Cerence Inc. CRNC reported fourth-quarter fiscal 2021 non-GAAP earnings of 66 cents per share, up 6.5% on a year-over-year basis. The figure beat the Zacks Consensus Estimate by 20%.Revenues came in at $98.1 million, up 7.5% year over year driven by strength in the License, Connected Services and Professional Services segments. However, the top line missed the Zacks Consensus Estimate by 0.6%.In fiscal 2021, the company reported non-GAAP earnings of $2.53 per share, up 48.8% on a year-over-year basis. Revenues came in at $387.2 million, up 17% year over year.The company reported bookings of $590 million for fiscal 2021. New products represented 20% of the total bookings for the year.Following the fiscal fourth-quarter announcement, shares of Cerence dropped 20.6% and closed at $82.59 on Nov 22. In the premarket trading on Nov 23, shares are trading up 1.1%.Cerence Inc. Price, Consensus and EPS Surprise Cerence Inc. price-consensus-eps-surprise-chart | Cerence Inc. Quote The Top Line in DetailLicense revenues of $51.4 million increased 11% year over year. Within License revenues, Variable License revenues were down 13%, while Fixed License revenues were up 54% on a year-over-year basis.Connected Services revenues of $25.6 million increased 1% from the year-ago quarter’s figure. Within Connected Services revenues, Legacy Connected Services revenues were up 1% and New Connected Services revenues were flat year over year.Professional Services revenues totaled $21.1 million, up 9% year over year.In the quarter under review, Vietnam’s domestic car company — VinFast — leveraged Cerence to power conversational AI for its entire range of smart electric vehicles (EVs). The company also won a deal with a client specializing in the manufacturing of elevators to provide voice AI technology and connected services for building next-generation elevators.The company reported that Repeatable software contribution (TTM) for the fiscal fourth quarter stood at 81%. Growth in billings per car (TTM over prior year TTM and excludes legacy contract) was 8%.The percent of worldwide auto production with Cerence Technology (TTM) stood at 53%.Operating DetailsNon-GAAP gross margin expanded 230 basis points (bps) on a year-over-year basis to 78.1%.Total operating expenses increased 27.9% year over year to $63.2 million, mainly due to research and development, sales and marketing along with general and administrative costs.Operating margin on a non-GAAP basis contracted 490 bps on a year-over-year basis to 37.2%.Balance Sheet & Cash FlowAs of Sep 30, 2021, cash, cash equivalents and marketable securities were $158.9 million compared with $149.9 million as of Jun 30, 2021.The long-term debt, net of discounts and issuance costs amounted to $265.1 million as of Sep 30.In the fiscal fourth quarter, cash provided by operating activities came in at $23.3 million compared with $24.1 million reported in the prior quarter. Free cash flow was $19.3 million compared with $21.2 million reported in the previous quarter.In fiscal 2021, cash provided by operating activities came in at $74.4 million compared with $44.8 million reported in the prior fiscal year. Free cash flow was $62.3 million compared with $25.8 million reported in the previous fiscal year.GuidanceFor first-quarter fiscal 2022, Cerence expects revenues between $91 million and $96 million.Non-GAAP earnings per share (EPS) for the fiscal first quarter is expected in the range of 47-53 cents. Non-GAAP operating margin is anticipated in the range of 32-34%.The company expects IHS auto production to decline 21% in the fiscal first quarter. Adjusted EBITDA is projected in the range of $31-$35 million.For fiscal 2022, the company expects revenues in the range of $400-$425 million. Adjusted EBITDA is forecast to be $144-$163 million for the fiscal year.Non-GAAP EPS are expected in the range of $2.17-$2.51 per share. Non-GAAP operating margin is anticipated in the range of 33-36%.Zacks Rank & Stocks to ConsiderCurrently, Cerence carries a Zacks Rank #5 (Strong Sell).Some better-ranked stocks worth consideration in the broader technology space includes Arrow Electronics ARW, Alphabet GOOGL and Monolithic Power Systems MPWR.While Arrow Electronics and Alphabet sport a Zacks Rank #1 (Strong Buy) at present, Monolithic carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Arrow Electronics’ shares have gained 31.4% on a year-to-date basis. The long-term earnings growth rate for the company is currently projected at 27.4%.Alphabet’s shares have surged 66.9% on a year-to-date basis. The long-term earnings growth rate for the company is currently projected at 25.8%.Monolithic’s shares have rallied 52.3% on a year-to-date basis. The long-term earnings growth rate for the company is currently projected at 25%. 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