BURLINGTON, Mass. - Cerence Inc . (NASDAQ: NASDAQ:CRNC), known for its voice AI technology in the automotive sector, has announced an expanded partnership with NVIDIA (NASDAQ:NVDA) to enhance its language models used in vehicles. The collaboration aims to advance Cerence’s cloud-based and embedded language models, CaLLM™ and CaLLM Edge, by leveraging NVIDIA’s AI Enterprise software and DRIVE AGX Orin hardware. According to InvestingPro data, Cerence’s stock has shown remarkable momentum with a 165% price return over the past six months, despite current profitability challenges.
Cerence’s integration with NVIDIA technology is intended to optimize the performance of its language models to deliver faster and more reliable in-vehicle assistant performance. The company’s Executive Vice President of Product & Technology, Nils Schanz, highlighted the benefits, including cost savings and improved performance for automakers and a better driving experience for users.
The partnership with NVIDIA enables Cerence to utilize NVIDIA TensorRT-LLM and NVIDIA NeMo, an end-to-end framework for deploying generative AI applications. This collaboration is expected to streamline the development and deployment of Cerence’s language models, enhancing in-car interaction with features like reduced latency, privacy, security, and robust protection against malicious interactions.
Rishi Dhall, NVIDIA’s Vice President of Automotive, emphasized the complexities of deploying large language models and the role of NVIDIA’s AI and accelerated computing technologies in simplifying this process for developers.
Cerence, headquartered in Burlington (NYSE:BURL), Massachusetts, is a leader in creating AI-powered experiences for automotive and transportation, with its technology present in over 500 million cars globally. The company’s partnership with NVIDIA is poised to push the boundaries of AI innovation in the automotive industry. While currently unprofitable, analysts tracked by InvestingPro expect Cerence to return to profitability this fiscal year, with a positive EPS forecast of $0.05 for FY2025.
This news is based on a press release statement from Cerence Inc.
In other recent news, Cerence Inc. has entered into a multi-year agreement with Jaguar Land Rover to enhance in-car experiences through advanced AI technology. The partnership aims to develop the next generation of in-vehicle experiences, focusing on increasing enjoyment, safety, and productivity. This development comes alongside Cerence’s appointment of Antonio Rodriquez as the new Chief Financial Officer, a move expected to drive growth and improve operating results.
The company’s financial performance revealed a revenue of $331.5 million in the last twelve months with a robust 73.7% gross margin. Craig-Hallum analysts maintained a Hold rating on Cerence’s stock while raising the price target to $6.00. Cerence has also guided for $25 million in free cash flow for the fiscal year 2025, with a projection of $34 million when excluding one-time items.
Furthermore, Cerence announced a strategic shift towards generative Artificial Intelligence with a goal of returning to profitability by fiscal year 2025. The company reported Q4 revenue of $54.8 million, surpassing guidance, and an adjusted EBITDA of negative $1.9 million, which was better than anticipated. These are the recent developments for Cerence.
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