SoundHound AI (SOUN +3.22%) stock is getting crushed in Friday's trading. The company's share price was down 18.1% as of 1:15 p.m. ET, according to data from S&P Global Market Intelligence.
SoundHound published its fourth-quarter earnings results after the market closed yesterday, reporting sales and earnings for the period that fell short of market expectations. The technology specialist reported a loss of $0.07 per share on revenue of $17.15 million, while the average analyst estimate had called for the business to record a per-share loss of $0.06 on sales of $17.21 million.
NASDAQ: SOUN
Key Data Points
SoundHound's Q4 report fell short of the hype
SoundHound AI has been one of the market's most explosive stocks in 2024. Even with today's post-earnings pullback, the company's share price is still up roughly 189% year to date. The business actually showed strong momentum in Q4, but the results couldn't sustain the artificial intelligence (AI) stock's incredible valuation run-up.
Revenue increased 80.5% year over year in Q4. Notably, the sales increase did not include contributions from the company's acquisition of AI audio tech specialist Sync3, which was announced in last year's fourth quarter but closed in Q1 this year. SoundHound also reported that its cumulative subscriptions and bookings backlog had increased to $661 million at the end of last year's fourth quarter -- more than double compared to where it was at the end of Q4 2022.
With its Q4 report, SoundHound AI showed that its business is seeing strong momentum. But sales and earnings results still fell a bit short of Wall Street's targets. Additionally, it looks like investors were expecting some groundbreaking announcements with the report that failed to materialize.
What comes next for SoundHound AI?
With its Q4 report, SoundHound AI laid out performance targets for 2024 and 2025. For the current fiscal year, the company expects revenue to come in between $63 million and $77 million. If the company were to hit the midpoint of its sales target, that would mean delivering growth of approximately 52.5%, compared to the $45.9 million in sales that it recorded last year.
Looking ahead to 2025, the company expects to deliver more than $100 million in sales. If performance were to come in near the low end of that guidance target, that would suggest sales growth of roughly 43% compared to this year's midpoint revenue target.
