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CRNC Stock Soars 387% in 6 Months: Will the Bull Run Continue in 2025?
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Cerence’s (CRNC - Free Report) shares have experienced an impressive surge of 387.1% over the trailing six months, outperforming the broader Zacks Computer & Technology Sector’s modest return of 1.1% and the Zacks Computers - IT Services industry’s appreciation of 13.6%.
CRNC’s positive share price movement has been driven by its successful integration of generative AI (Gen AI) solutions, record platform launches and robust partner network. Strong revenue performance and a clear focus on automotive AI innovations powered its growth.
Cerence’s recent collaboration with NVIDIA (NVDA - Free Report) strengthened its position in automotive AI. CRNC will utilize NVIDIA’s advanced chip technology that will improve the performance and scalability of its offerings.
However, the rising AI competition poses a threat to Cerence's market share. Maintaining a competitive edge amid increasing AI advancements is a challenge.
Cerence has positioned itself at the forefront of the AI revolution in the automotive industry by leveraging its diverse product portfolio to meet the growing demand for enhanced in-car experiences. Its solutions include conversational and Gen AI, and audio and communication AI.
CRNC achieved 10 customer wins and launched six Gen AI programs in fiscal 2024, showcasing strong momentum in deploying advanced AI solutions.
Major automotive OEMs, including Microsoft (MSFT - Free Report) , Volkswagen, BMW and Renault (RNLSY - Free Report) , have implemented Cerence's voice assistance systems to enhance in-car interactions.
CRNC's AI technology powers more than 500 million cars globally, highlighting its extensive market reach and leadership in the automotive AI sector.
The company created a record with 22 platform launches in 2024, four of which debuted in the fourth quarter of fiscal 2024. It recently announced a multi-year agreement with JLR to develop the luxury automaker's next-generation in-car experience. This partnership uses Cerence's AI-enabled technologies to deliver advanced intelligence and capabilities to JLR customers globally.
Cerence's Gen AI technology was chosen by Audi to enhance the capabilities of its in-car assistant.
Rising Competition Impacts CRNC’s Prospects
The rapid advancement of AI technologies has intensified competition in the automotive AI sector. Companies like SoundHound AI compete directly with Cerence in the automotive AI market, focusing on voice recognition and conversational AI solutions.
CRNC's technology has been integrated into 52% of global auto production for the trailing 12 months, showing a minor dip. This decrease is attributed to lower production volumes from key customers.
CRNC’s Sales & Earnings Estimates Show Mixed Trend
The Zacks Consensus Estimate for second-quarter fiscal 2025 revenues is pegged at $57.71 million, indicating a 14.92% year-over-year decline.
The Zacks Consensus Estimate for second-quarter fiscal 2025 non-GAAP earnings is pegged at 2 cents per share, unchanged over the past 30 days. The consensus mark indicates a year-over-year surge of 122.22%.
The company expects revenues for fiscal 2025 to be $236-$247 million. This outlook includes headwinds of $5-$7 million due to a strategic shift from professional service projects.
The Zacks Consensus Estimate for 2025 revenues is pegged at $241.27 million, indicating a year-over-year decline of 27.22%.
The non-GAAP loss per share for the fiscal 2025 is projected between 92 cents and 67 cents.
The consensus mark for 2025 earnings is pegged at 15 cents per share, unchanged over the past 30 days, marking a sharp year-over-year decline of 87.80%.
CRNC has a long history of reporting strong quarterly performances, with earnings surpassing the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 110.86%.
Image: Bigstock
CRNC Stock Soars 387% in 6 Months: Will the Bull Run Continue in 2025?
Cerence’s (CRNC - Free Report) shares have experienced an impressive surge of 387.1% over the trailing six months, outperforming the broader Zacks Computer & Technology Sector’s modest return of 1.1% and the Zacks Computers - IT Services industry’s appreciation of 13.6%.
CRNC’s positive share price movement has been driven by its successful integration of generative AI (Gen AI) solutions, record platform launches and robust partner network. Strong revenue performance and a clear focus on automotive AI innovations powered its growth.
Cerence’s recent collaboration with NVIDIA (NVDA - Free Report) strengthened its position in automotive AI. CRNC will utilize NVIDIA’s advanced chip technology that will improve the performance and scalability of its offerings.
However, the rising AI competition poses a threat to Cerence's market share. Maintaining a competitive edge amid increasing AI advancements is a challenge.
Cerence Inc. Price and Consensus
Cerence Inc. price-consensus-chart | Cerence Inc. Quote
Strong AI Portfolio & Partnerships Drive CRNC
Cerence has positioned itself at the forefront of the AI revolution in the automotive industry by leveraging its diverse product portfolio to meet the growing demand for enhanced in-car experiences. Its solutions include conversational and Gen AI, and audio and communication AI.
CRNC achieved 10 customer wins and launched six Gen AI programs in fiscal 2024, showcasing strong momentum in deploying advanced AI solutions.
Major automotive OEMs, including Microsoft (MSFT - Free Report) , Volkswagen, BMW and Renault (RNLSY - Free Report) , have implemented Cerence's voice assistance systems to enhance in-car interactions.
CRNC's AI technology powers more than 500 million cars globally, highlighting its extensive market reach and leadership in the automotive AI sector.
The company created a record with 22 platform launches in 2024, four of which debuted in the fourth quarter of fiscal 2024. It recently announced a multi-year agreement with JLR to develop the luxury automaker's next-generation in-car experience. This partnership uses Cerence's AI-enabled technologies to deliver advanced intelligence and capabilities to JLR customers globally.
Cerence's Gen AI technology was chosen by Audi to enhance the capabilities of its in-car assistant.
Rising Competition Impacts CRNC’s Prospects
The rapid advancement of AI technologies has intensified competition in the automotive AI sector. Companies like SoundHound AI compete directly with Cerence in the automotive AI market, focusing on voice recognition and conversational AI solutions.
CRNC's technology has been integrated into 52% of global auto production for the trailing 12 months, showing a minor dip. This decrease is attributed to lower production volumes from key customers.
CRNC’s Sales & Earnings Estimates Show Mixed Trend
The Zacks Consensus Estimate for second-quarter fiscal 2025 revenues is pegged at $57.71 million, indicating a 14.92% year-over-year decline.
The Zacks Consensus Estimate for second-quarter fiscal 2025 non-GAAP earnings is pegged at 2 cents per share, unchanged over the past 30 days. The consensus mark indicates a year-over-year surge of 122.22%.
The company expects revenues for fiscal 2025 to be $236-$247 million. This outlook includes headwinds of $5-$7 million due to a strategic shift from professional service projects.
The Zacks Consensus Estimate for 2025 revenues is pegged at $241.27 million, indicating a year-over-year decline of 27.22%.
The non-GAAP loss per share for the fiscal 2025 is projected between 92 cents and 67 cents.
The consensus mark for 2025 earnings is pegged at 15 cents per share, unchanged over the past 30 days, marking a sharp year-over-year decline of 87.80%.
CRNC has a long history of reporting strong quarterly performances, with earnings surpassing the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 110.86%.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Zacks Rank
Currently, CRNC carries a Zacks Rank #3 (Hold), which implies investors should wait for a more favorable entry point to accumulate the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.