Buying SoundHound AI as AMD News Fuels Speculative Action
Pockets of strong activity remain and I'm adding to this AI name as the sector continues to see speculation.
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Market action is mixed on Monday morning, but pockets of very strong speculative activity continue. A chip deal between Advanced Micro Devices (AMD) and OpenAI is driving increased interest in the AI sector, with semiconductors and data centers leading the way.
The Magnificent Seven is lagging with weakness in Nvidia (NVDA) , Meta (META) and Amazon (AMZN) . Tesla (TSLA) is up nicely in anticipation of positive news about new vehicle models.
Despite flat breadth, there is a long list of individual stocks up more than 10% and over 250 new highs. Small caps are leading with the Russell 2000 (IWM) gaining more than 0.7%.
A faction of market strategists believes that this intense speculative action in secondary stocks is a sign of excess and unhealthy, but the key will be the close. If we experience an intraday reversal and a weak close, it will be an indication that the bulls are losing momentum and cannot sustain the market's upward movement.
It is tough to find new buys right now, but one name that I am adding is SoundHound AI (SOUN) . I highlighted SOUN on August 11, and it has been a bit of a roller coaster ride since then. However, it is hitting new recent highs, was just added to the IBD50, and the chart looks attractive.
SOUN is a software company specializing in conversational intelligence and voice AI solutions. It offers a voice AI platform that enables businesses to deliver human-like interactions through speech and sound recognition technologies. The company's core offerings include voice recognition, natural language understanding, sound recognition and generative AI integration to automate conversational experiences, such as voice assistants and agents. These products are used in industries like automotive (e.g., in-car voice controls), restaurants (e.g., drive-thru ordering), retail, finance, TV, IoT devices and customer service. SoundHound's technology is used for voice AI agents that handle complex queries and tasks, making it a leading player in the growing agentic AI market.
On October 2, 2025, SoundHound was named a leader in the IDC MarketScape report for Worldwide General-Purpose Conversational AI Platforms 2025, which triggered a 9.1% stock surge shortly after the announcement. SoundHound also announced a Jeep rollout for in-vehicle voice AI.
In its Q2 2025 earnings, SoundHound reported 217% year-over-year revenue growth, prompting management to raise its full-year 2025 guidance. This performance has fueled optimism, with the stock up 230% over the past 12 months and 144% in the last six months.
Technically, the stock broke out on August 8 following strong guidance. It then pulled back to support, made a new high, and after a dip, it is testing those highs again.
At the time of publication, DePorre was long SOUN, NVDA and META.
