Could SOUN make investors millionaires?

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$SoundHound AI Inc(SOUN)$ 's shares have risen from earlier lows on news of $NVIDIA Corp(NVDA)$ investment. In the AI space, the company is not visible, but it has attracted the interest of influential tech businesses.

So far since 2024, SoundHound's stock has skyrocketed, surging a whopping 200%. Investors who got in at its all-time low last January are sitting pretty with some serious profits. But can this momentum last?

SoundHound's technology is primarily used in cars, restaurants, and smart home appliances, with customers like $Qualcomm(QCOM)$ $Toast, Inc.(TOST)$ $Block(SQ)$ $Hyundai Motor Co., Ltd.(HYMTF)$.

But here's what investors might not know: tons of big tech companies have invested in similar businesses to SoundHound. $Amazon.com(AMZN)$ and $Alphabet(GOOG)$ $Alphabet(GOOGL)$ , for example, use voice recognition software in their smart home products.

With an estimated potential market size of $50 billion, SoundHound has a chance to grab a chunk of that pie.

In the year ending December 31, 2023, SoundHound raked in $45.9 million in revenue, a 48% jump year-over-year. Clearly, this company is on an upward trajectory.

Some media outlets predict that SoundHound's revenue will grow by about 50% in both 2024 and 2025. With last year's sales hovering around $46 million, that means SoundHound will have $100 million in revenue by 2025.

Assume that SoundHound can maintain a 50% revenue growth rate through 2030. If that happens, sales would hit $780 million by 2030.

In addition, SoundHound's recent price-to-sales ratio is 29.3. Assuming the ratio normalizes to a more reasonable level of 15, for example, SoundHound AI's future market cap would be about $11.7 billion.

That's about 550% higher than the company's current market value. This means that a hypothetical investment of $100,000 in the stock would be worth $650,000 in 2030, well below $1 million.

While SoundHound represents an intriguing opportunity, the company would need to grow at an almost unprecedented rate for years in a row to make investors millionaires.