Why SoundHound AI Stock Is Plummeting Again Today

SoundHound AI (NASDAQ: SOUN) stock is sinking in Tuesday’s daily trading session. The company’s share price was down 11.9% as of 1:10 p.m. ET, according to data from S&P Global Market Intelligence.

Artificial intelligence (AI) stocks are seeing an uptick in bearish momentum today following news that Advanced Micro Devices may need to secure a special export license before it can sell some of its processors in China. While there isn’t any fresh, business-specific news for SoundHound today, the company is getting caught up in the broader pullback. With today’s sell-off, SoundHound stock is now down roughly 33% from its high in 2024.

What does AMD’s news mean for SoundHound stock?

The possibility that AMD, Nvidia, and other designers of high-performance processors could face additional roadblocks to selling their technologies in China probably doesn’t mean much for SoundHound’s near-term business outlook. The company generates most of its revenue from U.S.-based customers, and it’s unlikely that the U.S. or other Western governments would introduce obstacles to selling its software in the Chinese market.

On the other hand, it’s possible that rising tensions between the U.S. and China could cause investors to become more cautious about the market at large — and AI stocks in particular. Artificial intelligence has emerged as a new frontier in the technological arms race between the competing world powers, and geopolitical dynamics are a key risk factor for AI investors to monitor and analyze.

What’s next for SoundHound AI?

SoundHound is coming off a recent fourth-quarter report that Wall Street found broadly disappointing. While the company’s revenue rose 80.5% year over year to come in at $17.15 million, it missed the average analyst sales target by roughly $0.6 million. The company’s per-share loss of $0.07 also came in higher than Wall Street’s target for a per-share loss of $0.06 in the period.

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For its current fiscal year, SoundHound expects to record revenue between $63 million and $77 million. At the midpoint of its guidance range, that would…

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