SoundHound AI Stock Volatility Stabilizes, Positive Market Outlook
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4d ago
0mins
Source: Yahoo Finance
- Stock Volatility Analysis: SoundHound AI (NASDAQ: SOUN) has experienced extreme volatility over the past two years, with a stock surge in 2024 as interest in its AI voice platform grew, culminating in over 100 million voice-based sales processed by restaurants using its Smart Ordering technology by year-end, indicating market validation of its technology.
- Market Competitive Advantage: Viking Therapeutics (NASDAQ: VKTX), although late to the weight-loss drug market, has a promising candidate VK2735 that targets both GLP-1 and GIP receptors, potentially offering a more effective weight-loss solution, with analysts projecting a price target of $93.39, nearly 200% above its current price.
- Energy Sector Outlook: Vistra (NYSE: VST), while categorized as a utility, operates significant nuclear facilities in states like Texas and California that can quickly meet electricity demands, and the International Atomic Energy Agency predicts a doubling of nuclear power output by 2050, highlighting its growth potential.
- Investment Recommendation: In the current market environment, investors should be selective with growth stocks; while SoundHound AI faces volatility, its long-term growth potential in the AI sector is noteworthy, especially as profitability improves.
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Analyst Views on SOUN
Wall Street analysts forecast SOUN stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for SOUN is 16.60 USD with a low forecast of 11.00 USD and a high forecast of 26.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
7 Analyst Rating
5 Buy
2 Hold
0 Sell
Moderate Buy
Current: 9.690
Low
11.00
Averages
16.60
High
26.00
Current: 9.690
Low
11.00
Averages
16.60
High
26.00
About SOUN
SoundHound AI, Inc. is engaged in conversational intelligence, offering voice and conversational artificial intelligence (AI) solutions that let businesses offer experiences to their customers. Through its proprietary technology, its voice AI delivers speed and accuracy in numerous languages to product creators and service providers across retail, financial services, healthcare, automotive, smart devices, and restaurants via AI-driven products, such as Smart Answering, Smart Ordering, Dynamic Drive Thru, and Amelia AI Agents. Along with SoundHound Chat AI, a voice assistant with integrated Generative AI, it powers various products and services, and processes billions of interactions each year for businesses. Its developer platform, Houndify, is an open-access platform that allows developers to leverage its Voice AI technology and a library of over 100 content domains, including commonly used domains for points of interest, weather, flight status, sports and more.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
SoundHound AI Projects 2025 Revenue Growth
- Revenue Growth Outlook: SoundHound AI anticipates total revenue for 2025 to be between $165 million and $180 million, with a midpoint of $172.5 million representing a remarkable 103% year-over-year growth, indicating strong market demand in the conversational AI sector.
- Surging Market Expenses: Despite rapid revenue growth, SoundHound's marketing expenses nearly doubled and administrative costs rose by 43% in Q3 2025, resulting in a net loss of $109.2 million for the quarter, highlighting financial pressures during its expansion phase.
- Cash Flow Concerns: As of September 30, 2025, SoundHound had $269 million in cash, and if it continues its high spending strategy, it may need to raise capital in the coming years, which could dilute existing shareholders and increase investment risks.
- Stock Valuation Analysis: SoundHound's price-to-sales ratio stands at 27.9, which, while lower than its peak of over 100, remains higher than Nvidia's 24.6, suggesting that the market still holds high expectations for its future growth, necessitating careful evaluation of its long-term investment value.
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SoundHound AI Stock Volatility and Growth Outlook
- Revenue Growth Outlook: SoundHound anticipates total revenue between $165 million and $180 million for 2025, with a midpoint of $172.5 million indicating a 103% year-over-year growth, reflecting strong demand in the conversational AI market.
- High Expenditure Impact: Despite rapid revenue growth, SoundHound reported a net loss of $109.2 million in Q3 2025 due to nearly doubling marketing costs and a 43% increase in administrative expenses, highlighting the high risks associated with its expansion strategy.
- Capital Requirement Risk: With $269 million in cash as of September 30, SoundHound may need to raise capital in the coming years if losses continue, which could dilute existing shareholders and raise investor concerns about financial stability.
- Market Valuation Comparison: SoundHound's price-to-sales ratio stands at 27.9, still high compared to Nvidia's 24.6, indicating cautious market sentiment regarding its future growth, prompting investors to carefully assess risk versus return.
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