Financial Data and Key Metrics Changes - The company reported Q2 revenue of $78 million, exceeding the high end of guidance which was $74 million to $77 million [4][17] - Adjusted EBITDA for the quarter was $29.5 million, surpassing the guidance range of $18 million to $22 million [4][20] - Free cash flow was $13.1 million, marking the fourth consecutive quarter of positive free cash flow [4][20] - Net income for Q2 was $21.7 million, a significant improvement from a net loss of $278 million in the same quarter last year [20][21] Business Line Data and Key Metrics Changes - Variable license revenue increased to $29.9 million, up 19% year-over-year [21] - Fixed license revenue was $21.5 million, compared to $10.4 million for Q2 last fiscal year [21] - Connected services revenue decreased to $12.6 million, down 7% from $13.6 million in the same quarter last year [21][22] - Professional services revenue declined by approximately $4.8 million year-over-year, attributed to increased standardization of solutions [22] Market Data and Key Metrics Changes - The penetration of global auto production for the trailing twelve months was 51%, with approximately 11.6 million cars using Cerence technology shipped in Q2 [25] - Worldwide IHS production increased by 1.3% year-over-year but decreased by 10.9% quarter-over-quarter [25] - The number of cars produced using connected services increased by 10% on a trailing twelve-month basis compared to the previous year [26] Company Strategy and Development Direction - The company is focused on technology innovation, expanding partnerships, and diversifying its business beyond automotive [5][9] - Cerence is strategically investing in IP protection, with ongoing lawsuits against Samsung, Microsoft, and Nuance for patent and copyright infringement [10][60] - The company is enhancing its hybrid agentic AI platform, Cerence XUI, with new multimodal capabilities and partnerships with major automakers [11][12] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing macro challenges in the automotive industry but expressed confidence in the company's positioning and customer support [5][6] - The impact of tariffs on business remains limited, with expectations of minimal effects for the fiscal year [6][7] - Management is optimistic about the future, citing strong customer interest in new technologies and solutions [13][33] Other Important Information - The company plans to repay $60.1 million of convertible notes due in June and maintain a cash balance above $70 million for the rest of the fiscal year [30] - The five-year backlog metric is approximately $960 million, consistent with previous quarters [28] Q&A Session Summary Question: Can you walk through the metrics and what is driving the changes? - Management indicated that overall volumes were in line with expectations, with an increase in connected car shipments expected to drive future revenue [35][36] Question: What is driving the sequential uptick in new connected revenue? - Management confirmed that the increase is due to previous billings amortizing into revenue, with expectations for continued growth in connected revenue [37][38] Question: How is AI impacting connected services and pricing? - AI is integrated into both connected and non-connected vehicles, driving consumer demand and increasing pricing per unit [41][42] Question: Where are macro impacts being felt? - Management noted some pricing pressure from OEMs and potential impacts on volume due to market conditions [46][48] Question: Can you elaborate on the unchanged fiscal year guidance? - The guidance remains unchanged due to higher technology revenue offsetting headwinds in professional services [52][53] Question: What is the goal of the lawsuit against Microsoft? - The lawsuit aims to protect the company's intellectual property related to foundational technologies [60][88] Question: How is the partnership with MediaTek enhancing offerings? - The partnership focuses on optimizing automotive SoCs for better performance and cost efficiency [56][57] Question: What are the non-automotive opportunities being explored? - The company is leveraging its technology for applications in kiosks and other verticals, aiming for cost-effective market entry through partnerships [102][103]

Financial Performance - Total revenue for the first quarter of 2025 was $64.7 million, a decrease of 24.0% compared to the same period last year, primarily due to customer cancellations and downsells [2][5] - Net loss for the first quarter of 2025 was $14.1 million, or $0.15 per share, compared to a net loss of $35.6 million, or $0.40 per share, for the first quarter of 2024 [5][24] - Adjusted EBITDA for the first quarter of 2025 was $0.2 million, down from $0.5 million in the first quarter of 2024 [6][24] Customer Activity - The company signed a total of 50 deals in the first quarter, including 45 expansions and renewals and 5 new customers [3][5] - The trailing-twelve-months average revenue per enterprise and mid-market customer increased by 2.4% to $640,000 from approximately $625,000 in the prior year [3] Strategic Initiatives - The CEO highlighted the company's "innovation without disruption" approach, which allows customers to adopt AI and digital capabilities seamlessly [4] - The company is advancing strategic partnerships, including a planned integration with Amazon Connect in the second quarter [4] Financial Guidance - For the second quarter of 2025, total revenue is expected to range from $57 million to $60 million, representing a year-over-year decline of 29% to 25% [11] - For the full year 2025, total revenue is projected to be between $240 million and $255 million, reflecting a year-over-year decline of 23% to 18% [12] Cash Position - The company's cash balance was $176.3 million at March 31, 2025, down from $183.2 million at December 31, 2024 [9][32]

Core Viewpoint - Cerence Inc. reported strong financial results for Q2 FY2025, exceeding revenue and adjusted EBITDA guidance, and achieving its fourth consecutive quarter of positive free cash flow, indicating robust performance amid industry challenges [4][6]. Financial Performance - GAAP revenue for Q2 FY2025 was $78.0 million, up from $67.8 million in Q2 FY2024, representing a year-over-year increase of approximately 1.8% [2][27]. - GAAP gross margin improved to 77.1% in Q2 FY2025 from 69.2% in Q2 FY2024 [2][32]. - GAAP net income for Q2 FY2025 was $21.7 million, a significant recovery from a net loss of $278.0 million in Q2 FY2024 [2][27]. - Adjusted EBITDA for Q2 FY2025 was $29.5 million, compared to a loss of $0.3 million in Q2 FY2024 [2][32]. Key Performance Indicators - Cerence's technology was present in 51% of worldwide auto production over the trailing twelve months [5]. - The number of Cerence connected cars shipped increased by 10% year-over-year [5]. - Adjusted Total Billings remained unchanged year-over-year [5][7]. Future Outlook - For Q3 FY2025, revenue is projected to be between $52 million and $56 million, with gross margins expected to be between 66% and 68% [8][9]. - The full-year revenue guidance remains unchanged, but the net loss is now projected to be between $35 million and $29 million, with adjusted EBITDA expected to range from $28 million to $34 million [9]. Company Overview - Cerence Inc. is a leader in AI-powered user experiences in the automotive sector, with over 500 million cars shipped with its technology [25]. - The company focuses on enhancing user experiences through innovations like Cerence xUI, which supports automakers in developing next-generation infotainment platforms [4].

Financial Performance - Total revenues reached $60.4 million, a 0.5% increase compared to $60.1 million in 1Q'24[10] - Service revenues increased to $32.6 million, a 3.4% rise from $31.5 million in 1Q'24[10] - Non-GAAP gross margin remained stable at 65.2% compared to 1Q'24[10] - Non-GAAP operating margin decreased to 8.9% from 10.5% in 1Q'24[10] - Non-GAAP EBITDA margin declined to 10.2% from 11.2% in 1Q'24[10] - Non-GAAP EPS decreased to $0.15 from $0.17 in 1Q'24[10] - Non-GAAP EBITDA was $6.2 million in 1Q'25 compared to $6.7 million in 1Q'24[22, 25] Business Segments - Microsoft Teams business experienced a 7% year-over-year increase[13] - Customer Experience (CX) business grew by 2% year-over-year[14] - Conversational AI business saw an increase of over 10% year-over-year[14] - Live ARR increased by approximately 25% year-over-year[14]

Financial Data and Key Metrics Changes - Revenues for Q1 2025 were $60.4 million, a 0.5% increase from $60.1 million in Q1 2024 [8] - GAAP gross margin for the quarter was 64.8%, up from 64.4% in Q1 2024 [10] - Net income for the quarter was $4 million or $0.13 per diluted share, compared to $2.1 million or $0.07 per diluted share in Q1 2024 [10] - Non-GAAP operating income for Q1 was $5.4 million or 8.9% of revenues, down from $6.3 million or 10.5% in Q1 2024 [11] Business Line Data and Key Metrics Changes - Services revenues for the quarter were $32.6 million, up 3.4% year-over-year, accounting for 54% of total revenues [9] - The Enterprise UC and CX business accounted for 90% of revenues, with a 7% year-over-year growth in the Microsoft business [17] - The Conversational AI business grew over 10% year-over-year, with a strong pipeline of new wins and bookings [18] Market Data and Key Metrics Changes - Revenues by geographical region were: North America 8%, EMEA 30%, Asia Pacific 14%, and Central and Latin America 4% [9] - The top 15 customers represented 52% of total revenues, with 36% attributed to the nine largest distributors [9] Company Strategy and Development Direction - The company is focusing on two key strategic initiatives: growing the connectivity business and investing in conversational AI initiatives [16] - The goal for the conversational AI sector is to achieve 50% growth for the full year as opportunities mature [17] - The company is transitioning towards AI-powered voice services, with a strong emphasis on integrating advanced GenAI technologies [15] Management's Comments on Operating Environment and Future Outlook - Management noted that while tariffs have introduced uncertainty, they have not observed significant changes in customer buying patterns [21] - The company plans to withdraw previously provided annual guidance until tariff rates are finalized [23] - Management expressed confidence in navigating potential market challenges due to a strong balance sheet and a dominant connectivity franchise [42] Other Important Information - The company acquired 500,000 ordinary shares for approximately $5.2 million and declared a cash dividend of $0.18 per share [12] - The estimated tariff-related cost impact for 2025 is between $3 million to $4 million, with proactive steps taken to move manufacturing out of China [13][22] Q&A Session Summary Question: Tariff impact and proactive steps for manufacturing - Management confirmed plans to move manufacturing out of China to mitigate tariff impacts, expecting a reduced burden of $3 million to $4 million [47][48] Question: Trends in Microsoft ecosystem regarding Operator Connect vs Direct Routing - Management indicated a transition towards Operator Connect as the preferred method for connecting SBCs, with mild growth expected [50] Question: Strategy for Cisco opportunity and managing go-to-market dynamics - Management highlighted their long-standing relationships in the service provider space and ongoing projects, positioning them favorably against smaller competitors [52][53]

Financial Data and Key Metrics Changes - Revenues for Q1 2025 were $60.4 million, an increase of 0.5% compared to $60.1 million in Q1 2024 [7] - GAAP gross margin for the quarter was 64.8%, up from 64.4% in Q1 2024 [9] - Net income for the quarter was $4 million or $0.13 per diluted share, compared to $2.1 million or $0.07 per diluted share in Q1 2024 [9] - Non-GAAP net income for Q1 2025 was $4.7 million or $0.15 per diluted share, down from $5.2 million or $0.17 per diluted share in Q1 2024 [10] - Cash, cash equivalents, and marketable securities totaled $95.7 million as of March 2025 [10] Business Line Data and Key Metrics Changes - Services revenues for the quarter were $32.6 million, up 3.4% year over year, accounting for 54% of total revenues [8] - The Enterprise UC and CX business accounted for 90% of revenues, with a 7% year-over-year growth in the Microsoft business [16] - The CX connectivity business increased by 2% year over year [17] - The Conversational AI business grew above 10% year over year, with a strong pipeline of new opportunities [17] Market Data and Key Metrics Changes - Revenues by geographical region were split as follows: North America 8%, EMEA 30%, Asia Pacific 14%, and Central and Latin America 4% [8] - The top 15 customers represented 52% of total revenues, with 36% attributed to the nine largest distributors [8] Company Strategy and Development Direction - The company is focused on two key strategic initiatives: growing the connectivity business and investing in conversational AI initiatives [15] - The goal for the conversational AI sector is to achieve 50% growth for the full year as opportunities mature [16] - The company is transitioning towards AI-powered voice services, with a strong emphasis on integrating advanced GenAI technologies [14] Management's Comments on Operating Environment and Future Outlook - Management noted that while gross margin and profitability were lower than planned due to tariffs and increased R&D investments, the company is operating from a position of strength [41] - The company has withdrawn its previously provided annual guidance due to the fluidity of the tariff situation and plans to resume providing an outlook once rates are determined [12][21] - Management expressed confidence in achieving growth and profitability in the coming years, supported by a strong balance sheet and a dominant connectivity franchise [42] Other Important Information - The company acquired 500,000 ordinary shares for approximately $5.2 million and declared a cash dividend of $0.18 per share [11] - The estimated tariff-related cost impact for 2025 is approximately $3 million to $4 million, down from an initial potential impact of $10 million to $12 million [47] Q&A Session Summary Question: Plans regarding tariff impact and manufacturing relocation - The company plans to proactively move manufacturing out of China to mitigate tariff impacts, with steps already taken to shift production to other countries [46] Question: Trends in Microsoft ecosystem regarding Operator Connect vs Direct Routing - The market is transitioning towards Operator Connect, which is expected to become the preferred method for connecting SBCs [48] Question: Strategy for Cisco opportunity and managing go-to-market dynamics - The company has a long-standing presence in the service provider space and is confident in gaining market share due to its established relationships and competitive advantages [50][52]

Core Insights - AudioCodes reported a slight increase in revenues for Q1 2025, reaching $60.4 million, up from $60.1 million in Q1 2024, indicating a year-over-year growth of 0.5% [2][7] - The company achieved a net income of $4.0 million, or $0.13 per diluted share, compared to $2.1 million, or $0.07 per diluted share in the same quarter last year [3][7] - Annual Recurring Revenues (ARR) grew by approximately 25% year-over-year, reaching $67 million, driven by strong performance in UCaaS and conversational AI markets [8] Financial Performance - EBITDA for Q1 2025 was reported at $4.6 million, an increase from $3.8 million in Q1 2024 [2][7] - On a Non-GAAP basis, EBITDA was $6.2 million, down from $6.7 million in Q1 2024 [3][7] - Net cash provided by operating activities was $13.5 million for the quarter, with total cash and cash equivalents amounting to $95.7 million as of March 31, 2025, compared to $93.9 million at the end of 2024 [5][7] Strategic Developments - The company is focusing on growth in Live managed services within the UCaaS and CX markets, with a 7% increase in Microsoft business during the quarter [6][8] - New product introductions in the Conversational AI space are generating significant customer interest, contributing to a robust sales pipeline [9] - The upcoming launch of a next-generation Live platform is expected to enhance growth in AI-powered value-added services in the second half of 2025 [10] Operational Challenges - AudioCodes faced lower gross profit from product sales due to new US tariffs on imports from China, prompting the company to implement measures to mitigate this impact [11][12] - The company continues to navigate macroeconomic uncertainties while progressing in its transformation into a cloud and software services provider [12] Shareholder Returns - During Q1 2025, AudioCodes repurchased 500,000 ordinary shares at a total cost of $5.2 million and declared a cash dividend of $0.18 per share, totaling approximately $5.5 million [14][13]

BURLINGTON, Mass., May 05, 2025 (GLOBE NEWSWIRE) -- Cerence Inc. (NASDAQ: CRNC) (“Cerence AI”), a global leader pioneering conversational AI-powered user experiences, today announced an expanded collaboration with its long-time partner and distributor, Code Factory, to introduce VoiceTopping, a new solution that will bring conversational AI to self-service kiosks in a variety of industries. The announcement marks an important step as Cerence AI begins its strategic expansion into new markets, bringing the p ...

Core Insights - Cerence Inc. will showcase its Cerence xUI™ platform, an AI assistant that operates across edge and cloud, for the first time at Auto Shanghai 2025 in collaboration with Great Wall Motor and TCL [1][2] Company Overview - Cerence Inc. is a global leader in creating AI-powered user experiences in the automotive sector, with over 500 million cars equipped with its technology [3][5] - The company focuses on integrating voice, generative AI, and large language models to enhance user experiences in vehicles [3] Product Features - Cerence xUI includes multi-modal capabilities with CaLLM Edge™, enhancing in-car interactions beyond traditional infotainment [4] - The platform utilizes the CaLLM™ family of language models and integrates real-time and contextual data to create engaging conversational interfaces [4] - Features include dual- and multi-seat interaction, allowing synchronized voice-controlled operations between front and rear seats [4] - Smart home integration enables users to control home systems directly from the vehicle [4] Partnerships - The collaboration with Great Wall Motor aims to bring AI innovation to their vehicles as they expand globally [2] - The partnership with TCL focuses on combining intelligent cockpit technologies with Cerence's automotive expertise to revolutionize mobility [2]

Core Viewpoint - AudioCodes is set to release its financial results for the First Quarter of 2025 on May 6, 2025, before the market opens, reflecting the period ended March 31, 2025 [1] Financial Results Announcement - The financial results will be disseminated via news wires and posted on the corporate website [1] - A conference call to discuss the results will take place on May 6, 2025, at 8:30 a.m. Eastern Time, hosted by the President and CEO, Shabtai Adlersberg, and CFO, Niran Baruch [2] Conference Call Details - Investors can participate in the call by dialing 888-506-0062 in the USA or +1 973-528-0011 internationally, or via webcast on the AudioCodes investor website [3] - A replay of the call will be available approximately two hours after the conference call concludes [3] Company Overview - AudioCodes is a global leader in unified communications, voice, contact center, and conversational AI services, enhancing customer and employee experiences through improved communication and collaboration [5] - The company offers a wide range of products and SaaS services that ensure interoperability with major UCaaS and CCaaS platforms, including Microsoft Teams, Webex, and Zoom [5] - AudioCodes serves enterprises worldwide, including 65 Fortune 100 companies, focusing on productivity, collaboration, business process automation, compliance, and customer interaction [5]