Appen Ltd. (AU:APX)
ASX:APX
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Appen
(Sydney:APX)
Select Model
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Rating:56Neutral
Price Target:
AU$1.50
▼(-11.24% Downside)
Action:ReiteratedDate:03/26/26
The score is primarily held back by weak financial performance (multi-year losses and volatile revenue) and limited valuation support (negative P/E). Offsetting this, the latest earnings call was notably positive with explicit FY26 growth/margin guidance and strong Q4 execution/cash conversion. Technicals are mixed, with only modest near-term momentum.
Positive Factors
Rising generative AI mix
A growing share of higher-value generative AI work shifts the revenue mix toward projects with stronger pricing and technical barriers. This structural move supports sustained gross-margin expansion and deeper technical engagement, making revenues less commodity-driven and more defensible over time.
Negative Factors
Multi-year net losses
Sustained statutory losses and negative operating margins through multiple years have eroded equity and left returns negative. Persistent unprofitability constrains retained earnings, limits capital available for strategic investment, and raises the bar for achieving lasting margin recovery.
Read all positive and negative factors
Positive Factors
Negative Factors
Rising generative AI mix
A growing share of higher-value generative AI work shifts the revenue mix toward projects with stronger pricing and technical barriers. This structural move supports sustained gross-margin expansion and deeper technical engagement, making revenues less commodity-driven and more defensible over time.
Read all positive factors
Appen (APX) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$361.83M
Dividend YieldN/A
Average Volume (3M)1.76M
Price to Earnings (P/E)―
Beta (1Y)3.05
Revenue Growth-9.02%
EPS Growth80.67%
CountryAU
Employees1,130
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)-0.01
Shares Outstanding268,019,900
10 Day Avg. Volume1,778,676
30 Day Avg. Volume1,764,209
Financial Highlights & Ratios
PEG Ratio0.28
Price to Book (P/B)2.23
Price to Sales (P/S)0.89
P/FCF Ratio10.79
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$1.41Price Target Upside-16.57% Downside
Rating ConsensusHold
Number of Analyst Covering2
EPS Forecast (FY)>-0.01
Revenue Forecast (FY)AU$278.25M
Appen Business Overview & Revenue Model
Company Description
Appen Limited, together with its subsidiaries, operates as an AI lifecycle company that collects and labels image, text, speech, audio, video, and other data used to build and enhance artificial intelligence systems. It operates through two segmen...
How the Company Makes Money
Appen makes money primarily by selling AI data and related services to enterprise and technology customers that need high-quality, labeled and curated data to develop and improve machine-learning models. Its core revenue streams typically include:...
Appen Earnings Call Summary
Earnings Call Date:Feb 24, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Aug 26, 2026
Earnings Call Sentiment Positive
The call conveyed clear progress: solid group-level revenue growth (ex-Google), substantial improvement in underlying EBITDA, exceptional expansion and profitability in Appen China, growing exposure to higher-margin generative AI work, realized cost efficiencies, a stronger technical team, and a positive cash position. Offsetting these positives are a material YoY decline in Appen Global for the full year, seasonality and project-driven volatility, and earnings pressure from accelerated non-cash amortization. Management provided explicit FY '26 guidance, signaling confidence in continued momentum. On balance the positive operational and financial developments — particularly China’s outperformance, margin recovery, and cost savings — outweigh the near-term variability and accounting headwinds.Positive Updates
Group Revenue Growth (Ex-Google)
Group revenue of $230.8M, up 4.5% vs FY '24 when excluding the impact of Google, driven primarily by new project wins and expansions in generative AI.
Negative Updates
Appen Global Full-Year Decline
Appen Global full-year revenue of $127.9M was down 21.1% YoY (excluding Google) due to lower volumes in Q1–Q3, resulting in full-year underlying EBITDA of $5.8M (down from $9.2M in FY '24).
Read all updates
Q4-2025 Updates
Positive
Negative
Group Revenue Growth (Ex-Google)
Group revenue of $230.8M, up 4.5% vs FY '24 when excluding the impact of Google, driven primarily by new project wins and expansions in generative AI.
Read all positive updates
Company Guidance
Appen guided FY '26 group revenue of $270–$300 million and an underlying EBITDA before FX margin of 5%–10% (implying ~17%–30% growth versus FY '25 revenue of $230.8M and materially higher margin potential versus FY '25 underlying EBITDA of $12.2M and a 5.3% full‑year margin). That outlook follows strong Q4 momentum (group Q4 EBITDA margin 18.2%; Appen Global Q4 revenue $41.4M, +56% QoQ, with Q4 Appen Global EBITDA $10.2M at a 24.6% margin), Appen China FY '25 revenue $102.9M (+74.8% YoY) with EBITDA up 640% to $10.6M and annualized revenue exiting the year >$135M, a group gross margin of 40.3% (up 100 bps), 44.1% of Q4 revenue from generative AI (versus 34.8% a year ago), $10M of annualized cost efficiencies, cash of USD 59.8M (AUD 89.5M), ~100% conversion of EBITDA to operating cash flow in the period, and a longer‑term FY '27 margin ambition of 10%.Appen Financial Statement Overview
Summary
Income Statement
28
Negative
Balance Sheet
62
Positive
Cash Flow
55
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 238.82M | 234.28M | 411.31M | 559.89M | 615.57M |
| Gross Profit | 7.75M | 61.18M | -34.79M | 10.07M | 93.01M |
| EBITDA | 10.64M | 3.34M | -89.37M | 11.77M | 101.30M |
| Net Income | -22.58M | -20.01M | -118.08M | -344.86M | 28.52M |
Balance Sheet | |||||
| Total Assets | 152.57M | 170.59M | 227.65M | 375.94M | 690.68M |
| Cash, Cash Equivalents and Short-Term Investments | 59.86M | 54.81M | 47.17M | 34.55M | 65.85M |
| Total Debt | 14.66M | 16.83M | 17.01M | 15.01M | 20.71M |
| Total Liabilities | 57.90M | 56.27M | 91.50M | 157.72M | 151.69M |
| Stockholders Equity | 94.67M | 114.32M | 136.00M | 218.22M | 538.99M |
Cash Flow | |||||
| Free Cash Flow | 19.60M | -3.96M | -42.79M | -14.00M | 41.07M |
| Operating Cash Flow | 23.77M | -1.07M | -22.94M | 26.29M | 71.84M |
| Investing Cash Flow | -17.22M | -19.83M | -31.48M | -46.33M | -67.71M |
| Financing Cash Flow | -5.02M | 57.22M | 79.36M | -13.74M | -18.85M |
Appen Technical Analysis
Neutral
1.69
Price Trends
1.58
Negative
1.22
Positive
1.06
Positive
Market Momentum
-0.04
Positive
46.36
Neutral
30.83
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:APX, the sentiment is Neutral. The current price of 1.69 is above the 20-day moving average (MA) of 1.46, above the 50-day MA of 1.58, and above the 200-day MA of 1.06, indicating a neutral trend. The MACD of -0.04 indicates Positive momentum. The RSI at 46.36 is Neutral, neither overbought nor oversold. The STOCH value of 30.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AU:APX.
Appen Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | AU$1.03B | 15.07 | 58.17% | 3.02% | 5.82% | 11.11% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
56 Neutral | AU$361.83M | -9.37 | -26.36% | ― | -9.02% | 80.67% | |
56 Neutral | AU$65.64M | 38.88 | 5.67% | ― | 11.90% | 42.11% | |
46 Neutral | AU$37.73M | 8.18 | 1.96% | 3.45% | 2.06% | -277.78% | |
46 Neutral | AU$268.28M | 31.82 | -10.10% | ― | -3.10% | -236.41% | |
45 Neutral | AU$85.58M | -58.44 | -1.40% | ― | -18.64% | 92.67% |
* Technology Sector Average
AU:APX
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.