SoundHound AI Inc. (SOUN) shares climbed Thursday morning, catching a wave of renewed optimism sweeping through the technology sector after Nvidia delivered an earnings report that reminded everyone why AI stocks became exciting in the first place.
The Setup
For SoundHound investors, the rally offers a welcome change of pace. The company had actually posted impressive third-quarter numbers earlier this month, with revenue jumping 68% year-over-year to $42.05 million. But that didn't stop the stock from tumbling about 30% over the past month as broader valuation worries crept into the market.
Enter Nvidia's Wednesday evening earnings release. The chipmaker reported $57 billion in revenue, comfortably topping the $54.88 billion consensus estimate, and issued guidance suggesting that demand for AI infrastructure isn't slowing down anytime soon.
Why This Matters
Nvidia's strong performance acts as something of a validation for the entire AI ecosystem. If companies are still spending heavily on AI chips and infrastructure, the thinking goes, then software players like SoundHound should benefit from that same wave of investment. The company recently raised its own full-year 2025 revenue guidance to between $165 million and $180 million, signaling confidence in its growth trajectory.
With Nvidia CEO Jensen Huang declaring that the "AI era is in full steam," the market seems to be switching back into risk-on mode for speculative AI growth stocks. Investors appear to be taking another look at SoundHound's recent dip, potentially viewing it as a buying opportunity. CEO Keyvan Mohajer has been talking up the company's technology, claiming it outperforms Big Tech competitors in both accuracy and latency.
The Technical Picture
Market data shows an interesting split in the stock's profile. While momentum indicators are strong with a score of 88.98, price trends remain negative across short, medium, and long-term timeframes. That suggests the stock has energy behind it even as it works to reverse its recent decline.
Price Action
SoundHound AI shares were trading up 5.50% at $12.28 at the time of publication Thursday.
