SoundHound AI (NASDAQ:SOUN) stock gained significantly in value since chip giant Nvidia (NASDAQ:NVDA) said that it bought shares of this voice artificial intelligence (AI) solutions provider. SOUN stock jumped nearly 334% in one month. However, the company’s Q4 sales and earnings miss put the brakes on the stock’s blistering rally.
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SoundHound stock fell over 21% in Thursday’s after-hours trading after the company delivered lower-than-expected fourth-quarter results.
SOUN’s Top and Bottom Lines Miss Estimates
SoundHound delivered revenue of 17.1 million, up 80% year-over-year in the fourth quarter. New customer wins and expansion within the existing ones supported its top-line growth. However, its top line fell short of the Street’s estimate of $17.75 million.
Higher revenues and a focus on driving efficiency led to a year-over-year improvement in adjusted EBITDA. Further, it enabled the company to cut losses in the fourth quarter. However, its loss per share of $0.07 was wider than the analysts’ estimate of $0.06.
Looking ahead, SoundHound expects its Fiscal 2024 revenue to be between $63 million and $77 million. The midpoint of the guidance, which is $70 million, is in line with Street’s forecast. Further, SOUN projects its Fiscal 2025 revenue to exceed $100 million. This compares analysts’ revenue estimates of about $100 million.
What is the Projection for SoundHound?
Given the massive rally in its shares, analysts project notable downside potential over the next 12 months. Analysts’ average price target is $5.17, reflecting a downside potential of 30.3% from current levels.
SoundHound stock has two Buys and one Sell recommendation. It sports a Moderate Buy consensus rating.
