Cerence

CRNC

Software - Application · Technology

Exchange

NASDAQ

Winston Score

Winston is serious

Mixed quality — meaningful strengths and weaknesses.

Data as of Aug 23, 2026 · filings through Jun 30, 2026

How the score breaks down

Quality

Good

Growth

Good

Cash Flow

Mixed

Stability

Good

Valuation

Data not available

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Winston Score History

The full picture

Cerence makes software that lets people talk to their cars. Its main product is an AI-powered voice assistant built into vehicle dashboards, allowing drivers to control navigation, music, phone calls, and other features using natural speech. The company sells its technology to major automakers — including BMW, Toyota, and Volkswagen — making it one of the leading providers of in-car voice AI in the world.

Cerence earns money through a mix of software licenses, royalties paid per vehicle shipped, and connected-service subscriptions. It operates globally, with customers across North America, Europe, and Asia, and generates roughly $300–400 million in annual revenue. Its deep integration into automakers' existing platforms creates switching costs, but the company faces real pressure from big tech firms like Google and Amazon pushing their own in-car voice platforms. The key risk is whether automakers will continue choosing Cerence over these larger competitors as vehicles become more software-defined.

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+11.8% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

+147.7% YoY

YoY Growth Rate

Strong earnings growth

Insider Activity

3.1%ownership

→ Flat

Insider ownership roughly steady over the past year

Cash Position

Cash flow positive

$128M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Growth + cash flow

Cerence is a rare growth stock that's already generating positive cash flow while growing at 12%. The Winston Score doesn't fully credit this transition from "burner" to "earner."

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Profit per sale

Gross Margin

76.0%

Premium pricing power — 76.0% gross margin

Profit after running costs

Operating Margin

2.7%

Thin — 2.7% operating margin

Return on the money invested

ROCE

10.1%

Below par — 10.1% return on capital

ROIC between 5% and 15%. They earn 5 to 15 cents back per year on every dollar invested.

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Growth

Sales growth

Sales YoY

+25.8%

Fast-growing sales (+25.8% YoY)

Profit growth

EPS YoY

-102.7%

Earnings shrinking (-102.7% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

How steady the profit is

EPS Consistency

5/8 quarters

Mixed — about half the quarters showed growth

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Cash Flow

Profit that turns into cash

Cash Conversion

N/A

Data not available

Spare cash per sale

FCF Margin

41.3%

Converts sales into free cash efficiently (41.3%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

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Stability

What it owes vs what it owns

Debt / Equity

1.12

Elevated debt (1.12)

Covers its interest

Interest Cover

10.47x

Comfortably covers interest (10.5x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

Price vs profit

P/E Ratio (TTM)

N/M

no trend

Negative earnings — P/E not meaningful

Cheaper or dearer next year

P/E vs Forward

N/A

not available

Data not available

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Dividends

Not applicable for this business.

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