The stock price of SoundHound AI, listed as SOUN on NASDAQ, has plummeted by more than 60% since hitting a high for the year. This drop in value has caused the company's market capitalization to decrease from $2.76 billion to $1.25 billion. This decline is part of a larger trend affecting various AI companies, including SMCI, Nvidia, AMD, and Intel, as their shares have been falling.

The recent decline in the value of SoundHound AI's stock is due to ongoing fatigue in the artificial intelligence industry. Since March, the share price has dropped from a high of $10.23 to around $4.0. This downward trend has been consistent with other AI companies, like AMD, Nvidia, and Super Micro Computer, experiencing similar retreats. Since March 14th, SoundHound AI's stock has lost over $1.5 billion in value.

There are three primary reasons behind the significant drop in the company's stock price. Firstly, there is a general fatigue surrounding the artificial intelligence sector. Additionally, other AI-focused companies, such as SingularityNET, Fetch AI, and Ocean Protocol, have also seen their stocks decline. Secondly, concerns about the valuation of SoundHound AI persist after the recent pullback. The company's current valuation stands at $1.23 billion, significantly higher than its revenue of $45.9 million last year, with a net loss exceeding $88 million in the same period.

Despite its high valuation metrics, analysts are cautiously optimistic about the future of SoundHound AI's stock price. The average estimate for the stock is $7.15, an increase from the current $4.9. Leading analysts from Cantor Fitzgerald, DA Davidson, HC Wainwright, and Wedbush each have a positive outlook on SoundHound AI.

Several catalysts may impact the future price of SoundHound's stock, including upcoming earnings reports from semiconductor and AI companies like SMCI, Intel, and AMD, as well as SoundHound's own financial results to be released on May 10th. Analysts anticipate a rise in revenue for Q1, from $6.7 million last year to $10 million this year.

Despite the recent decline, there are indications that SoundHound AI's stock may rebound soon. The stock has remained above the 200-day Exponential Moving Average (EMA) and has become highly oversold, suggesting a potential opportunity for investors to buy the dip and drive a recovery in the stock price.