SoundHound AI Inc. (SOUN) shares experienced a significant plunge of 6.31% in the intraday trading session on Thursday, despite the company reporting impressive fourth-quarter 2024 results and raising its revenue guidance for 2025.

SoundHound AI, a leading provider of voice artificial intelligence (AI) solutions, reported an 85% year-over-year revenue growth in Q4 2024, reaching nearly $85 million and exceeding its original guidance. Furthermore, the company raised its 2025 revenue outlook, 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, the stock experienced a sharp decline on Thursday. The potential factors contributing to this plummet are unclear. 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.

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.