SoundHound AI Inc (SOUN) shares experienced a 5.02% plunge in the pre-market trading session on Thursday, March 6, 2025, despite the company reporting impressive fourth-quarter 2024 results and raising its revenue guidance for 2025.

SoundHound AI is a leading provider of voice artificial intelligence (AI) solutions, offering conversational AI and voice recognition technologies to enterprises across various sectors, including automotive, restaurants, healthcare, retail, and more. The company has gained significant traction with its voice AI solutions, which have been adopted by numerous customers.

In its recent Q4 2024 earnings report, SoundHound AI posted an 85% year-over-year revenue growth, reaching nearly $85 million and exceeding its original guidance. Furthermore, the company raised its revenue outlook for 2025, now expecting its top line to nearly double, projecting a range of $157 million to $177 million, up from its earlier guidance of $155 million to $175 million.

Despite these positive developments, SoundHound AI's stock experienced a pre-market plunge on March 6th. Potential factors contributing to this decline are unclear based on the available information. It is possible that some investors may have taken profits after the stock's recent rally, or there could be concerns about SoundHound AI's ability to sustain its rapid growth trajectory in the competitive AI market.

While the specific reasons for the pre-market plunge are uncertain, SoundHound AI appears well-positioned for continued growth, with a robust pipeline of customer contracts and plans to expand into emerging areas like agentic AI. However, the stock's volatile trading behavior underscores the inherent risks and uncertainties associated with investing in rapidly evolving technology companies.