As artificial intelligence (AI) continues to reshape industries, investors are increasingly turning to niche AI players that offer promising upside. Two such names—SoundHound AI SOUN and BigBear.ai BBAI—stand out for their unique positioning within the AI ecosystem. While they differ in size, each offers a pure-play focus on AI: SoundHound specializes in voice and conversational AI, while BigBear.ai provides data-driven “decision intelligence” solutions for enterprises and government. SoundHound’s meteoric rise in 2024 pushed its market cap to more than $3 billion, placing it firmly in mid-cap territory, while BigBear remains a small-cap firm with a market value closer to $743 million.
SoundHound’s stock soared a staggering 836% in 2024 amid rapid revenue growth, and BigBear.ai likewise surged almost 108%. This explosive upside, however, has been followed by extreme volatility. Year to date, both stocks have pulled back sharply, with SoundHound shares down 59% in 2025 so far, even steeper than BigBear.ai’s roughly 42.2% slide.
SOUN & BBAI Stock Performances
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In this context, investors might want to know which of these two beaten-down AI plays offers better upside potential now. Let us delve into their fundamentals, growth potential and key risks.
The Case for SOUN Stock
SoundHound AI has positioned itself as a leader in voice-enabled AI, and its technology is gaining real traction across industries. The company’s core platform lets businesses add conversational voice assistants to their products, from cars to mobile apps to customer service. This translated into explosive top-line growth. SoundHound’s revenues jumped 85% in 2024 to $84.7 million. In the fourth quarter, revenues were $34.5 million (up 101% year over year) as adoption accelerated, prompting management to raise its 2025 outlook.
One of the key developments for SoundHound has been its focus on reducing its reliance on a small set of clients. In 2024, its largest client made up just more than 14% of revenues, down from nearly 50% in 2023, and overall reliance on its top five customers has dropped from more than 90% to about one-third, marking strong progress in diversifying its revenue base.
SoundHound boasts an impressive client base. It powers voice AI in vehicle infotainment systems, drive-thru restaurant kiosks, banking apps, and more. For instance, the company is working with more than 30% of the top 20 quick-service restaurant chains and 70% of the top 10 global financial institutions. It also expanded deeper into auto – signing deals with six additional Stellantis car brands to deploy its in-car voice assistant. Yesterday, SoundHound announced a partnership with Tencent Holdings’ (TCEHY) Intelligent Mobility unit to provide AI voice technology for in-car assistance systems in China. SoundHound has expanded its collaboration with NVIDIA NVDA by integrating NVIDIA AI Enterprise tools to enhance its voice AI capabilities.
Despite its strong technology and sales momentum, SoundHound continues to burn cash like many emerging tech firms. It faces intense competition as well. Tech giants in the “Magnificent Seven” are developing similar conversational AI capabilities. Companies like Amazon AMZN for Alexa, Alphabet GOOGL for Assistant, Apple AAPL for Siri, and others all invest heavily in voice AI, which could pressure an independent player. However, SoundHound tries to differentiate itself as an independent platform that clients can use without ceding control to Big Tech.
Also, if a recession or spending slowdown hits, some of SoundHound’s customers (automakers, restaurants, etc.) might trim investments in new tech. Management has noted that trade turbulence, for example, tariffs impacting auto manufacturers like Stellantis, could indirectly dampen demand for SoundHound’s services. In short, the company must continue its high-growth trajectory and move toward breakeven to justify investor optimism.
The Case for BBAI Stock
BigBear.ai is a smaller company but one that has carved out a notable presence in AI for government and enterprise. It describes itself as a pure-play AI provider with core expertise in decision intelligence, essentially using AI and machine learning to help organizations make better decisions with data. BigBear.ai’s solutions are applied in critical areas like defense, intelligence, cybersecurity, logistics and supply chain, and other government-related operations.
This niche focus led to significant contract wins and a swelling backlog of orders. At the end of 2024, BigBear’s contract backlog stood at $418 million, leaping from just $168 million a year prior. Such a backlog provides substantial revenue visibility for future periods. The company has been securing bigger and longer-term deals, signaling growing customer trust. In March 2025, for example, the U.S. Department of Defense awarded BigBear.ai a 3.5-year, $13.2 million sole-source contract to support a Joint Chiefs of Staff directorate.
Moreover, BigBear.ai is forging alliances with industry heavyweights like Amazon and Palantir Technologies Inc. PLTR that validate its technology. Amazon Web Services has integrated BigBear’s ProModel simulation software into its offerings to enhance AI-driven logistics for customers. Palantir – a leader in data analytics platforms – partnered with BigBear to bolster AI capabilities for defense and intel use cases.
While BigBear.ai’s long-term prospects appear promising, it currently faces significant near-term challenges. BigBear’s bottom line has been deep in the red. In the fourth quarter of 2024, the company posted a whopping $108 million net loss, partly due to a one-time $93 million non-cash charge related to a new convertible note. Operating expenses, particularly SG&A (selling, general, and administrative expenses), rose sharply to $22.2 million in the quarter from $18.2 million a year prior, due in part to integrating its recent acquisition (Pangiam) and scaling up staff. As a result, adjusted EBITDA fell to $2 million in the fourth quarter from $3.7 million a year ago.
Management anticipates adjusted EBITDA will remain negative in the low-single-digit millions in 2025 as they continue to invest and integrate operations. In short, BigBear is still far from achieving profitability and is burning cash to fuel growth, a risky profile in a volatile market.
Another concern is its heavy dependence on U.S. government and defense contracts. Federal budget uncertainty (exacerbated by stopgap funding measures in Congress) has introduced delays in contract awards and spending. Additionally, BigBear’s capital structure carries some risk; the presence of those 2029 convertible notes (tied to the large derivative loss) suggests the company has taken on debt financing, which could dilute shareholders or strain finances if not managed well. Overall, BigBear.ai must prove that it can convert its hefty backlog into profitable growth.
Earnings Estimates Trend & Growth Rate for SOUN and BBAI Stocks
For SOUN Stock
Analysts are growing increasingly optimistic about SOUN’s earnings potential. Over the past 60 days, the Zacks Consensus Estimate for SOUN’s 2025 loss per share has narrowed to 16 cents per share from 27 cents, reflecting a positive shift in sentiment. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
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For BBAI Stock
The Zacks Consensus Estimate for 2025 loss per share is pegged at 21 cents, which has widened by a couple of pennies in the past 60 days.
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The contrast in growth rates is notable — for 2025, the analysts expect BigBear’s revenues to rise 5.7% to $167.2 million, whereas SoundHound is aiming to roughly double its revenue this year to $165.8 million (up 95.7%). This slower growth trajectory, coupled with ongoing losses, makes investors cautious in the short term for BBAI stock.
Valuation of SOUN & BBAI Stocks
After its spectacular run last year, SoundHound’s valuation became quite rich. Even after pulling back, the stock trades around an 18X forward 12-month price-to-sales (P/S) ratio – a steep multiple for a firm still posting losses. SOUN stock is currently overvalued, as suggested by its Value Score of F.
The good news is that the company expects to double revenues in 2025 (guiding for $157–$177 million, roughly 2x 2024 sales), so rapid growth could help boost this valuation over time.
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BBAI is trading at 4.24X, higher than its median of 2.23X but lower than the industry’s 16.15X as well as the Zacks Computer and Technology sector’s 5.1X. BBAI also currently has a Value Score of F. It may need clear signs of improving execution or a shift in federal spending trends to regain bullish momentum.
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Conclusion
After weighing both sides, SoundHound AI — which currently carries a Zacks Rank #3 (Hold) —appears to have the clearer edge. The fundamental differences are striking — SoundHound is delivering solid revenue growth, expanding into new deals across industries, and benefits from a strong liquidity position – all of which fuel positive momentum.
By contrast, BigBear.ai — a Zacks Rank #4 (Sell) company — is growing much more slowly and grappling with larger immediate losses and external uncertainties. While BBAI’s low valuation and big-name partnerships show promise, those factors may take longer to translate into stock gains.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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