Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Position Status | Return(%)* |
|---|---|---|---|---|---|---|---|---|
| 18 Sep, 25 | SOUN | Buy | USD 15.12 | USD 15.9 | USD 16.8 | 1 day | Closed |
9.06%
|
*Return(%) represent the percentage change between the entry price and exit price of the recommendation.
Data Powered by EOD Historical Data (“EODHD”).
SoundHound AI, Inc. develops independent voice artificial intelligence (AI) solutions that enables businesses across automotive, TV, and IoT, and to customer service industries to deliver high-quality conversational experiences to their customers. Its products include Houndify platform that offers a suite of Houndify tools to help brands build conversational voice assistants, such as Application Programming Interfaces (API) for text and voice queries, support for custom commands, extensive library of content domains, inclusive software development kit platforms, collaboration capabilities, diagnostic tools, and built-in analytics; SoundHound Chat AI that integrates with knowledge domains, pulling real-time data like weather, sports, stocks, flight status, and restaurants; and SoundHound Smart Answering is built to offer customer establishments custom AI-powered voice assistant. The company's products also include CaiNET software that uses machine learning to enhance how domains work together to handle queries; CaiLAN software that arbitrates responses so users get answers from the right domain; Dynamic Interaction a real-time, multimodal customer service interface; Smart Ordering which offers an easy-to-understand voice assistant for restaurants; Employee Assist; automatic speech recognition; natural language understanding; wake words; custom domains; text-to-speech; and embedded voice solutions. The company was founded in 2005 and is headquartered in Santa Clara, California.
Non-GAAP Net Loss Improvement: Non-GAAP net loss narrowed by 20%, improving from (USD 14.9) million in Q2 FY24 to (USD 11.9) million in Q2 FY25
Revenue Growth: Revenue surged 217% year-over-year, rising from USD 13.5 million in Q2 FY24 to USD 42.7 million in Q2 FY25
Margin Decline: GAAP gross margin declined sharply by 24 percentage points, from 63.0% in Q2 FY24 to 39.0% in Q2 FY25
GAAP Net Loss Expansion: GAAP net loss widened by 100%, doubling from (USD 37.3) million in Q2 FY24 to (USD 74.7) million in Q2 FY25
SoundHound faces significant investment risk from persistent operating losses and margin pressures, which, if not offset by sustained revenue growth and efficiency improvements, could delay its path to profitability despite a strong cash position
| Entry Price | Support* | Target 1** | Target 2** |
|---|---|---|---|
| 15.12 | 13.5 | 15.9 | 16.8 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
**Target prices may vary by ±0.5% depending on market volatility.
Record Quarter Driven by Strategic Execution: SoundHound AI delivered its strongest-ever quarterly performance in the second quarter of 2025, supported by the successful execution of strategic initiatives and momentum across all business segments. The company credited its 2024 acquisitions and disciplined investments for accelerating growth and enabling cross-selling opportunities. Leadership emphasized that the results reflected a repeatable growth formula built on innovation and customer adoption.
Financial Performance Highlights: The company reported revenue of USD 42.7 million, representing a 217% year-over-year increase from USD 13.5 million in Q2 2024. Non-GAAP gross profit rose by 178% to USD 24.9 million, while GAAP gross profit nearly doubled to USD 16.7 million. However, margins declined, with GAAP gross margin decreasing to 39.0% from 63.0% and non-GAAP gross margin falling to 58.4% from 66.5%. On the bottom line, GAAP net loss widened to USD 74.7 million compared to USD 37.3 million last year, primarily due to non-cash charges related to acquisition liabilities, while non-GAAP net loss improved to USD 11.9 million from USD 14.9 million.
Operational Losses and Profitability Measures: GAAP operating loss expanded significantly to USD 78.1 million, compared to USD 22.0 million in Q2 2024, largely influenced by a USD 31 million mark-to-market adjustment on contingent acquisition liabilities. Adjusted EBITDA remained negative at USD 14.3 million, a marginal deterioration compared to a USD 13.8 million loss in the prior year. Despite these losses, management highlighted stronger revenue efficiency and the company’s ongoing transition toward sustainable profitability.
Strong Business Momentum Across Verticals: SoundHound continued to expand its footprint across multiple industries. Its Agentic AI platform Amelia 7 attracted 15 large enterprise migrations, while voice commerce advanced through pilot programs with major automotive brands in the U.S. and Europe. The restaurant vertical recorded multiple new wins and renewals with brands such as Applebee’s, IHOP, and Red Lobster, alongside expansions with Chipotle and Firehouse Subs. The automotive segment secured a major OEM win in China and expanded its partnership with Kia in India. Healthcare, retail, and financial services also contributed to growth through customer additions, renewals, and upselling opportunities.
Strategic Partnerships to Scale Adoption: The company strengthened its ecosystem through partnerships with technology and service leaders. Expanded collaborations with EXL, Par Technologies, and Acrelec aimed to broaden SoundHound’s reach in verticals such as restaurants and enterprise solutions. New sales alliances with AVANT Communications and CRM-focused partners further accelerated the deployment of AI-driven solutions across industries. These partnerships reinforced SoundHound’s position as a key enabler of conversational AI adoption.
Liquidity and Cash Position: SoundHound ended the quarter with a strong balance sheet, holding USD 230 million in cash and cash equivalents and no debt. For the first half of 2025, net cash used in operating activities totaled USD 43.7 million compared to USD 40.4 million in the prior year. The company benefited from USD 76.6 million in financing inflows, partially offsetting cash outflows from operations. Management emphasized that the liquidity position provides ample flexibility to invest in growth and manage ongoing operating requirements.
Outlook for FY2025: Reflecting confidence in sustained momentum, SoundHound raised its full-year 2025 revenue guidance to a range of USD 160 million to USD 178 million, up from prior expectations. The revised outlook highlights the company’s ability to capitalize on increasing demand for voice and conversational AI solutions across industries, supported by strategic partnerships and growing customer adoption.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given on SoundHound AI, Inc. (NASDAQ: SOUN) at the closing market price of USD 15.12, as on Sep 17, 2025.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Technology Industry: Software - Application
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| SOUN SoundHound AI Inc |
0.09 0.81% | 11.20 | - | - | 74.94 | 17.04 | 73.58 | -25.4189 |
| CRM Salesforce.com Inc |
4.76 1.87% | 259.67 | 100.89 | 27.47 | 7.42 | 4.34 | 7.44 | 26.81 |
| SAPGF SAP SE |
-2.17 0.89% | 241.24 | 76.28 | 22.88 | 5.61 | 3.84 | 5.59 | 26.18 |
| SAP SAP SE ADR |
-1.88 0.77% | 241.78 | 75.80 | 22.37 | 5.62 | 3.75 | 5.51 | 25.79 |
| INTU Intuit Inc |
-2.485 0.37% | 666.87 | 55.56 | 32.68 | 11.28 | 10.07 | 11.62 | 40.11 |
Data Powered by EOD Historical Data (“EODHD”).
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is September 17,2025. The reference data in this report has been partly sourced from REFINITIV.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
Disclaimer :
This report has been issued by StockNextt which has an Ontario Business Identification Number 1000958347 and British Columbia registration Number FM1051529 is a trade name under Kalkine Canada Advisory Services Inc. having Business Number 761925130BC0001. Kalkine Canada Advisory Services Inc. and StockNextt are collectively referred to as “StockNextt”, “we”, “us”, and “our”. The website https://stocknextt.com and associated pages are published by StockNextt. The information in this report and on the StockNextt website has been prepared from a wide variety of sources, which StockNextt, to the best of its knowledge and belief, considers accurate. StcokNextt has made every effort to ensure the reliability of information contained in its reports, newsletters, and websites. All information represents our views at the date of publication and may change without notice. The information in this report does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products. Our reports contain general recommendations for investing in securities and other financial products. StockNextt does not offer financial advice based upon your personal financial situation or goals, and we shall not be held liable for any investment or trading losses you may incur by using the opinions expressed in our reports, publications, market updates, news alerts and corporate profiles. StockNextt does not intend to exclude any liability which it is not permitted to exclude under applicable law or regulation. StockNextt’s general advice does not in any way endorse or recommend individuals, investment products or services for your personal financial situation. You should discuss your portfolios and the risk tolerance level appropriate for your personal financial situation, with a professional authorised financial planner and adviser. You should be aware that the value of any investment and the income from it can go down as well as up and you may not get back the amount invested. Please also read our Terms and conditions for further information. Employees and/or associates of StockNextt and its related entities may hold an interest in the securities or other financial products covered in this report or on the StockNextt website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.
Copyright © 2023 Krish Capital Pty Ltd. All rights reserved. No part of this website, or its content, may be reproduced in any form without our prior consent.
