SoundHound AI (NASDAQ:SOUN) Trading Down 1.2% – Here’s Why

SoundHound AI, Inc. (NASDAQ:SOUN) shares were down 1.2% on Wednesday . The company traded as low as $6.37 and last traded at $6.43. 27,222,258 shares changed hands during mid-day trading, a decline of 4% from the average session volume of 28,267,834 shares. The stock had previously closed at $6.51.

Trending Headlines about SoundHound AI

Here are the key news stories impacting SoundHound AI this week:

• Positive Sentiment: SoundHound reported record second-quarter revenue of $61.9 million, up 45% year over year and well ahead of analyst estimates. The company’s adjusted loss also beat expectations, while gross profit increased 67.6% to $27.9 million. SoundHound AI Reports Record Q2 and All-Time High Revenue
• Positive Sentiment: Management raised its 2026 revenue outlook to $230 million-$260 million, with the company citing strong OASYS momentum, faster deal conversion, broader enterprise adoption and improving margins despite continued investment. SOUN Q2 Earnings Call Focuses on OASYS and Higher Outlook
• Positive Sentiment: Glass Lewis recommended that LivePerson stockholders vote in favor of the proposed transaction with SoundHound at the August 20 special meeting, potentially improving the deal’s prospects and strengthening SoundHound’s conversational-AI capabilities. Glass Lewis Recommends Vote for SoundHound AI Transaction
• Positive Sentiment: Heavy call-option activity and SoundHound’s high short interest may have amplified the post-earnings rally through bullish positioning and short covering.
• Neutral Sentiment: DA Davidson maintained a “buy” rating but lowered its price target from $12 to $10, signaling continued long-term confidence while acknowledging valuation or execution risks.
• Negative Sentiment: Despite rapid growth, SoundHound remains unprofitable, with a substantial operating loss and continued cash burn. Analysts and valuation screens view the stock as expensive relative to sales, while Piper Sandler cut its target to $7 and kept a neutral rating.
• Negative Sentiment: Recent insider activity shows selling rather than purchases by executives, a potential confidence concern following the sharp multi-year advance.

Analyst Ratings Changes

SOUN has been the topic of several research reports. Weiss Ratings reaffirmed a “sell (e+)” rating on shares of SoundHound AI in a research report on Monday, June 15th. DA Davidson reduced their price objective on SoundHound AI from $12.00 to $10.00 and set a “buy” rating for the company in a research report on Thursday. LADENBURG THALM/SH SH raised SoundHound AI to a “strong-buy” rating in a research report on Wednesday, May 6th. Finally, Piper Sandler reduced their price target on SoundHound AI from $8.00 to $7.00 and set a “neutral” rating for the company in a research report on Thursday. One investment analyst has rated the stock with a Strong Buy rating, five have issued a Buy rating, three have given a Hold rating and one has given a Sell rating to the company’s stock. Based on data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and an average target price of $14.07.

SoundHound AI Trading Up 13.3%

The company has a market capitalization of $3.47 billion, a price-to-earnings ratio of -21.10 and a beta of 2.64. The stock’s 50 day moving average price is $6.81 and its 200 day moving average price is $7.60.

SoundHound AI (NASDAQ:SOUN) last released its earnings results on Wednesday, August 5th. The company reported ($0.02) earnings per share (EPS) for the quarter, topping the consensus estimate of ($0.13) by $0.11. The business had revenue of $61.90 million for the quarter, compared to analyst estimates of $42.56 million. SoundHound AI had a negative return on equity of 31.06% and a negative net margin of 67.45%.SoundHound AI’s revenue was up 45.0% on a year-over-year basis. During the same quarter in the prior year, the company posted ($0.19) earnings per share. On average, research analysts expect that SoundHound AI, Inc. will post -0.45 earnings per share for the current year.

Insider Buying and Selling

In related news, COO Michael Zagorsek sold 64,994 shares of the firm’s stock in a transaction on Monday, June 15th. The shares were sold at an average price of $7.46, for a total value of $484,855.24. Following the completion of the transaction, the chief operating officer directly owned 1,669,497 shares of the company’s stock, valued at approximately $12,454,447.62. This trade represents a 3.75% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Keyvan Mohajer sold 126,540 shares of the business’s stock in a transaction on Monday, June 15th. The stock was sold at an average price of $7.46, for a total transaction of $943,988.40. Following the transaction, the chief executive officer owned 1,947,237 shares in the company, valued at approximately $14,526,388.02. The trade was a 6.10% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold a total of 268,022 shares of company stock worth $1,999,444 in the last quarter. 8.84% of the stock is owned by company insiders.

Institutional Investors Weigh In On SoundHound AI

Several hedge funds have recently bought and sold shares of SOUN. Morgan Stanley boosted its position in SoundHound AI by 48.1% during the fourth quarter. Morgan Stanley now owns 8,987,522 shares of the company’s stock worth $89,606,000 after purchasing an additional 2,917,280 shares during the period. UBS Group AG raised its position in shares of SoundHound AI by 77.6% in the fourth quarter. UBS Group AG now owns 6,124,283 shares of the company’s stock valued at $61,059,000 after purchasing an additional 2,676,707 shares during the period. Voloridge Investment Management LLC raised its position in shares of SoundHound AI by 2,259.7% in the fourth quarter. Voloridge Investment Management LLC now owns 2,199,511 shares of the company’s stock valued at $21,929,000 after purchasing an additional 2,106,298 shares during the period. Vanguard Group Inc. lifted its stake in shares of SoundHound AI by 4.4% during the 4th quarter. Vanguard Group Inc. now owns 45,367,437 shares of the company’s stock worth $452,313,000 after buying an additional 1,909,868 shares during the last quarter. Finally, Jump Financial LLC bought a new stake in shares of SoundHound AI during the 3rd quarter worth about $21,679,000. 19.28% of the stock is currently owned by institutional investors and hedge funds.

SoundHound AI Company Profile

SoundHound AI, Inc is a voice AI and conversational intelligence company specializing in speech recognition, natural language understanding and sound identification technologies. Founded in 2005 and headquartered in Santa Clara, California, the company initially gained recognition with its music discovery app before pivoting to enterprise-grade voice AI solutions. Over the years, SoundHound AI has built a comprehensive platform that enables developers and businesses to embed conversational intelligence into a wide range of products and services.

The company’s core offering is the Houndify voice AI platform, which provides customizable speech-to-meaning technology, domain-specific natural language understanding and text-to-speech capabilities.