Detailed financial statements for Cerence Inc. (CRNC): income statement, balance sheet and cash-flow summary. Track margins, debt, liquidity and profitability trends year over year with up to 20 years of history.
Cerence Inc. specializes in developing and providing AI-driven virtual assistants tailored for the global mobility and transportation industry. The company's diverse portfolio includes both embedded (edge) software components and cloud-based solutions, along with relevant development toolkits, applications, and professional services to facilitate virtual assistant coexistence.
Analysis Summary
Cerence Inc. reported revenue of $251.8M in the most recent fiscal year, growing at a 5-year CAGR of -5.3%.
Trailing-twelve-month margins: gross margin 78.7%, operating margin 11.5%, net margin -5.0%. Free cash flow grew at 12.7% CAGR over 5 years.
At the current price of $7.85, CRNC has negative trailing earnings (P/E not meaningful) and an ROE of -9.84%. Market capitalisation stands at $355M.
Balance sheet quality for CRNC: current ratio of 1.8, net debt of $142.8M. A debt-to-equity below 1.0 typically signals conservative capital structure, while a current ratio above 1.5 indicates comfortable short-term liquidity.
Income Statement (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $211.1M | $244.7M | $277.0M | $303.3M | $331.0M | $387.2M | $327.9M | $294.5M | $331.5M | $251.8M |
| Cost of Revenue | $68.3M | $76.4M | $93.3M | $113.5M | $120.4M | $113.8M | $108.7M | $101.0M | $89.4M | $70.3M |
| Gross Profit | $142.8M | $168.4M | $183.7M | $189.8M | $210.6M | $273.4M | $219.2M | $193.5M | $242.1M | $181.5M |
| Research & Development | $53.6M | $56.8M | $81.0M | $93.1M | $88.9M | $112.1M | $107.1M | $123.3M | $121.6M | $97.8M |
| Selling, General & Admin | $41.0M | $47.4M | $50.4M | $62.2M | $82.8M | $95.7M | $73.8M | $85.4M | $74.2M | $70.6M |
| Operating Expenses | $93.1M | $102.1M | $129.9M | $153.6M | $171.7M | $207.7M | $180.9M | $208.7M | $195.8M | $168.3M |
| Operating Income | $49.7M | $66.3M | $53.8M | $36.2M | $38.9M | $65.7M | $38.3M | -$15.3M | $46.3M | $13.1M |
| EBITDA | $67.0M | $82.9M | $62.6M | $40.0M | $29.7M | $91.9M | -$160.4M | -$5.6M | -$561.4M | $12.0M |
| Interest Expense | 0 | 0 | 0 | 0 | $22.7M | $14.0M | $14.4M | $14.8M | $12.6M | $10.2M |
| Pre-tax Income | $47.3M | $63.2M | $36.8M | $11.2M | -$23.0M | $48.3M | -$198.8M | -$36.4M | -$584.6M | -$8.8M |
| Income Tax | $12.3M | $15.9M | $30.9M | -$89.1M | -$4.7M | $2.4M | $112.1M | $19.9M | $3.5M | $9.9M |
| Net Income | $34.9M | $47.3M | $5.9M | $100.3M | -$18.3M | $45.9M | -$310.8M | -$56.3M | -$588.1M | -$18.7M |
| EPS | $0.96 | $1.30 | $0.16 | $2.75 | $-0.57 | $1.22 | $-7.93 | $-1.40 | $-14.12 | $-0.43 |
| EPS (Diluted) | $0.96 | $1.30 | $0.16 | $2.75 | $-0.57 | $1.17 | $-7.93 | $-1.40 | $-14.12 | $-0.43 |
| Shares Outstanding (Diluted) | $36.4M | $36.4M | $36.4M | $36.4M | $36.4M | $39.3M | $39.2M | $40.2M | $41.6M | $43.2M |
Balance Sheet (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Cash & Equivalents | 0 | 0 | 0 | 0 | $136.1M | $128.4M | $94.8M | $101.2M | $121.5M | $84.0M |
| Short-term Investments | 0 | 0 | 0 | 0 | $11.7M | $30.4M | $20.3M | $9.2M | $5.5M | $3.4M |
| Receivables | $55.2M | $74.0M | $72.1M | $65.8M | $49.9M | $45.6M | $45.1M | $61.3M | $62.8M | $58.9M |
| Inventory | 0 | 0 | 0 | 0 | 0 | 0 | 0 | $6.9M | 0 | 0 |
| Total Current Assets | $59.2M | $80.8M | $83.0M | $92.3M | $249.1M | $287.0M | $227.5M | $225.7M | $265.5M | $186.3M |
| Property, Plant & Equipment | $15.6M | $13.3M | $13.4M | $20.1M | $49.6M | $46.4M | $52.4M | $46.0M | $43.0M | $52.5M |
| Goodwill | $1.07B | $1.08B | $1.12B | $1.12B | $1.13B | $1.13B | $890.8M | $900.3M | $296.9M | $299.0M |
| Intangible Assets | $61.5M | $50.7M | $84.8M | $65.6M | $45.6M | $25.3M | $9.7M | $3.9M | $1.7M | 0 |
| Total Assets | $1.29B | $1.34B | $1.40B | $1.48B | $1.69B | $1.71B | $1.32B | $1.30B | $702.4M | $630.6M |
| Accounts Payable | $6.5M | $5.5M | $6.5M | $16.7M | $8.4M | $11.6M | $10.4M | $16.9M | $4.0M | $901000 |
| Short-term Debt | 0 | 0 | 0 | 0 | $6.2M | $6.2M | $10.9M | $437000 | $87.1M | $4.4M |
| Total Current Liabilities | $79.6M | $94.4M | $121.8M | $129.1M | $198.6M | $165.3M | $147.0M | $148.1M | $216.8M | $101.2M |
| Long-term Debt | 0 | 0 | 0 | 0 | $266.9M | $265.1M | $259.4M | $276.0M | $194.8M | $212.8M |
| Total Liabilities | $281.6M | $338.6M | $404.2M | $415.7M | $729.7M | $673.8M | $605.5M | $602.7M | $561.3M | $479.9M |
| Retained Earnings | 0 | 0 | 0 | 0 | -$20.6M | $27.6M | -$283.2M | -$333.7M | -$921.7M | -$940.5M |
| Total Equity | $1.01B | $997.2M | $993.3M | $1.07B | $957.8M | $1.03B | $713.0M | $694.9M | $141.1M | $150.7M |
| Total Debt | 0 | 0 | 0 | 0 | $296.6M | $289.8M | $286.8M | $289.3M | $295.2M | $230.3M |
| Net Debt | 0 | 0 | 0 | 0 | $148.9M | $130.9M | $171.7M | $179.0M | $168.2M | $142.8M |
| Working Capital | -$20.5M | -$13.6M | -$38.8M | -$36.8M | $50.5M | $121.7M | $80.5M | $77.6M | $48.7M | $85.1M |
Cash Flow (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Net Income | $34.9M | $47.3M | $5.9M | $100.3M | -$18.3M | $45.9M | -$310.8M | -$56.3M | -$588.1M | -$18.7M |
| Depreciation & Amortization | $19.8M | $19.7M | $25.8M | $28.8M | $30.0M | $29.7M | $23.9M | $16.0M | $10.6M | $10.5M |
| Stock-based Compensation | $18.6M | $19.8M | $22.0M | $29.7M | $47.3M | $60.6M | $28.1M | $40.8M | $23.7M | $27.4M |
| Change in Working Capital | $61.1M | $27.8M | $49.1M | $30.5M | -$28.9M | -$61.3M | -$65.3M | -$1.7M | -$41.6M | $36.5M |
| Operating Cash Flow | $113.9M | $96.8M | $115.3M | $88.1M | $44.8M | $74.4M | -$2.1M | $7.5M | $17.2M | $61.2M |
| Capital Expenditure | -$8.3M | -$4.7M | -$6.5M | -$4.5M | -$19.0M | -$12.0M | -$17.4M | -$5.1M | -$5.0M | -$14.4M |
| Acquisitions | 0 | 0 | -$79.8M | 0 | 0 | -$2.6M | -$584000 | 0 | 0 | 0 |
| Stock Repurchased | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | -$153.0M | 0 | 0 | 0 | 0 | 0 |
| Free Cash Flow | $105.6M | $92.1M | $108.7M | $83.6M | $25.8M | $62.3M | -$19.6M | $2.4M | $12.2M | $46.8M |
Growth & Margins (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue Growth (YoY) | +15.9% | +13.2% | +9.5% | +9.1% | +17.0% | -15.3% | -10.2% | +12.6% | -24.0% | |
| Net Income Growth (YoY) | +35.3% | -87.6% | +1604.9% | -118.3% | +350.6% | -777.3% | +81.9% | -945.4% | +96.8% | |
| EPS Growth (YoY) | +35.4% | -87.7% | +1618.8% | -120.7% | +314.0% | -750.0% | +82.3% | -908.6% | +97.0% | |
| Shares Change (YoY) | +0.0% | +0.0% | +0.0% | +0.1% | +7.9% | -0.3% | +2.6% | +3.5% | +3.7% | |
| FCF Growth (YoY) | -12.8% | +18.1% | -23.2% | -69.1% | +141.9% | -131.4% | +112.1% | +413.9% | +283.7% | |
| Gross Margin | 67.6% | 68.8% | 66.3% | 62.6% | 63.6% | 70.6% | 66.9% | 65.7% | 73.0% | 72.1% |
| Operating Margin | 23.5% | 27.1% | 19.4% | 11.9% | 11.8% | 17.0% | 11.7% | -5.2% | 14.0% | 5.2% |
| EBITDA Margin | 31.7% | 33.9% | 22.6% | 13.2% | 9.0% | 23.7% | -48.9% | -1.9% | -169.4% | 4.7% |
| Net Margin | 16.5% | 19.3% | 2.1% | 33.1% | -5.5% | 11.9% | -94.8% | -19.1% | -177.4% | -7.4% |
| FCF Margin | 50.0% | 37.6% | 39.3% | 27.5% | 7.8% | 16.1% | -6.0% | 0.8% | 3.7% | 18.6% |
| Effective Tax Rate | 26.1% | 25.2% | 84.0% | -796.5% | 20.5% | 4.9% | -56.4% | -54.6% | -0.6% | -112.2% |
Per-Share Data (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| FCF Per Share | $2.90 | $2.53 | $2.99 | $2.30 | $0.71 | $1.59 | $-0.50 | $0.06 | $0.29 | $1.08 |
| Dividends Per Share | $0.00 | $0.00 | $0.00 | $0.00 | $4.20 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| Shares Outstanding (Basic) | $36.4M | $36.4M | $36.4M | $36.4M | $36.4M | $37.8M | $39.2M | $40.2M | $41.6M | $43.2M |
What to look at in Technology companies
- Revenue growth 3y (>=15%/year) — Validates sustained traction, not a one-off.
- Gross margin (Sub-sector dependent) — SaaS >=70%, Internet >=55%, Semis >=45%, Hardware >=35%.
- FCF / Revenue (>=20%) — Real cash generated. Many tech firms dress up non-GAAP earnings.
- ROIC (>=15%) — Capital reinvested efficiency — Buffett's first metric.
- SBC / Revenue (<10% healthy) — Stock-based compensation. Silent dilution: >20% destroys value.
- Net Debt / EBITDA (<=2x (1.5x SaaS)) — Resilience in downturns and rate hikes.
Profitability
| Return on Equity | -9.84% |
| Return on Invested Capital | -4.52% |
| Return on Assets | -2.48% |
| Gross Margin | 78.69% |
| Operating Margin | 11.49% |
| Net Margin | -4.97% |
Financial Health
| Debt / Equity | 1.12 |
| Current Ratio | 2.08 |
| Piotroski F-Score | 4 |
| Altman Z-Score | -0.79 |
Key Ratios (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| P/E | 26.56 | 19.62 | 159.38 | 6.27 | -85.74 | 78.78 | -1.99 | -14.55 | -0.22 | -28.98 |
| P/B | 0.92 | 0.93 | 0.93 | 0.59 | 1.86 | 3.52 | 0.87 | 1.18 | 0.93 | 3.57 |
| P/S | 4.39 | 3.79 | 3.35 | 2.07 | 5.38 | 9.37 | 1.88 | 2.78 | 0.40 | 2.14 |
| Gross Margin | 67.6% | 68.8% | 66.3% | 62.6% | 63.6% | 70.6% | 66.9% | 65.7% | 73.0% | 72.1% |
| Operating Margin | 23.5% | 27.1% | 19.4% | 11.9% | 11.8% | 17.0% | 11.7% | -5.2% | 14.0% | 5.2% |
| Net Margin | 16.5% | 19.3% | 2.1% | 33.1% | -5.5% | 11.9% | -94.8% | -19.1% | -177.4% | -7.4% |
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