SoundHound AI (NASDAQ:SOUN) Shares Up 7.9% - Here's Why

Key Points

• SoundHound AI shares rose 7.9% to $4.89 following a rebound from a recent 52-week low near $4.46. The move came despite trading volume running about 34% below the average session level.
• The company reported strong operating growth, with quarterly revenue up 45% year over year to $61.9 million and earnings exceeding expectations. Its OASYS voice-AI platform powering a generative assistant in Kia vehicles also offers a commercial validation point.
• Profitability and technical concerns remain: SoundHound is still unprofitable, has negative cash flow, and remains well below its 50-day and 200-day moving averages. Analyst sentiment is mixed, with a “Moderate Buy” consensus but several recent rating or price-target reductions.

SoundHound AI, Inc. (NASDAQ:SOUN - Get Free Report)'s stock price was up 7.9% during mid-day trading on Thursday. The company traded as high as $4.90 and last traded at $4.89. 17,833,998 shares were traded during mid-day trading, a decline of 34% from the average session volume of 27,080,494 shares. The stock had previously closed at $4.53.

More SoundHound AI News

Here are the key news stories impacting SoundHound AI this week:

• Positive Sentiment: Kia launch provides a commercial validation point: SoundHound’s OASYS platform is powering a real-time generative voice AI assistant in the Kia Sorento in India. The deployment, described as a global and category first for in-car generative AI, could strengthen SoundHound’s automotive pipeline and demonstrate enterprise adoption. What Could SoundHound AI First In Car AI Launch Mean For Investors?
• Positive Sentiment: Technical rebound from depressed levels: SOUN recently touched a new 52-week low near $4.46 before recovering, suggesting some bargain hunting and short-term trading interest after a severe selloff. SoundHound AI Gains in a Single Session
• Neutral Sentiment: Growth remains substantial but speculative: Recent quarterly revenue rose 45% year over year to $61.9 million and exceeded expectations, while adjusted earnings also beat estimates. However, the company remains unprofitable, and analysts expect a full-year loss.
• Negative Sentiment: Profitability and cash-flow concerns continue to weigh on valuation: Persistent losses, negative cash flow and uncertainty about when SoundHound can reach profitability have undermined investor confidence. Analysts also flag acquisition-related execution risks despite expanding enterprise adoption. SoundHound Stock Trades at a Discount
• Negative Sentiment: Downtrend remains pronounced: The stock has fallen sharply over the past month and year while the broader market and enterprise software group advanced, indicating company-specific concerns rather than simply sector weakness. The recent decline has also left SOUN well below its 50-day and 200-day moving averages. How Much Downside Is Left in SOUN Stock?

Wall Street Analysts Forecast Growth

SOUN has been the subject of several recent analyst reports. Wall Street Zen cut SoundHound AI from a "sell" rating to a "strong sell" rating in a research note on Saturday, September 26th. DA Davidson decreased their price target on SoundHound AI from $12.00 to $10.00 and set a "buy" rating on the stock in a research note on Thursday, August 6th. Weiss Ratings reissued a "sell (e+)" rating on shares of SoundHound AI in a report on Friday, September 11th. Finally, Piper Sandler lowered their price target on SoundHound AI from $7.00 to $6.00 and set a "neutral" rating for the company in a report on Tuesday, September 22nd. One equities research analyst has rated the stock with a Strong Buy rating, three have given a Buy rating, two have assigned a Hold rating and one has assigned a Sell rating to the company's stock. Based on data from MarketBeat.com, the stock has an average rating of "Moderate Buy" and an average target price of $12.75.

SoundHound AI Price Performance

The firm has a 50-day simple moving average of $6.46 and a 200 day simple moving average of $6.98. The stock has a market capitalization of $2.17 billion, a P/E ratio of -12.87 and a beta of 2.73.

SoundHound AI (NASDAQ:SOUN - Get Free Report) last released its quarterly earnings data on Wednesday, August 5th. The company reported ($0.02) earnings per share (EPS) for the quarter, beating the consensus estimate of ($0.13) by $0.11. The company had revenue of $61.90 million during the quarter, compared to the consensus estimate of $52.38 million. SoundHound AI had a negative return on equity of 30.22% and a negative net margin of 67.45%. The firm's revenue was up 45.0% compared to the same quarter last year. During the same quarter in the prior year, the firm posted ($0.19) earnings per share. Sell-side analysts anticipate that SoundHound AI, Inc. will post -0.32 earnings per share for the current fiscal year.

Insider Buying and Selling at SoundHound AI

In other SoundHound AI news, CEO Keyvan Mohajer sold 137,290 shares of the company's stock in a transaction that occurred on Tuesday, September 15th. The shares were sold at an average price of $6.33, for a total value of $869,045.70. Following the completion of the transaction, the chief executive officer directly owned 3,684,947 shares in the company, valued at approximately $23,325,714.51. This represents a 3.59% decrease in their position. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, COO Michael Zagorsek sold 71,113 shares of the firm's stock in a transaction on Tuesday, September 15th. The shares were sold at an average price of $6.33, for a total transaction of $450,145.29. Following the transaction, the chief operating officer directly owned 2,600,231 shares of the company's stock, valued at $16,459,462.23. The trade was a 2.66% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last 90 days, insiders sold 288,758 shares of company stock valued at $1,828,598. 8.84% of the stock is owned by insiders.

Institutional Inflows and Outflows

Large investors have recently bought and sold shares of the stock. Swiss National Bank lifted its position in shares of SoundHound AI by 3.7% in the 1st quarter. Swiss National Bank now owns 767,100 shares of the company's stock worth $5,270,000 after purchasing an additional 27,300 shares during the period. California State Teachers Retirement System raised its position in shares of SoundHound AI by 25.0% in the 1st quarter. California State Teachers Retirement System now owns 440,023 shares of the company's stock worth $3,023,000 after acquiring an additional 87,998 shares in the last quarter. AXQ Capital LP raised its position in shares of SoundHound AI by 395.6% in the 2nd quarter. AXQ Capital LP now owns 254,744 shares of the company's stock worth $1,648,000 after acquiring an additional 203,345 shares in the last quarter. SG Americas Securities LLC acquired a new position in shares of SoundHound AI in the 1st quarter valued at about $1,606,000. Finally, Virtu Financial LLC lifted its stake in shares of SoundHound AI by 43.9% in the 4th quarter. Virtu Financial LLC now owns 219,773 shares of the company's stock valued at $2,191,000 after purchasing an additional 67,088 shares during the period. 19.28% of the stock is owned by institutional investors.

SoundHound AI Company Profile

SoundHound AI, Inc develops voice artificial intelligence technologies that enable people to interact with products and services using natural language. Its platform is designed to understand conversational speech, answer questions, and support voice-enabled experiences across automotive, restaurant, consumer electronics and other industries.

The company's offerings include the Houndify voice AI platform, which businesses can use to build customized voice assistants, and SoundHound Chat AI, a conversational assistant designed to provide responses and complete tasks through voice interaction.

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