Could the Soaring Artificial Intelligence (AI) Company Potentially Emerge as the Next Version of SoundHound AI by 2025?

Could the Soaring Artificial Intelligence (AI) Company Potentially Emerge as the Next Version of SoundHound AI by 2025?

Rewritten Article:

SoundHound's stellar performance over the past year, with a remarkable 936% increase, can be attributed to various factors, including Nvidia's small stake in the company and its impressive quarterly growth. However, the stock's current price-to-sales ratio of 94 might make it unattractive for some investors. If you're in search of a cheaper alternative in the AI-proliferation field, consider Ambarella (AMBA 1.91%).

Ambarella, a chipmaker, excels in image and video processing, primarily for the automotive industry and IoT applications like security cameras, drones, and wearable cameras. The burgeoning adoption of AI-enabled applications within the automotive sector and IoT is fueling the demand for its SoCs (System-on-Chips) capable of tackling AI workloads at the edge.

Edge AI, the processing of data on devices without AI servers, is gaining popularity due to its real-time decision-making capabilities, reduced latency, and enhanced security and privacy. The market for edge AI is forecast to reach approximately $270 billion annually by 2032, with Ambarella aiming to profit from this trend by developing AI computer vision chips for edge devices.

For its third quarter of fiscal 2025 (October 2025), Ambarella reported a substantial 63% year-over-year revenue increase to $82.7 million. CEO Fermi Wang attributed the growth to record levels of AI revenue, contributing to a higher blended ASP. Ambarella's double-digit growth is expected to continue, reaching $279 million in fiscal 2025, a 23% increase from fiscal 2024 levels.

The expanding revenue pipeline points towards a promising future for Ambarella. The company estimates its serviceable addressable market will rise from $5 billion in 2024 to around $8 billion by 2027. Its automotive revenue pipeline, including $800 million in secured business and an additional $1.3 billion in the pipeline, could reach an annual run rate of $360 million for the next five years.

Ambarella's focus on AI and edge AI technology, coupled with its strategic partnerships, puts the company in a strong position to capitalize on the growing demand for these technologies. While SoundHound's revenue grew 89% year-over-year in Q3 2024, Ambarella's performance in Q3 2025 reflects its potential to clock outstanding growth that could lead to substantial gains on the market in the future.

Enrichment Data:

Ambarella has made its mark in the AI and edge AI market by providing low-power, high-performance SoC solutions for intelligent devices. Its CVflow AI vision processors allow these devices to perceive and comprehend their surroundings effectively. Its primary areas of focus are the automotive sector and IoT, including security cameras and robotics.

The automotive industry is a significant market for Ambarella, with products such as Oculii AI 4D imaging radar technology utilized in high-end electric vehicles like the Lotus Eletre and Emeya. Ambarella's strategic partnerships with companies like Plus, LG Electronics, and Leapmotor further strengthen its position in the automotive industry.

With a client pipeline valued at approximately $2.2 billion over the next six years, Ambarella is well-positioned to capitalize on the edge AI market's growth potential. The company's non-GAAP net income of $4.5 million in Q3 2025, despite a GAAP net loss of $24.1 million, indicates its financial resilience and growth potential.

Ambarella's strong performance and focus on AI and edge AI technologies make it an attractive investment option for those seeking to capitalize on the burgeoning market for these technologies.

1. If you're considering investing in the AI-proliferation field but find SoundHound's stock price-to-sales ratio unattractive, you might want to explore Ambarella, given its significant market potential.
2. Ambarella's strategic partnerships with companies like Plus, LG Electronics, and Leapmotor, along with its focus on AI and edge AI technology, position it well to significantly benefit from the expanding edge AI market.
3. The market for edge AI is projected to reach an annual value of $270 billion by 2032, and Ambarella aims to capitalize on this trend by developing AI computer vision chips for edge devices.
4. SoundHound's impressive growth of 89% year-over-year in Q3 2024 is noteworthy, but Ambarella's performance, with a 63% year-over-year revenue increase in Q3 2025, suggests the potential for even more significant gains in the future.

Read also: