Artificial IntelligenceNuance Announces Third Quarter 2021 Results

Nuance Communications, Inc. (NASDAQ: NUAN) today announced financial results for its third quarter ended June 30, 2021:

  • GAAP revenue of $336.6 million and GAAP earnings per diluted share of $(0.09).
  • Non-GAAP revenue of $336.6 million and non-GAAP earnings per diluted share of $0.16.

“We are pleased to report another quarter of execution on our key strategic objectives, leading to solid Q3 results on both our top-line and bottom-line,” said Mark Benjamin, Chief Executive Officer at Nuance. “In Healthcare, our shift towards cloud-based offerings across our portfolio helped drive a healthy ARR performance. This performance led in part to our second consecutive quarter of 29% year-over-year growth in Dragon Medical and DAX Cloud revenue. In total, Healthcare revenue increased by 22% year-over-year due to cloud revenue strength. In Enterprise, our Digital Engagement and Security & Biometrics solutions saw continued adoption throughout the quarter, leading to a return to year-over-year growth in Q3. Overall, Enterprise revenue increased 5% year-over-year, driven by the adoption of these solutions. We are encouraged by the company’s overall performance year-to-date, and feel we are set up for a strong end to fiscal year 2021.”

On March 1, 2021, we completed the sale of our medical transcription and electronic healthcare record implementation businesses. Accordingly, for all periods presented, the businesses’ results of operations have been included within discontinued operations in our condensed consolidated financial statements. All commentary is provided on a continuing operations basis. A reconciliation of continuing and discontinued operations to total operations is provided in the accompanying tables.

Q3 2021 Performance Summary
Q3 2021 results for continuing operations include:

  • GAAP and Non-GAAP revenue of $336.6 million, compared to $298.6 million in the same period last year.
  • GAAP operating income of $4.8 million, compared to $11.9 million in the same period last year.
  • Non-GAAP operating income of $74.2 million, compared to $63.8 million in the same period last year.
  • GAAP operating margin of 1.4%, compared to 4.0% in the same period last year.
  • Non-GAAP operating margin of 22.0%, compared to 21.4% in the same period last year.
  • GAAP net loss of $26.3 million, compared to a net income of $2.3 million in the same period last year.
  • Non-GAAP net income of $50.4 million, compared to $40.5 million in the same period last year.
  • GAAP EPS of $(0.09), compared to $0.01 in the same period last year.
  • Non-GAAP EPS of $0.16, compared to $0.14 in the same period last year.
  • Operating cash flows from continuing operations was $45.8 million, compared to $14.6 million in the same period last year.

Proposed Merger with Microsoft
On April 11, 2021, Nuance entered into an Agreement and Plan of Merger with Microsoft Corporation. Subject to the terms and conditions of the Merger Agreement, Microsoft, through a wholly-owned subsidiary, has agreed to acquire all of the outstanding shares of Nuance common stock for $56.00 per share in an all-cash transaction. As a result of the Merger, Nuance will cease to be a publicly traded company. The Merger is currently intended to close by December 31, 2021. Consummation of the Merger is subject to certain conditions, including the satisfaction of certain regulatory approvals and other customary closing conditions. For additional information related to the Merger Agreement, please refer to the definitive proxy statement previously filed with the SEC and other relevant materials in connection with the transaction that we will file with the SEC and which will contain important information about Nuance and the Merger.

Please refer to the “Discussion of Non-GAAP Financial Measures,” and “GAAP to Non-GAAP Reconciliations,” included elsewhere in this release, for more information regarding the Company’s use of non-GAAP financial measures.

Conference Call and Prepared Remarks
Given the pending transaction with Microsoft, Nuance will not be hosting a conference call, issuing Prepared Remarks, or providing financial guidance in conjunction with its third quarter 2021 earnings release.

PRNewswire

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