Core Viewpoint - SoundHound AI's stock has significantly declined, down approximately 60% from its December highs, raising questions about potential buying opportunities for investors [1] Company Overview - SoundHound AI has been in the public market for several years and gained attention when Nvidia owned shares, which initially boosted its stock price [2] - Nvidia no longer holds shares in SoundHound AI, leading to speculation about the reasons behind their initial investment [3][4] - SoundHound AI is working towards profitability and has raised capital multiple times, with management expecting to achieve adjusted EBITDA profitability by the end of 2025 [5] Financial Performance - SoundHound AI experienced a remarkable revenue growth of 101% in Q4, with projected revenue for 2025 expected to be between $157 million and $177 million, indicating a growth rate of 97% [6] - The company's valuation has decreased from over 100 times sales at its peak to 41 times sales, which, while still high, is more justifiable given the expected revenue growth [7][8] Market Position and Future Outlook - SoundHound AI's revenue backlog was reported at $1.2 billion in Q4, suggesting significant future revenue potential, not including new deals that may be signed [10] - The stock could be a solid investment opportunity, with potential strong performance over the next five years if management's projections are met [11]

Core Viewpoint - A class action lawsuit has been filed against SoundHound AI, Inc. for failing to disclose material weaknesses in its internal controls over financial reporting, particularly related to corporate acquisitions [1][2]. Summary by Sections Allegations - Robbins LLP is investigating allegations that SoundHound AI, Inc. did not disclose material weaknesses in its internal controls over financial reporting, which affected its ability to account for corporate acquisitions [2]. - The complaint states that SoundHound overstated its remediation efforts regarding these weaknesses, leading to inflated reported goodwill following the Amelia Acquisition [2]. - The company is expected to require additional time and resources to account for the SYNQ3 and Amelia Acquisitions, increasing the risk of delays in filing financial reports with the SEC [2]. Recent Developments - On March 4, 2025, SoundHound announced it would be unable to timely file its Annual Report for 2024 due to complexities in accounting for the SYNQ3 and Amelia Acquisitions, and acknowledged material weaknesses in its internal controls [3]. - Following this announcement, SoundHound's stock price dropped by $0.61, or 5.86%, closing at $9.72 per share [3]. Next Steps - Shareholders may be eligible to participate in the class action against SoundHound AI, Inc. and can contact Robbins LLP if they wish to serve as lead plaintiff [4]. - Participation in the case is not required to be eligible for recovery, and shareholders can choose to remain absent class members [4].

Core Insights - SoundHound AI has experienced significant price fluctuations but remains a compelling investment opportunity due to its strong business fundamentals and growth potential [1][11]. Company Overview - SoundHound AI, originally known for its music identification apps, has evolved to develop AI tools for audio decoding, which have found applications in various industries [2][3]. - The company launched the Houndify system in 2016, leading to partnerships with global automakers and entertainment technology firms, and subsequently went public [4]. Business Development - SoundHound AI has secured a backlog of $1.2 billion in unfilled orders, representing a 75% increase year-over-year, indicating strong demand for its services [6]. - The company has established partnerships with notable clients, including Stellantis and restaurant management specialist Toast, expanding its market reach [5]. Stock Performance - The stock price of SoundHound AI saw a dramatic rise from $1.70 to $8.00 per share, influenced by an investment from Nvidia, but later experienced a decline [7][11]. - As of March 25, the stock was priced at $10.20 per share, down 49.4% year-to-date, but is now viewed as a more reasonable investment opportunity [11]. Market Dynamics - The stock became a target for short-sellers, with 33% of its publicly traded shares on loan, leading to a short-squeeze scenario that ultimately did not materialize as expected [8][10]. - The excessive price manipulation experienced in December has subsided, allowing for a more stable investment environment [12]. Investment Outlook - SoundHound AI is positioned as a practical application of AI technology across lucrative markets, making it a strong candidate for investment consideration [13].

Core Viewpoint - SoundHound AI has experienced significant stock volatility, with a notable rise of over 350% since the start of 2024, despite a decline from its peak due to Nvidia selling its stake and broader AI market sell-offs [1][2][5] Company Overview - SoundHound AI focuses on audio input for AI applications, differentiating itself from competitors that primarily use text input, which is particularly useful in hands-free situations [6] - The company has a current market capitalization of $3.9 billion, and to turn a $10,000 investment into $1 million, it would need to grow to nearly $400 billion, a challenging feat given the scale of existing giants in the industry [4] Financial Performance - In Q4, SoundHound's revenue grew by 101% to $34.5 million, with management projecting revenue between $157 million and $177 million for 2025, indicating a potential growth rate of 97% at the midpoint [7] - The revenue backlog at the end of Q4 was $1.2 billion, suggesting sustained growth potential for several years, even after accounting for the 2025 revenue forecast [8] Valuation Metrics - Despite a 60% decline from its all-time high, SoundHound's stock trades at a high valuation of 39 times sales, which is above the typical range of 10 to 20 times for software companies [9] - If SoundHound doubles its revenue as projected, the valuation could adjust to around 20 times sales, making it more attractive [10] Future Outlook - The future performance of SoundHound's stock will largely depend on its ability to sustain growth beyond 2025, with potential for significant stock price appreciation if revenue continues to double in subsequent years [11] - While the potential for turning a $10,000 investment into $1 million is unlikely, the company could still represent a successful investment opportunity that enhances portfolio returns [12]

Company Performance - SoundHound AI, Inc. closed at $10.20, reflecting a -1.07% change from the previous day, underperforming the S&P 500 which gained 0.16% [1] - The company's shares increased by 9.33% over the past month, outperforming the Computer and Technology sector which declined by 5.94% and the S&P 500 which fell by 3.59% [1] Earnings Expectations - The upcoming earnings report for SoundHound AI, Inc. is anticipated to show an EPS of -$0.07, remaining consistent with the same quarter last year [2] - Revenue is expected to reach $30.21 million, representing a significant increase of 160.62% compared to the same quarter last year [2] Full Year Projections - For the full year, analysts project an EPS of -$0.16 and revenue of $165.76 million, indicating increases of +84.62% and +95.72% respectively from the previous year [3] Analyst Forecast Revisions - Recent revisions to analyst forecasts for SoundHound AI, Inc. are important as they reflect short-term business trends, with positive changes indicating analyst optimism about the company's profitability [4] - The Zacks Rank system, which incorporates these estimate changes, provides a rating system that can help investors make informed decisions [5] Zacks Rank and Industry Position - SoundHound AI, Inc. currently holds a Zacks Rank of 3 (Hold), with the Zacks Consensus EPS estimate having decreased by 4.72% in the past month [6] - The Computers - IT Services industry, part of the Computer and Technology sector, has a Zacks Industry Rank of 78, placing it in the top 32% of over 250 industries [7]

Core Insights - The individual has retired after over 43 years in investment research, now operating independently to provide actionable investment insights [1] - The focus is on rules and factor-based equity investing strategies, emphasizing the use of numbers to inspire human intelligence-driven investment stories rather than solely relying on statistical studies [1] - The individual combines quantitative analysis with classic fundamental analysis to uncover the true story of companies and their stocks, aiming to predict future performance [1] Experience and Background - The individual has extensive experience covering a wide range of stocks, including large cap, small cap, micro cap, value, growth, and income [1] - Previous roles include managing a high-yield fixed-income fund and conducting research on quantitative asset allocation strategies, contributing to the development of Robo Advising [1] - The individual has authored two books on stock selection and analysis and has a passion for investor education, having conducted numerous seminars [1]

Core Insights - SoundHound AI experienced significant stock performance in 2024, rising 836% at its peak, but has since declined approximately 60% from its all-time high, raising questions about potential buying opportunities for new investors [1] - The company specializes in audio input for AI models, differentiating itself from other AI investments that focus on text inputs, indicating a substantial market opportunity [1] - Key industries for SoundHound include restaurants and automotive, with its software being utilized for automating drive-thru experiences and as digital assistants in vehicles [2] Financial Performance - In Q4, SoundHound's revenue increased by 101% year over year to $34.5 million, and for the full year, revenue rose 85% to $84.7 million, with expectations for continued acceleration in 2025 [3] - Management projects revenue for 2025 to be between $157 million and $177 million, suggesting nearly double the revenue compared to 2024 [3] - SoundHound's bookings backlog reached $1.2 billion, up 75% year over year, with an expected conversion of about $167 million into revenue during 2025 [7] Valuation Insights - The stock's valuation peaked at over 100 times sales, which was deemed unsustainable, and has since adjusted to 41 times sales, still considered high compared to typical software company valuations of 10 to 20 times sales [4] - If SoundHound doubles its revenue in 2025, it could align with a more typical valuation range for software companies, making the current price more attractive [5] Growth Potential - The company has significant growth potential, with expectations of acquiring new customers throughout 2025 and 2026, which could lead to substantial returns for investors if growth continues [8]

Group 1 - The company SoundHound AI has seen its stock price decline from $24 to approximately $10, indicating significant volatility in its market performance [1] - The author expresses a belief in the long-term potential of SoundHound AI, despite the current stock price drop [1] - The focus of the analysis is on fundamental analysis, valuation, and long-term growth potential, particularly in sectors like AI, fintech, and technology [1] Group 2 - The author has a beneficial long position in shares of PLTR, indicating a positive outlook on this company's stock [2] - The article reflects the author's personal opinions and is not influenced by any compensation from companies mentioned [2] - There is an emphasis on providing data-driven analysis to assist investors in making informed decisions regarding stock investments [1]

Core Viewpoint - Nvidia has significantly increased its valuation due to strong sales of its data center chips for AI, but it recently sold its stake in SoundHound AI, raising questions about the latter's future potential [1][2][16]. Company Overview - SoundHound AI specializes in conversational AI technologies, with over 30% of the top 20 quick-service restaurants and major car manufacturers utilizing its technology [4]. - The company has developed tools like Employee Assist for restaurants and Chat AI for automotive applications, enhancing customer service and user experience [5][6]. Financial Performance - SoundHound reported a record revenue of $84.7 million in 2024, an 85% increase from the previous year, which was a significant acceleration from a 47% growth in 2023 [9]. - The company diversified its revenue base through the acquisition of Amelia, reducing reliance on a single customer, which accounted for only 14% of total revenue in 2024 [10]. Future Growth Potential - SoundHound ended 2024 with a $1.2 billion order backlog, a 75% increase from the previous year, with expectations to convert this backlog into revenue over six years [11]. - The company projects revenue could reach up to $177 million in 2025, indicating a potential growth rate of 109% [11]. Profitability Concerns - Despite revenue growth, SoundHound reported a GAAP net loss of $350.6 million in 2024, a 294% increase from 2023, raising concerns about its financial sustainability [12]. - The non-GAAP net loss was $69.1 million, and with only $198 million in cash at year-end, the company faces challenges in maintaining its current spending rate [13]. Valuation Analysis - SoundHound's stock trades at a price-to-sales (P/S) ratio of 34.2, which is significantly higher than Nvidia's P/S ratio of 12.7, indicating a premium valuation compared to established AI leaders [14][15]. - The forward P/S ratio based on projected 2025 revenue is 17.9, still above Nvidia's, suggesting that SoundHound's valuation may limit its upside potential [15].

Core Viewpoint - The Schall Law Firm is investigating claims against SoundHound AI, Inc. for potential violations of securities laws, particularly concerning misleading statements and undisclosed information [1][2]. Group 1: Investigation Details - The investigation centers on whether SoundHound issued false or misleading statements and failed to disclose critical information to investors [2]. - SoundHound filed a Notification of Late Filing on Form 12b-25 with the SEC on March 4, 2025, indicating it could not file its 10-K annual report on time due to accounting complexities [2]. - The company identified material weaknesses in its internal control over financial reporting, which persisted as of December 31, 2024 [2]. Group 2: Company Response - SoundHound expects to file its Form 10-K within the fifteen-day period allowed under Rule 12b-25, no later than March 18, 2025 [2].