SoundHound AI (NASDAQ:SOUN) Shares Up 1.1% – Should You Buy?

SoundHound AI, Inc. (NASDAQ:SOUN) shot up 1.1% on Thursday . The stock traded as high as $7.48 and last traded at $7.48. 20,114,571 shares traded hands during trading, a decline of 30% from the average daily volume of 28,920,412 shares. The stock had previously closed at $7.40.

Key Stories Impacting SoundHound AI

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

• Positive Sentiment: SoundHound’s record second-quarter results are prompting higher estimates. Revenue reached $61.9 million, exceeding expectations by roughly $9.5 million and rising 45% year over year, while the adjusted loss of $0.02 per share was substantially better than the expected $0.13 loss. Management also raised its 2026 revenue outlook. SoundHound’s Q2 Results Fuel Estimate Hikes
• Positive Sentiment: The company’s OASYS platform, which helps businesses build voice-enabled AI agents, is viewed as a potential growth catalyst. Analysts and commentators believe adoption across automotive, restaurants and enterprise customers could accelerate revenue and support a stronger 2027. Should You Buy SoundHound AI Stock After Its 67% Plunge?
• Positive Sentiment: Northland Securities raised its SoundHound estimates for third-quarter 2026 EPS, full-year 2026 EPS and full-year 2027 EPS. Although the company is still expected to lose money, the revisions suggest improving operating expectations. SoundHound AI analyst estimates
• Positive Sentiment: Institutional Shareholder Services recommended that LivePerson shareholders approve the proposed transaction with SoundHound. ISS joins Glass Lewis in supporting the deal, reducing some execution uncertainty ahead of LivePerson’s August 20 special meeting. ISS recommends LivePerson-SoundHound transaction
• Neutral Sentiment: Wall Street’s average price target implies approximately 56% upside, but the coverage notes that consensus targets are unreliable by themselves. The more meaningful signal is the recent improvement in earnings estimates. Wall Street analysts believe SoundHound could rally
• Negative Sentiment: SoundHound remains unprofitable, with analysts expecting a roughly $0.36 per-share loss for 2026. Northland cut its fourth-quarter 2026 loss estimate to $0.11 per share, and the company’s cash burn and negative margins make its valuation vulnerable if growth slows.

Analyst Ratings Changes

A number of analysts recently commented on the company. LADENBURG THALM/SH SH upgraded SoundHound AI to a “strong-buy” rating in a research report on Wednesday, May 6th. DA Davidson cut their price target on SoundHound AI from $12.00 to $10.00 and set a “buy” rating for the company in a research note on Thursday, August 6th. Weiss Ratings reaffirmed a “sell (e+)” rating on shares of SoundHound AI in a research report on Monday, June 15th. Finally, Piper Sandler lowered their price objective on shares of SoundHound AI from $8.00 to $7.00 and set a “neutral” rating on the stock in a research note on Thursday, August 6th. One equities research analyst has rated the stock with a Strong Buy rating, four have issued a Buy rating, three have assigned a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat.com, SoundHound AI currently has an average rating of “Moderate Buy” and a consensus price target of $13.60.

SoundHound AI Stock Performance

The business’s 50-day moving average price is $6.72 and its 200-day moving average price is $7.51. The stock has a market cap of $3.24 billion, a P/E ratio of -19.68 and a beta of 2.64.

SoundHound AI (NASDAQ:SOUN) last announced its earnings results on Wednesday, August 5th. The company reported ($0.02) EPS for the quarter, topping analysts’ consensus estimates of ($0.13) by $0.11. The company had revenue of $61.90 million for the quarter, compared to analysts’ expectations of $52.38 million. SoundHound AI had a negative return on equity of 31.06% and a negative net margin of 67.45%.SoundHound AI’s revenue for the quarter was up 45.0% compared to the same quarter last year. During the same period last year, the firm earned ($0.19) EPS. As a group, equities research analysts expect that SoundHound AI, Inc. will post -0.36 earnings per share for the current year.

Insider Transactions at SoundHound AI

In other news, insider James Ming Hom sold 28,843 shares of the firm’s stock in a transaction dated Monday, June 15th. The stock was sold at an average price of $7.46, for a total value of $215,168.78. Following the transaction, the insider owned 743,521 shares of the company’s stock, valued at $5,546,666.66. This trade represents a 3.73% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CTO Timothy Stonehocker sold 18,802 shares of SoundHound AI stock in a transaction dated Monday, June 15th. The shares were sold at an average price of $7.46, for a total value of $140,262.92. Following the transaction, the chief technology officer directly owned 502,290 shares in the company, valued at approximately $3,747,083.40. The trade was a 3.61% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last three months, insiders have sold 268,022 shares of company stock valued at $1,999,444. Company insiders own 8.84% of the company’s stock.

Hedge Funds Weigh In On SoundHound AI

Hedge funds have recently modified their holdings of the company. Handelsbanken Fonder AB increased its stake in shares of SoundHound AI by 17.4% in the second quarter. Handelsbanken Fonder AB now owns 124,000 shares of the company’s stock worth $802,000 after purchasing an additional 18,400 shares in the last quarter. Focus Financial Network Inc. lifted its stake in shares of SoundHound AI by 21.4% during the 2nd quarter. Focus Financial Network Inc. now owns 48,229 shares of the company’s stock valued at $312,000 after buying an additional 8,516 shares in the last quarter. IFC & Insurance Marketing Inc. lifted its stake in shares of SoundHound AI by 17.9% during the 2nd quarter. IFC & Insurance Marketing Inc. now owns 42,255 shares of the company’s stock valued at $273,000 after buying an additional 6,427 shares in the last quarter. Hennion & Walsh Asset Management Inc. boosted its holdings in SoundHound AI by 19.2% in the 2nd quarter. Hennion & Walsh Asset Management Inc. now owns 118,662 shares of the company’s stock worth $768,000 after buying an additional 19,133 shares during the period. Finally, Empowered Funds LLC increased its stake in SoundHound AI by 19.6% in the 1st quarter. Empowered Funds LLC now owns 13,896 shares of the company’s stock worth $95,000 after buying an additional 2,277 shares in the last quarter. 19.28% of the stock is currently owned by institutional investors.

About SoundHound AI

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.