SoundHound AI heads into late August with its short position marginally smaller than last week — but the structural stalemate in the lending market is now in its fifth consecutive week with no sign of resolution.
Short interest edged down to 41.2% of the free float as of August 25, a fraction below the 41.8% reading from the prior note. The weekly change in shares short is essentially flat at -0.01%, confirming what was flagged seven days ago: the post-earnings covering trend has run out of momentum. Bears who reduced exposure earlier this month did so between late July and mid-August, trimming roughly 8 million shares from the peak. That wave is over. What has not changed at all is the structural picture underneath: availability remains pinned at exactly 0% across every single session in the 30-day history. The lending pool is completely exhausted. There is no new borrow supply. Any further covering must happen by buying in the open market. The borrow seal, documented in two consecutive prior notes, has not cracked.
Cost to borrow has continued its steady descent, now at 6.8% — down nearly 24% on the week and more than 53% over the past month from a mid-July peak above 15%. That fall reflects reduced urgency among short sellers to secure new positions rather than any easing of structural tightness. Availability at 0% means the lending market is still fully occupied regardless of what the fee says. Options traders are not adding much pressure either: the put/call ratio is 0.378, slightly below its 20-day average of 0.40 and near the lower end of its 52-week range. Call demand has quietly edged ahead of puts over the past few sessions — not a dramatic shift, but a mild lean toward the bullish side relative to recent weeks.
The Street picture is mixed but tilting cautious. The two most recent analyst actions — both from August 6, the day after the last earnings print — saw DA Davidson and Piper Sandler lower their price targets while maintaining existing ratings. DA Davidson cut to $10 from $12; Piper Sandler to $7 from $8. Those moves set the tone: bulls acknowledge the growth story but are trimming their ambitions on valuation. The consensus mean target of $12.71 implies meaningful upside from the current $7.05, but that figure is now 20 days stale and leans heavily on older, higher targets from firms like HC Wainwright ($20) that predate the stock's recent range. The EPS momentum picture, however, remains genuinely strong — ranking in the 96th percentile on 30-day momentum and 86th on 90-day, suggesting analysts have been revising estimates upward consistently even as price targets drift lower. The short score of 77.5 is elevated but has eased from a peak of 79.8 on August 12, consistent with the slow drift of the short book.
Founders are still selling. The June 15 cluster — CEO Keyvan Mohajer, CSO Seyed Emami, COO Michael Zagorsek, CTO Timothy Stonehocker, and Chief Level Officer James Hom all transacted on the same date — totalled roughly $2 million in aggregate proceeds at prices near $7.46, a level close to where the stock trades now. These appear to be plan sales rather than conviction signals, but their timing immediately around the $7 price level is worth noting. On the institutional side, BlackRock added 1.575 million shares in the most recent reporting period to reach 7.65% of shares outstanding, while Mirae Asset nearly doubled its position, adding 2.19 million shares. Those accumulation moves provide a demand-side counterweight to the insider selling.
Last quarter's earnings reaction was emphatic: the stock gained roughly 25% in the session following the August 6 report. The next event is not until November 5 — a long runway. Between now and then, the central dynamic to monitor is whether the borrow seal finally breaks and shares return to the lending pool, or whether another catalyst arrives while 41% of the float remains committed to the short side.
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