SoundHound AI SOUN is scheduled to report its third-quarter 2024 outcomes on Nov. 12.
The Zacks Consensus Estimate for revenues is pegged at $23.68 million, suggesting progress of 78.47% from the year-ago quarter’s reported determine.
The consensus mark for loss is pegged at 8 cents per share, unchanged over the previous 60 days. SOUN reported a lack of 9 cents per share within the year-ago quarter.
SOUN’s earnings beat the Zacks Consensus Estimate in one of many trailing 4 quarters, lacking it twice and assembly as soon as, the adverse shock being 5%, on common.
SoundHound AI, Inc. Value and EPS Shock
SoundHound AI, Inc. price-eps-surprise | SoundHound AI, Inc. Quote
See the Zacks Earnings Calendar to remain forward of market-making information.
Let’s see how issues have formed up previous to this announcement.
Key Elements to Be aware for SOUN’s Q3 Earnings
SOUN provides conversational intelligence by way of unbiased Voice AI options in 25 languages in cloud-enabled and hardware-embedded gadgets. It’s prone to have benefited from the rising demand for its conversational AI platform, owing to the growing reputation of Generative AI and enormous language fashions.
SoundHound AI is benefiting from a robust portfolio, a robust companion base and an increasing clientele. The demand for AI-driven customer support options within the restaurant and auto sectors is predicted to stay a key think about driving SOUN’s efficiency within the to-be-reported quarter.
SoundHound’s choices, akin to Sensible Ordering, Worker Help and Sensible Answering, cater to this demand and are anticipated to have contributed to income progress within the third quarter.
Sensible Answering, which caters to quite a few totally different industries, has opened up a large marketplace for SOUN in customer support with its proprietary know-how, and is predicted to have boosted third quarter top-line progress.
SoundHound AI had a $723 million cumulative subscriptions and bookings backlog on the finish of the second quarter of 2024, and roughly doubled yr over yr, with a median period of about seven years. This displays the sturdy demand for SOUN’s options, which is predicted to have benefited third quarter outcomes.
SOUN Inventory Outperforms Sector
12 months thus far, SOUN shares have surged 227.8%, outperforming the broader Zacks Pc & Know-how sector’s return of 31.1% and the Zacks IT Providers trade’s rally of 14.2%.
SoundHound AI has outperformed trade friends like ServiceNow NOW, Infosys INFY and Vertiv VRT over the identical timeframe.
NOW, INFY and VRT shares have gained 44%, 17.8% and 153.7%, respectively.
YTD Efficiency
Picture Supply: Zacks Funding Analysis
Nevertheless, SOUN inventory shouldn’t be so low cost, because the Value Style Score of F suggests a stretched valuation at this second.
By way of the ahead 12-month Value/Gross sales ratio, SoundHound AI is buying and selling at 17.58, increased than its median of 15.33 and the Zacks Pc & Know-how sector’s 6.41.
Value/Gross sales Ratio (F12M)
Picture Supply: Zacks Funding Analysis
SOUN Inventory to Profit From Increasing Footprint
SoundHound AI’s prospects profit from a large addressable market price greater than $140 billion that features various industries like automotive, eating places, customer support, leisure, Sensible TVs and Web of Issues powered gadgets. It has greater than 270 patents at present, with over 155 granted and greater than 115 pending.
Within the second quarter of 2024, SOUN’s AI providers have been employed by present restaurant clients, like Jersey Mike’s, together with a number of new shopper acquisitions. Beef ‘O’ Brady’s launched SOUN’s voice AI ordering system throughout all its company areas, with plans to broaden to twenty states.
Automotive presents a major progress alternative for SOUN. TAM for the worldwide mild automobile auto market is at present pegged at roughly 88 million and is predicted to hit 95 million models by 2028. TAM for the restaurant market is at present pegged at roughly $3.3 trillion and is predicted to hit $4.4 trillion models by 2028, providing important progress prospects for SoundHound AI.
SOUN has strengthened its footprint within the automotive trade by introducing its superior SoundHound Chat AI voice assistant, built-in with ChatGPT, into Peugeot, Opel, Vauxhall, Alfa Romeo, Citron and DS Vehicles automobiles throughout 11 European markets, together with Austria, France, Germany, Italy, Spain and the U.Ok. SOUN’s collaborations with NVIDIA, ARM, Perplexity, Olo and Oracle are increasing its portfolio.
Within the second quarter, SOUN signed a brand new contract and have become the primary firm to introduce ChatGPT-style capabilities to in-vehicle voice assistants in Latin America.
SOUN’s acquisition of SYNQ3 in early 2024 bolstered its presence within the restaurant sector, contributing positively to the income combine and buyer base enlargement.
The acquisition of key property from Allset, a web-based ordering platform that connects eating places with native clients, enhanced its capabilities in Voice AI. Within the longer run, SOUN goals to create a voice commerce ecosystem, permitting clients to order meals and full varied transactions hands-free from their automobiles, telephones and sensible gadgets.
Exiting the second quarter, SOUN additionally introduced its acquisition of conversational AI chief Amelia. The mixed firm is predicted to have a clientele of roughly 200 marquee clients. The acquisition is anticipated to be earnings-accretive by the second-half of 2025, with a concentrate on aligning Amelia’s recurring income enterprise and optimizing the lower-growth areas within the portfolio.
Conclusion
SoundHound AI is a dangerous wager for growth-oriented buyers, given the uncharted Voice AI area. Nevertheless, its modern portfolio makes SOUN well-positioned to learn from the sturdy TAM of world automotive and restaurant markets.
SOUN at present has a Zacks Rank #3 (Maintain), which means buyers ought to anticipate a extra favorable entry level to build up the inventory.
You possibly can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Free: 5 Shares to Purchase As Infrastructure Spending Soars
Trillions of {dollars} in Federal funds have been earmarked to restore and improve America’s infrastructure. Along with roads and bridges, this flood of money will pour into AI information facilities, renewable vitality sources and extra.
In, you’ll uncover 5 stunning shares positioned to revenue probably the most from the spending spree that’s simply getting began on this area.
Download How to Profit from the Trillion-Dollar Infrastructure Boom absolutely free today.
American Noble Gas Inc. (INFY) : Free Stock Analysis Report
ServiceNow, Inc. (NOW) : Free Stock Analysis Report
Vertiv Holdings Co. (VRT) : Free Stock Analysis Report
SoundHound AI, Inc. (SOUN) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the creator and don’t essentially replicate these of Nasdaq, Inc.
