Cerence Beats On Q2 Earnings, Raises FY21 Guidance - Cerence (NASDAQ:CRNC)

Cerence Inc CRNC reported second-quarter FY21 revenue growth of 14% year-on-year to $98.7 million, beating the analyst consensus of $93.44 million.
License revenue rose 21.8% Y/Y to $54.4 million, Connected services revenue increased 18.2% Y/Y to $27.7 million, while Professional services revenue declined 11.7% Y/Y to $16.6 million.
Cerence Technology accounted for 52% of global auto production in Q2 with an average contract duration of 6.5 years. Repeatable software contribution was 79%, and Growth in billings per car rose 10%.
Non-GAAP gross margin expanded 680 basis points to 77%, while the Non-GAAP operating margin expanded 630 basis points to 37.6%.
Non-GAAP net income rose 77.4% Y/Y to $29.1 million, translating to Non-GAAP EPS of $0.69, beating the analyst consensus of $0.52.
Non-GAAP EBITDA rose 33.7% Y/Y to $39.3 million, with the margin expanded 510 basis points to 39.9%.
The company held $119.5 million in cash and equivalents and generated $27 million in operating cash flow.
The first half bookings included over $30 million for new Applications. Cerence won every competitive decision in Q2, including key strategic wins in the two-wheeler market with one of the most prestigious and fastest-growing two-wheeler companies in China and a well-known domestic motorcycle brand, CEO Sanjay Dhawan said.
Guidance: Cerence sees Q2 revenue guidance of $94 million - $97 million versus the consensus of $94.89 million. The Adjusted EBITDA guidance stands at $34 million - $37 million.
Cerence raised FY21 revenue guidance to $380 million - $390 million from the previous $370 million - $380 million, versus the analyst consensus of $380.1 million. Adjusted EBITDA guidance was raised to $143 million - $152 million from $131 million - $140 million prior.
Price action: CRNC shares traded lower by 0.25% at $85.19 on the last check Monday.

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