SoundHound AI (SOUN) Stock: What You Need to Know in 2025

SoundHound AI (SOUN) stock is a company that’s carving out a unique space in the voice artificial intelligence landscape. Its stock, listed as SOUN on the NASDAQ, has caught the attention of investors looking for the next big thing in tech. 

With a rapidly growing market and innovative solutions, SoundHound is positioned as a leader in voice AI. This article dives into what SoundHound AI is, its applications, the risks involved, and how its stock is performing in 2025, offering clear insights for anyone considering this investment.

What is SoundHound AI (SOUN) Stock?

SoundHound AI, Inc. (NASDAQ: SOUN) is a technology company specializing in voice artificial intelligence. Founded in 2005 and headquartered in Santa Clara, California, it develops solutions that allow devices to understand and respond to human speech with impressive speed and accuracy. 

Unlike many competitors, SoundHound’s platform is independent, meaning it’s not tied to tech giants like Amazon or Google. This independence makes it appealing to businesses that want customized, brand-specific voice assistants without relying on big-tech ecosystems.

The company went public in 2021, and its stock represents a chance to invest in a firm driving the future of conversational AI. With a market capitalization of around $4.06 billion and 369.2 million shares outstanding, SoundHound is a mid-sized player with significant growth potential. 

Its proprietary “speech-to-meaning” technology processes voice commands quickly, making it a standout in industries like automotive, hospitality, and consumer electronics. For investors, SOUN offers exposure to the booming voice AI market, which could be a key driver of profitability in the coming years.

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What Can SoundHound Be Used For?

SoundHound’s technology is versatile, powering voice interactions across multiple industries. Its flagship product, the Houndify platform, provides tools for businesses to create conversational voice assistants. 

These tools include APIs for text and voice queries, support for custom commands, and a vast library of content domains, making it adaptable for various applications. Here’s a closer look at how SoundHound is used:

• Automotive Industry: SoundHound has partnered with over 20 car brands, including Hyundai, Kia, Genesis, and Stellantis. Its voice assistants are embedded in vehicles, allowing drivers to control navigation, music, or climate settings through natural speech. These partnerships generate long-term royalties as new cars hit the market.

• Restaurants and Hospitality: Quick-service restaurants use SoundHound’s voice AI for drive-thru automation, phone orders, and in-store kiosks. For example, a restaurant chain might start with drive-thru solutions and later adopt the same technology for other customer interactions, boosting efficiency and customer satisfaction.

• Internet of Things (IoT): SoundHound’s AI can be integrated into smart devices like TVs, coffee machines, or fitness equipment. This allows manufacturers to offer branded voice assistants, enhancing user experience without relying on generic solutions like Alexa or Siri.

• Customer Service: SoundHound’s Smart Answering and Chat AI products pull real-time data to assist customers in industries like retail, finance, and healthcare. For instance, its technology can provide instant answers about flight statuses or restaurant menus.

The ability to adapt its core technology across these sectors positions SoundHound for scalability. Businesses can leverage its platform to create tailored solutions, driving recurring revenue through subscriptions and royalties. 

This versatility is a key factor in SoundHound’s potential profitability, as it taps into diverse markets with minimal additional development costs.

Financials

SoundHound’s financials reveal a company in high-growth mode. In the first quarter of 2025, the company reported revenue of $29.1 million, marking a 151% increase from the same period last year. That puts it on track for its full-year guidance of $157 million to $177 million in revenue.

The gross margin was 36.5% on a GAAP basis, with a more favorable 50.8% margin on a non-GAAP basis. While still unprofitable, SoundHound reduced its operating cash outflow to $19.2 million and finished the quarter with $246 million in cash and no debt. The company aims to achieve positive adjusted EBITDA by the end of 2024 or early 2025.

SoundHound’s strong bookings pipeline, valued at around $1.2 billion, gives it long-term revenue visibility. This backlog is expected to convert steadily into revenue over the coming years, supporting future profitability.

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The Risk Behind SoundHound AI

Like any high-growth tech firm, SoundHound AI carries investment risks:

• Dependence on Key Clients: Much of the current revenue is tied to large automotive contracts. A disruption in global car production or the loss of a major partner could impact financial performance.
• Big-Tech Competition: Tech giants such as Amazon, Apple, and Google offer their own voice assistants. These competitors have more resources and existing customer bases, which could limit SoundHound’s expansion.
• Execution Risk: Despite its growing revenue, SoundHound is not yet profitable. The company must convert its backlog effectively while managing costs to avoid needing additional funding.

Investors should also consider that the company’s valuation remains high relative to earnings, making the stock sensitive to any slowdown in growth or unexpected market shifts.

SoundHound AI (SOUN) Stock Price Movement

As of June 1, 2025, SoundHound AI’s stock (SOUN) shows dynamic performance. According to real-time data from MarketWatch, the stock opened at $10.37, with a day range of $9.85 to $10.51. Over the past year, it has fluctuated significantly, reaching a low of $3.82 and a high of $24.98. 

The stock has gained 100.20% over the past 12 months but is down 49.04% year-to-date in 2025, reflecting volatility. Its five-day performance shows a 5.53% increase, and it’s up 7.67% over the past month, indicating short-term positive momentum.

The stock’s beta of 2.09 suggests it’s more volatile than the broader market, making it a riskier bet for conservative investors. 

With a short interest of 31.49% of its float, there’s significant bearish sentiment, which could lead to price swings if short sellers cover their positions. The average trading volume is 31.08 million shares, showing active investor interest.

Analysts remain optimistic, with seven rating SOUN as a “Buy” and forecasting a 12-month price target of $11.00, a 4.46% increase from recent levels. However, the stock’s high valuation, at roughly 20 times 2025 sales estimates, suggests investors are betting on future growth rather than current earnings.

For those wondering how to approach SOUN, tracking its price movements alongside industry developments and quarterly earnings is key. The stock’s volatility offers opportunities for traders but requires careful timing. Long-term investors should focus on SoundHound’s ability to execute its backlog and achieve profitability.

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Conclusion

SoundHound AI is at the forefront of a voice-driven future, offering innovative solutions that span cars, restaurants, and smart devices. Its $1.2 billion contract backlog and 151% year-over-year revenue growth in Q1 2025 highlight its potential to become a major player in voice AI. 

However, risks like reliance on automotive contracts, competition, and ongoing losses mean investors must proceed with caution. The stock’s recent performance, with a 100.20% gain over the past year but a 49.04% drop year-to-date, reflects both opportunity and volatility.

For those exploring how to invest in emerging tech, SoundHound offers a compelling case, akin to cloud mining in its potential for high returns but with inherent risks. Its path to profitability hinges on converting contracts into revenue and staying ahead of competitors. 

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FAQ

What does SoundHound AI do?

SoundHound AI develops voice recognition technology used in cars, restaurants, smart devices, and customer service, enabling businesses to create custom voice assistants.

Is SoundHound AI a good investment in 2025?

SoundHound offers strong growth potential with a $1.2 billion contract backlog and 151% revenue growth, but risks like competition and lack of profitability require careful consideration.

How does SoundHound’s stock perform?

As of June 1, 2025, SOUN is volatile, up 100.20% over the past year but down 49.04% year-to-date. Analysts predict a $11.00 price target, suggesting modest upside.

What are the risks of investing in SoundHound AI?

Risks include dependence on automotive contracts, competition from tech giants, ongoing losses, and potential legal issues from recent lawsuits.

How can SoundHound achieve profitability?

By converting its $1.2 billion backlog into revenue, expanding into new sectors, and improving margins, SoundHound aims to reach positive adjusted EBITDA by late 2025.