Cerence (CRNC, Financial) has announced that its cutting-edge technologies are integral to the upcoming release of the next-generation MBUX system, initially featured in the all-electric Mercedes-Benz CLA. This marks a significant advancement in Cerence's collaboration with Mercedes-Benz, showcasing the fourth iteration of MBUX, which incorporates sophisticated conversational features via the MBUX Virtual Assistant. Additionally, this release represents the debut of Mercedes-Benz's MB.OS platform. Together, these developments highlight the companies' ongoing commitment to enhancing intelligent and innovative user experiences for Mercedes-Benz drivers.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 6 analysts, the average target price for Cerence Inc (CRNC, Financial) is $11.17 with a high estimate of $16.00 and a low estimate of $9.00. The average target implies an upside of 18.54% from the current price of $9.42. More detailed estimate data can be found on the Cerence Inc (CRNC) Forecast page.
Based on the consensus recommendation from 7 brokerage firms, Cerence Inc's (CRNC, Financial) average brokerage recommendation is currently 2.9, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Cerence Inc (CRNC, Financial) in one year is $11.11, suggesting a upside of 17.94% from the current price of $9.42. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Cerence Inc (CRNC) Summary page.
CRNC Key Business Developments
Release Date: May 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Cerence Inc (CRNC, Financial) exceeded the high end of their guidance with Q2 revenue of $78 million and adjusted EBITDA of $29.5 million.
- The company generated a strong free cash flow of $13.1 million, marking the fourth consecutive quarter of positive free cash flow.
- Cerence Inc (CRNC) raised their full-year guidance for adjusted EBITDA and free cash flow.
- The company continues to differentiate itself with a unique combination of technology, innovation, and a diverse customer base.
- Cerence Inc (CRNC) is expanding into new verticals with solutions like VoiceTopic, enhancing their market presence beyond automotive.
Negative Points
- Cerence Inc (CRNC) is experiencing pressure from customers on pricing and changes in program timelines due to tariffs.
- Professional services revenue decreased year over year, reflecting a shift towards more standardized solutions.
- The company anticipates no material fixed license revenue for the remainder of the fiscal year.
- There is ongoing litigation against major companies like Samsung, Microsoft, and Nuance, which could be lengthy and risky.
- The macroeconomic environment remains uncertain, with potential impacts on pricing and volume from OEMs.
