Point72 Exits SoundHound AI, Doubles Down on Nvidia Amid AI Sector Shifts

Billionaire investor Steven Cohen's Point72 Asset Management made decisive portfolio moves last quarter, liquidating its entire stake in SoundHound AI while significantly increasing exposure to Nvidia. The semiconductor giant continues attracting institutional capital as the foundational infrastructure play in artificial intelligence.

SoundHound's voice recognition technology failed to maintain Cohen's confidence despite operating in the AI sector. Meanwhile, Nvidia's dominance in AI chips appears unshaken, with its stock split making shares more accessible to retail investors. Market participants increasingly view Nvidia as the 'picks and shovels' beneficiary of the AI gold rush.

The divergent moves highlight institutional investors' selective approach to AI investments. While application-layer companies face scrutiny, infrastructure providers command premium valuations. Nvidia's data center revenue grew 427% year-over-year last quarter, validating Cohen's bet.