according to Statista. Generative AI -- as used in ChatGPT, Perplexity, and Alphabet's Gemini -- is also expected to grow at a breakneck pace. For perspective, Microsoft and Nvidia had combined sales of $367 billion over the last 12 months. It's easy to see why companies are scrambling for a chunk of this market, and investors are following suit. The enthusiasm sent some stocks soaring in 2024. As I write this, Palantir Technologies (PLTR 4.63%) stock is up 335% year to date, while SoundHound AI (SOUN -3.28%) has gained an astounding 811%. Will this continue in 2025? Here are a few things to consider. Automated ordering at the drive-thru and fast-casual restaurants is coming to a town near you. There are too many cost-saving incentives for businesses not to make the transition now or in the near future. More sophisticated voice-recognition virtual assistants are also going into new vehicles. The technology allows for conversational communication and pulls answers from a vast database. For instance, you can ask for directions to the highest-rated nearby Italian restaurant within 10 miles, what the weather will be like at 5 p.m. on Saturday, or what the most scenic route is. SoundHound's proprietary technology powers these platforms, and the company continues to win new customers, driving the stock to all-time highs. In December alone, Church's Chicken piloted the technology at some locations, and Torchy's Tacos implemented SoundHound's Voice AI phone ordering system at all locations. Revenue increased 89% year over year in Q3 to $25 million. SoundHound expects total sales of $82 million to $85 million in 2024, potentially doubling this to $155 million to $175 million in 2025. The growth is incredible, but SoundHound is not profitable or producing positive cash flow from its operations. The company reported an operating loss of $84 million and a $76 million operating cash flow loss through three quarters of 2024. Losses aren't unusual for a fast-growing tech company, but investors should know the risk. SoundHound stock's incredible run is pushing valuation boundaries to an extreme level. As shown below, the stock trades for over 90 times sales and 45 times the 2025 analyst forecast. These ratios are incredibly high for any company -- and definitely for an unprofitable one. This doesn't make SoundHound a bad stock to own long term, but echoes of the 2021 tech bubble are appearing in the market. I was bullish on the stock recently, but much less so after the terrific run. Buyers of SoundHound at the current price should expect some drastic swings in the price over the next couple of years. Palantir, another AI highflier, saw a significant boost due to its Artificial Intelligence Platform (AIP). AIP uses generative AI to assimilate data and assist with making high-level decisions by interacting with people in defense and the private sector conversationally. One example that Palantir gives is a wholesale company that will experience downtime in one location due to inclement weather. AIP assists with determining the optimal rerouting and showing the impact on profits. In another example for the defense sector, assume a hostile force is amassing near a border. AIP can show the resources available to the commander and suggest possible enemy formations. These impressive features spurred Palantir's commercial and total customer growth, as shown below. Total sales reached $726 million in Q3, a 30% increase, and Palantir's operating income soared from $40 million to $113 million year over year, showing the success of the AIP product. The stock has a market capitalization of $169 billion, or 60 times sales guidance for 2024. While the valuation is more palatable than SoundHound's, it is by no means a value. Both companies are doing exciting things in AI and look like long-term winners. Although there is considerable downside risk, the stocks could continue to rise in 2025 -- but don't expect the same exponential gains as this year. Don't fret if you missed the spectacular gains, there are tons of excellent companies to invest in. A significant dip could come anytime, and AI has a long runway.

1 Wall Street Analyst Thinks SoundHound AI Stock Is Going to $26. Is It a Buy?

SoundHound AI (SOUN -0.93%) stock has more than quadrupled over just the last three months. Shares of the maker of voice recognition artificial intelligence (AI) technology solutions are now higher by 860% year to date. Wall Street analyst Scott Buck with H.C. Wainwright thinks it has more room to run. Buck just issued a note maintaining his "buy" rating on the stock and ratcheted his price target from $8 to $26 per share, according to reports. That would imply another 27% upside even after the stock's recent surge higher. Voice generative artificial intelligence (AI) A market that began with voice technology in customer service sectors such as restaurants has expanded to other areas, including automotive use cases for voice generative AI bringing cloud-based large language models into vehicles. That's led SoundHound management to increase its revenue guidance this year and estimate that sales will approximately double in 2025. The H.C. Wainwright analyst sees demand continuing to grow across multiple sectors. In his client note this week, Buck noted that recent acquisitions will allow SoundHound to "meaningfully" increase the scope of its business in sectors including retail, healthcare, and financial services. One concern for investors, though, is SoundHound's valuation. The company isn't yet profitable and has a forward price-to-sales (P/S) ratio of nearly 90. Buck addressed that in his report: While valuation levels may look stretched at today's share price, we believe the company has built a scalable platform which should allow revenue, adjusted EBITDA [earnings before interest, taxes, depreciation and amortization] and ultimately earnings to catch up to share price over time. Investors buying the stock now will need to be patient, as Buck notes. It should be considered an aggressive investment, but as use cases grow, SoundHound could have a bright, and profitable, future.

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

That's nearly unheard-of performance, and any investor would love to have returns like that. But after a significant run-up, is either of these two stocks worth buying right now? While both companies operate in the AI space, Palantir and SoundHound AI aren't competitors. Palantir's focus is to provide purpose-built AI applications for its clients, which allows decisions to be made with the most up-to-date information possible. Furthermore, Palantir has tools that allow generative AI integration within businesses' inner workings, rather than using it as a tool on the side. While Palantir's primary customer base is government entities, the commercial side of its business has adopted this next wave of AI much faster. This balanced approach between government and commercial should allow the company's business to continue benefiting from this AI wave for a long time. SoundHound AI's product is centered around using audio input for AI models. There are nearly unlimited use cases for this, which is why SoundHound AI has partnered up with some of the largest AI players, like Nvidia, to integrate its sophisticated technology with others' products. The main use cases from SoundHound AI's software have been in the restaurant and automobile industries, but it has also recently found success in the financial and healthcare sectors. Both Palantir and SoundHound AI have strong business cases, but how are their finances? On the financial side, it's really difficult to compare the two. Palantir is a much larger and profitable company growing at a slower rate as a result (it's much harder for a large company to grow as quickly as a small company). SoundHound AI is the exact opposite in all of those aspects. In Q3, each company posted strong growth, with Palantir's revenue rising 30% year over year to $725 million, and SoundHound AI's increasing 89% to $25 million. However, Palantir posted a strong 20% profit margin, while SoundHound AI's bottom-line margin was a negative 87%. While those numbers may cause investors to favor Palantir, we're comparing these companies for 2025, and a lot could change over the next year. Wall Street analysts expect Palantir to grow revenue by 24% next year, while SoundHound AI's revenue is expected to rise 96%. That's a huge difference, and it shows that SoundHound AI's growth is just getting started, while Palantir's may decrease a bit. On the profitability side, SoundHound AI isn't expected to make a true profit in 2025, but management has noted that they expect to achieve adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) profitability by the end of 2025. While that's not real profitability, it is a step in the right direction. There isn't a true winner in this analysis either, but there is one huge component that we need to discuss with both companies: valuation. As mentioned, both of these stocks are up massively for 2024, yet their revenue or profits aren't up by a corresponding amount. That's because their valuation ratios have skyrocketed. SoundHound AI trades for 92 times sales and Palantir for 75 times sales, making them among the most expensive stocks in the market. Most of the time, when we discuss valuation, 92 or 75 times earnings constitutes an expensive valuation, yet these two are trading that high without considering any expenses. But do those price points make sense? Palantir is much further along in its company maturity than SoundHound AI and should be aiming for profit margins of 30%. It will likely trade around 40 times trailing earnings. However, if Palantir maintains its current 30% growth rate (remember, Wall Street expects it to decline to 24% growth next year), it will take the stock nearly six years to achieve that valuation with no stock price movement. That's sky-high expectations, and I'm not sure Palantir can meet them. SoundHound AI is a bit different, as it's doubling its revenue year over year. Let's say SoundHound AI can double its revenue in three years. If it does that, the price-to-sales ratio will fall to around 11.5 by 2027, a more typical software company valuation. Clearly, both stocks already have huge expectations baked into their stock prices, making any further stock price growth more associated with hype rather than actual business results. Still, if I had to pick one, I'd choose SoundHound AI, as its explosive growth can more rapidly cool down its valuation multiples in a shareholder-friendly manner.

Why SoundHound Stock Is Soaring Today | The Motley Fool

SoundHound AI stock is surging amid a day of strong momentum for meme stocks. Speculative growth plays are seeing a strong rebound on the heels of recent valuation volatility, and the conversational artificial intelligence (AI) is also getting a boost from bullish analyst coverage. After valuation pullbacks that occurred in conjunction with news that the Federal Reserve only expects to deliver two interest rate cuts next year, speculative growth stocks are seeing strong rebound momentum. With today's gains, SoundHound has notched a new high and is up more than 1,000% across 2024's trading -- a rally that makes it one of the year's best-performing stocks. With speculative growth stocks seeing strong bullish momentum, investors appear to be bidding SoundHound up with recent bullish coverage from analysts in mind. On Monday, H.C. Wainwright published new coverage on the stock that maintained a buy rating and raised the firm's one-year price target from $8 per share to $26 per share. While the firm's analysts noted that recent valuation gains have been driven by market excitement, they believe that the company will perform well enough to support its growth-dependent valuation. With today's gains, SoundHound's market capitalization has been pushed up to roughly $8.8 billion. The company is now trading at approximately 105 times this year's expected sales. SoundHound's conversational AI services suggest highly scalable business opportunities, and it's likely that demand for this kind of software will continue to increase rapidly over the long term. On the other hand, investors should keep in mind that the stock's highly growth-dependent valuation opens the door for high levels of volatility if growth falls short of expectations or macroeconomic conditions take a turn for the worse.

My Top 2 AI Stocks for 2025 | The Motley Fool

The rise of artificial intelligence (AI) in 2024 has reshaped our world in ways previously confined to science fiction. Virtual assistants now handle complex customer service queries with human-like understanding, while AI-powered chips process vast amounts of data at unprecedented speeds. These technological breakthroughs have caught Wall Street's attention, driving the S&P 500's (^GSPC 1.10%) remarkable bull run since October 2022. The economic impact of this AI revolution promises to be transformative. PwC projects AI will add $15.7 trillion to the global economy by 2030. This isn't just about chatbots and automation anymore. AI fundamentally transforms how businesses operate, from restaurants using voice AI to handle drive-thru orders to data centers requiring increasingly sophisticated chips to power their AI operations. Many investors have already profited from AI's meteoric rise through industry giants like Nvidia (NVDA 0.39%). However, the next wave of AI growth may come from companies that are only now beginning to flex their technological muscle. As we approach 2025, two companies stand out for their unique positions in the AI value chain, offering investors fresh opportunities to capitalize on this technological revolution. SoundHound AI (SOUN -0.93%) has quietly built an AI empire that's revolutionizing how businesses interact with customers. In November 2024, the company reported quarterly revenue of $25.1 million, representing an 89% year-over-year increase as more businesses adopt voice AI solutions. What makes SoundHound AI particularly intriguing is its rapid transformation from an automotive-focused company to a diversified AI powerhouse. The company now serves seven of the top 20 global quick-service restaurant chains, with its AI handling everything from drive-thru orders to phone reservations. Its expansion into financial services, healthcare, and insurance demonstrates the universal appeal of its technology platform. Major automotive manufacturers aren't being left behind. Stellantis has integrated SoundHound AI's technology across its luxury brands in Europe, while partnerships with next-generation vehicle manufacturers in the Middle East and India showcase global demand. With the AI voice generators market projected to grow at nearly 30% annually through 2030, SoundHound AI's first-mover advantage and proven technology make it a compelling play for investors seeking exposure to the future of human-machine interaction. Advanced Micro Devices (AMD) (AMD 1.36%) has emerged as the dark horse in the AI chip race, offering performance that rivals Nvidia to a degree at more attractive price points. The numbers tell the story: AMD's data center revenue soared to $3.5 billion in its latest quarter, marking a staggering 122% year-over-year leap. The company's AI graphics processing units (GPUs) business has exploded from virtually nothing a year ago to over $1.5 billion in the most recent quarter. This growth stems in part from AMD's strategic partnership with Taiwan Semiconductor Manufacturing and its innovative chiplet manufacturing approach -- a combination that allows for rapid product development and competitive pricing. The potential market opportunity is mind-boggling. Industry analysts project the AI accelerator market will reach $500 billion by 2028. While Nvidia currently dominates this space, customers and developers are actively seeking alternatives to prevent overreliance on a single supplier. AMD's competitive pricing, proven technology, and established reputation make it perfectly positioned to capture a significant share of this expanding market. The convergence of voice AI technology and semiconductor innovation represents two distinct paths to profit from the AI revolution. SoundHound AI offers pure-play exposure to the rapidly growing voice AI market, with its technology already proving transformative across multiple industries. Meanwhile, AMD provides investors access to the critical infrastructure powering the AI boom, with its competitive pricing strategy and technological capabilities challenging the status quo in AI chip manufacturing. As we enter 2025, these companies represent more than just potential growth stories -- they're actively reshaping how businesses operate and interact with customers. For investors seeking to capitalize on the next wave of AI innovation, SoundHound AI and AMD offer compelling opportunities to participate in this technological revolution while it's still in its early stages. Their unique market positions, proven technology, and massive addressable markets create a powerful combination that could deliver substantial returns as the AI revolution continues to unfold.

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

In an exclusive interview on Friday, SoundHound CEO Keyvan Mohajer told Benzinga the company is "just getting started." SoundHound AI Inc SOUN shares are trading lower on Tuesday, pulling back from recent strength. The rally accelerated in November when the company reported strong earnings. Here's what you need to know. What To Know: SoundHound shares are up more than 875% since the start of the year, buoyed by the company's positioning in the AI space. The stock has nearly tripled since mid-November when the company reported better-than-expected quarterly results, marking its "largest quarter on record." SoundHound reported a third-quarter loss of 6 cents per share, beating estimates of a loss of 7 cents per share. The company reported revenue of $25.1 million, beating estimates of $23.02 million, according to Benzinga Pro. SoundHound said demand was driven by "incredible market enthusiasm" for conversational AI tools. SoundHound shares continued to move higher following earnings after Nvidia reported investments in multiple companies, including SoundHound, in a 13-F filing with the SEC. Nvidia's 13F latest filing showed that it increased its stake in SoundHound by about 18% in the third quarter. Analysts lifted price targets as the stock has continued to trend higher. Last Week, Wedbush analyst Dan Ives maintained SoundHound with an Outperform rating and raised its price target from $10 to $22. On Monday, HC Wainwright & Co. analyst Scott Buck maintained a Buy rating on the stock and raised its price target from $8 to $26. See Also: American Airlines Lifts Christmas Eve Grounding, Shares Bounce Back It's worth noting that SoundHound has high short interest with 24.4% of the float currently sold short, according to data from Benzinga Pro. SoundHound has also been showing up on Benzinga's Stock Whisper Index in recent weeks. In an exclusive interview on Friday, SoundHound CEO Keyvan Mohajer told Benzinga that AI has moved from the exploratory phase to the mandatory phase for budgets. "In that context, SoundHound is in a prime position. Our ability to combine proprietary voice AI technology with sophisticated large language models has allowed us to deliver immense value," Mohajer said. The SoundHound CEO told Benzinga that the company is powering hundreds of global enterprise brands, thousands of restaurant and retail locations and millions of vehicles and devices. "And we're just getting started," Mohajer said. SOUN Price Action: SoundHound shares were flat at 0.34% at $20.45 at the time of publication, according to Benzinga Pro. Read Next: Benzinga's 'Stock Whisper' Index: 5 Stocks Investors Secretly Monitor But Don't Talk About Yet, Including QUBT, QBTS Photo: Shutterstock. SOUNSoundHound AI Inc$20.811.86%WatchlistOverviewMarket News and Data brought to you by Benzinga APIs

SoundHound AI VP sells stock valued at $760,575 By Investing.com

Majid Emami (NS:EMAM), Vice President of Engineering at SoundHound AI , Inc. (NASDAQ:SOUN), a company whose stock has surged over 1,000% year-to-date and currently commands a market capitalization of $7.5 billion, recently sold 37,459 shares of the company's Class A common stock. The sale, which took place on December 20, 2024, was priced at $20.3042 per share, resulting in a total transaction value of approximately $760,575. Following this transaction, Emami holds 698,226 shares in the company. The sale was executed to satisfy tax withholding obligations related to the vesting of restricted stock units granted on various dates. According to InvestingPro analysis, SOUN is currently trading near its 52-week high of $24.98, with notably high price volatility. Get access to 16+ additional ProTips and comprehensive financial analysis with an InvestingPro subscription. In other recent news, SoundHound AI's revenue growth has grabbed the spotlight. The company reported a significant year-over-year increase of 89% in the third quarter of 2024, reaching $25.1 million. This success is attributed to the company's expansion across various sectors and the successful integration of AI solutions in numerous brands. In response to these positive results, SoundHound AI has revised its revenue projections upward for the fourth quarter of 2024 and the full year of 2025, expecting revenues to range between $155.0 million and $175.0 million. Analysts from H.C. Wainwright and Wedbush have responded to these developments by raising their price targets for the company to $26 and $22 respectively, maintaining a Buy and Outperform rating. These upgrades reflect the company's strong performance in the AI market and the growing demand for its voice AI solutions. SoundHound AI has also been making significant strides in its partnership with Apivia Courtage, a French wholesale broker. The collaboration has resulted in the deployment of SoundHound's Amelia AI Agents to manage over 100,000 customer service calls, reducing Apivia Courtage's direct customer queries by nearly 20%. The company's recent acquisitions are expected to significantly expand its business scope, extending into retail, healthcare, and financial services sectors. SoundHound AI, as a rare pure-play artificial intelligence firm, is considered to command a premium valuation, trading at a high Price/Book multiple of 27.2x. With the company's market capitalization now exceeding $7.0 billion, it is also seen as an attractive investment for large institutional money managers.

SoundHound AI CEO Keyvan Mohajer sells shares worth $5.6 million By Investing.com

Keyvan Mohajer, the CEO of SoundHound AI , Inc. (NASDAQ:SOUN), recently executed a series of stock sales totaling approximately $5.6 million. The transactions come as the company's stock trades near its 52-week high of $24.98, having delivered an impressive return of over 1,000% year-to-date. On December 20, Mohajer sold 121,194 shares at an average price of $20.30 per share, generating about $2.46 million. This transaction was made to satisfy tax withholding obligations related to the vesting of restricted stock units.According to InvestingPro analysis, SoundHound AI's market capitalization now stands at $7.48 billion, with the stock showing significant price volatility. Additionally, on December 24, Mohajer sold a total of 156,288 shares in three separate transactions. The shares were sold at prices ranging from $19.46 to $21.07 per share, totaling approximately $3.16 million. These sales were conducted under a pre-arranged trading plan established in August 2024. Following these transactions, Mohajer retains direct ownership of 2,021,666 shares of SoundHound AI. In other recent news, SoundHound AI has seen positive adjustments from H.C. Wainwright and Wedbush, with the firms raising their price targets for the company to $26 and $22, respectively, while maintaining Buy and Outperform ratings. The upgrades follow SoundHound AI's impressive third-quarter 2024 results, which saw revenues of $25.1 million, surpassing the forecasted $22.6 million. The company attributes this success to organic demand growth and contributions from recent mergers and acquisitions. Looking ahead, SoundHound AI has revised its revenue projections upward for the fourth quarter of 2024 and the full year of 2025, expecting revenues to range between $155.0 million and $175.0 million. In addition, SoundHound AI's partnership with Apivia Courtage has shown significant strides, with the deployment of SoundHound's Amelia AI Agents managing over 100,000 customer service calls, reducing Apivia Courtage's direct customer queries by nearly 20%. On the other hand, despite the company's robust financial health and promising outlook, SoundHound AI's stock experienced a recent decline. However, analysts from H.C. Wainwright and Wedbush believe that the company's strong performance, coupled with ongoing demand for AI companies, should attract investor interest and contribute to an upward trajectory in the company's share price.

SoundHound AI CFO Nitesh Sharan sells $1.17 million in stock By Investing.com

Nitesh Sharan, the Chief Financial Officer of SoundHound AI , Inc. (NASDAQ:SOUN), recently sold 57,761 shares of the company's Class A common stock. The shares were sold at an average price of $20.3042 each, amounting to a total transaction value of approximately $1.17 million. The stock has seen remarkable performance, with InvestingPro data showing a staggering 1,043% return year-to-date, currently trading at $24.23. Following this sale, Sharan retains ownership of 1,502,650 shares. The transaction was conducted to satisfy tax withholding obligations related to the vesting of restricted stock units granted on several occasions between 2022 and 2024. With a market capitalization of $7.48 billion and trading near its 52-week high of $24.98, SoundHound AI has captured significant investor attention. InvestingPro subscribers can access 16 additional investment tips and a comprehensive Pro Research Report for deeper analysis of this high-momentum stock. In other recent news, SoundHound AI has experienced significant developments. The company's third-quarter revenue for 2024 reached $25.1 million, surpassing estimates due to organic demand growth and the impact of recent acquisitions. As a result, SoundHound AI has revised its revenue projections upward for the fourth quarter of 2024 and the full year of 2025, expecting revenues to range between $155.0 million and $175.0 million. In terms of stock valuation, H.C. Wainwright and Wedbush have increased their price targets for SoundHound AI to $8 and $22 respectively, maintaining Buy and Outperform ratings. These upgrades reflect the company's strong performance in the AI market and the growing demand for its voice AI solutions. SoundHound AI has also made significant strides with Apivia Courtage, a French wholesale broker. SoundHound's Amelia AI Agents have been deployed to manage over 100,000 customer service calls, reducing Apivia Courtage's direct customer queries by nearly 20%. Furthermore, SoundHound AI's recent acquisitions are expected to significantly expand its business scope, extending into retail, healthcare, and financial services sectors. Despite these developments, it's important to note that the company's stock experienced a recent decline. These are some of the recent developments for SoundHound AI, which continues to focus on revenue growth, gross margin expansion, and the pursuit of positive adjusted EBITDA.

Soundhound AI director Diana Sroka sells shares worth $77,225 By Investing.com

On December 23, 2024, Diana Sroka, a director at SoundHound AI , Inc. (NASDAQ:SOUN), sold 3,402 shares of the company's Class A common stock. The transaction comes as SoundHound AI trades near its 52-week high of $24.98, having delivered an impressive return of over 1,000% year-to-date. The shares were sold at a price of $22.70 each, totaling $77,225. Following this transaction, Sroka holds 142,252 shares directly. This transaction was executed under a Rule 10b5-1 trading plan, which Sroka adopted in August 2024. According to InvestingPro, the company currently has a market capitalization of $7.48 billion, with analysts anticipating sales growth in the current year. Get access to 16 additional ProTips and comprehensive analysis through InvestingPro's detailed research reports. In other recent news, SoundHound AI Inc. has seen a series of positive developments. Analysts from Wedbush and H.C. Wainwright have raised their price targets for the company, reflecting SoundHound AI's strong performance in the AI market and the growing demand for its voice AI solutions. SoundHound AI reported significant revenue growth of 89% year-over-year in the third quarter of 2024, reaching $25.1 million. In response to these positive results, the company has revised its revenue projections upward for the fourth quarter of 2024 and the full year of 2025, expecting revenues to range between $155.0 million and $175.0 million. SoundHound AI also made significant strides with Apivia Courtage, a French wholesale broker, deploying Amelia AI Agents to manage over 100,000 customer service calls, reducing Apivia Courtage's direct customer queries by nearly 20%. The company's recent acquisitions are expected to significantly expand its business scope, extending into retail, healthcare, and financial services sectors. These developments are part of SoundHound AI's strategy to prioritize revenue growth, gross margin expansion, and the pursuit of positive adjusted EBITDA.

SoundHound AI's chief product officer sells $746,605 in stock By Investing.com

James Ming Hom, the Chief Product Officer of SoundHound AI , Inc. (NASDAQ:SOUN), recently sold 36,771 shares of Class A Common Stock. The company's stock has seen remarkable performance, surging over 1,000% year-to-date and currently trading near its 52-week high of $24.98. According to InvestingPro analysis, the stock appears to be trading above its Fair Value, with notably high price volatility. This transaction, executed on December 20, was valued at approximately $746,605, with shares sold at an average price of $20.30 each. Following this sale, Hom retains ownership of 718,040 shares. The sale was made to satisfy tax withholding obligations related to the vesting of restricted stock units granted over the past two years. In other recent news, SoundHound AI has witnessed a series of positive developments. H.C. Wainwright and Wedbush have both upgraded their price targets for the company to $26 and $22, respectively. Their upgrades reflect SoundHound AI's impressive performance in the AI market, coupled with the growing demand for its voice AI solutions. The company has also reported a significant growth in revenue of 89% year-over-year in the third quarter of 2024, reaching $25.1 million. SoundHound AI has also established partnerships with major restaurant chains Church's Texas Chicken and Torchy's Tacos, and French wholesale broker Apivia Courtage. The collaboration with Apivia Courtage resulted in the deployment of SoundHound's Amelia AI Agents, managing over 100,000 customer service calls and reducing Apivia Courtage's direct customer queries by nearly 20%. SoundHound AI's recent acquisitions are expected to expand its business scope, extending into retail, healthcare, and financial services sectors. Lastly, the company maintains a healthy current ratio of 2.58 and operates with a moderate debt level, though it remains unprofitable with an EBITDA of -$88.4 million in the last twelve months.

SoundHound AI's CTO Timothy Stonehocker sells $698,606 in stock By Investing.com

The sale was conducted to satisfy tax withholding obligations related to the vesting of restricted stock units granted in previous years. Following this transaction, Stonehocker retains ownership of 796,581 shares in the company. This figure includes 1,492 shares acquired through the company's Employee Stock Purchase Plan in November 2024. Additionally, Stonehocker has transferred significant holdings to his ex-spouse under a domestic relations order. According to InvestingPro data, SOUN has shown strong momentum with a 508% gain over the past six months, though investors should note its high price volatility. Get access to 16 additional ProTips and comprehensive analysis in the Pro Research Report. According to InvestingPro data, SOUN has shown strong momentum with a 508% gain over the past six months, though investors should note its high price volatility. Get access to 16 additional ProTips and comprehensive analysis in the Pro Research Report. The sale was conducted to satisfy tax withholding obligations related to the vesting of restricted stock units granted in previous years. Following this transaction, Stonehocker retains ownership of 796,581 shares in the company. This figure includes 1,492 shares acquired through the company's Employee Stock Purchase Plan in November 2024. Additionally, Stonehocker has transferred significant holdings to his ex-spouse under a domestic relations order. In other recent news, SoundHound AI (NASDAQ:SOUN) has been garnering attention due to its significant financial developments and strategic partnerships. The company's AI-enabled services have seen growing demand across several industries, leading to new contracts with major restaurant chains and acquisitions that extend its reach into retail, healthcare, and financial services sectors. Analysts from H.C. Wainwright and Wedbush have raised their price targets for SoundHound AI, reflecting the company's strong performance in the AI market and the growing demand for its voice AI solutions. The company's third-quarter revenue for 2024 reached $25.1 million, exceeding the predicted $22.6 million. This success has been attributed to organic demand growth and the impact of recent mergers and acquisitions. Following these developments, SoundHound AI's management has revised its revenue projections upward for the fourth quarter of 2024 and the full year of 2025. SoundHound AI has also made significant strides in its partnership with Apivia Courtage, a French wholesale broker. The collaboration has resulted in the deployment of SoundHound's Amelia AI Agents to manage over 100,000 customer service calls, reducing Apivia Courtage's direct customer queries by nearly 20%. These recent developments highlight SoundHound AI's ongoing strategy to prioritize revenue growth and gross margin expansion.

Soundhound ai's COO Michael Zagorsek sells shares worth $1.23 million By Investing.com

Michael Zagorsek, the Chief Operating Officer of SoundHound AI , Inc. (NASDAQ:SOUN), recently sold a significant portion of his holdings in the company. The sale comes as SOUN trades near its 52-week high of $24.98, having delivered an impressive return of over 1,000% year-to-date. According to a filing with the Securities and Exchange Commission, Zagorsek sold 60,796 shares of Class A Common Stock on December 20, 2024, at an average price of $20.30 per share. This transaction amounted to a total value of approximately $1.23 million. According to InvestingPro analysis, the stock currently appears overvalued based on its Fair Value metrics. The sale was conducted to satisfy tax withholding obligations related to the vesting of restricted stock units granted to Zagorsek in previous years. Following the transaction, Zagorsek retains ownership of 1,412,526 shares in the now $7.48 billion market cap company. InvestingPro subscribers can access 16 additional investment tips and comprehensive analysis about SOUN's valuation and growth prospects through the platform's detailed Pro Research Report. In other recent news, SoundHound AI has seen a surge of positive developments. H.C. Wainwright and Wedbush have raised their price targets for SoundHound AI to $26 and $22 respectively, maintaining Buy and Outperform ratings. This upgrade reflects the company's strong performance in the AI market and the growing demand for its voice AI solutions. SoundHound AI reported notable revenue growth of 89% year-over-year in the third quarter of 2024, reaching $25.1 million. In response to these positive results, SoundHound AI has revised its revenue projections upward for the fourth quarter of 2024 and the full year of 2025, expecting revenues to range between $155.0 million and $175.0 million. The company has also made significant strides with Apivia Courtage, a French wholesale broker. SoundHound's Amelia AI Agents have been deployed to manage over 100,000 customer service calls, reducing Apivia Courtage's direct customer queries by nearly 20%. This collaboration has allowed Apivia Courtage to reallocate its human workforce towards more complex tasks, enhancing both efficiency and workplace satisfaction. SoundHound AI's recent acquisitions are expected to significantly expand its business scope, extending into retail, healthcare, and financial services sectors.

Marcus Lawrence sells $409,436 in SoundHound AI stock By Investing.com

Marcus Lawrence, a director at SoundHound AI , Inc. (NASDAQ:SOUN), has reported the sale of 20,000 shares of Class A common stock. The transaction, executed on December 23, 2024, saw shares sold at an average price of approximately $20.47, resulting in a total sale value of $409,436. The sale comes as SOUN shares have surged over 1,000% year-to-date, with the stock currently trading near its 52-week high of $24.98. According to InvestingPro analysis, the stock is currently showing signs of overvaluation. Following the transaction, Lawrence holds 108,117 shares indirectly through the Marcus Family Trust. The shares were sold at prices ranging from $20.44 to $20.52, as per the details disclosed in the filing. InvestingPro data reveals the stock typically trades with high volatility, with a beta of 3.41. Subscribers can access 15+ additional ProTips and comprehensive valuation metrics in the Pro Research Report. In other recent news, SoundHound AI has experienced major developments that have caught the attention of investors. The company's third-quarter revenue for 2024 surpassed expectations, reaching $25.1 million, leading to upward revisions in the revenue projections for the fourth quarter of 2024 and the full year of 2025, with an anticipated range between $155.0 million and $175.0 million. Analysts from H.C. Wainwright and Wedbush have shown confidence in the company's performance, raising their price targets to $8 and $22 respectively. These upgrades reflect the company's strong performance in the AI market and the growing demand for its voice AI solutions. SoundHound AI's partnership with Apivia Courtage, a French wholesale broker, has also made significant progress. The deployment of SoundHound's Amelia AI Agents has managed over 100,000 customer service calls, reducing Apivia Courtage's direct customer queries by nearly 20%. Moreover, SoundHound AI's recent acquisitions and contracts with major restaurant chains, such as Church's Texas Chicken and Torchy's Tacos, have significantly expanded its business scope, extending into retail, healthcare, and financial services sectors. These developments, coupled with the company's strong financial standing and minimal debt, provide flexibility for future growth initiatives or potential mergers and acquisitions.