Impressive news from a high-profile business partner was a major reason for the share price increase SoundHound AI (NASDAQ: SOUND) on Thursday. The artificial intelligence (AI) company rose nearly 9% in late session trading, a rate that easily outpaced the stock’s 0.8% gain. S&P500 (SNPINDEX: ^GSPC).
That news was the quarterly results released after market hours on Wednesday by a leading graphics card company Nvidiawhose advanced hardware products are widely used in the fast-growing AI industry.
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Fortunately for that sector — not to mention shareholders — Nvidia did very well in the third quarter of fiscal 2025. It managed to nearly double its already significant annualized revenues to more than $35 billion. and somehow that’s topped with a 103% improvement in net earnings per share (which was $0.81). Both figures were well above analysts’ consensus expectations.
This positively impacts SoundHound AI in two important ways. First, it clearly illustrates that there is more than enough demand for all kinds of AI capabilities to support companies that provide the hardware that makes the technology possible. Second, and more directly, Nvidia is an investor in SoundHound AI; as of September 30, the former company owned more than 1.7 million shares of the latter.
That happy development with Nvidia’s results wasn’t the only reason why the market was good on SoundHound AI Thursday – the company had some good news of its own to report.
That morning, it said in a press release that its AI “agents” had assisted one of its clients, insurer Apivia Courtage, in helping with more than 100,000 customer queries. SoundHound AI added that this had reduced the number of inbound requests handled by Apivia’s customer relationship specialists by 20%.
Both developments were unequivocally positive for SoundHound AI and should boost the company’s profile. Currently, it is not considered one of the most impactful or influential AI companies on the market.
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Eric Volkman has no positions in the stocks mentioned. The Motley Fool holds positions in and recommends Nvidia. The Motley Fool has a disclosure policy.
Why SoundHound AI Stock Raced Higher on Thursday was originally published by The Motley Fool
