AI Growth Stocks Present New Investment Opportunities

A recent report highlights promising growth stocks in the AI sector, showcasing SoundHound AI and Advanced Micro Devices as leaders in their fields with substantial revenue growth and strategic partnerships that could fuel future stock price increases.

Date: 07-12-2024

AI Rating: 7

The report discusses the emerging growth opportunities in the stock market due to advancements in artificial intelligence (AI). Two key players identified are SoundHound AI and Advanced Micro Devices (AMD), both of which exhibit significant growth metrics that could positively impact their stock prices.

SoundHound AI

SoundHound AI has demonstrated impressive growth, with a trailing revenue of $67 million and a remarkable year-over-year revenue increase of 89% in Q3. This growth can be partly attributed to its recent acquisition of Amelia, which suggests that the company is successfully expanding its market reach. Moreover, the company plans to broaden its customer base beyond traditional sectors like automotive and restaurants, targeting industries such as retail, healthcare, and banking. This diversification is critical as it allows for a wider addressable market and potential revenue streams.

While SoundHound AI has yet to achieve profitability, the management anticipates reaching positive adjusted EBITDA by the end of 2025, which could serve as a catalyst for stock price growth. The presence of partnerships with notable tech companies like Nvidia and Oracle adds credibility to its growth prospects.

Advanced Micro Devices (AMD)

AMD is also showing strong signs of growth, especially in the data center segment where revenue skyrocketed by 122% year over year, reaching $3.5 billion in Q3. The management's adjustment of the long-term forecast—from an estimated $400 billion in 2027 to $500 billion by 2028 for the AI accelerators market—indicates an optimistic outlook. Furthermore, AMD's capability to generate more data center revenue than Intel suggests a paradigm shift in the semiconductor landscape, favoring companies like AMD that focus on GPUs essential for AI training.

Both companies showcase significant revenue growth, strong management goals, and promising market trends driven by advancements in AI. These factors could positively influence investor sentiment and stock prices in the long term.

Stocks: NASDAQ:SOUN NASDAQ:AMD