Nuance announces first quarter 2021 results

Nuance Communications, Inc. today announced financial results for its first quarter ended December 31, 2020:

• GAAP revenue of $345.8 million and GAAP earnings per diluted share of $0.02.
• Non-GAAP revenue of $345.8 million and non-GAAP earnings per diluted share of $0.20.

“We are very pleased with the strong start to the fiscal year, as we delivered revenue and EPS above our guidance range expectations,” said Mark Benjamin, Chief Executive Officer at Nuance. “We continued to advance our strategic initiatives, accelerating our cloud transition across our core platforms in Healthcare and focusing on our AI-first approach in Enterprise. In Healthcare, we saw solid performance in our cloud-based offerings, growing cloud revenue 28% year-over-year. In particular, we benefited from strong performance in Dragon Medical & DAX Cloud revenue, which grew 22% year-over-year driven by the ongoing transition of our installed base to Dragon Medical One, as well as traction in international, ambulatory and community hospital markets. Enterprise delivered another record revenue quarter, up slightly from its previous record in Q1’20, driven by particularly strong demand for our Security & Biometrics solutions.”

Mr. Benjamin concluded, “In a separate release today, we announced the acquisition of Saykara, a like-minded healthcare IT company that aligns well with our technology portfolio and growth strategy. This acquisition brings together the best and brightest minds in AI, machine learning, and ambient technologies for healthcare, and we are pleased to be adding even more leading scientists and developers to our world-class R&D team.”

As previously announced, in the first quarter of 2021 we announced the sale of our medical transcription and electronic healthcare record go-live businesses. The sale is on track to close during Q2 2021. Accordingly, we are now presenting our results on a continuing and discontinued operations basis, giving effect to the disposition of these businesses.  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.

Q1 2021 Performance Summary

Q1 2021 results for continuing operations include:

• Revenue of $345.8 million, compared to $361.5 million in the same period last year.
• Non-GAAP revenue of $345.8 million, compared to $361.6 million in the same period last year.
• GAAP operating income of $31.5 million, compared to $36.0 million in the same period last year.
• Non-GAAP operating income of $91.4 million, compared to $90.4 million in the same period last year.
• GAAP operating margin of 9.1%, compared to 10.0% in the same period last year.
• Non-GAAP operating margin of 26.4%, compared to 25.0% in the same period last year.
• GAAP net income of $7.0 million, compared to a net income of $43.6 million in the same period last year.
• Non-GAAP net income of $62.5 million, compared to $63.5 million in the same period last year.
• GAAP EPS of $0.02, compared to $0.15 in the same period last year.
• Non-GAAP EPS of $0.20, compared to $0.22 in the same period last year.
• Operating cash flows from continuing operations was $54.6 million, compared to $44.7 million in the same period last year.

Capital Allocation
We remain committed to our balanced capital allocation approach. In February, we replaced our revolving credit facility, with the maturity date now extended to 2026 and the facility upsized to $300 million. We did not repurchase any shares during the first quarter, and have $261 million remaining under our share repurchase board authorization. We remain confident in the strength of our balance sheet and our liquidity position, ending the first quarter with a cash and marketable securities balance of $374 million, above our target minimum cash balance range. – PR Newswire