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]

Revenue and Loss - Total revenues for the year ended December 31, 2024, increased to $84.693 million, a 84.5% increase from $45.873 million in 2023[4] - The net loss for the year ended December 31, 2024, was $350.681 million, compared to a net loss of $88.937 million in 2023, representing a 295.5% increase in losses[4] - The company’s basic and diluted net loss per share for the three months ended December 31, 2024, was $(0.69), compared to $(0.07) for the same period in 2023[3] Operating Expenses - Operating expenses for the year ended December 31, 2024, totaled $426.046 million, significantly up from $114.481 million in 2023, reflecting a 272.5% increase[4] Assets and Equity - The total assets of the company as of December 31, 2024, were $553.953 million, compared to $151.122 million in 2023, marking a 267.5% increase[2] - The company’s total stockholders' equity improved to $182.653 million as of December 31, 2024, compared to $28.168 million in 2023, a 648.5% increase[2] Cash and Cash Equivalents - Cash and cash equivalents as of December 31, 2024, were $198.240 million, up from $95.260 million as of December 31, 2023, indicating a 108.3% increase[2] - Cash, cash equivalents, and restricted cash equivalents at the end of 2024 reached $198,916,000, up from $109,015,000 in 2023[8] - Total cash and cash equivalents were $198,240,000 in 2024, compared to $95,260,000 in 2023[8] Liabilities - Total current liabilities increased to $67.742 million as of December 31, 2024, from $24.223 million in 2023, reflecting a 179.5% increase[2] - Payments on notes payable increased significantly to $215,373,000 in 2024 from $35,029,000 in 2023[8] Accounts Receivable - The company reported a significant increase in accounts receivable, net of allowances, which rose to $23.159 million in 2024 from $4.050 million in 2023, a 471.5% increase[2] Financing Activities - Net cash provided by financing activities increased to $210,906,000 in 2024 from $168,237,000 in 2023[8] - Proceeds from warrants exercised amounted to $23,000 in 2024, compared to $0 in 2023 and 2022[8] Other Financial Metrics - Cash paid for interest decreased to $6,337,000 in 2024 from $11,984,000 in 2023[11] - Cash paid for income taxes increased to $2,717,000 in 2024 from $2,356,000 in 2023[11] - The conversion of Series A Preferred Stock to Class A common stock resulted in $14,187,000 in 2024, compared to $10,755,000 in 2023[11] - Fair value of contingent earnout consideration under SYNQ3 and Amelia acquisitions was recorded at $286,898,000[11] - The change in fair value of contingent acquisition liabilities for the three months ended December 31, 2024, was $220.946 million, with no comparable figure in 2023[3] - The company reported a net change in cash of $89,881,000 in 2024, down from $99,560,000 in 2023[8]

Core Viewpoint - SoundHound AI has experienced significant volatility, with a 150% gain over the past year but a 55% decline from its all-time high, raising questions about its investment potential [1][2]. Company Overview - SoundHound AI is a speculative company focused on developing voice and sound AI technologies for various applications, including vehicles and drive-throughs [3]. - The company has undergone growth, particularly after acquiring Amelia in late 2024, which is expected to boost revenue from approximately $85 million in 2024 to a range of $155 million to $175 million in 2025 [6]. Valuation and Market Position - The stock reached a peak price-to-sales (P/S) ratio of 110, which is considered unsustainable and reflects overly high expectations [3][5]. - Currently, the P/S ratio has decreased to about 24 based on 2025 revenue guidance, but this is still viewed as relatively high compared to other similar companies [9]. Financial Performance and Challenges - SoundHound AI has burned over $75 million in cash through the first nine months of 2024, indicating it is not close to achieving positive cash flow or net income [8]. - The company must demonstrate a clear path to profitability to maintain investor interest and valuation [8]. Market Potential - Management estimates the addressable market for SoundHound AI at $140 billion, suggesting significant growth opportunities if the company can effectively penetrate new sectors [7]. - Competition exists from other companies, including those in the "Magnificent Seven," which also offer audio-based AI technology [7]. Investment Considerations - The current high valuation of SoundHound AI presents limited upside relative to the risks involved, leading to skepticism about its potential as a "millionaire maker" stock [12].

Core Viewpoint - Nvidia's divestment from SoundHound AI raises concerns among investors, but it may present a buying opportunity given the company's strong growth potential in 2025 [2][3][4]. Group 1: Nvidia's Investment and Divestment - Nvidia sold all of its stake in SoundHound AI, which was valued at $33.7 million as of December 31, 2024, leading to a sell-off in SoundHound's stock [2]. - Nvidia's stake in SoundHound was relatively small compared to its overall portfolio, owning only 1.7 million shares [2]. - The decision to sell may not have been driven by business reasons, as Nvidia generated $16.8 billion in free cash flow last quarter and holds $38.5 billion in cash and short-term investments [3]. Group 2: SoundHound's Growth Potential - SoundHound AI's revenue increased by 89% in Q3, indicating strong growth potential [4]. - Preliminary guidance for 2025 suggests revenue could reach between $155 million and $175 million, effectively doubling from the projected $82 million to $85 million in 2024 [5]. - Despite the sell-off, SoundHound's stock is still trading at 50 times sales, which is considered expensive but may be justified by the anticipated revenue growth [6][7]. Group 3: Market Sentiment and Future Considerations - The stock faces high selling pressure as investors reassess their positions following a strong performance last year [8]. - If Q4 results do not exceed expectations, further sell-off may occur, and the stock could be reconsidered post-earnings [8]. - Investors are advised to be patient, as uncertainties remain regarding SoundHound's performance, and taking profits may be prudent for those with significant gains [9].

Core Viewpoint - SoundHound AI is experiencing significant stock sell-offs due to macroeconomic concerns and upcoming earnings reports from key industry players like Nvidia [2][3][4] Group 1: Stock Performance - SoundHound AI's stock price decreased by 6.4% as of 1:50 p.m. ET, with a peak decline of 10% earlier in the day [1] - The stock is down 55% year to date, despite being up 127% over the last year [3][4] Group 2: Market Conditions - The decline in SoundHound AI's stock is attributed to broader valuation pullbacks in growth-dependent AI stocks, influenced by new tariffs and semiconductor export restrictions to China [2] - Investors are adjusting to emerging macroeconomic risks, including concerns about inflation [2] Group 3: Future Outlook - Nvidia's upcoming Q4 report is anticipated to provide insights into the AI market's growth outlook, which could significantly impact SoundHound's stock price [3][4] - SoundHound AI is currently valued at approximately 21 times this year's expected sales, indicating a heavily forward-looking valuation [4] - Despite recent volatility, the company's sales growth and forward forecasts support a potential bullish case at current levels [5]

Core Viewpoint - SoundHound AI is expected to report significant revenue growth in its fourth quarter of 2024, driven by increasing demand for its conversational AI platform and strategic partnerships in various sectors [2][4][5]. Financial Performance - The Zacks Consensus Estimate for fourth-quarter revenues is $33.49 million, indicating a growth of 95.29% compared to the same quarter last year [2]. - The consensus estimate for loss is 11 cents per share, unchanged over the past 60 days, compared to a loss of 6 cents per share in the year-ago quarter [2]. Market Demand and Growth Factors - The performance is likely to benefit from the rising demand for AI-driven customer service solutions, particularly in the restaurant and automotive sectors [5]. - SoundHound's global expansion, especially in China and India, along with partnerships with companies like DayinTec and VE Commercial Trucks, is expected to contribute to growth [6]. Product Offerings and Clientele - SoundHound's products, such as Smart Ordering and Smart Answering, are anticipated to drive revenue growth, particularly in the small and medium-sized business market [7]. - The company has a strong partner base, including Rekor Systems and Lucid Group, enhancing its position in the AI-driven voice technology market [11][12][13]. Competitive Landscape - Despite impressive growth and strong partnerships, increasing competition in the AI market, especially in customer service and voice assistant sectors, may have negatively impacted performance [15]. - SoundHound's stock has underperformed, with a year-to-date decline of 44.8%, compared to a 0.5% decline in the broader Zacks Computer & Technology sector [8]. Valuation and Investment Outlook - SoundHound AI's current Price/Sales ratio is 21.95, significantly higher than its median of 19.41 and the sector's 6.35, indicating a stretched valuation [11]. - The company has a Growth Score of F, suggesting it may not be an ideal investment for growth-oriented investors at this time [17].

Core Insights - SoundHound AI's stock experienced a significant decline of 8.5% in a trading session, reflecting broader market trends with the S&P 500 and Nasdaq Composite also falling [1][2] - The volatility of AI stocks, particularly those with growth-dependent valuations, was exacerbated by concerns over Nvidia's upcoming quarterly results and Microsoft's data center expansion plans [2][3] - Despite a 141% increase in share price over the past year, SoundHound AI's stock has dropped approximately 52.5% in 2025, indicating high volatility and potential for further movement in the near term [3][4] Financial Performance - SoundHound AI has a market capitalization of around $3.7 billion, trading at approximately 22.4 times this year's expected sales, indicating a growth-dependent valuation that carries downside risk [4] - The company raised its full-year sales target for 2024 to between $82 million and $85 million, suggesting a year-over-year sales growth of about 82% [5] - Revenue projections for 2025 are estimated to be between $155 million and $175 million, indicating potential for more than doubling revenue this year [5] Investment Considerations - The recent valuation pullback may present an entry point for investors with high risk tolerance and a positive outlook on SoundHound AI's expansion potential, although it may not be suitable for risk-averse investors [6]

Group 1 - SoundHound AI's stock experienced a significant decline, dropping 8.8% during trading, with a peak decline of 11.9% earlier in the session [1] - The overall tech sector is facing a pullback as investors prepare for Nvidia's fourth-quarter earnings report, which could impact SoundHound AI [2] - Nvidia's upcoming earnings report is highly anticipated and may lead to substantial valuation shifts in AI stocks, including SoundHound AI, due to its forward-looking valuation [2] Group 2 - Nvidia has divested all its shares in SoundHound AI, raising concerns among investors about potential competitive pressures from Nvidia's new AI offerings [3] - SoundHound AI's stock has shown high volatility recently, with its valuation multiples decreasing significantly, yet it still trades at approximately 23 times this year's expected sales [4]

So far, 2025 has not been kind to SoundHound AI (SOUN -10.33%) stock. The speech recognition specialist's shares are down 45% year to date. And the pessimism intensified on Feb. 14 after Nvidia's latest 13F filing with the Securities and Exchange Commission revealed that the chip giant had sold its entire equity stake in SoundHound during the fourth quarter.Yet SoundHound remains a small company pursuing a potentially massive niche, so if things go well, its stock could deliver extraordinary returns. With t ...

Soundhound AI's (SOUN -5.50%) shares skyrocketed as much as 883% last year. However, the artificial intelligence (AI) stock is now down roughly 55% from its peak in late December.You can blame part of this decline on the Federal Reserve. Investors were spooked when the Fed signaled there could be fewer interest rate cuts than expected in 2025. This caused many high-flying growth stocks, including Soundhound AI, to fall.However, another culprit was behind Soundhound AI's plunge of nearly 30% in recent days - ...