SoundHound AI is favored over BigBear.ai due to revenue growth and positive momentum

From Nasdaq: 2025-04-23 12:15:00

Investors are eyeing niche AI players like SoundHound AI and BigBear.ai for strong upside potential. SoundHound specializes in voice AI, with a market cap over $3 billion, while BigBear.ai focuses on data-driven solutions for enterprises and government, with a market value around $743 million. Both stocks surged in 2024 but have seen sharp declines in 2025.

SoundHound’s revenues soared 85% in 2024 to $84.7 million, driven by a diverse client base in industries like auto, quick-service restaurants, and financial institutions. The company is expanding rapidly and recently partnered with Tencent Holdings and NVIDIA to enhance its AI capabilities. However, competition from tech giants and industry challenges remain concerns for SoundHound.

BigBear.ai, on the other hand, has carved out a niche in AI for government and enterprise, with a growing backlog of orders reaching $418 million in 2024. The company secured a $13.2 million contract from the U.S. Department of Defense and forged partnerships with Amazon and Palantir. Despite promising prospects, BigBear.ai faces profitability challenges and heavy reliance on government contracts.

Analysts are optimistic about SoundHound’s earnings potential, with a narrowing loss per share estimate for 2025. BigBear.ai, on the other hand, has a wider loss per share estimate for 2025. SoundHound is expected to double its revenue in 2025, while BigBear.ai faces slower growth and ongoing losses.

SoundHound’s valuation remains high even after a pullback, trading at an 18X forward 12-month price-to-sales ratio. BigBear.ai, on the other hand, trades at 4.24X, higher than its median but lower than the industry average. SoundHound’s rapid revenue growth could help justify its valuation over time, while BigBear.ai needs to show improved execution to regain bullish momentum.

In conclusion, SoundHound AI appears to have the edge over BigBear.ai due to its strong revenue growth, expanding client base, and positive momentum. BigBear.ai, while showing promise with partnerships and a growing backlog, faces challenges with profitability and government contract dependence. Investors should carefully consider these factors before making investment decisions.



Read more at Nasdaq: SOUN vs. BBAI: Which AI Stock Has Bigger Potential in 2025?