Cerence Inc. (CRNC) Earnings Call Transcript & Summary

[Presentation] Hello, and welcome to Cerence in Motion. I am Jillian Sindoni from team Cerence, and it is my pleasure to be your host for today's event. Thank you so much for taking the time to join us. The next 90 minutes are going to be packed with exciting new products, services and platforms that advance connected mobility. You will hear from Cerence leadership. Plus, we are excited to welcome Sunny Madra, Head of Ford X, as our special guest. There is no doubt that you will walk away today as inspired and excited as we are, so let's get started. I am honored to introduce you to the Chief Executive Officer of Cerence, Sanjay Dhawan. Sanjay, please go ahead.

thank you, Jillian, for the welcome. I couldn't be happier to be here with all of you today. It is with immense pride and excitement that I say thank you and welcome to Cerence in Motion. As our first major product launch event since our establishment as an independent company, just a little over 15 months ago, this is an important moment for our team and for you, our customers and partners. I and the entire Cerence team thank you for your support, your enthusiasm, your partnership and for taking the time to join us today. Together, we have paved the way with meaningful game-changing innovation, transforming the role of virtual assistant and driving the entire mobility industry forward. Despite everything we have all faced in 2020, I'm proud to say that this past year was, without question, the best in our history: nearly 20 major design wins; over 100-plus start-up productions from 33 brands; 51 million cars, that's almost 54% of the global production shipped with Cerence technology; and 1.4 billion transactions ran through our cloud, demonstrating not just usage, but ongoing adoption of the automotive assistance we are building; and we launched 17 new products, a remarkable piece of innovation. But if you can believe it, we have just -- we are just getting started. The bar is higher than ever. Our commitment to our customers is stronger than ever, and we have more -- we are more committed than ever before to shaping the -- shaping and advancing the world of mobility to create a safer, more enjoyable journey for everyone. We'll further enhance the in-car experience, deepen our AI, innovate to cloud and expand into new adjacent markets, all in faster, more powerful, easier to deploy and more scalable solutions. For customers around the world, this means meeting their growing desire to bring their entire digital life, all waiting devices, content and services they touch on a daily and sometimes hourly basis into their mobility journey. For you, our customers and partners, this means preserving your brand experience, preserving your data and elevating your role in your customers' lives through smart, user-centric design and innovative new capabilities. These are strategic tenets that propel us forward. As you know, Cerence is an AI company. Our tagline is AI for the world in motion. We believe firmly that AI is going to define the software-defined car of the future -- software-defined connected car of the future. We -- our vision is to play in all different elements of AI. From a long-term vision standpoint, we're very, very focused on using AI to enhance the experience, make it safer, make it secure, make it convenient. We're focused on driver AI, using AI to enhance the driver experience in a safer way. We're going to expand further in-cabin AI, using not just voice but other modalities as well, including vision, and obviously, from a safety standpoint, road AI as well. So we have a very long-term vision for the future of transportation and mobility, and I'm definitely very excited to share a part of that with all of you today. So with that, I'm excited to preview what you'll hear today. What can most easily be described as the new Cerence. With a set of product launches, you will see the remarkable growth in innovation that gives way to the next generation of Cerence products and offerings: Cerence Drive 2.0, a unified cloud and embedded stack that will set new standards for voice and AI performance; new Cerence Cloud Services products, extending drivers' digital lives into the cars like never before; significant enhancements to our core offerings that goes beyond voice that further transform the role of mobility assistant; and now Cerence mobility -- and the new cerence Mobility Platforms, a strategic technical foundation and path forward in new areas of mobility. As you'll hear from our team, you will see that we're focused on driving increased value, smart innovation and incredible experiences across the entire mobility landscape. Today is the beginning of the next generation of Cerence, a new path built on over 20 years of industry-leading heritage. So let's get started. Jillian?

Thank you, Sanjay. What a great way to kick things off. It's very clear that our recent success is what makes us ready for the next phase of our journey together. With that, let me turn it over to Udo Haiber, Senior Vice President of Research and Development, to introduce Cerence Drive 2.0. Take it away, Udo.

Thanks, Jillian, and nice to talk to you all. So a year ago, we started to rethink and renew our core platform, taking all the experience to the next level that we made in delivering hundreds of SOPs before. And now it is available. So therefore, I'm super excited to have the opportunity during the next 15 minutes to unveil our new product called Cerence Drive 2.0 to you. It is the fastest, most powerful and intelligent AI assistant platform for mobility. It now features deeper cloud connectivity, along with Cerence's industry-leading embedded solutions, to deliver a new level of performance, content and services. As a leader in that space, we are constantly pushing the boundaries. But before I explain more about this new product release, let's take a closer look and keep in mind we are building white-label assistance for automotive use. So any comparison is not meant to compete with Big Tech assistance but will show that we have greatly advanced our core tech and tuned it for automotive use and coexistence with those voice assistants. So let's see it in action now. [Presentation]

Wow. What an amazing new user experience and with lightning speed. But what is Cerence Drive 2.0 exactly? It is a software platform. It's a platform that combines all of our speech services across embedded in cloud, and it is used throughout our complete product portfolio. So all assistance and mobility applications that my colleagues will introduce today are built on top of this new platform. It is available on all relevant operating systems and comes with a dedicated service layer interface that is native to the respective operating systems like using AIDL on Android or C++ on Linux. And as part of that, it is, of course, also integrated with corresponding audio devices on the hardware platform through our abstraction layer. To round it up, the run time is packaged together with our developer tools like our Cerence Studio. New in this product is that we add customizable NLU domains that will give a quick start for each new OEM program rather than developing those domains from scratch over and over again. Let's talk about more new features on the next slide. I'm going to start with the core speech engines. We brought next gen of deep learning to all of our voice technologies now. Be it variations of gated recurring units for noise reduction or sector set-based NLU or generated voicenets for speech output, and you'll hear about that. And due to the breakthroughs in getting the compute needs for our inference engines down, the same voice technology will be deployed, not only in the cloud, but also on the edge. And you will see the improvements we made in a minute. Moving on to the next new feature called parallel multi-seat interaction. Our enhanced Audio AI Suite enables concurrent interaction of multiple speakers by creating audio bubbles around each speaker for our automotive platform, and Stefan will talk in more detail about it later. Also Just Talk, that's both drivers and passengers start a conversation with the assistant just as they would with a human without needing to first press a button or explicitly say a wake-up word. While it was available before, it was limited to a subset of features. With 2.0, we now enable the complete set of all hybrid NLU intents, not just in a car, but also, for example, in elevators. And my colleague, Charles will talk more about that in his session. And for that, for those, he will also require to understand multiple languages. With Cerence Drive 2.0, we now support that without explicitly switching between languages. We are also giving the end user more flexibility in the way he can formulate his request. For example, we allow the user to combine multiple paths for intents in a single utterance, which is a little bit like defining an ad hoc routine that does several things for you in a row; or we allow to make references to the interaction history, which is also called anaphora or ellipsis resolution. A simple example of that is the call him, where the him refers to a previous interaction and a person there. The nice thing is this works across client and server or even across modalities, which means you can refer, for example, to a place-name in a cloud use case like weather that was entered haptically before on the head unit. Having the flexibility to say more is great but sometimes, and I like that, it is even greater to say less and still get all you want. With our hybrid AI reasoning module, we predict the information that is missing in the utterance. For example, if the user simply says, "find parking at destination " we may have learned preferences on covered parking when it's raining, for example. And we'll find only those that are open while the user arrives. Preferences make sense only in case you can identify the user. With that, you can then offer personalized services. Adding user authentication to the picture enables for more services, including payment transactions. My colleague, Prateek, will talk more about Cerence Pay right after I'm finished. Drive 2.0 also comes with intelligent over-the-air update capabilities that allow, for example, for partial updates of their systems, like only adding a new language or even update only a single prompt without changing complete TTS and all, of course, with zero disruptions to the running client and no need to stop the service for AI. But enough talking about new features, let's have numbers speak to our performance improvement. At the heart of Cerence Drive 2.0, our renewed voice recognition and natural language understanding engines has been developed. After 1 year of hard work of the global R&D team in Cerence, I'm incredibly proud to say today that the team created the fastest, most accurate offering out there for automotive. As we all know, AI is about data. And only today, 19th of January, we'll see around 6 million more new automotive utterances that hit our cloud, 24/7. And we use those to constantly improve our models across the board. Leveraging those field data massively, together with our new deep learning models, improved the accuracy by large. As you can see on the left, we improved accuracy for both, the voice recognition and the natural language processor. The ASR went up by 60% measured on field data. And if we look at the subset of utterances with accents and nonnative speech only, the accuracy improvement is even higher. The NLU is now using transformer-based sector set models, as mentioned before, and those models outperform the previous models by 75%. But Cerence Drive 2.0 is not only more accurate, but it delivers now 5x faster response time. And with that, we've reduced end-to-end latency to under 1 second. And as you may know, normally, there is a trade-off between speed and quality. Therefore, I was happy to see that we were able to push both KPIs into the right direction. But not only ASR and NLU improved, also the Voice of Cerence made great progress. I am thrilled to introduce Cerence neural TTS, which is following our Cerence suite of product that was announced this past summer. Our new, high-end text-to-speech takes the tech from the world's best long-form reading product and applies same breathtaking, incredibly natural voices and applies it to your speech output prompting cache. Now let's listen to some examples. [Presentation]

Isn't that outstanding quality? At least it sounds to my ears. It is attributed to a full deep learning methodology that includes transformer-based networks and generated voicenets. In those 6 months following the Cerence Reader launch, we were able to reduce the latency to under 200 milliseconds which made it work for a prompting engine. We measure the quality improvements using mean opinion score methods. And indeed, we're beating the currently best TTS by 0.4 points, which is a significant improvement. Till now, I introduced new features and talked about performance. Moving on, I will talk to the expanded offering of Cerence Drive 2.0 to support your global needs. For all of you that have worked with Cerence over the years, you know that we excel at serving a global market. Drive 2.0 has integrated more than 60 content providers into our Cerence domain universe. Combined with the broadest language coverage, we now deliver nearly 1,500 different domain packages for all the languages. And most impressively, for me, Cerence delivers around 14,000 [ analytic ] signatures, which is a multiple more than other offerings in the automotive market today. And those numbers were all about our own native domains only. With our new products, Cerence's extent and our new ability to import ecosystem skills into our Cerence Studio, the number of supported domains becomes basically unlimited. And Prateek will introduce that as well in a second. With that, I'm happy to officially launch Cerence Drive 2.0. We have seen together that it is easy to integrate, feature-rich, incredibly fast and accurate and has the broadest set of domains and languages. I can't tell you how proud I am about those big steps forward, really. So I wanted to thank the global Cerence R&D team for those achievements. And the good thing for you is it is ready today. Some of our customers have already started with the integration, and it will likely hit the road already this calendar year. So I'm happy to engage with all of you about Drive 2.0 and explain and show more about it, hopefully soon by visiting you in person. Thank you, and stay safe. Back to you, Jillian.

Wow, Udo, incredible. Cerence Drive 2.0 is just remarkable. It's the arms and legs that we need to expand our offerings, meet consumer needs across mobility and create experiences unlike ever before. On that note, please allow me to introduce our Chief Technology Officer, Prateek Kathpal, who will unveil our new suite of cloud-connected services. Prateek, please go ahead.

Thanks, Jillian. Jillian, I totally agree with you, multi-intent dialogue flow that looks absolutely amazing. The Drive 2.0 and the innovation around this, it just opens up doors for some amazing new products, and it also serves as a foundation for a new suite of products that will advance the mobility experience. Let's take a moment to consider our daily lives. If you're like me and the rest of the Cerence team here, your digital lives are multifaceted. They're intertwined. We all use mobile tools today. We have smartphones with smart devices, thermostats. Our offices are connected, and we want dynamic, real-time content, convenience and even productivity in our lives. A few short years ago, a new frontier for connectedness was the living room. That box is checked now. Cars today are adding the next-generation connected experience. So today, we are excited to announce Cerence Extend. Cerence Extend offers a seamless and an easy way to extend your digital lives into the car. Since Extend brings the power of your phone apps to car and enables you to use voice to interact with the apps on your phone from the head unit. It enables the multiple Big Tech ecosystems association and connects to your broad digital lives into the car. Today, the current projection-based solutions like the Apple CarPlay, Android Auto, they offer very limited user experience. And not only the OEMs lose control on the UI in the infotainment screen, they also have no visibility into the user actions and user data. Since Extend not only enables the users to access their apps directly from the head unit to a voice-based interface, but it also keeps the OEMs in complete control of the in-car user experience. It offers a safer and an intuitive experience to interact with the phone apps, and drivers can access the native phone features like the calendaring, the alarms and the reminders, as well as the third-party apps like the Zoom, the Microsoft Team, WhatsApp, Amazon, Starbucks and many more. Well, of course, it goes without saying both iOS and Android apps and the phone functions are supported by Extend. Let's have a look. [Presentation]

Well, wasn't that great? I would love to have this in my car. Well, another product that we are thrilled to announce today in our cloud services portfolio is the Cerence Connect. Cerence Connect provides an easy way to control your smart home devices and IoT ecosystems through voice and the infotainment UI in the car. If you're like me, I have my smart home lights connected to Alexa, I have a Nest thermostat connected to Google Home. I use Samsung SmartThings for my Samsung appliances. When we started building the Connect product, we had a very simple goal. We wanted the users to bring in all their smart home connections that they already have into the car seamlessly and not have them create or reenroll these devices in the car again. Think about the themes, the room names, the devices that you have defined in your Home Graph today. Would you want to go sit in the car and reenroll and set all of them again into the full new ecosystem? And even if someone does spend the time and has the courage to do that, what happens when you add or remove some of these appliances or buy a new device and add it in your home? You start all over again in the car. Well, Connect removes all these limitations and enables the drivers to simply link their Big Tech ecosystem accounts into the cloud. And behind the scenes, it uses ARK and deep learning to create a very intuitive experience to the users in the car. But it does not just stop there. This is the first time in the automotive world that you can now link your vehicle data to your smart home to create unlimited use cases, themes, rules as you would like. For example, on one side, you can set up a very simple rule and connect that when I share my car with my kid and he drives, let's say, more than 80-mile speed, I get SMS notification. And on the other hand, I can create a rule to automatically turn on my Philips lights at home, disable my ADT alarm and turn on the TV when my car goes into the garage. Connect eliminates all these complexities and boundaries and the integrations that were needed with thousands of different smart home devices and gives the OEMs a one single interface to enable and to operate all of them together. Let's have a look. [Presentation]

Really amazing and transformative, right? It just bridges your IoT and the smart home and the automotive lights, just bridges them all together. Next slide, please. So today, we are also excited now to announce Browse, an AI-powered content service that brings the intelligence of Internet search engines directly into the car. It enables users to ask any general knowledge question or real-time event questions. And behind the scenes, it connects to multiple sources in real time. It indexes continuous information from millions of Internet sources and uses machine reading comprehension to deliver the best possible answer to the user. So whether you're asking what's the latest score in soccer today, to how tall is the Empire State Building, you'll receive a very refined and a natural language answer. We have, in the past, announced apps, Cerence Car Life and Cerence Pay. Today, I'm excited to announce a new addition in our apps portfolio, Cerence Tour Guide, your virtual tour guide and concierge on the go. If you could have a virtual tour guide telling you about the journey, the monuments as you're passing by and gives you more information about the points of interest around you, wouldn't that be great and cool? Well, as the name suggests, Cerence Tour Guide is your virtual tour guide and assistant in the car. It provides you with the information and facts to explore the sites while on the road. You can set up custom tours or it can suggest you tours if you're visiting new cities or places. You can also use it to book experiences at the restaurants, the museums and attractions. Let's have a look. [Presentation]

So as you can see here, the Cerence Cloud Services now fully connects your digital life into the car and integrate with thousands of different ecosystems and devices and services to provide a complete experience. Not only is the cloud multi-tenant and multi-region enabled, but it is also constantly evolving with deep learning and enables a very personalized experience based on your preferences. Cerence Cloud Services and Drive 2.0, as Udo had shared, have become the foundational elements of various mobility platforms that you will hear more about from Charles today. Now it doesn't just stop right there. Cerence Studio is a development environment for developers and OEMs to add new domains and integrations into the Cerence Studio -- Cerence Assistant. We are now extending it with a new capability for developers to easily improve Google Actions and Alexa Skills that they have previously written and now can reuse them and improve them into the Cerence Assistant or Cerence Studio and finally into the Assistant to get to the next-generation in-car voice assistant. We can import these actions and skills into the Cerence Studio and still reuse the application and business logic written for Google Actions and Alexa Skills. This eliminates the time that was previously needed to write new domains or applications on the Cerence platform. With cars becoming more and more connected, Cerence Cloud Services focuses on the extension of your digital life seamlessly into the car and sets the stage for an entire new chapter in the automotive technology. With that, I'll pass it back to Jillian. Thank you.

Thank you for Prateek. So exciting. Smart home and smartphone connectivity is a major leap for mobility assistance, very innovative and just incredible. To continue the theme of groundbreaking, I am excited to introduce our very special guests today, Sunny Madra, Vice President of Ford X at Ford Motor Company. Sunny is joined by Cerence's Chief Marketing Officer, Rick Mack, for a special fireside chat on bridging drivers' mobile and digital lives. Rick, I'll turn it over to you and Sunny.

Awesome. Thank you, Jillian, and thrilled today to have Sunny join us. Sunny heads the Ford X program over at Ford, their incubation group, where they are charting the future for mobility and transportation. Sunny brings a fascinating background across tech in automotive, media, venture capital. And with today being all about innovation, new business, new models, I can't think of a better guest to have here. So Sunny, welcome to Cerence In Motion.

Great. Thanks for having me. The announcements have been wonderful so far, so really awesome to see what you guys are doing, the innovative cyber technology you guys are releasing today.

That's great. Great.

So let's get started. I have a handful of things that I'd love to hear your thoughts on. And we'll stay with the theme that Prateek was just talking about and this idea of bridging our mobile and digital lives. So you've seen that we're fully committed to AI and IoT and smart home. I'm curious, what are you hearing from Ford customers about this trend? And how are you addressing it?

Yes. And it's wonderful to see the product announcements because the customers are actually looking for that seamless connection between their smart home ecosystems and their vehicles. Up until today, until these announcements, those 2 ecosystems have been quite separated, and there have been sort of lightweight touch points. And I think what customers are really looking for is an end-to-end seamless journey. And we started to see that in other places with like if you look at music, right? Right now, your music experience, whether it's Spotify or whether it's Apple Music, you can kind of carry that from the home into your vehicle. And I think the expectation of the customer now is the ability to have that ecosystem with them. So if they wanted to adjust their temperature at home, interact with their garage or open it, all the examples we saw Prateek just gave us, I think that's the direction which customers are looking for. And we're seeing that as a -- almost like a primary decision factor around the vehicle because it's so important that the investment that you make in your smart home, the work that you do to create this connected ecosystem carries into your vehicle.

That's great. I love the idea of the concept of end-to-end seamless journey. So as the car does become more connected, it becomes more of that central hub. You've got all of these ecosystems playing a role. You've got all of these sensors, all of this data. How do you ensure that coexistence, a cohesive and coherent experience with all of these competing ecosystems, assistants that are out there and technologies that are making their way into a vehicle?

Yes. And it's a really great point because one of the things that we've seen previous to today's announcement is this notion of sort of these fractured or fragmented ecosystems. And what you guys are really bringing to the market today is the ability to continue to use that same ecosystem. If I've made the investment in my home to make Alexa connected and I have that everywhere, then I want to carry that into the vehicle. I don't want to redo those with a number of system. On the flip side, maybe I haven't done it, and there's an opportunity for an OEM to build out a branded assistant and do that in a way. So I think it's really important that both the platform and the vehicle support multiple assistants, and then there'll be partners that can easily give that choice to your customers. So when I get in the car, if I don't have an assistant, I can use sort of a maybe OEM-branded one; or if I have an ecosystem that I've chosen to work with, I can leverage that quite easily out of the same interface. And I think, again, seeing the announcements today are really, really making me excited that you guys are kind of 2 steps ahead of where the industry is going already.

That's fabulous. Yes. The choice and flexibility is so critical in all of this. Pulling back out a little bit, there's a ton of trends that are obviously having a profound effect on each of our respective businesses. You've got autonomous driving, electrification, all of this intelligence making its way into vehicles. When you look across the landscape, where do you see the biggest opportunities and some of the biggest challenges that we face as an industry?

Yes. It's a great question. I think like -- I'll come back around to autonomous. I think like connected vehicles is so nascent right now. For me, it feels like the smartphone ecosystem, really, really early on when the Apple iPhone App Store came out and the Google Play Store came out. We are -- and a lot of people forget, when the iPhone first came out, they didn't even have an App Store. All the apps are just bundled on the phone, very similar to what we saw with other OEMs previous -- for mobile phone OEMs. I think what we're seeing now start to occur is sort of this app ecosystem is just starting to evolve. And if you kind of look back at that movie, the folks that were involved in that ecosystem quite early on are some of the most successful companies in the world today. Mark Zuckerberg has a very famous quote about the shift from HTML5 to the mobile apps. And by not doing that early on enough, it will threaten the company. And I really see the same thing happening in this ecosystem where the companies that are making the investment around the application ecosystem tied into other things, it's really, really important that we're just starting to see that kind of come -- happen.

That's great. I'll follow on with a second quote. Read a recent interview that with the new Ford CEO, Jim Farley, where he said that data is going to be more powerful and more valuable than fuel economy. Can you give some use cases and some benefits that we're going to see from the proliferation of data that is coming out of our cars in mobility today?

Yes. Great question, and I'll give you guys a couple of examples, right? So I'll give you an example just from internal to our industry, and then I'll go towards customers. So internally, one of the things that we've done on the new F-150 is, using the data, we realized we used to provide like proximity sensors for keys. We used to provide those sort of all around the vehicle, and we use the data coming off our vehicle to understand that most customers are not entering the vehicle from their rear doors or anywhere else. We were able to kind of reduce the number of antennas inside our vehicles. And obviously, there's a cost benefit to that and also warranty benefits, so you have less things to worry about. So that's sort of data changing our world from a standpoint of efficiency as an OEM. I think as a customer, what we're really starting to see is, and I saw it in some of the examples that Prateek just showed, it's sort of that endless and seamless journey, right? Where if I've started something, one of the things that voice is really enabling is this seamless experience without driver distraction. And there's a couple of things that are going to factor into that is I have decided to go somewhere, and so we know we're embarking on the world of charging, right? And with charging, one of the things that we have to be conscious of is until the technology significantly changes, there's going to have to be other activities for us to do around charging. And so I'll just use the Tesla ecosystem for a second. The Superchargers are generally located somewhere where you can go and get a meal and do other things while your car is charging for 40 to 50 minutes. And so the importance of there being some AI that understands the end user and says, "Okay, Rick is going here, and he's going to be charging his electric vehicle. And these are the type of things that he likes. And so what I will suggest for him is to charge, make sure that I've also taken into account that I've reserved the charging station for him. But also here's, some food recommendations for him." So we're really starting to see that play in. And if you look at a lot of the investment that even Tesla has made around entertainment within the vehicle, it's to keep people occupied while they're charging. I think fewer people are sitting in their driveway and playing karaoke in their car. So more people are doing that while they're charging. Now I don't think it's enough, and I don't think it's sufficient to say let's just create entertainment options within the vehicle. I think the more you can be connected in the ecosystem, the more you can understand the end user with that data and you could provide them an experience while they're charging your electric vehicle, I think that's going to be really powerful.

That's amazing. So when we think about the experience in the car and that seamless journey, it was almost 14 years ago to the day, it was at CES in 2007 that Ford launched SYNC. It was kind of a watershed moment for the industry. It was one of the first heavily marketed, heavily deployed voice assistance out there, and it's evolved tremendously over the course of the last 14 years. You're on SYNC 4 now. It's beginning to pop up in the Mach-E in the Ford F-150 in the Bronco which are getting unbelievable reviews and winning all kinds of awards, so congratulations for that. When you think of SYNC 4 and how far it's come, what excites you most? What really stands out to you in the system?

Well, it's just going to tie back to what we were seeing a second ago. I think when we -- when that journey was started, and I was well before I was at Ford, but like I had seen it from the outside, right? It was sort of there was a recognition by the company that like technology and end user technology needed to merge with the vehicle, right? What I see now with sort of the SYNC platform is the ability to understand that it's more of a platform, and it's a platform to support these external partners like Cerence. We need to do that in an interesting way because the customer expectation is so broad now because of the smartphone world that they expect to have world-class services in every area, whether they're listening to music, whether they're listening to content, whether they're connecting with their smart home or just using it for POI searches. And so the only way to actually kind of retain that world-class experience that you have on the smartphone is to basically turn your AVI system into a platform, and I think that's the evolution that we're starting to see with SYNC now, right? When we started, it was sort of we provided everything. There was no apps, and so I view that as the iPhone 2007. There was no apps. Apple provided them all. And then we're now kind of going in this moment where, no, we have to have an ecosystem where the developers can come in. They can actually create wonderful experiences for our customers.

That's great. So all the goodness that we find in automotive, last question for you. Your role at Ford X is not just about automotive but also looking at mobility and transportation in general. When we spoke about a week ago, we talked a little bit about micromobility, and I'm going to foreshadow a little bit of the conversation to come here. But I'm curious, how do we begin to take the transcendent nature of these automotive assistants and bring that same type of capability to micromobility, bikes, motorcycle, scooters, obviously, where Ford has some interest as well?

Yes. It's really great. I think one of the very, very special sauce that exists in companies like Cerence is this understanding of voice-first application. And because of that, if you think of micromobility and if you've ridden any of these scooters, you do not have the ability to fumble around with your phone. As much as people do that in their car, you really can't do it on a scooter because you're going to hit a pothole or a curve or something like that. And so I think the ability to create a really seamless voice experience from a navigation standpoint, from an entertainment standpoint, from a use case standpoint of where should I go? Where can I talk to this thing? We're can I go? I think those things are really, really powerful. And I think for micromobility, that's the next jump there, right? Everyone kind of has these scooters today, and everyone has deployment, and that's been the name of the game for now. And Spin has done a wonderful job, but I think the next term for that industry is going to be creating the better experience that comes with those scooters. And really excited, you guys gave me a little bit of a preview of what you're announcing, but I can't wait to kind of watch more into exactly what it is. And maybe we can even work together on that, that would be awesome.

Absolutely. Absolutely. Well, Sunny, thank you very much. This was wonderful. I appreciate you taking the time. I appreciate the support from you and Ford over all these years. It's been really great to see and look forward to this absolutely continuing. So really appreciate you joining today.

Great. And a great partnership from you guys as well. Thank you, and congrats on all of the announcements today.

Awesome. Sunny, thank you so much. Jillian, back to you.

Excellent. Thank you, Rick. That was such a great conversation. Thank you both truly. It's incredible to hear the endless possibilities for how voice and AI will shape our mobility experience. Next up, I'll be turning it over to Stefan Ortmanns, Executive Vice President and General Manager of Core Products, here at Cerence. He will introduce several significant enhancements to our core. Stefan, please go ahead.

Thanks, Jillian, and special thanks to you, Sunny. Great discussion, faster, smarter and more powerful, truly extending our digital life to mobility. So I'm delighted to introduce a number of exciting enhancements, new offerings as part of our core stack, deepening our experience in voice and looking into additional multimodalities. Like humans do, the natural human interaction is more than just speech. It's a combination of voice, gesture and eye movement. By bringing guests to our conversational AI platform, we enable a whole new way of in-cabin interaction. All you need to say is what's that or tell me more about the building on the left side. Moreover, our innovations and solutions are focusing on all occupants in the car and are no longer limited to the driver or front-seat passengers only. So I'm really thrilled to announce the next-generation of Cerence Look 2.0. We have tuned the assistant into an intuitive, knowledgeable companion that has rich insight about anything accounted on your journey. That said, it allows drivers and passengers to interact with point of interests outside the car. Simply look at the building or a landmark and ask the assistant for contact information, opening hours or even ratings. For you -- for example, you see a restaurant, just ask what are the opening hours of that restaurant or book me even a table there. And the assistant will provide all the information and necessary steps you are looking for. Let's have a look at the video, please. [Presentation]

Isn't this cool? It's just fantastic. Many thanks to our colleagues from Mercedes for providing us with a video. This solution is super intelligent. It enhances the voice assistant by connecting passengers with the world around them. In addition to bringing the outside world in, we can also model all regions within the car, enabling occupants to interact with the inside of the car. You see a warning light or notification, just ask for more help or more details. All in all, Cerence Look made it easier than ever for drivers and passengers to interact with and better understand their cars. Coming now to Audio AI. I'm very pleased to introduce our Cerence Audio AI Suite. It's a very critical piece of our core platform, as Udo mentioned, especially when we have to deal with very disturbed and noisy environments. Our Audio AI solution supports a wide range of applications such as enhanced speech quality for hands-free communication, so for phone calls; activation of barge in and wake words or Just Talk in speech dialogues; or for instance, the realization of multi-seat applications, and we'll talk later about this. So in order to be understood, we must be first heard. Now what does it mean for us? Great voice intelligibility starts with a crystal-clear audio signal. So if you want to have a world-class communication and speech experience, we need a clear-cut and precise speech input from drivers and passengers. The foundation of our Audio AI offering is our new DNN-based signal enhancement with superior noise suppression and a new beam former. To start with, just let me give you an idea of the challenges we are facing. Please, can you play the sound example? [Presentation]

So it's a very disturbed audio signal. You can hear drive noises, music and other background noises. But can you really understand what has been said? Can you play it again, please? [Presentation]

Now by processing that audio sample with our new SSE, all that nasty, ambient, internal noise will be removed from the speech input. In comparison, let's now listen to the processed and clear signal, please. [Presentation]

Evidently much, much better, and you can really understand what has been said, namely set the destination to Long Beach, California. As you can hear from this example here, the new SSE provides a superior speech quality while suppressing various stationary and nonstationary noise types. With the new SSE, you get a first-class audio quality, whether you're on a hands-free call, speaking to your voice assistant or communicating with other occupants in the car. And moreover, the new DNN-based solution learns to better cope with more and more noise types over time. Now for enabling a world-class in-cabin experience, we have to provide access to in-vehicle content and functionality from all seats. Our multi-seat solution allows a vehicle to customize the cabin into private acoustic zones that allow passengers to simultaneously interact with the system. For instance, an acoustic shown for the driver would allow him, her to make a call without being interfered by other passengers. Whereas a passenger in the rear could interact with the voice assistant saying, "Roll down my window." But let's listen to the samples first. The first one is without zoning. [Presentation]

The challenge here is all speakers interacting simultaneously, again impossible to understand. I cannot even tell you who is speaking and what has been said. And now please, can you play the sample after multi-zone processing, please? [Presentation]

It's like magic. Clearly, a huge improvement and a much, much better experience for the passengers. We have made this possible by evolving our multi-seat intelligence solution, and just let me highlight a couple of features. First, by combining beam-forming with passenger interfering techniques, the new multi-seat solution allows an almost perfect suppression of interfering speech from other speaker zones. With that, we have the ability to enable or is enabled zones dynamically, even during an ongoing call, undoubtedly a new experience for multi-zone, hands-free telephony. For speech recognition from all seats, we are supporting multi-zone with anaphora recognition and barge in with up to 8 zones. In combination with multi-zone arbitration and our new 1x architecture, as introduced by Udo, the new multi-seat sheet solution can handle speech dialogues from all seats in parallel and listen real time. Finally, let me also present our enhanced In-Car Communication system. The conversation between passengers, especially between front- and rear-seat passengers is often challenged by the driving noise and the fact that driver and front passengers normally speak toward the windshield. That means in order to be understood in the rear seats, driver and front passengers have to speak louder than normal, which makes longer conversations very painful. You know what I mean, especially if you have kids. Our In-Car Communication solutions overcome these problems by providing a superior intelligibility of conversations between front- and rear-seat occupants. The ICC system takes a speech signal off a dedicated seat microphone and distributes them via the sound system. That means speech signals from the front passengers are played via the rear right speakers and vice versa. Let's take a closer look at our ICC. The first sample is without ICC . Please, can you play it? [Presentation]

You see that's a typical standard conversation here. It's the noise in the back, what you hear, but now let's play it with ICC turned on. [Presentation]

Yes. As you can hear, ICC improves the communication quality, and equally important, reduces the cognitive load of the driver. The new conversation enhancement is based on 2 big things: one, a new super directive beamer and enhanced adoption control for feedback separation. And we have optimized the solution for 3-seat rows. And maybe you have seen it or not, in newly released car models, for instance, Cadillac Escalade, you'll find a button on the steering wheel just playing in ear. With this, the driver can easily activate or deactivate this safety feature for a stress-free, in-car communication. Just let me wrap up here. We are doing everything to bring more excitement and safety to the car. Cerence Look, as part of our conversational AI platform, provides a new, natural way of interacting with the inside and outside of a vehicle. Our Cerence Audio package provides highest quality and allows the vehicle to personalize the interaction and command experience for each occupant in the car. Thank you very much. Stay safe and healthy. And with that, I hand back to Jillian.

Very exciting. Thank you, Stefan. So with everything you have heard so far, Cerence Drive, Cerence Cloud Services, moving far beyond voice, we are ready to take Cerence into a broader world of mobility. To share more on that, I am pleased to introduce Charles Kuai, the Senior Vice President and General Manager of Mobility Solutions. Hi, Charles. Please take it away.

Hi, Jillian. Good evening, good afternoon, good morning and Happy New Year to everybody. I'm actually joining everybody from Asia. So first, welcome and what an exciting, exciting day. Cerence, globally, is known as an auto leader in conversational artificial intelligence. Our heritage, our DNA has been bringing advanced technologies, artificial intelligence to our customers at commercial scale globally in auto. Today, we will introduce our world premiere, the first time will bring the power of artificial intelligence to commercial scale globally to other mobility solutions. Cerence Mobility Platforms, with the amazing new innovations that we just heard from Udo, Cerence Drive 2.0, globally, brings the best conversational artificial intelligence to the world of mobility. And with Prateek, Cerence Cloud brings the state-of-the-art native services as well as extending to unlimited content, bridging consumers from the move to their digital lives online. And last, Cerence Beyond Voice, with my colleague, Stefan, vision, gesture links our machines to us, closer, more human, more analog-based. I am thrilled to launch our next-generation automotive platform, an out-of-box solution that actually seamlessly integrates the above technologies innovation into our auto industry. And importantly, I want to welcome our new customers, our customers from both 2-wheelers and mobility for buildings. Cerence is unlocking this artificial intelligence and cloud advanced tech from cars to other modalities of mobility, 2-wheelers and building mobility. The 2-wheeler market, also Sunny and Rick talked about it, which is micromobility, are -- it's a very exciting market. It includes motorcycles, e-bicycles, bicycles, snowmobiles, jet skis and many, many more. Riders, unlike drivers, and machines are experiencing explosive growth. In urban cities, 2-wheelers have become a very, very desired way of mobility because it offers clean technology, and you can navigate between buildings without disruption of traffic. In developing countries, many, many of the world's markets, this is the main mode of transportation. Just in 2020, there has been over 100 million new units of these 2-wheelers that were added globally, and this is going to continue to grow. However, almost none of them are digitally connected, which means the riders and the life are decoupled or the ride and the life are decoupled, which Sunny just touched upon. Cerence's 2-Wheeler Platform brings the power of artificial intelligence, including touch, voice projection technology, to the riders to connect the ride and the digital life seamlessly. We support both iOS and Android operating systems. We integrate to the bike's data and fuse the sensors for intelligence beyond anything you can imagine today. And we're seamlessly integrating with the helmet, the headset that are generally available in the market. This AI power and technology is not only advanced but makes the ride safer, 2-way connected, intuitive. I'd imagine a decade from now, we would look back at this point in time and say, "How can we ride without a Cerence 2-Wheeler Platform?" Just like today, we do not ride a helmet -- we do not ride without a helmet. But just a few years ago, helmet have become a safety law requirement in many countries. This 2-Wheeler Platform brings our digital life ecosystem, contact information, music, point of interests to the ride. With our software platform that is contextually aware and with the Audio AI that Stefan touched upon, this cuts the road noise completely out while displaying critical information on the dashboard, either on your phone or other display mechanisms such as smart meters. Please join me on a road trip with Cerence 2-Wheeler. Please play the video. [Presentation]

Thank you. Sorry about that video challenge. Wow, Sanjay, you and I need to ride our motorcycle across the Alps when COVID is behind us and we're able to get vaccinated. I cannot wait until we're able to ride safely across the Alps and find our favorite burger place while enjoying the mountain scenes and feel assured that we will have enough juice to ride back home. This is very exciting. The next product that I would like to launch is touchless is becoming the norm. Born back in March 2020, my son inspired me to think how can we safely enter and use our elevators without touching? COVID-19 changed the world forever, from touch to talk. And with the new innovations, during a crisis, crisis in Chinese is made up of 2 meanings: danger and opportunity. This crisis unlocked many opportunities in this new vertical, what we call vertical mobility, which is the world of buildings that will actually last beyond COVID's crisis. Today, our skyscrapers are vertical cities. Our elevators, in my opinion, are the first autonomous vehicles, yet many of them are not AI nor digitally connected. I am very excited to introduce Building Mobility. Building Mobility works with all native operating systems in the elevator industry, languages, multiple languages simultaneously in an elevator. As the borders start opening up, we'll have a lot of international travelers connected to the building directory for point-of-interest navigation, connected with services cloud for nearby context and conditions. Our Building Mobility brings our full, robust cloud, including the power of analytics, for enhancing building management and building maintenance. We have a universal AI software module that can easily integrate to existing hall call devices or car call devices that easily and seamlessly out of the box to a non-digitally connected elevator to become an AI-powered vertical autonomous vehicle. Please join me walking into our vertical autonomous vehicle. Please play the video. [Presentation]

Now I will never be lost when I enter a newer skyscraper, when I'm rushing from one meeting to another and certainly I forgot what floor is Sunny on. I will know when my lunch arrives. When Uber Eats arrives, it will notify me. My customers are welcomed with open arms, while strangers are blocked safely. And most importantly, when I leave my 50th floor meeting place, as I descend down to the lobby, when I say, "Take me to the lobby," it knows that it's raining at the ground level. It reminds me to take an umbrella. And when I leave the elevator, before I leave the elevator, it knows the traffic condition in the neighborhood and reminds me rather than taking the taxi, I should take a Metro. Whether you're traveling within a vertical city, riding between vertical cities or driving between cities, Cerence Audio, Two-Wheelers and Building Mobility will ensure you're digitally connected on the move. Thank you, and back to you, Jillian.

Wonderful, Charles. Thank you so much. The possibilities are absolutely endless. And as I've heard you say, we are only just beginning. This has been an amazing event, our first virtual launch in these new times. It's an amazing time for Cerence, and we are thrilled you could join us today. There is way more to come for all of us together. But for closing comments, I'm pleased to welcome back our CEO, Sanjay, to take us home Sanjay, please go ahead.

Thank you, Jillian. Thank you to all the colleagues for introducing the -- and for all the hard work of all my team and the R&D and the product teams who have been working tirelessly to kind of create these great products. Innovation is central to Cerence. Focusing on customers is central in our DNA. We know we exist as a company because you give us an opportunity to serve you, and we thank you for that, for your partnership, for your -- you adopting and trusting in Cerence and all of our products. We work extremely hard and in an extremely focused way to basically create these world-best class and most innovative products, as you can see from some of the use cases and the launch videos that we shared with all of you. We thank you for your participation today. We thank you for your partnership and your trust in Cerence. And with that, we thank you for participating. Good morning, good evening to all of you. Bye-bye.