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Sep 30, 2025
Cerence Q4 2025 Earnings Report
Cerence beat the high end of guidance in Q4 2025, with strong free cash flow and adjusted EBITDA, despite a GAAP net loss.
Key Takeaways
Cerence delivered $60.6M in revenue in Q4 2025, surpassing expectations. The company reported a GAAP net loss of $13.4M but posted $8.25M in adjusted EBITDA. Free cash flow more than doubled YoY, and strong adoption of the xUI platform continues to drive growth.
Revenue by Segment
Forward Guidance
Cerence expects FY26 revenue between $300M and $320M, driven by IP monetization and 8% growth in core technology. Q1 FY26 revenue expected between $110M and $120M, including a one-time $49.5M patent license payment.
Positive Outlook
- FY26 revenue guidance implies 23% YoY growth at midpoint
- Core tech business expected to grow 8% in FY26
- Q1 FY26 includes $49.5M IP license revenue from Samsung deal
- Gross margins projected at 85–86% in Q1 FY26
- FY26 adjusted EBITDA forecasted between $50M and $70M
Challenges Ahead
- FY26 GAAP net income may still be negative (up to -$8.1M)
- Q1 FY26 may report a GAAP net loss up to -$2.4M
- No material fixed license revenue expected in Q1 FY26
- Continued restructuring and stock-based comp impacts costs
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
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