Nvidia and SoundHound AI are two artificial intelligence stocks that investors should consider buying before the next stock market swing. Nvidia is a key player in the AI industry, producing GPUs that are critical for developing, training, and executing AI services. The company has a dominant market share of at least 90% in data center GPUs.
Despite its premium pricing, Nvidia’s chips outperform the competition due to early investments by the management team. Nvidia’s shares have fallen nearly 20% since the beginning of 2025 but are still expensive at 21 times sales. However, the AI revolution is just getting started, and Nvidia’s lead on the competition provides it with more resources to maintain its edge.
The company also enjoys impressive vendor lock-in through developer environments like CUDA. With sales expected to grow by 57% this year and another 24% next year, Nvidia stock is still “cheap” for investors willing to accept the upfront premium. SoundHound AI is a smaller AI competitor that offers maximum upside potential.
Consider Nvidia and SoundHound stocks
The company creates AI services that deal with sound, such as replacing drive-thru operators or customer support agents with AI agents. SoundHound has been in business for two decades and has amassed several hundred patents.
Dozens of well-known brands have signed up as customers to pilot SoundHound’s technology, allowing the company to grow sales considerably in recent quarters. Sales growth next quarter is expected to top 166%, more than double Nvidia’s growth rate. Investors must pay for these higher growth rates with a higher price-to-sales ratio, but with a market cap of just $3.5 billion, SoundHound can grow at these rates for far longer than Nvidia can manage.
Some concerns remain about SoundHound’s long-term competitiveness, as big tech is investing heavily in AI, including the audio category that SoundHound specializes in. With a research and development budget of just $70 million per year, it’s unclear if SoundHound can compete with the multibillion-dollar budgets of big tech competitors over the long term. However, for maximum growth potential despite added risk, SoundHound is a great speculative bet.
Several AI stocks have faced pressure this year due to rising competition and concerns about a slowdown in spending amid tariff wars and macroeconomic headwinds.
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Rashan is a seasoned technology journalist and visionary leader serving as the Editor-in-Chief of DevX.com, a leading online publication focused on software development, programming languages, and emerging technologies. With his deep expertise in the tech industry and her passion for empowering developers, Rashan has transformed DevX.com into a vibrant hub of knowledge and innovation. Reach out to Rashan at [email protected]
