Better AI Stock: SoundHound vs. Taiwan Semiconductor

• SoundHound's stock terms has doubled implicit the past year.

• Taiwan Semiconductor shares person besides surged, and the institution is profitable.

• Both companies are successfully tapping into the AI market, but lone 1 banal appears comparatively inexpensive.

• 10 stocks we similar amended than Taiwan Semiconductor Manufacturing ›

It's not hard to place artificial quality stocks that person experienced important gains implicit the past year. A monolithic spending spree among ample tech companies is fueling investments successful AI information centers that could scope up to $4 trillion by 2030.

Software companies are benefiting arsenic well, with galore companies tapping into a emergence successful request for AI services that volition assistance boost productivity and summation outgo savings.

Two companies that person seen their stock prices surge acknowledgment to each of this AI involvement are SoundHound AI (NASDAQ: SOUN), with its shares rising 87% implicit the past year, and Taiwan Semiconductor (NYSE: TSM), with its terms up 44%.

Both are taking a unsocial attack to AI, but lone 1 is the amended AI stock. Here's however the 2 compare.

Let's commencement with what SoundHound has going for it. The institution utilizes awesome conversational AI technology, which galore companies employment crossed a wide scope of industries. For example, Chipotle has implemented SoundHound's conversational AI exertion for online ordering successful its app, and Hyundai uses it for dependable commands connected immoderate of its conveyance infotainment systems.

What's more, SoundHound's income maturation is impressive. The company's gross jumped 68% successful the 3rd 4th to $42 million, which bushed Wall Street's statement estimation of astir $40 cardinal for the quarter. Management besides accrued income guidance for 2025 to a scope betwixt $165 cardinal and $180 million, the 2nd clip it raised its gross guidance this year.

SoundHound besides narrowed its non-GAAP (adjusted) nonaccomplishment per stock to $0.03 successful the quarter, amended than the estimated nonaccomplishment of $0.04 by analysts. With the caller top- and bottom-line beats and an awesome lawsuit list, it's not astonishing that SoundHound's stock terms has surged.

Taiwan Semiconductor, besides referred to arsenic TSMC, is the world's starring semiconductor manufacturing company, and it has benefited immensely from tech giants spending hundreds of billions of dollars connected AI information centers.

In the company's precocious reported Q3, gross roseate by 30% to $33.1 billion, and its net accrued 39% to $2.92 per American depositary receipt (ADR). TSMC CEO C.C. Wei said connected the third-quarter net telephone that AI request continues to beryllium "very strong" and stronger than absorption thought it would beryllium conscionable 3 months ago.