Cerence (CRNC) Global Automotive OEM, Dealer & Supplier Conference summary

Company overview and market position

• Has 25 years of experience in voice recognition, spun off as a pure-play automotive software company in 2019.

• Holds over 50% penetration in the global auto market, with technology in 500 million+ vehicles.

• Works with nearly every major automotive OEM, including significant relationships in Europe and China (outside China market).

• Leadership changes in the past year, with a new CEO and CFO taking permanent roles.

Tariffs, China, and global production trends

• Not directly impacted by tariffs due to software focus, but monitors production volume effects.

• China represents less than 10% of revenue; faces strong local competition but sees growth in Chinese OEMs exporting outside China.

• Production concerns for Q2 are limited, but more uncertainty is expected in Q4 due to tariffs and global trends.

Revenue model and key metrics

• Revenue streams include license, connected, and professional services; prepaid license revenue is declining and being capped at $20M annually.

• Pro forma royalties have been flat over the past year; future growth expected from new product pricing.

• Price per unit (PPU) metric introduced, showing growth and expected to rise with new product launches and increased content per vehicle.