SoundHound AI (SOUN) experienced a volatile trading session on January 14, 2025, with its stock price opening at $13.58, reaching a high of $14.41, and closing at $12.79, a slight decrease of 0.23% from the previous close. However, after-hours trading saw a 1.17% increase, bringing the price to $12.94. The stock's movement was influenced by several factors, including macroeconomic data and competitive developments.
The day began with a positive sentiment as the Producer Price Index (PPI) report showed a lower-than-expected increase of 0.2% for December, easing inflation concerns and initially boosting growth stocks like SoundHound AI. This macroeconomic news contributed to the stock's early surge, with shares up as much as 12.4% in the morning session. However, the stock faced headwinds later in the day due to competitive pressures in the automotive AI sector. Mercedes-Benz's decision to adopt Alphabet's conversational AI platform for its vehicles highlighted the increasing competition SoundHound faces, causing the stock to relinquish some of its early gains.
Additionally, Northland Securities raised its price target for SoundHound AI from $6.00 to $8.00, which provided some support to the stock. Despite these positive developments, the stock's valuation remains a concern, with some analysts deeming it "Significantly Overvalued" based on current financial metrics. Social media discussions reflected mixed sentiments, with some users expressing optimism about SoundHound's potential in the AI sector, while others remained cautious about its valuation and competitive challenges.