12 Worst AI Stocks to Invest In According to Reddit

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1. Cerence Inc. (NASDAQ:CRNC)

Number of Hedge Fund Holders: 15

Cerence Inc. (NASDAQ:CRNC) is one of the worst AI stocks to invest in according to Reddit. On February 5, TD Cowen lowered its price target for Cerence to $12 from $13 and kept a Hold rating. The firm characterized the recent financial results as noisy and noted that while there was a significant EBITDA beat in the FQ1 2026 and management confirmed the 2026 guidance, the figures imply an EBITDA shortfall for the remainder of the year compared to consensus estimates.

A day before, Cerence announced that FQ1 2026 was highlighted by a 126% year-over-year revenue surge to $115.1 million, largely driven by a $49.5 million patent settlement with Samsung. This windfall contributed to a record quarterly free cash flow of $35.6 million and a significant gross margin expansion to 86%. Cerence Inc. (NASDAQ:CRNC) also reaffirmed its full-year guidance, projecting revenue between $300 and $320 million and targeting increased penetration through its next-generation XUI platform.

The company already secured five major XUI programs with both Western and Chinese automakers, all commanding higher price-per-unit values than previous averages. Additionally, Cerence is expanding its AI portfolio with new Microsoft-integrated work agents and tools for dealership automation. While ongoing IP litigation with Apple and Sony remains a multi-year strategy, the Samsung resolution has established a positive precedent for the company’s monetization efforts across the automotive and technology sectors.

Cerence Inc. (NASDAQ:CRNC) provides AI-powered assistants for the mobility/transportation market in the US, the rest of the Americas, Germany, the rest of Europe, the Middle East, Africa, Japan, and the rest of the Asia-Pacific.

While we acknowledge the potential of CRNC to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CRNC and that has 100x upside potential, check out our report about this cheapest AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

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