Why SoundHound AI, Inc. (SOUN) Crashed on Monday

We recently compiled a list of the 10 Firms Suffer Steep Downfall on Monday. In this article, we are going to take a look at where SoundHound AI, Inc. (NASDAQ:SOUN) stands against the other stocks.

Ten companies kicked off Monday’s trading in a bloodbath, mirroring the broader market pessimism, with valuations slashed by double digits mostly due to investor caution brought about by key economic uncertainties.

Wall Street’s main indices all fell in the red, with the tech-heavy Nasdaq recording the steepest downfall with 4 percent.

The S&P 500 declined by 2.7 percent, while the Dow Jones dropped by 2.08 percent.

We have identified the 10 worst-performing companies on Monday and detailed the reasons behind their drop.

To come up with the list, we considered only the stocks with $2 billion in market capitalization and $5 million in trading volume.

A software engineer focused on a computer screen, writing code to create a conversational assistant.

SoundHound AI, Inc. (NASDAQ:SOUN) fell by 12.01 percent on Monday to close at $8.57 apiece as investors sold off positions following news that it was being investigated by several shareholder law firms for allegations that it materially misled business information to the investing public.

On March 4, SoundHound AI, Inc. (NASDAQ:SOUN) told the Securities and Exchange Commission that it was unable to file its annual report for last year on time due to the complexity of accounting for its prior acquisitions of Synq3 and Amelia Holdings.

The notification furthered that SoundHound AI, Inc. (NASDAQ:SOUN) “has identified material weaknesses in its internal control over financial reporting. These material weaknesses continue to exist as of December 31, 2024.”

SoundHound AI, Inc. (NASDAQ:SOUN) said it expects to officially file its annual report by March 18, 2025.

Overall SOUN ranks 10th on our list of Monday's worst performing stocks. While we acknowledge the potential of SOUN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SOUN but trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.