SoundHound AI (NASDAQ:SOUN) Stock Price Down 5.6% – Time to Sell?

SoundHound AI, Inc. (NASDAQ:SOUN)’s share price was down 5.6% on Tuesday . The stock traded as low as $7.79 and last traded at $7.85. Approximately 54,512,430 shares traded hands during mid-day trading, an increase of 105% from the average daily volume of 26,571,818 shares. The stock had previously closed at $8.32.

Key Stories Impacting SoundHound AI

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

• Positive Sentiment: SoundHound announced a definitive agreement to acquire LivePerson, creating an end-to-end conversational AI platform it says will combine proprietary voice AI with digital messaging, a customer footprint that includes 25 of the Fortune 100, a stated $500M revenue opportunity, an accelerated path to profitability and a balance sheet with no debt. This is the largest catalyst of the day and explains heavy market attention. Acquisition Press Release
• Positive Sentiment: The company updated FY‑2027 revenue guidance to $350–$400 million versus a consensus near $279 million, signaling stronger-than-expected top‑line growth and a faster path to scale — a material fundamental beat that supports longer‑term upside.
• Positive Sentiment: Commercial traction: earlier in April SoundHound said members of the Associated Carrier Group (Tier‑2/3 telecom operators) will use its platform for customer service and staff‑experience use cases, adding to enterprise distribution and recurring revenue potential. Partnership Article
• Neutral Sentiment: Multiple analyst and media writeups (Zacks, Yahoo) are spotlighting SOUN as a trending AI/tech name; these stories can boost retail interest but are not new fundamental news. Zacks Article
• Neutral Sentiment: Earlier market coverage noted a short‑term bounce (stock had climbed ~3% in another session), reflecting intraday volatility around AI names and M&A headlines rather than steady trend change. Market Reaction
• Negative Sentiment: Despite the deal and raised revenue outlook, the stock is trading down today on very heavy volume — which suggests profit‑taking or investor hesitation about deal execution, integration risk or dilution dynamics (common reactions to big acquisitions). Market technicals show the share price below its 200‑day moving average, a potential headwind for momentum traders.
• Negative Sentiment: Company remains unprofitable: recent quarter showed negative net margin (~‑8.7%) and negative ROE (~‑3.6%), with a consensus outlook still projecting negative EPS for the year. Investors weighing the acquisition will factor in near‑term profitability and integration risk alongside the growth narrative.

Analysts Set New Price Targets

A number of research firms have commented on SOUN. DA Davidson set a $14.00 price target on SoundHound AI in a research note on Thursday, January 8th. Zacks Research upgraded SoundHound AI from a “strong sell” rating to a “hold” rating in a report on Monday, February 9th. HC Wainwright decreased their target price on SoundHound AI from $26.00 to $20.00 and set a “buy” rating on the stock in a research note on Monday, March 2nd. Piper Sandler reaffirmed a “neutral” rating and issued a $9.00 target price (down from $11.00) on shares of SoundHound AI in a research report on Friday, February 27th. Finally, Weiss Ratings reiterated a “sell (d-)” rating on shares of SoundHound AI in a research note on Friday, January 9th. One investment analyst has rated the stock with a Strong Buy rating, five have given a Buy rating, three have issued a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat, SoundHound AI currently has an average rating of “Moderate Buy” and a consensus target price of $14.93.

SoundHound AI Stock Performance

The company’s 50-day simple moving average is $7.43 and its 200 day simple moving average is $11.01. The company has a market cap of $3.32 billion, a PE ratio of -156.97 and a beta of 2.71.

SoundHound AI (NASDAQ:SOUN) last posted its quarterly earnings data on Thursday, February 26th. The company reported ($0.02) earnings per share for the quarter, hitting analysts’ consensus estimates of ($0.02). The business had revenue of $55.06 million for the quarter, compared to analyst estimates of $53.88 million. SoundHound AI had a negative return on equity of 3.63% and a negative net margin of 8.71%.The company’s revenue was up 59.4% on a year-over-year basis. During the same quarter in the prior year, the company earned ($0.05) earnings per share. Analysts forecast that SoundHound AI, Inc. will post -0.34 EPS for the current year.

Insiders Place Their Bets

In related news, insider James Ming Hom sold 31,019 shares of the stock in a transaction on Friday, March 20th. The stock was sold at an average price of $6.79, for a total value of $210,619.01. Following the transaction, the insider owned 772,364 shares of the company’s stock, valued at $5,244,351.56. This represents a 3.86% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available through this hyperlink. Also, SVP Majid Emami sold 31,019 shares of SoundHound AI stock in a transaction dated Friday, March 20th. The stock was sold at an average price of $6.79, for a total value of $210,619.01. Following the sale, the senior vice president directly owned 501,826 shares of the company’s stock, valued at $3,407,398.54. This trade represents a 5.82% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last ninety days, insiders have sold 307,973 shares of company stock worth $2,091,110. Corporate insiders own 9.17% of the company’s stock.

Institutional Trading of SoundHound AI

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Royal Bank of Canada boosted its holdings in shares of SoundHound AI by 71.3% in the 1st quarter. Royal Bank of Canada now owns 160,299 shares of the company’s stock valued at $1,301,000 after buying an additional 66,714 shares in the last quarter. Integrated Wealth Concepts LLC raised its stake in SoundHound AI by 8.9% during the 1st quarter. Integrated Wealth Concepts LLC now owns 14,676 shares of the company’s stock worth $119,000 after acquiring an additional 1,201 shares in the last quarter. NewEdge Advisors LLC lifted its position in SoundHound AI by 12.9% in the first quarter. NewEdge Advisors LLC now owns 41,030 shares of the company’s stock valued at $333,000 after acquiring an additional 4,692 shares during the last quarter. Goldman Sachs Group Inc. boosted its stake in SoundHound AI by 69.8% in the first quarter. Goldman Sachs Group Inc. now owns 2,639,689 shares of the company’s stock valued at $21,434,000 after acquiring an additional 1,085,473 shares in the last quarter. Finally, UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC grew its holdings in shares of SoundHound AI by 10.1% during the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 692,170 shares of the company’s stock worth $5,620,000 after purchasing an additional 63,398 shares during the last quarter. Institutional investors and hedge funds own 19.28% of the company’s stock.

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.