- Cerence rallies (CRNC +20.0%) as bookings momentum continued with the 2nd highest total in the company’s history, supported by strategic wins in all major geographic markets.
- Secular technology trends continue driving fiscal YTD revenue of $238.8M, up 8% Y/Y despite major impact of COVID-19 on global auto production.
- Q3 Adj. margins: Gross declined 380 bps to 68.7%; operating declined 550 bps to 28.4% and EBITDA too declined 440 bps to 31.8%.
- KPIs indicate long term growth potential as % of worldwide auto production with Cerence technology of 54%; Average contract duration of 6.2; Growth in billings/car YTD +7% Y/Y; Backlog at start of FY20 was $1.36B.
- The strong financial performance generated $19.3M from cash flow from operations during Q3.
- As of June 30, cash & equivalents of $132.8M; Intra quarter cash requirements of $25-30M; Debt of $300M and secured leverage ratio of 0.7x as stated in Q3 Earnings Presentation.
- The Company successfully refinanced total debt resulting in more than $10M annual cash interest expense savings.
- Q4 2020 Outlook: Revenue of $76-80M; Adj. gross margin of 68-70%; Adj. operating margin of 27-29%; Adj. EBITDA margin of 30-32%; EPS of $(0.09)-(0.02) and Adj. EPS of $0.30-0.35.
- Previously: Cerence EPS beats by $0.23, beats on revenue (Aug. 4)