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How Cerence (CRNC) makes money

Cerence (CRNC) made $69.6M of revenue in the third quarter fiscal 2026 (Q3 FY26), +12% from a year earlier. License brought in $41.6M (60%); Connected services brought in $15.5M (22%); Professional services brought in $12.5M (18%). Of every dollar of revenue, 76¢ was left as gross profit, 3¢ was left as operating profit, 2¢ was left as net earnings.

Drawing the Sankey…

Cerence revenue by segment, Q3 FY26Cerence revenue by segment, Q3 FY26License$41.6MConnected services$15.5MProfessional services$12.5M
Cerence: revenue by line, Q4 FY24 to Q3 FY26Cerence: revenue by line, Q4 FY24 to Q3 FY26LicenseProfessional servicesConnected servicesLicense: $41.6M latest$41.6MProfessional services: $12.5M latest$12.5MConnected services: $15.5M latest$15.5MQ4 FY24Q2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26
Professional services went from 32% of revenue in Q4 FY24 to 18% in Q3 FY26, the largest shift in the mix.
Cerence revenue by quarterCerence revenue by quarter$54.8MQ4 FY24$78.0MQ2 FY25$62.2MQ3 FY25$60.6MQ4 FY25$115MQ1 FY26$64.2MQ2 FY26$69.6MQ3 FY26
Cerence: where each dollar of revenue goesCerence: where each dollar of revenue goesCost of revenue24¢Gross profit76¢Operating expenses73¢Operating profit3¢Income tax0¢Net earnings2¢Operating cash flow29¢Free cash flow28¢

Revenue by segment, Q3 FY26

SegmentRevenueShareQ/QY/Y
License$41.6M59.8%+11%+22%
Connected services$15.5M22.2%+1%+20%
Professional services$12.5M18.0%+11%-18%

Where each dollar of revenue goes

LineQ3 FY26% of revenue
Revenue$69.6M100.0%
Cost of revenue$16.7M24.0%
Gross profit$52.9M76.0%
Operating expenses$51.0M73.3%
Operating profit$1.9M2.7%
Income tax$15K0.0%
Net earnings$1.5M2.2%
Operating cash flow$20.0M28.7%
Free cash flow$19.6M28.2%

Revenue, quarter by quarter

QuarterRevenueY/Y
Q3 FY26$69.6M+12%
Q2 FY26$64.2M-18%
Q1 FY26$115M+126%
Q4 FY25$60.6M+11%
Q3 FY25$62.2M-12%
Q2 FY25$78.0M+15%
Q4 FY24$54.8M-32%

From Cerence's 10-Q filed Aug 6, 2026 (on EDGAR).

Questions

How does Cerence make money?

Cerence (CRNC) made $69.6M of revenue in the third quarter fiscal 2026 (Q3 FY26), +12% from a year earlier. License brought in $41.6M (60%); Connected services brought in $15.5M (22%); Professional services brought in $12.5M (18%). Of every dollar of revenue, 76¢ was left as gross profit, 3¢ was left as operating profit, 2¢ was left as net earnings.

What is Cerence's biggest business?

License: $41.6M in the third quarter fiscal 2026, 60% of revenue, +22% from a year earlier.

What is Cerence's profit margin?

Net earnings were $1.5M, 2.2% of revenue, in the third quarter fiscal 2026; the operating margin was 2.7%.

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Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.