SoundHound (SOUN) Soars 30% after Q2 Results Prompt Analyst Praise
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Looking ahead, SoundHound raised its 2025 guidance slightly to a range of $160 million to $178 million, up from $157 million to $177 million. Interestingly, Wedbush believes that this new forecast is still conservative because demand is strong and partnerships with channel partners continue to grow. Ives called this a big step forward for SoundHound by saying that the company is an underappreciated AI leader that's gaining ground across multiple industries. However, other analysts had a more cautious view.
More specifically, Piper Sandler's 4.5-star analyst, James Fish, kept a Hold rating and a $12 price target despite saying it was encouraging to see improved growth and profitability. Cantor also maintained a Hold rating with an $8.50 target, even though it highlighted SoundHound's organic growth, a win in China's auto sector, and better engagement with users. Nevertheless, Cantor, led by four-star analyst Thomas Blakey, noted that there is some uncertainty when it comes to deal closings for the second half of the year and that said trade pressures may slightly impact production.
Is SOUN Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SOUN stock based on four Buys, three Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average SOUN price target of $12.43 per share implies 10.9% downside risk.
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3 hours ago
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Did Nvidia Make a Mistake by Selling SoundHound AI Stock? The Answer Might Surprise You.
Key Points SoundHound AI stock is generating blistering revenue growth right now, as some of the world's biggest brands adopt its conversational artificial intelligence software. Nvidia used to be a SoundHound shareholder, but the chip giant sold its entire stake towards the end of 2024. SoundHound stock is soaring right now, but that doesn't mean Nvidia made the wrong move. 10 stocks we like better than SoundHound AI › Nvidia (NASDAQ: NVDA) has become the world's largest company on the back of surging demand for its data center chips, which are the gold standard for developing artificial intelligence (AI) models. The chip giant occasionally puts its vast financial resources to work by investing in other AI companies, and SoundHound AI (NASDAQ: SOUN) was one of them. SoundHound is a specialist in conversational AI technologies, and its customers include some of the world's biggest brands. Nvidia first revealed its stake in the company in a 13-F filing with the Securities and Exchange Commission in February 2024, but the chipmaker had sold its entire position by December. SoundHound's revenue tripled during its most recent quarter, and its stock is up by a whopping 40% in the past month alone. Did Nvidia make a mistake by dumping its position? Read on for the surprising answer. A leader in conversational AI SoundHound's conversational AI applications are popular in a variety of industries, but they are experiencing particularly high demand in quick-service restaurant chains and with automotive brands that want to include a powerful AI assistant in their new vehicles. In the restaurant space, SoundHound's Voice AI technology can accept customer orders autonomously in-store, over the phone, and in the drive-thru. It can also answer queries from employees, whether they need help making menu items or need clarity on a particular store policy. Chains like Chipotle, Krispy Kreme, and Papa John's are just a few of SoundHound's customers. In the automotive industry, companies like Hyundai and Stellantis (Chrysler, Jeep, and Dodge) are using SoundHound's Chat AI software in their latest vehicles. It can give drivers information about the weather, stocks, and everything in between with a simple voice command, and manufacturers can customize its personality to suit their brand. Last August, SoundHound acquired another conversational AI specialist called Amelia. The joint companies recently launched a new platform called Amelia 7, which allows businesses to create custom AI agents that can assist customers with their inquiries or even help employees troubleshoot technical issues. Of course, these agents can be controlled entirely with voice commands. SoundHound's revenue is absolutely skyrocketing SoundHound generated a record $42.6 million in total revenue during the second quarter of 2025 (ended June 30), which was a blistering 217% increase from the year-ago period. The strong result gave management the confidence to increase its full-year revenue guidance for 2025 from $167 million to $169 million (at the midpoint of the forecast range), which would be a 99% increase compared to 2024. That would mark an acceleration from the 85% growth SoundHound generated last year, highlighting the significant momentum in its business. But that growth is coming at a significant cost, because SoundHound continues to burn truckloads of cash. It lost $74.7 million on a generally accepted accounting principles (GAAP) basis during the second quarter, which was twice as much as it lost in the year-ago period. SoundHound did suffer a one-off, $31 million hit to its bottom line from a liability associated with one of its acquisitions during the quarter, but even after stripping it out -- along with every other one-off and non-cash expense -- the company still lost $11.8 million. SoundHound has a solid balance sheet with $230 million in cash on hand and no debt, so it can sustain losses of that size for the foreseeable future. However, the company will eventually have to prioritize profitability, or else it might need to raise capital, which could dilute existing shareholders. Cost cuts would almost certainly dent SoundHound's revenue growth, which is something for investors to keep in mind. Here's why Nvidia didn't make a mistake by selling SoundHound stock Nvidia never told investors why it sold SoundHound stock, but if I had to speculate, I think its valuation likely had something to do with the decision. Its price-to-sales (P/S) ratio is trading at an eye-popping level of 48.6, which is more than a 50% premium to Nvidia's P/S ratio of 29.9. It was even more expensive when Nvidia sold it toward the end of 2024, because its P/S ratio was hovering near 100. SoundHound will quickly grow into its current valuation if its revenue continues to increase at such a blistering pace, but the financial results of companies in the early stages of commercialization are notoriously unpredictable, so there's no guarantee it will. Moreover, Nvidia is one of the highest quality companies in the world with a track record of success that spans decades, a rock-solid balance sheet, and surging profits, so I don't think SoundHound deserves to trade at a premium to the chip giant. Nvidia held 1.73 million SoundHound shares, which would've been worth around $27.7 million at the current price of $16. Given the chip giant's market cap of $4.4 trillion, a total loss would've been a mere rounding error. However, holding a stock with such a steep valuation opens the door to substantial downside if the underlying company falters, so I don't think Nvidia made a mistake by closing its position. Should you invest $1,000 in SoundHound AI right now? Before you buy stock in SoundHound AI, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and SoundHound AI wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $663,630!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,115,695!* Now, it's worth noting Stock Advisor's total average return is 1,071% — a market-crushing outperformance compared to 185% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 13, 2025 Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Chipotle Mexican Grill and Nvidia. The Motley Fool recommends the following options: short September 2025 $60 calls on Chipotle Mexican Grill. The Motley Fool has a disclosure policy. Did Nvidia Make a Mistake by Selling SoundHound AI Stock? The Answer Might Surprise You. was originally published by The Motley Fool Sign in to access your portfolio
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19 hours ago
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Why SoundHound Could Be the Next AI Stock to Rocket
From a penny stock trading at around $2 per share at the start of 2024, SoundHound AI (SOUN) stock has made significant gains, rising 693% to near $16.50 per share. The market typically rewards artificial intelligence companies that can combine rapid growth and innovation with a clear path to profitability. SoundHound checks all three boxes. SoundHound AI just delivered its strongest quarter in company history, and the numbers suggest it may still be one of the most underappreciated growth stories in the mid-cap AI space. SOUN stock is down 17.6% year-to-date, underperforming the S&P 500 Index's ($SPX) gain of 10.2%. Let's dig in. More News from Barchart UnitedHealth Stock Soars as Warren Buffett's Berkshire Hathaway Discloses $1.57B Stake Palantir CEO Alex Karp Sees More Gains Ahead With America-Focused Growth Strategy, Calls U.S. The 'Leader of the Free World' Lucid Motors Is Caught in a Tariff Trap. Is LCID Stock More Likely to Hit $1 or $7 in 2025? Tired of missing midday reversals? The FREE Barchart Brief newsletter keeps you in the know. Sign up now! SoundHound AI: A Strong Growth Story In the Q2 earnings call, CFO Nitesh Sharan called Voice AI the 'spearhead' of the current generative AI era. The second-quarter numbers suggest that SoundHound's technology, acquisitions, and integration capabilities are giving it a competitive advantage that is starting to translate into strong fundamentals. SoundHound reported $43 million in revenue, up 217% year over year, a rare level of growth in today's market. This growth was not limited to one segment. SoundHound experienced significant growth across automotive AI, enterprise AI customer service, and restaurant AI automation. SoundHound's recent success can be attributed to Polaris, its multimodal, multilingual foundation model for conversational AI, which is the result of 20 years of research and development and data. Management stated that as customers migrate to Polaris, they notice immediate improvements in speed, accuracy, and user experience, resulting in high renewal rates, subscription expansions, and faster deal closures. Many small-cap tech companies have ambitious acquisition plans but fail to integrate and monetize them. However, SoundHound has delivered on its acquisition by encouraging cross-selling solutions between acquired companies and existing customers, as well as replacing legacy technology with in-house Polaris models, lowering costs while increasing performance. In May, SoundHound launched Amelia 7, its agentic AI platform, powered by Polaris. Management stated that 15 large enterprise customers have already migrated to Amelia 7, and initial feedback indicates significant productivity gains. Notably, the company's proprietary technology and acquisition strategy are establishing a competitive advantage that may result in outsized returns for early investors. Although SoundHound is a growing company, it remains unprofitable due to aggressive AI investments and planned acquisitions. Its adjusted net loss came in at $0.03 per share, compared to a loss of $0.04 per share in the year-ago quarter. The adjusted EBITDA loss stood at $14.3 million. Continued cost discipline, combined with investments in generative AI capabilities and market expansion to boost revenue, could help the company be profitable. Management anticipates achieving adjusted EBITDA profitability by year-end 2025. SoundHound AI ended the quarter with $230 million in cash and equivalents and no debt. The company raised its full-year 2025 revenue guidance to a range of $160 million to $178 million, in line with the consensus estimate of $166 million. Analysts expect revenue could further increase by 29.1% in 2026. Currently, SOUN stock trades at 30 times forward sales, which is high but reflects investor confidence in the company's long-term prospects in the voice AI industry. What Are Analysts Saying About SOUN Stock? On Wall Street, SOUN stock is now rated as a 'Strong Buy' compared to a 'Moderate Buy' rating a month ago. Of the seven analysts covering SOUN, five give it a 'Strong Buy' rating, while two suggest a 'Hold.' The stock has surpassed its average price target of $14.29. However, the highest target price of $18 implies potential upside of 12.1% within the next 12 months. Why Should You Eye This AI Stock? While the company acknowledges that deal flow may cause quarterly revenue volatility, its long-term trajectory appears to be stable. SoundHound AI has the first-mover advantage in voice AI solutions. Voice commerce, while still in its early stages, has the potential to be SoundHound's most explosive growth driver in the coming years. Management is striking a balance between aggressive market capture and disciplined spending, which could propel the company to become one of the standout mid-cap AI success stories of the coming years. On the date of publication, Sushree Mohanty did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
a day ago
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Why Shares of SoundHound Are Soaring Higher This Week
Key Points SoundHound reported strong second-quarter 2025 financial results last week. An analyst upwardly revised his price target on SoundHound stock on Monday. For risk-averse investors, an AI ETF may be a better investment option than SoundHound stock. 10 stocks we like better than SoundHound AI › After climbing 34% last week, shares of SoundHound AI (NASDAQ: SOUN) are maintaining their upward trajectory. The company reported strong second-quarter 2025 financial results last week, and investors seem intent on continuing to pick up shares of the artificial intelligence (AI) company, while an analyst's optimistic outlook on the stock from earlier this week is contributing to investors' ebullience. According to data provided by S&P Global Market Intelligence, shares of SoundHound have risen 21.3% from the end of trading last Friday through 3:32 p.m. ET on Thursday. An analyst's favorable opinion is music to investors' ears On Monday, investors learned that they weren't the only ones enthusiastic about SoundHound's Q2 2025 financial results. Ladenburg analyst Glenn Mattson upgraded SoundHound stock to buy from neutral and hiked his price target to $16 from $9. With shares of SoundHound closing at $13.55 last Friday, Mattson's price target implies upside of 18.1%. According to The Fly, Ladenburg predicates its view on SoundHound on the belief that the company is adding value to companies seeking to integrate AI functionality, and the company is demonstrating strong growth potential in the near term. Last week, SoundHound reported impressive second-quarter 2025 financial results. In addition to revenue growing 217% year over year, SoundHound reported non-GAAP (generally accepted accounting principles) earnings per share of negative $0.03, beating analysts' expectations. With shares rocketing higher over the past two weeks, is it too late to buy SoundHound stock now? For innovative companies such as SoundHound, there's often volatility in the stock prices as investors wrestle with the company's growth into a more mature company. The recent rise shouldn't dissuade those interested in SoundHound stock. While notable over the past couple of weeks, shares are still down about 16% since the start of the year as of this writing. Volatility is sure to continue with SoundHound stock, so those who are looking to gain AI exposure, yet have a low risk tolerance, may be more interested in an AI exchange-traded fund. Should you buy stock in SoundHound AI right now? Before you buy stock in SoundHound AI, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and SoundHound AI wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $649,544!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,113,059!* Now, it's worth noting Stock Advisor's total average return is 1,062% — a market-crushing outperformance compared to 185% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 13, 2025 Scott Levine has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Why Shares of SoundHound Are Soaring Higher This Week was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
