ZACKS·2025-05-13 20:01Core Viewpoint - NVIDIA Corporation and SoundHound AI, Inc. are making significant strides in the AI sector, with both companies experiencing stock price increases over the past year, but they are targeting different segments of the AI market [1] Group 1: SoundHound AI Insights - The recent trade agreement between the U.S. and China has positively impacted SoundHound AI, reducing tariffs on Chinese imports from 145% to 30% and on American commodities from 125% to 10% [2] - SoundHound AI has entered the Chinese market through a partnership with Tencent, which will integrate its voice AI into Tencent's cloud solutions for the automotive sector [3] - In Q1 2025, SoundHound AI's revenues surged by 151% year-over-year to $29.1 million, and its adjusted EPS loss narrowed by 14% [4] - The company aims for 85% to 90% revenue growth and a positive adjusted EBITDA for the full year 2025 [4] - SoundHound AI is not yet profitable and has struggled to meet its guidance, with a negative adjusted EBITDA of $22.2 million five quarters later [8] Group 2: NVIDIA Insights - NVIDIA is benefiting from substantial investments in AI infrastructure by major companies like Amazon and Alphabet, which are purchasing NVIDIA's GPUs to enhance their AI capabilities [5] - By 2028, NVIDIA anticipates AI data center spending to reach $1 trillion, which is expected to drive stock growth [6] - NVIDIA's net profit margin stands at 55.9%, outperforming the Semiconductor - General industry average of 49.5%, indicating strong profitability and growth potential [8] - NVIDIA holds over 80% market share in the GPU space, providing a competitive edge that can help sustain stock performance amid market volatility [9]