Nuance Beats Revenue Guidance in Q1 Update

Nuance Communications has issued its results for the first quarter of its 2020 fiscal year. The company’s Q1 is for the quarter ended December 31st, 2019.

The results were strong, exceeding Nuance’s guidance for revenues and earnings per share. At first glance, the reported revenues of $418.2 million, compared to revenues of $419.7 million in Q1 of the previous fiscal year, would merely suggest stability. But Nuance is also reporting EPS of $0.19, an improvement over the EPS of $0.05 in Q1 of fiscal 2019; and its net income has come in at $54.9 million (GAAP), compared to a net income of $13.9 million a year ago.

Commenting on the results in a statement, Nuance CEO Mark Benjamin emphasized the success of the company’s voice-based technological solutions in the healthcare and enterprise sectors. “Our pivot to the cloud was bolstered by strong Dragon Medical cloud growth and notable demand from our new cloud solutions, including PowerScribe One and CDE One,” he said. “We delivered record revenue in our Enterprise business and made important progress with international expansion, launching Dragon Medical cloud in three new countries.”

This strong performance allows Nuance to reaffirm its full-year revenue and ARR guidance, and to raise its EPS guidance as well, Benjamin said.

He went on to highlight Nuance’s strategic efforts in the allocation of capital, pointing to Nuance’s repurchasing of 5.7 million shares of common stock and paying down $300 million in high yield bonds during the quarter. “We also announced today the redemption of $47 million of high yield debt as a further step to strengthen our capital structure, while maintaining a strong cash balance,” he added.

The update arrives soon after Nuance was named one of the “Best Places to Work for LGBTQ Equality” by the Human Rights Campaign Foundation for the second consecutive year.

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February 7, 2020 – by Alex Perala