What Happened?
Shares of voice AI technology company SoundHound AI (NASDAQ: SOUN) jumped 8.6% in the afternoon session after the company announced an expanded partnership with French insurer Apivia Courtage to deploy its agentic AI technology in the insurer's contact centers. The collaboration involved implementing SoundHound's Amelia 7 AI platform, building on a previous successful project. That initial deployment had already resulted in a 20% productivity increase at Apivia Courtage's contact center, demonstrating the technology's effectiveness. This new agreement was seen as a positive step, reflecting strong investor enthusiasm for the company's AI capabilities and its growing presence in the insurance industry. The partnership is a key part of the digital transformation for Apivia Courtage, which is a subsidiary of the AEMA Group, a major mutual insurance group in France.
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What Is The Market Telling Us
SoundHound AI’s shares are extremely volatile and have had 95 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock dropped 3.3% on the news that tech stocks pulled back as a report raised concerns about artificial intelligence demand and profitability. Oracle shares lost more than 5% following news of its cloud business generating lighter margins than expected. According to internal documents cited in the report, the gross profit margin for this business was only 14%, a figure much lower than what analysts had expected. This suggested that the high costs of running the advanced chip infrastructure were weighing on profitability. Compounding these worries was the ongoing U.S. government shutdown, in its second week, with no clear resolution in sight from Washington. These updates drove investors away from riskier assets and towards safe havens, a trend highlighted by gold futures hitting a record $4,000 per ounce for the first time.
SoundHound AI is down 2.7% since the beginning of the year, and at $19.62 per share, it is trading 19% below its 52-week high of $24.23 from December 2024. Investors who bought $1,000 worth of SoundHound AI’s shares at the IPO in April 2022 would now be looking at an investment worth $2,615.
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