Free cash flow remains erratic, fluctuating from a $35.6M inflow in 2026Q1 to $13.6M in 2026Q2, while stock-based compensation consistently averages over $6M per quarter.
Cerence Inc. (CRNC) cash flow statement — 10-year operating, investing & financing cash flows
| Metric | TTM | Sep'25 | Sep'24 | Sep'23 | Sep'22 | Sep'21 | Sep'20 | Sep'19 | Sep'18 | Sep'17 | Sep'16 |
|---|
| Cash from Operations | 136.71M | 61.17M | 17.2M | 7.5M | -2.14M | 74.39M | 44.79M | 88.07M | 115.26M | 96.78M | 113.92M |
| Operating CF Margin % | - | 24.3% | 5.19% | 2.55% | -0.65% | 19.21% | 13.53% | 29.04% | 41.61% | 39.55% | 53.95% |
| Operating CF Growth % | 612.86% | 255.74% | 129.34% | 450.7% | -102.87% | 66.09% | -49.14% | -23.59% | 19.09% | -15.04% | - |
| Net Income | -15.39M | -18.71M | -588.08M | -56.25M | -310.83M | 45.89M | -18.32M | 100.27M | 5.88M | 47.28M | 34.94M |
| Depreciation & Amortization | 14.83M | 10.55M | 10.63M | 16.04M | 23.94M | 29.66M | 30.04M | 28.84M | 25.77M | 19.67M | 19.75M |
| Stock-Based Compensation | 39.02M | 27.35M | 23.67M | 40.77M | 28.08M | 60.55M | 47.28M | 29.68M | 22.04M | 19.79M | 18.59M |
| Deferred Taxes | 38.27M | 241K | -4.66M | 7.6M | 97.29M | -4.42M | -10.57M | -101.22M | 12.47M | -17.72M | -20.47M |
| Other Non-Cash Items | 7.48M | 5.21M | 617.25M | 1.09M | 224.7M | 3.99M | 25.27M | 0 | 0 | 0 | 0 |
| Working Capital Changes | 56.08M | 36.53M | -41.63M | -1.74M | -65.32M | -61.29M | -28.92M | 30.5M | 49.1M | 27.76M | 61.1M |
| Change in Receivables | -58K | -1.4M | 11.76M | -16.96M | -6.59M | 5.75M | 15.15M | 904K | 8.47M | -17.94M | -4.22M |
| Change in Inventory | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Change in Payables | 3.54M | -3.15M | -12.55M | 5.77M | 157K | 3.41M | -2.43M | 10.13M | -6.29M | -1.02M | 3.63M |
| Cash from Investing | -2.19M | -10.55M | 4.38M | 5.82M | -10.56M | -41.63M | -30.68M | -4.52M | -86.31M | -4.71M | -8.29M |
| Capital Expenditures | -8.8M | -14.36M | -5M | -5.12M | -17.45M | -12.05M | -19.01M | -4.52M | -6.51M | -4.71M | -8.29M |
| CapEx % of Revenue | 2.84% | 5.7% | 1.51% | 1.74% | 5.32% | 3.11% | 5.74% | 1.49% | 2.35% | 1.93% | 3.93% |
| Acquisitions | 0 | 0 | 0 | 0 | -584K | -2.56M | 0 | 0 | -79.8M | 0 | 0 |
| Investments | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -2.25M | -1.71M | -1.74M | -1.35M | 2.02M | 1.1M | 0 | 0 | 0 | 0 | 0 |
| Cash from Financing | -53.8M | -87M | 225K | -5.33M | -19.61M | -41.51M | 121.55M | -83.55M | -28.95M | -92.07M | -105.62M |
| Debt Issued (Net) | -55.3M | -87.5M | -392K | 11.11M | -6.67M | -6.74M | 276.02M | 0 | 0 | 0 | 0 |
| Equity Issued (Net) | 9.29M | 2.88M | 10.9M | 5.63M | 36.06M | 11.52M | 1.32M | 0 | 0 | 0 | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | -152.98M | 0 | 0 | 0 | 0 |
| Share Repurchases | -7.55M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Financing | -7.79M | -2.38M | -10.28M | -22.07M | -49M | -46.29M | -2.81M | -83.55M | -28.95M | -92.07M | -105.62M |
| Net Change in Cash | 78.18M | -37.47M | 20.33M | 6.31M | -33.58M | -7.64M | 136.07M | 0 | 0 | 0 | 0 |
| Free Cash Flow | 127.91M | 46.82M | 12.2M | 2.37M | -19.58M | 62.34M | 25.78M | 83.55M | 108.75M | 92.07M | 105.62M |
| FCF Margin % | 41.33% | 18.59% | 3.68% | 0.81% | -5.97% | 16.1% | 7.79% | 27.55% | 39.26% | 37.62% | 50.03% |
| FCF Growth % | 206.46% | 283.75% | 413.9% | 112.12% | -131.41% | 141.85% | -69.15% | -23.17% | 18.12% | -12.83% | - |
| FCF per Share | 2.68 | 1.08 | 0.29 | 0.06 | -0.50 | 1.59 | 0.71 | 2.30 | 2.99 | 2.53 | 2.90 |
| FCF Conversion (FCF/Net Income) | -8.31x | -3.27x | -0.03x | -0.13x | 0.01x | 1.62x | -2.45x | 0.88x | 19.60x | 2.05x | 3.26x |
| Interest Paid | -2.4M | 5.55M | 6.03M | 11.57M | 9.09M | 9.55M | 14.73M | 0 | 0 | 0 | 0 |
| Taxes Paid | 4.59M | 6.71M | 10.18M | 11.19M | 12.27M | 6.18M | 2.18M | 12.14M | 18.44M | 0 | 0 |
Quick answers to the most common questions about buying CRNC stock.
Cerence Inc. (CRNC) generated $61.2M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Cerence Inc. (CRNC) generated $46.8M in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Cerence Inc. (CRNC) spent $14.4M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
Key Metrics
Top Statement Risk
Cyclical automotive production dependence
Metrics are mathematically derived from official filings.
Earnings Quality Masked by Volatility
Based on reported financial data, the persistent divergence between net income and operating cash flow, exemplified by the 2026Q1 period where the company reported a $5.2M net loss alongside $37.9M in operating cash, suggests that GAAP earnings are currently poor indicators of underlying cash generation.
The significant gap between net income and operating cash flow appears driven by non-cash adjustments and the timing of revenue recognition inherent in fixed-price licensing. Investors should monitor whether this cash-generative capacity is sustainable or merely a byproduct of aggressive working capital management that may reverse in subsequent quarters.
FCF Volatility Reflects Operational Instability
As reported in quarterly filings, free cash flow has exhibited extreme variance, swinging from a $35.6M inflow in 2026Q1 to a $13.6M inflow in 2026Q2, which highlights the company's difficulty in maintaining a predictable cash trajectory amidst shifting automotive production cycles and lumpy contract recognition.
The erratic nature of FCF margins, which fluctuated between -2.7% and 31.0% over the last ten quarters, suggests that the business model remains highly sensitive to the timing of OEM procurement. This lack of consistency complicates long-term valuation and warrants a cautious approach to projecting future cash availability.
Working Capital as Cash Buffer
According to recent SEC filings, working capital changes have frequently served as a primary source of operating cash, contributing $13.2M in 2026Q1 and $7.8M in 2025Q4, which suggests that the company is relying on balance sheet optimization to offset operational losses and fund ongoing R&D requirements.
The reliance on working capital shifts to bolster cash flow may indicate that the company is pulling forward collections or delaying payables to manage liquidity. Such tactics are inherently finite and may suggest underlying pressure on organic cash generation if the trend of relying on these adjustments continues.
SBC Dilution Obscures Cash Reality
Based on the provided cash flow statements, stock-based compensation remains a consistent and significant non-cash expense, averaging over $6M per quarter, which effectively masks the true economic cost of talent retention and dilutes the cash-generative potential available to shareholders over the long term.
While SBC is a standard practice in the technology sector, its magnitude relative to operating cash flow suggests that the company's reported cash position is being supported by equity-based incentives rather than pure operational efficiency. This warrants further investigation into the long-term impact of this dilution on per-share value.