Cerence Inc. Reports Strong Q1 2026 Earnings with Record Cash Flow
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Should l Buy CRNC?
Source: seekingalpha
- Strong Financial Performance: Cerence reported Q1 2026 revenue of $115.1 million and adjusted EBITDA of $44.6 million, both exceeding guidance, alongside a record quarterly free cash flow of $35.6 million, indicating robust performance driven by technology and market demand.
- Technological Innovation Progress: The debut of new AI agents integrated into the xUI platform, showcased live at CES, particularly the Mobile Work AI Agent developed in partnership with Microsoft, received positive feedback from OEMs, driving active commercial negotiations and enhancing Cerence's competitiveness in the smart automotive sector.
- Key Customer Collaborations: Cerence announced partnerships with five significant clients, including JLR, Volkswagen, and Geely for xUI programs, demonstrating success against major tech competition and further solidifying its market position.
- Optimistic Future Outlook: Management reaffirmed full-year fiscal 2026 revenue guidance between $300 million and $320 million, projecting Q2 revenue between $58 million and $62 million, reflecting confidence in future growth and sustained market demand.
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Analyst Views on CRNC
Wall Street analysts forecast CRNC stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for CRNC is 10.50 USD with a low forecast of 10.00 USD and a high forecast of 11.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
2 Analyst Rating
0 Buy
2 Hold
0 Sell
Hold
Current: 10.360
Low
10.00
Averages
10.50
High
11.00
Current: 10.360
Low
10.00
Averages
10.50
High
11.00
About CRNC
Cerence Inc. is a provider of artificial intelligence (AI)-powered assistants for connected and autonomous vehicles. The Company builds AI-powered virtual assistants for the mobility/transportation market. Its software platform is used to build virtual assistants that can communicate, find information and take action across an expanding variety of categories. Its software platform has a hybrid architecture combining edge software components with cloud-connected components. Its Edge software components are installed on a vehicle’s head unit and can operate without access to external networks and information. Its Cloud-connected components comprise certain speech and natural language understanding-related technologies, AI-enabled personalization and context-based response frameworks, and a content integration platform. Virtual assistants built with its software platform address user requests across various categories, such as navigation, control, media, communication, and more.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Cerence Inc. Reports Strong Q1 2026 Earnings with Record Cash Flow
- Strong Financial Performance: Cerence reported Q1 2026 revenue of $115.1 million and adjusted EBITDA of $44.6 million, both exceeding guidance, alongside a record quarterly free cash flow of $35.6 million, indicating robust performance driven by technology and market demand.
- Technological Innovation Progress: The debut of new AI agents integrated into the xUI platform, showcased live at CES, particularly the Mobile Work AI Agent developed in partnership with Microsoft, received positive feedback from OEMs, driving active commercial negotiations and enhancing Cerence's competitiveness in the smart automotive sector.
- Key Customer Collaborations: Cerence announced partnerships with five significant clients, including JLR, Volkswagen, and Geely for xUI programs, demonstrating success against major tech competition and further solidifying its market position.
- Optimistic Future Outlook: Management reaffirmed full-year fiscal 2026 revenue guidance between $300 million and $320 million, projecting Q2 revenue between $58 million and $62 million, reflecting confidence in future growth and sustained market demand.
See More
Cerence (CRNC) Q1 2026 Earnings Call Transcript
See More
Cerence (CRNC) Q1 Earnings Preview and Growth Outlook
- Earnings Announcement: Cerence is set to announce its Q1 earnings on February 4th after market close, with a consensus EPS estimate of $0.31, reflecting a staggering year-over-year growth of 1133.3%, indicating strong profitability and market confidence.
- Strong Revenue Expectations: The anticipated revenue for Q1 is $114.51 million, representing a 125.0% year-over-year increase, showcasing Cerence's sustained growth in the automotive sector and robust market demand.
- Record of Beating Estimates: Over the past two years, Cerence has beaten EPS estimates 88% of the time and revenue estimates 100% of the time, demonstrating the company's exceptional capabilities in market analysis and execution.
- Positive Estimate Revisions: In the last three months, EPS estimates have seen 2 upward revisions and 1 downward revision, while revenue estimates have experienced 4 upward revisions with none downward, reflecting analysts' optimistic outlook on Cerence's future performance.
See More
Neusoft and Cerence Collaborate to Enhance In-Car Voice Experience
- Strategic Collaboration: Neusoft and Cerence have announced a strategic partnership aimed at advancing voice-driven intelligence in vehicles by integrating automotive software with conversational AI, reflecting the industry's push for more intuitive digital experiences.
- Technology Integration: The companies plan to combine Neusoft's intelligent cockpit platform with Cerence's large language model and generative AI technologies to deliver more natural and intuitive voice experiences for automakers worldwide.
- Software Foundation: Neusoft will provide the underlying software foundation, enabling Cerence's voice AI tools to be embedded directly into vehicle cockpits, with the goal of scaling across different vehicle models and global markets to enhance consumer experience.
- Market Expansion: By leveraging Neusoft's extensive global product development and delivery network alongside Cerence's technological strengths in automotive, the two companies aim to jointly expand into global target markets and promote wider adoption of hybrid AI platforms.
See More
Neusoft and Cerence Sign AI Collaboration Agreement to Enhance Smart Vehicle Interaction
- Collaboration Agreement: Neusoft and Cerence AI have signed a Memorandum of Understanding to collaborate in the field of large language model-based voice AI, aiming to provide intelligent interaction solutions for global automotive partners to meet rising user demands.
- Technological Integration: Neusoft will leverage its advanced intelligent cockpit software platform, NAGIC, to deeply integrate Cerence's expertise in conversational AI and generative AI, enhancing natural language interaction experiences within vehicles and setting new industry standards.
- Market Expansion Plans: By combining Neusoft's global product development network with Cerence's technological strengths, the two companies plan to jointly expand into global target markets, helping automakers tackle market challenges and deliver safer, more natural mobility experiences.
- Open Collaboration Philosophy: Neusoft will continue to uphold its philosophy of
See More
Neusoft and Cerence Sign AI Collaboration Agreement
- Collaboration Agreement: Neusoft and Cerence signed a Memorandum of Understanding to collaborate in the field of large language model-based voice AI, aiming to meet the rising demand for intelligent interaction in the automotive industry.
- Technological Integration: Neusoft will leverage its advanced intelligent cockpit software platform, NAGIC, to deeply integrate Cerence's expertise in conversational AI and generative AI, enhancing users' natural language interaction experience in vehicles.
- Market Expansion Plans: By combining Neusoft's global product development network with Cerence's technological strengths, the two companies will jointly expand into global target markets, driving innovation and application of smart automotive technology.
- Ecosystem Success: Neusoft will continue to uphold its philosophy of 'open collaboration and shared ecosystem success', working closely with more leading technology partners to address market challenges arising from the trends of automotive intelligence.
See More
Cerence Inc. Reports Strong Q1 2026 Earnings with Record Cash Flow
- Strong Financial Performance: Cerence reported Q1 2026 revenue of $115.1 million and adjusted EBITDA of $44.6 million, both exceeding guidance, alongside a record quarterly free cash flow of $35.6 million, indicating robust performance driven by technology and market demand.
- Technological Innovation Progress: The debut of new AI agents integrated into the xUI platform, showcased live at CES, particularly the Mobile Work AI Agent developed in partnership with Microsoft, received positive feedback from OEMs, driving active commercial negotiations and enhancing Cerence's competitiveness in the smart automotive sector.
- Key Customer Collaborations: Cerence announced partnerships with five significant clients, including JLR, Volkswagen, and Geely for xUI programs, demonstrating success against major tech competition and further solidifying its market position.
- Optimistic Future Outlook: Management reaffirmed full-year fiscal 2026 revenue guidance between $300 million and $320 million, projecting Q2 revenue between $58 million and $62 million, reflecting confidence in future growth and sustained market demand.
See More
Cerence (CRNC) Q1 2026 Earnings Call Transcript
See More
Cerence (CRNC) Q1 Earnings Preview and Growth Outlook
- Earnings Announcement: Cerence is set to announce its Q1 earnings on February 4th after market close, with a consensus EPS estimate of $0.31, reflecting a staggering year-over-year growth of 1133.3%, indicating strong profitability and market confidence.
- Strong Revenue Expectations: The anticipated revenue for Q1 is $114.51 million, representing a 125.0% year-over-year increase, showcasing Cerence's sustained growth in the automotive sector and robust market demand.
- Record of Beating Estimates: Over the past two years, Cerence has beaten EPS estimates 88% of the time and revenue estimates 100% of the time, demonstrating the company's exceptional capabilities in market analysis and execution.
- Positive Estimate Revisions: In the last three months, EPS estimates have seen 2 upward revisions and 1 downward revision, while revenue estimates have experienced 4 upward revisions with none downward, reflecting analysts' optimistic outlook on Cerence's future performance.
See More
Neusoft and Cerence Collaborate to Enhance In-Car Voice Experience
- Strategic Collaboration: Neusoft and Cerence have announced a strategic partnership aimed at advancing voice-driven intelligence in vehicles by integrating automotive software with conversational AI, reflecting the industry's push for more intuitive digital experiences.
- Technology Integration: The companies plan to combine Neusoft's intelligent cockpit platform with Cerence's large language model and generative AI technologies to deliver more natural and intuitive voice experiences for automakers worldwide.
- Software Foundation: Neusoft will provide the underlying software foundation, enabling Cerence's voice AI tools to be embedded directly into vehicle cockpits, with the goal of scaling across different vehicle models and global markets to enhance consumer experience.
- Market Expansion: By leveraging Neusoft's extensive global product development and delivery network alongside Cerence's technological strengths in automotive, the two companies aim to jointly expand into global target markets and promote wider adoption of hybrid AI platforms.
See More
Neusoft and Cerence Sign AI Collaboration Agreement to Enhance Smart Vehicle Interaction
- Collaboration Agreement: Neusoft and Cerence AI have signed a Memorandum of Understanding to collaborate in the field of large language model-based voice AI, aiming to provide intelligent interaction solutions for global automotive partners to meet rising user demands.
- Technological Integration: Neusoft will leverage its advanced intelligent cockpit software platform, NAGIC, to deeply integrate Cerence's expertise in conversational AI and generative AI, enhancing natural language interaction experiences within vehicles and setting new industry standards.
- Market Expansion Plans: By combining Neusoft's global product development network with Cerence's technological strengths, the two companies plan to jointly expand into global target markets, helping automakers tackle market challenges and deliver safer, more natural mobility experiences.
- Open Collaboration Philosophy: Neusoft will continue to uphold its philosophy of
See More
Neusoft and Cerence Sign AI Collaboration Agreement
- Collaboration Agreement: Neusoft and Cerence signed a Memorandum of Understanding to collaborate in the field of large language model-based voice AI, aiming to meet the rising demand for intelligent interaction in the automotive industry.
- Technological Integration: Neusoft will leverage its advanced intelligent cockpit software platform, NAGIC, to deeply integrate Cerence's expertise in conversational AI and generative AI, enhancing users' natural language interaction experience in vehicles.
- Market Expansion Plans: By combining Neusoft's global product development network with Cerence's technological strengths, the two companies will jointly expand into global target markets, driving innovation and application of smart automotive technology.
- Ecosystem Success: Neusoft will continue to uphold its philosophy of 'open collaboration and shared ecosystem success', working closely with more leading technology partners to address market challenges arising from the trends of automotive intelligence.
See More
