$SOUN Acoustic Tech Surge
Can AI process sound like humans? According to SoundHound AI, Inc. (NASDAQ: SOUN), its AI platform can. SOUN’s voice AI platform processes speech in a way that is closer to cognitive auditory processing than AI transitional processing which gives it an indispensable market edge in the voice AI industry. That said, SOUN stock is set to be included in the Russell 2000 and the Russell 3000 indexes on June 26 which could cause the stock to rebound from its 21% fall last week.
SOUN Fundamentals
As things stand, SOUN’s voice AI tech is unique in that it is able to break down speech through direct understanding as opposed to programmed text-to-speech transitions. This allows its AI platform to more accurately understand a vast quantity of speech, which basically entails that it could understand more complex demands as opposed to pre-programmed text commands. As a result, SOUN has an extremely significant market.
Currently, SOUN utilizes its tech to obtain revenue through three prongs. The first is empowering devices like TVs, cars, and IoTs. The second is through chatbot customer service applications, and the third prong consists of the integration of customer service applications in the second prong into the devices in the first prong. Through these three prongs, SOUN has acquired a strong list of prominent clients which includes Mastercard, Opel, LG, Hyundai, Netflix, Mercedes Benz, and Peugeot.
Automotive Voice Recognition
The most advanced automotive voice recognition system out there is SOUN’s, which is why it has accumulated so many automotive clients. Additionally, it is highly probable that the bulk of its revenues is obtained through this sector. According to its Q1 2023 report, SOUN realized more than half of its revenue from Korea and Germany, which could be the result of SOUN’s partnerships with Mercedes and Hyundai. Having said that, it is highly likely that SOUN will gain additional automotive clients due to the drastic technological leap that exists between it and its competitors.
Keeping that in mind, the automotive voice recognition market was valued at $ 2 billion in 2021, however, it is expected to grow at a CAGR of 16.6% from 2022 to 2030 reaching $7.9 billion. As SOUN increases its clientele, it may obtain a larger share of the market. Additionally, there is a possibility that SOUN may end up monopolizing the market as a result of its technological advantage. Taking into consideration the fact that it has the only voice recognition software that does not rely on rigid text-to-speech transition this possibility cannot be understated.
Russell Index Inclusion
With things as they are, SOUN stock is set to be included in the Russell 2000 index, and the Russell 3000 index when the market opens on the 26th of June. Its inclusion is likely to increase its visibility, which could cause a noticeable increase in volume for the stock and a stock run due to an increased rate of buying. Another advantage SOUN stock may gain due to inclusion is an increased likelihood of institutional buys due to an air of authenticity provided by Russell and additional exposure.
Finally, the icing on the cake in this instance is the Russell effect which is the automatic purchase of a stock by mutual funds that are tied to the Index. These factors could cause the stock to surge, and as a result, recover from its 21% fall during the previous week.
SOUN Financials
According to its Q1 2023 report, SOUN’s assets increased QoQ from $38.2 million to $72.8 million, which is partially due to its cash balance increasing from $9.24 million to a whopping $46.33 million. On the other hand, its liabilities decreased from $73 million to $70 million.
In terms of revenue, SOUN witnessed a substantial increase YoY from $4.29 million to $6.7 million. That said, expenses increased from $25 million to $31.7 million which in turn caused its net loss to slightly increase from $25.1 million to $26.3 million.
Technical Analysis
SOUN stock is in a bullish trend with the stock trading in an upward channel which it has recently broke. Looking at the indicators, the stock is trading above the 200 and 50 MAs which are bullish indications, but below the 21 MA which is a bearish indication. Meanwhile, the RSI is neutral at 44 and the MACD is curling bullishly.
As for the fundamentals, SOUN stock being included in the Russell 2000 and 3000 indexes is a major catalyst since it increases the stock’s visibility to institutions. At the same time, the Russell effect could allow the stock to run this week as funds benchmarked to the indexes would automatically buy shares of SOUN stock. For this reason, SOUN may rebound from last week’s dip and return to its upward channel.
SOUN Forecast
It is no exaggeration to state that SOUN could end up monopolizing the automotive voice recognition market since its advanced voice AI platform processes speak in a similar fashion to people which is why it could understand complex demands. That said, SOUN stock is set to join the Russell 2000 and 3000 indexes on June 26 which could cause the stock to surge due to the Russell effect, as well as increased visibility and institutional exposure.
SOUN Fundamentals
As things stand, SOUN’s voice AI tech is unique in that it is able to break down speech through direct understanding as opposed to programmed text-to-speech transitions. This allows its AI platform to more accurately understand a vast quantity of speech, which basically entails that it could understand more complex demands as opposed to pre-programmed text commands. As a result, SOUN has an extremely significant market.
Currently, SOUN utilizes its tech to obtain revenue through three prongs. The first is empowering devices like TVs, cars, and IoTs. The second is through chatbot customer service applications, and the third prong consists of the integration of customer service applications in the second prong into the devices in the first prong. Through these three prongs, SOUN has acquired a strong list of prominent clients which includes Mastercard, Opel, LG, Hyundai, Netflix, Mercedes Benz, and Peugeot.
Automotive Voice Recognition
The most advanced automotive voice recognition system out there is SOUN’s, which is why it has accumulated so many automotive clients. Additionally, it is highly probable that the bulk of its revenues is obtained through this sector. According to its Q1 2023 report, SOUN realized more than half of its revenue from Korea and Germany, which could be the result of SOUN’s partnerships with Mercedes and Hyundai. Having said that, it is highly likely that SOUN will gain additional automotive clients due to the drastic technological leap that exists between it and its competitors.
Keeping that in mind, the automotive voice recognition market was valued at $ 2 billion in 2021, however, it is expected to grow at a CAGR of 16.6% from 2022 to 2030 reaching $7.9 billion. As SOUN increases its clientele, it may obtain a larger share of the market. Additionally, there is a possibility that SOUN may end up monopolizing the market as a result of its technological advantage. Taking into consideration the fact that it has the only voice recognition software that does not rely on rigid text-to-speech transition this possibility cannot be understated.
Russell Index Inclusion
With things as they are, SOUN stock is set to be included in the Russell 2000 index, and the Russell 3000 index when the market opens on the 26th of June. Its inclusion is likely to increase its visibility, which could cause a noticeable increase in volume for the stock and a stock run due to an increased rate of buying. Another advantage SOUN stock may gain due to inclusion is an increased likelihood of institutional buys due to an air of authenticity provided by Russell and additional exposure.
Finally, the icing on the cake in this instance is the Russell effect which is the automatic purchase of a stock by mutual funds that are tied to the Index. These factors could cause the stock to surge, and as a result, recover from its 21% fall during the previous week.
SOUN Financials
According to its Q1 2023 report, SOUN’s assets increased QoQ from $38.2 million to $72.8 million, which is partially due to its cash balance increasing from $9.24 million to a whopping $46.33 million. On the other hand, its liabilities decreased from $73 million to $70 million.
In terms of revenue, SOUN witnessed a substantial increase YoY from $4.29 million to $6.7 million. That said, expenses increased from $25 million to $31.7 million which in turn caused its net loss to slightly increase from $25.1 million to $26.3 million.
Technical Analysis
SOUN stock is in a bullish trend with the stock trading in an upward channel which it has recently broke. Looking at the indicators, the stock is trading above the 200 and 50 MAs which are bullish indications, but below the 21 MA which is a bearish indication. Meanwhile, the RSI is neutral at 44 and the MACD is curling bullishly.
As for the fundamentals, SOUN stock being included in the Russell 2000 and 3000 indexes is a major catalyst since it increases the stock’s visibility to institutions. At the same time, the Russell effect could allow the stock to run this week as funds benchmarked to the indexes would automatically buy shares of SOUN stock. For this reason, SOUN may rebound from last week’s dip and return to its upward channel.
SOUN Forecast
It is no exaggeration to state that SOUN could end up monopolizing the automotive voice recognition market since its advanced voice AI platform processes speak in a similar fashion to people which is why it could understand complex demands. That said, SOUN stock is set to join the Russell 2000 and 3000 indexes on June 26 which could cause the stock to surge due to the Russell effect, as well as increased visibility and institutional exposure.
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