Cerence Q1 revenue slightly beats estimates

Overview

• Conversational AI firm's fiscal Q1 revenue slightly beat analyst expectations

• Company achieved record free cash flow of $35.6 mln in fiscal Q1

Outlook

• Cerence expects Q2 revenue between $58 mln and $62 mln

• Company projects Q2 gross margins between 71% and 72%

• Cerence reaffirms FY2026 revenue guidance of $300 mln to $320 mln

Result Drivers

• PATENT LICENSE REVENUE - Q1 revenue included a $49.5 mln payment from a patent license agreement with Samsung

• CUSTOMER MOMENTUM - Cerence xUI gained traction with five automaker programs and positive reception at CES 2026

Key Details

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is no "strong buy" or "buy", 4 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the software peer group is "buy."

• Wall Street's median 12-month price target for Cerence Inc is $11.00, about 6.2% above its February 3 closing price of $10.36

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 17 three months ago

Press Release: ID:nGNX51Wxq

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