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Published May 5, 2025
SoundHound uses artificial intelligence to create artificial voices, but it turns out its assets were artificial, too. When investors learned SoundHound had to make millions of dollars in accounting adjustments due to major bookkeeping errors, shareholders rapidly dumped their stock. Some of those investors are fighting back with class action against the Company.
In t2024, SoundHound admitted to material weaknesses in its financial controls but was working to fix the problem. Nonetheless, the Company bought out two other AI rivals and boasted about how those buyouts were going to bring investors major value.
It turns out those buyouts only brought headaches.
In March 2025, SoundHound admitted it hadn’t fixed the financial control problems. In fact, those problems affected the accounting for the buyouts. It turned out both companies were worth far less than originally thought and SoundHound had to redo its accounting books, meaning it had fewer assets than originally thought.
Investors raced for the exits and SoundHound’s stock price tanked. Now, some investors are joining the lawsuit.