Down 18%, Should You Buy the Dip on SoundHound AI Stock?

SoundHound AI’s 2025 has been a rollercoaster compared to its stellar 2024 performance when it soared 836%. Now down 18% this year, I’m left wondering how a company growing at breakneck speed is seeing its stock falter. This disconnect between business performance and stock price creates an intriguing opportunity for investors like me.

Having closely followed SoundHound’s trajectory, I’m impressed by their first-half revenue nearly tripling year-over-year to $72 million. Management’s confidence in hitting $169 million for the full year signals even stronger growth ahead. Their aggressive acquisition strategy, particularly with Amelia and Interactions, has strategically positioned them in lucrative verticals including insurance, finance, healthcare, and retail.

What really catches my attention is their patent portfolio—now 400 strong after the Interactions acquisition. This intellectual property moat gives them significant leverage in the conversational AI market that’s projected to grow 8x between 2023 and 2030. Their debt-free balance sheet with $270 million cash reserves gives them plenty of ammunition for future acquisitions or aggressive marketing.

The price-to-sales ratio has dropped by half to 48 from 90 at 2024’s end. Yes, that’s still expensive compared to the tech sector’s 8.8 average, but SoundHound isn’t your average tech company. With a $1.2 billion backlog, they’ve got runway to significantly outperform analyst expectations.

I’ve seen too many investors miss opportunities by focusing solely on traditional valuation metrics. Sometimes the most promising growth stocks appear overvalued by conventional standards. SoundHound’s combination of triple-digit growth, strategic acquisitions, and massive addressable market makes this dip increasingly attractive.

For growth-oriented investors willing to weather some volatility, this pullback might be the entry point you’ve been waiting for. The voice AI revolution is just beginning, and SoundHound appears positioned at its forefront.

Should you invest $1,000 in SoundHound AI right now?

Before jumping in, consider that our analyst team identified what they believe are better opportunities right now. When Netflix made our recommendation list in 2004, a $1,000 investment would be worth $657,110 today. Similarly, our 2005 Nvidia recommendation would have turned $1,000 into over $1 million.

With our service’s average return at 1,064% compared to the S&P 500’s 190%, our latest top picks might be worth exploring before making your decision.