In 2024, Artificial intelligence (AI) industry continues to attract significant investment, with global AI funding reaching new heights. As reported by Crunchbase, AI startups will raise over $50 billion worldwide in 2023Despite a broader slowdown in venture capital, this trend shows no signs of slowing down this year. Big tech companies like Nvidia (NVDA), Microsoft (MSFT), and Alphabet (GOOGL) are pouring billions of dollars into AI research, acquisitions, and partnerships.
One such company, SoundHound AI, Inc. (SOUN), is making waves in the AI ​​penny stock market by leveraging cutting-edge voice-enabled AI and conversational intelligence technology. SOUN has already surged an impressive 182% since the beginning of the year. Strategic investment from AI giant Nvidia.
However, SoundHound AI stock just fell sharply after the company postponed its revenue targets. While investors are clearly disappointed, at least one prominent tech analyst sees a particularly bright future for this low-cost AI product.Let's take a closer look at what Wall Street expects from this outperformance. penny stock now.
SOUN misses out on revenue
In short, 2024 was a very good year for SoundHound AI (SOUN). The stock peaked at $7.91, up 273% from a year ago, but fell 18.5% at one point in late February as investors reacted to the decline. Missing quarterly revenue.
SoundHound AI reported an 80.5% increase in revenue to $17.15 million, but that number fell just short of the $17.21 million that Wall Street was expecting. Similarly, loss per share was $0.07, slightly wider than expected. Additionally, SOUN previously projected to achieve positive his EBITDA in the fourth quarter of 2023, which is now positive despite improving margins. pushed back that milestone Until sometime in 2025.
That said, this kind of wild price swings are pretty standard not only in the penny stock world, but also in the AI ​​stock world. Nvidia's significant intraday volatility By the end of last week. In any case, for those who were buzzing about NVIDIA's multi-million dollar investment in SOUN, the negative reaction to earnings was a cold splash of reality, as the company's financials didn't quite live up to the hype.
What is driving SoundHound AI's growth?
SoundHound AI's future remains promising despite recent poor performance. First, the company's voice AI technology is legal. We're talking about solutions that have the potential to transform industries like automotive, consumer electronics, and more. And let's not forget our investment with Nvidia. This shows that the company has the foundations to become a strong player in his AI field, although details are not disclosed.
Speaking of integrations, SoundHound AI’s voice assistant with ChatGPT integration Stellantis DS Automobiles begins full-scale production, its use in cars will increase significantly. they again, Teamed up with Jersey Mike Introducing voice AI phone ordering. Not too shabby, right?
And looking to the future, the company predicts significant revenue growth. They predict revenue will jump by more than half this year. Aiming for sales of over $100 million by 2025. That's pretty ambitious, especially considering it has a backlog worth $661 million.
What do analysts expect from SoundHound AI stock?
So while SoundHound AI's stock price has been volatile, analysts seem pretty optimistic about the company's future direction.At the top of the list is the frank AI bull. Dan Ives of Wedbushand supported the optimistic outlook after the results.
in particular, Ives is a fan He appreciates SoundHound AI's innovative technology and strategic partnerships, and believes that speech recognition and natural language processing skills will be in high demand as more industries begin using AI-powered solutions. Masu. Ives calls SOUN a “buy” and has a high price target of $9. This suggests an expected 50.5% upside from Monday's closing price.
Most analysts are also bullish, with 5 out of 6 analysts rating it a Strong Buy, with an average price target of $6.97, representing a 16.5% premium to current levels.
SOUN stock conclusion
Sure, SoundHound AI may be in the throes of a pretty volatile stock market, but pros are still betting on a bright future. Of course, investing in speculative AI penny stocks is not for the faint of heart.
But for those willing to take the risk, SoundHound AI could be an exciting play in the rapidly evolving world of artificial intelligence. They have ambitions to make big noises in technology, partnerships, and his AI field. Just don't bet your farm on this bet. Bet low, stay calm, and try to balance these “moonshot” bets with more conservative choices.
On the date of publication, Ebbw Jones did not have (directly or indirectly) any positions in the securities mentioned in this article. All information and data in this article is for informational purposes only. For more information, please see the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.