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SoundHound AI: Not Impressed By Amelia Deal

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Update - Nov. 12, 2024

SoundHound reports after the close with the following expectations:

  • Consensus EPS Estimate is -$0.07 (+22.2% Y/Y) 
  • Consensus Revenue Estimate is $23.03M (+73.2% Y/Y

The big growth comes from the Amelia deal, but the market typically latches onto the reported growth rate, regardless of whether the growth was organic. The stock has already surged to over $7.50 and a market cap of $2.7 billion despite recent guidance for 2025 revenues of $150 million, up from only $103 million prior to announcing the deal. 

Finviz Chart


Original article posted on Aug. 9

  • SoundHound AI reported unimpressive results with minimal revenues, despite the hype surrounding automotive and restaurant AI voice deals.
  • The acquisition of Amelia raises concerns due to its low valuation, debt assumption, and potential limited growth, distracting from existing opportunities.
  • The stock will still trade at 12x 2025 sales targets, while Amelia will cut organic growth rates.
SoundHound AI, Inc. (NASDAQ:SOUN) has risen again, but not as high as the recent AI hype highs. The AI voice company has a promising future, but the business just doesn't ever scale fast enough in the dynamic AI market. My investment thesis is Neutral on the stock around $5 with another deal likely to boost revenues, but not help with the key organic growth.

Read the full article on Seeking Alpha. 

Disclosure: No position mentioned. Please review the disclaimer page for more details. 

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