Shares of SoundHound AI, Inc. (SOUN) have been drawing investor attention as the company expands its footprint in AI-driven voice technology. However, TipRanks’ AI analysis urges caution, pointing to ongoing profitability and valuation concerns. According to TipRanks A.I., SOUN stock currently scores 48 out of 100 based on the OpenAI model. It also assigns a price target of $13.50 to SOUN, suggesting a potential upside of almost 11%. On the other hand, Wall Street analysts rate the stock as a Moderate Buy, predicting over 40% upside.
For context, TipRanks’ A.I. Stock Analysis delivers automated, data-driven evaluations of stocks, giving investors a clear and concise snapshot of a stock’s potential. Moreover, TipRanks’ A.I.-driven rating combines insights from multiple models, including OpenAI’s (PC:OPAIQ) GPT-4o and Perplexity’s SonarPro.
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SOUN Earns Neutral Rating
SOUN’s Neutral rating is supported by strong revenue growth and upbeat earnings call commentary. In Q3, the company delivered revenue of $42 million, up 68% year-over-year.
The tool also highlights SoundHound’s earnings call sentiment as positive. Overall, the company delivered robust top-line growth and made meaningful progress in new markets, even as automotive headwinds and rising expenses continued to pressure its net loss. Looking ahead, SoundHound also raised its full-year revenue outlook to $165–$180 million, up from the prior range of $160–$178 million.
AI Analyst Signals Risks Ahead for SOUN
On the flip side, SOUN stock looks expensive compared to its fundamentals. Its EV/sales ratio is 32.67, far higher than the sector average of 3.55, meaning investors are paying more than nine times the industry norm for every dollar of revenue.
SoundHound also faces persistent profitability issues, raising concerns about long-term financial sustainability. Despite solid revenue growth, the company reported an adjusted net loss of $0.03 per share in Q3. However, the reported figure compared favorably with the analysts’ expectations of a $0.09 loss and improved from the prior-year loss of $0.04.
Moreover, ongoing challenges in the automotive segment—one of its most important growth drivers—present meaningful execution risks and may limit near-term revenue momentum unless the company adapts quickly.
The A.I. analysis highlights both the positive and negative factors influencing the company’s stock performance. Below is the screenshot for reference.
What Is the Price Target for SOUN?
According to TipRanks, SOUN stock has received a Moderate Buy consensus rating, with two Buys and four Holds assigned in the last three months. The average SoundHound stock price target is $17.20, suggesting a potential upside of 41.3% from the current level.
Year-to-date, SOUN stocks has declined by over 38%.
