Cerence | 10-K: FY2025 Revenue Beats Estimate at USD 251.78 M

Revenue: As of FY2025, the actual value is USD 251.78 M, beating the estimate of USD 246.43 M.

EPS: As of FY2025, the actual value is USD -0.43, beating the estimate of USD -0.5067.

EBIT: As of FY2025, the actual value is USD 4.079 M.

Segment Revenue

• License Revenue: $140.6 million in 2025, an increase of 12.7% from $124.7 million in 2024, primarily due to higher volume of licensing royalties.
• Connected Services Revenue: $53.4 million in 2025, a decrease of 60.0% from $133.4 million in 2024, primarily due to the early termination of a legacy contract.
• Professional Services Revenue: $57.8 million in 2025, a decrease of 21.2% from $73.3 million in 2024, due to increased standardization of software product offerings.

Operational Metrics

• Net Loss: $18.7 million in 2025, a significant improvement from a net loss of $588.1 million in 2024, primarily due to the absence of goodwill impairment charges in 2025.
• Gross Profit: $183.1 million in 2025, a decrease of 25.0% from $244.3 million in 2024, driven by the decrease in connected services revenue.
• Operating Expenses: $185.4 million in 2025, a decrease of 77.5% from $824.2 million in 2024, primarily due to the goodwill impairment charge in 2024.

Cash Flow

• Operating Cash Flow: $61.2 million in 2025, an increase of 255.7% from $17.2 million in 2024, driven by changes in deferred revenue and working capital.

Unique Metrics

• Five-Year Backlog: Estimated at $1,169.2 million as of September 30, 2025, including $165.2 million of five-year remaining performance obligations and $1,004.0 million of five-year variable backlog.

Outlook / Guidance

• The company expects to continue focusing on cost management and streamlining operations, with ongoing efforts to reduce operating expenses and position for profitable growth.