SoundHound AI Inc (SOUN) experienced a significant 24-hour plunge of 5.44% on Thursday, following the release of its first-quarter 2025 financial results. The AI-powered voice recognition company reported record revenue growth but fell short of market expectations, triggering a sell-off in after-hours trading.

SoundHound announced Q1 revenue of $29.1 million, representing an impressive 151% year-over-year increase. However, this figure missed the analyst consensus estimate of $30.4 million. The company reported earnings per share (EPS) of $0.31 and a net income of $129.9 million for the quarter. Despite the strong growth, the results were not enough to meet the high expectations set for AI companies in the current market environment.

The market reaction highlights the challenges faced by AI companies in meeting increasingly demanding investor expectations. SoundHound AI reaffirmed its full-year 2025 revenue guidance of $157-177 million, indicating continued optimism for growth. However, the stock's decline suggests that investors were anticipating even stronger results. As SoundHound AI navigates the competitive landscape of the AI industry, market participants will be closely monitoring the company's ability to deliver on its growth promises in the upcoming quarters.