SoundHound AI (NASDAQ:SOUN) stock is getting a boost on Monday after the voice artificial intelligence (AI) solutions company announced the early repayment of its debt.
According to SoundHound, the company has reached an agreement with its lenders to prepay its remaining debt. That will result in the full repayment of the $100 million that the company owes to lenders.
SoundHound AI notes that this allows it to eliminate all of its outstanding debts while also avoiding $55 million in interest and fees. It also mentions that after this it still has $180 million in cash available.
SoundHound AI Chief Financial Officer Nitesh Sharan said the following about the debt retirement:
“With the massive opportunity to deliver innovative AI around the world, our strong net cash position has meaningfully improved our financial profile […] We now have a capital structure free of debt, which will allow us to move even more nimbly to capture the increasing customer demand for our voice AI solutions.”
What This Means for SOUN Stock
News of the company retiring its debt puts it in a stronger financial position than it was before. That may also make it a more attractive investment for traders. This means it could be a benefit to SOUN stock.
SOUN stock is up 2.3% as of Monday morning with more than 9 million shares traded. That’s still a ways off from its daily average trading volume of about 42.3 million shares.
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
