Is SoundHound AI a Buy?
Artificial intelligence (AI) stocks soared over the past two years as investors got excited about this potentially game-changing technology. And SoundHound AI (NASDAQ: SOUN), a company specializing in voice AI, saw its share price take off as part of this new gold rush. Over 2023 and 2024, SoundHound stock surged 1,000%, outperforming AI market superstar Nvidia, which climbed 800% during that period.
But AI stocks lost some of their luster earlier this year amid concerns about economic growth and potential spending on this newish technology. President Trump set out plans for tariffs on imports, and investors worried that these duties would increase prices on a wide range of products, paving the way to a weak economy and even a recession. As a result, investors fled high-growth companies that could be among the first to suffer in such an environment.
And that resulted in declines in AI stocks, including SoundHound. The voice AI player has lost about 50% since the start of the year. Yet the company continues to deliver explosive growth, reporting a revenue increase of 151% in the recent quarter. Meanwhile, Trump's initial tariff deal with China has offered investors optimism that tariffs may not be as tough on the economy as expected -- and that's helped indexes rebound.
Source Fool.com
