SoundHound AI (NASDAQ: SOUN) is staging a strong rebound after delivering robust fourth-quarter earnings and raising its 2025 revenue outlook. The stock surged 17.5%, reversing some of the losses from a recent sell-off triggered by Nvidia’s (NASDAQ: NVDA) exit from its investment in the company.As of press time, SOUN stock is trading at $10.82, extending its rally with pre-market gains of 3.8%. However, despite the recovery, the stock remains under pressure, down 45% year-to-date (YTD). SOUN one-day price c ...

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SoundHound AI (SOUN) incurred a fourth-quarter 2024 loss of 69 cents per share, wider than the year-ago quarter’s loss of 6 cents. The figure missed the Zacks Consensus Estimate by 527.27%.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.Revenues surged 101.5% year over year to $34.5 million, beating the Zacks Consensus Estimate by 3.14%. This growth was driven by major customer wins, expanded partnerships and advancements in generative AI. Strong adoption in quick-service restaurants, ...

Shares of SoundHound AI (SOUN 16.12%) have been beaten up in the first two months of the year. The stock broke out last year, but entered today down more than 50% so far in 2025. The provider of voice artificial intelligence (AI) solutions announced a fourth-quarter adjusted loss of $0.05 per share, with sales of $34.5 million.However, the stock is soaring today, as the company beat expectations and management also raised 2025 guidance. At 11:30 a.m. ET, shares were trading slightly off the morning high, up ...

Group 1: Market Overview - Q4 2024 earnings reporting indicates positive trends, but the outlook for 2025 earnings growth has dimmed [1] - Stocks in leadership positions are regaining traction after price dips, suggesting a continued uptrend in the S&P 500, albeit at a slower pace than in 2024 [1] Group 2: NVIDIA - NVIDIA's automotive segment grew nearly 30% year-over-year in Q4, driven by demand for driver-assist technology essential for EVs and autonomous driving [2][3] - Analysts view the automotive segment as a potential billion-dollar revenue stream that will grow in the coming years, aiding in diversification from the data center segment [3] - The consensus price target for NVIDIA has risen, indicating nearly 30% upside potential, with 91% of ratings at Buy or better [4] Group 3: Salesforce - Salesforce reported mixed earnings and weak guidance, leading to lowered price targets, but analysts believe business remains strong with a forecasted 20% upside [5][7] - Highlights include high single-digit growth, substantial margins, and free cash flow sufficient for capital returns, including dividends and buybacks [8] Group 4: 3M - 3M is expected to revert to organic and adjusted growth in 2025, with improving cash flow and capital return outlook [10][11] - Analysts have a positive sentiment for 2025, with a consensus rating of Moderate Buy and a rising price target [11] Group 5: SoundHound AI - SoundHound AI's stock price has pulled back to long-term lows, but the growth outlook remains intact despite NVIDIA selling its stake [12][13] - Analysts rate SoundHound as a Hold, with potential for a 30% gain, possibly reaching $22.50 by year-end [14] Group 6: Shopify - Shopify is among the most upgraded stocks post-Q4 reporting, with a consensus rating of Moderate Buy and potential for at least 10% upside, likely 20% or more by year-end [15][16] - Q4 results showed accelerated growth and strength in both top and bottom lines, with guidance indicating continued strength in 2025 [17]

Core Viewpoint - SoundHound AI has experienced significant stock price decline and concerns about its profitability and cash flow, despite initial investor enthusiasm driven by Nvidia's stake in the company [1][2][8]. Company Performance - SoundHound AI's stock price has fallen below $10, losing more than 50% of its value since the beginning of the year [2]. - The company has shown strong revenue growth due to acquisitions, particularly of AI companies Amelia and SYNQ3, which have diversified its customer base [2][4]. - Operating losses have often exceeded revenue, indicating unsustainable financial performance [3]. Financial Health - SoundHound is burning through cash and has indicated plans to raise up to $500 million through a mixed shelf offering, which may lead to further dilution for existing shareholders [4]. - The company's valuation remains high, with a price-to-sales (P/S) multiple of 43 and a price-to-book ratio over 12, suggesting that it is still considered expensive relative to its financial performance [6][7]. Market Sentiment - Retail investors had high hopes for SoundHound as a leading AI stock, but skepticism is growing, especially after Nvidia divested its stake [8]. - Despite a 42% gain over the last year, the volatility and lack of a clear path to profitability may deter potential investors [8][9].

Financial Data and Key Metrics Changes - Q4 2024 revenue reached $35 million, representing over 100% year-over-year growth, achieving the top-end of the revenue guidance range for the full year [7][39] - Full-year revenue grew by 85%, totaling $85 million [39] - Cumulative subscriptions and bookings backlog reached nearly $1.2 billion, up over 75% year-over-year [44] - GAAP gross margin was 40%, down year-over-year, while non-GAAP gross margin was 52% [54] - Non-GAAP net loss was $19 million, with a non-GAAP net loss per share of $0.05 [66] Business Line Data and Key Metrics Changes - Automotive unit growth was impacted by macro pressures, but projections for 2025 indicate continued strong growth [51] - Significant growth in the restaurant sector, with major customers like Burger King going live in the UK [17][52] - Expansion in healthcare with notable wins including Duke Health and Englewood Health [16] - New industry entry in energy with a large electric utility contract [20][41] Market Data and Key Metrics Changes - Company works with 30% of top quick-service restaurants and 70% of top financial institutions globally [40] - Customer concentration improved, with the largest customer representing slightly over 14% of revenue in 2024, down from nearly half in 2023 [42][53] Company Strategy and Development Direction - Company has introduced a three-pillar business strategy: voice assistant, AI customer service, and voice commerce ecosystem [11][37] - Focus on expanding into new verticals beyond restaurants, including healthcare, financial services, government, military, and energy [108] - Emphasis on leveraging Agentic AI to enhance capabilities and drive efficiencies [21][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory, expecting revenue in 2025 to range from $157 million to $177 million [69] - Anticipated ramp in revenue throughout the year, with a shift towards more predictable recurring revenue streams [70] - Commitment to achieving adjusted EBITDA profitability by the end of 2025 [72] Other Important Information - Company showcased innovations at CES, including collaborations with major partners like NVIDIA and Lucid Motors [27][28] - Strong presence in the automotive sector with ongoing POCs and partnerships with multiple OEMs [15][94] Q&A Session Summary Question: Recent breakthroughs in AI model efficiency - Management confirmed that advances in AI models allow for improved accuracy and reduced costs, with potential for edge computing [76][78] Question: Details on backlog duration and verticals - Backlog duration is slightly over six years, with balanced growth across automotive, restaurant, healthcare, and energy sectors [81][82] Question: Typical time to revenue for POCs - POCs can be executed quickly, especially in automotive, with revenue generation linked to unit shipments [92][96] Question: Economic impact of the new energy deal - The energy deal is multi-year with accelerated cash collection, indicating strong economic benefits [104][105] Question: Prioritization of secondary verticals - Company prioritizes based on potential customer benefits and market opportunities, leveraging existing technology across multiple sectors [123][125]

Financial Data and Key Metrics Changes - Q4 revenue reached $35 million, representing an increase of over 100% year-over-year, achieving the top-end of the revenue guidance range for the full year [7][39] - Full year revenue grew by 85%, totaling $85 million [39] - Cumulative subscriptions and bookings backlog was nearly $1.2 billion, up over 75% year-over-year [44] - GAAP gross margin was 40%, down year-over-year, while non-GAAP gross margin was 52% [54] - Non-GAAP net loss was $19 million, with a non-GAAP net loss per share of $0.05 [66] Business Line Data and Key Metrics Changes - In automotive, there was continued double-digit unit price expansion, although unit growth was hampered by macro pressures [51] - The restaurant sector saw significant growth, with new logos such as Burger King and expansions with existing customers [17][52] - Healthcare had strong performance with notable wins including Duke Health and Englewood Health [16] - The energy sector was added to the portfolio with a new high seven-figure deal [41][106] Market Data and Key Metrics Changes - The company works with 30% of the top quick-service restaurants and 70% of the top financial institutions globally [40] - Customer concentration improved, with the largest customer representing slightly more than 14% of revenue in 2024, down from nearly half in 2023 [42][53] Company Strategy and Development Direction - The company has introduced a three-pillar business strategy, focusing on voice AI, AI customer service, and voice commerce [11][37] - The strategy aims to create a flywheel effect, increasing momentum as more OEMs and businesses adopt the voice assistant and AI customer service [15] - The company is positioned to capitalize on the growing voice AI market, with a strong pipeline and ongoing innovation [10][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory, expecting revenue for 2025 to be between $157 million and $177 million [69] - The company aims to achieve adjusted EBITDA profitability by the end of 2025, driven by scale and high ROI investments [71] - The management highlighted the importance of the Agentic AI revolution and its potential impact on the company's offerings [25][73] Other Important Information - The company showcased its technologies at CES, receiving significant interest from industry leaders [26][27] - The company has a strong balance sheet with $198 million in cash and equivalents at year-end, having paid down all outstanding debt [67] Q&A Session Summary Question: Recent breakthroughs in AI model efficiency - Management confirmed that advances in AI technology allow for improved accuracy and reduced costs, with the potential to leverage open-source models [76][78] Question: Details on backlog duration and verticals - The backlog duration is slightly over six years, with balanced growth across automotive, restaurant, healthcare, and energy sectors [81][82] Question: Time to revenue for POCs - Management indicated that POCs can be executed quickly, especially in automotive, with revenue generation tied to unit shipments [92][94] Question: Economic impact of the new energy deal - The energy deal is a multi-year contract with accelerated cash collection, indicating strong economic benefits [103][104] Question: Prioritization of secondary verticals - The company prioritizes verticals based on customer benefits and market opportunities, focusing on high ROI investments [123][130] Question: Cross-selling and upselling momentum - Management noted ongoing opportunities for cross-selling and upselling, with a focus on capturing customer opportunities quickly [135][140]

Financial Performance - SoundHound AI, Inc. reported a quarterly loss of $0.69 per share, significantly worse than the Zacks Consensus Estimate of a loss of $0.11, representing an earnings surprise of -527.27% [1] - The company posted revenues of $34.54 million for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 3.14%, and showing a substantial increase from $17.15 million in the same quarter last year [2] - Over the last four quarters, SoundHound AI has surpassed consensus EPS estimates two times and topped consensus revenue estimates four times [2] Stock Performance - SoundHound AI shares have declined approximately 51.8% since the beginning of the year, contrasting with the S&P 500's gain of 1.3% [3] - The current consensus EPS estimate for the upcoming quarter is -$0.09 on revenues of $34.42 million, and for the current fiscal year, it is -$0.25 on revenues of $162.99 million [7] Industry Outlook - The Computers - IT Services industry, to which SoundHound AI belongs, is currently ranked in the top 31% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - The performance of SoundHound AI's stock may be influenced by the overall industry outlook and trends in earnings estimate revisions [5][8]