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Appen Ltd. (AU:APX)
:APX
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Appen (APX) AI Stock Analysis

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AU:APX

Appen

(OTC:APX)

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Neutral 43 (OpenAI - 4o)
Rating:43Neutral
Price Target:
AU$0.50
▼(-35.90% Downside)
Appen Ltd. is facing significant financial and operational challenges, reflected in its low financial performance and valuation scores. Despite some positive developments in the China market and cost-saving initiatives, the overall outlook remains cautious due to ongoing profitability issues and bearish technical indicators.

Appen (APX) vs. iShares MSCI Australia ETF (EWA)

Appen Business Overview & Revenue Model

Company DescriptionAppen (APX) is a global provider of human-annotated data for machine learning and artificial intelligence. The company specializes in data collection, data annotation, and data validation services, catering to a diverse range of sectors including technology, automotive, healthcare, and finance. Appen's core offerings include text, image, audio, and video data services, which are essential for training AI and machine learning models to improve their accuracy and functionality.
How the Company Makes MoneyAppen generates revenue primarily through its data services, which are sold to technology companies and organizations requiring high-quality training data for their AI and machine learning applications. The company's revenue model is based on project-based contracts, where clients pay for specific data collection and annotation projects. Key revenue streams include contracts with major tech firms, government agencies, and enterprises in various industries. Additionally, Appen benefits from partnerships with leading AI companies and platforms, enabling it to expand its reach and service offerings. The company's ability to leverage a global crowd of workers for data tasks allows it to scale operations efficiently and meet diverse client needs, contributing significantly to its earnings.

Appen Earnings Call Summary

Earnings Call Date:Aug 27, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Mar 02, 2026
Earnings Call Sentiment Neutral
Appen's earnings call highlighted positive growth in revenue, particularly driven by the China market and cost efficiency initiatives. However, challenges remain due to losses in EBITDA, volatility in the U.S. market, and uncertainty in large LLM projects. The strong cash position and positive contributions from the China market provide a solid foundation for future growth.
Q2-2025 Updates
Positive Updates
Revenue Growth
Appen recorded revenue of USD 102.1 million, representing a 2% year-on-year growth when excluding the impact of Google. 24% of this revenue was from generative AI-related projects.
China Market Success
Revenue in China grew 67% year-on-year, with an annualized run rate revenue exceeding $100 million, highlighting strong momentum in the region.
Cost Efficiency Initiatives
Appen identified approximately $10 million in annualized cost efficiencies, with 70% to be realized by the end of Q3 FY '25.
Positive EBITDA Contribution from China
China contributed $2.9 million to underlying EBITDA, a $2.8 million improvement compared to H1 FY '24.
Strong Cash Position
Appen ended the half with a cash position of USD 60.9 million or AUD 92.9 million.
Negative Updates
Losses in EBITDA
Group underlying EBITDA before FX recorded a loss of $2.2 million despite improvements compared to the previous period.
Short-Term Volatility in U.S. Market
Global Services and New Markets segments were impacted by volatility in the U.S. AI market, leading to lower revenue and gross margin.
U.S. Government Division Challenges
Due to U.S. policy uncertainty, meaningful short-term revenue opportunities within the U.S. Government division are challenging, leading to a decision to wind back investment.
Uncertainty in Large LLM Projects
There is limited visibility regarding the timing of the resumption of large volume LLM projects.
Company Guidance
In the recent call, Appen provided detailed guidance for the fiscal year 2025, focusing on several key metrics and strategic initiatives. The company reported a 2% year-on-year revenue growth to USD 102.1 million, excluding the impact of Google, with 24% of this revenue coming from generative AI-related projects. Appen highlighted a significant 67% increase in revenue from China, achieving an annualized run rate exceeding $100 million by the half's end. The company has identified $10 million in annualized cost efficiencies in its non-China business, with 70% of these expected to be realized by the end of Q3 FY '25. Appen also mentioned an additional $4 million in annualized OpEx savings due to the wind-down of U.S. Government division investments. Despite a loss of $2.2 million in group underlying EBITDA before FX, the company remains focused on achieving EBITDA positivity for the full year. Appen reaffirmed its FY '25 revenue guidance towards the low end of the $235 million to $260 million range, supported by strong customer relationships and market differentiation in multilingual speech training data and large language model evaluation.

Appen Financial Statement Overview

Summary
Appen Ltd. is facing significant financial challenges with declining revenues, profitability, and cash flow generation. Despite a stable equity base, operational inefficiencies and cash flow constraints are evident. Strategic improvements are needed to enhance performance and restore growth trajectory.
Income Statement
40
Negative
Appen Ltd. has experienced a significant decline in revenue and profitability over recent years. The gross profit margin remains notably low, and the company reported negative net income for the last three years, indicating challenges in maintaining profitability and revenue growth. The lack of EBIT and negative EBITDA margin highlight operational inefficiencies.
Balance Sheet
55
Neutral
The company's balance sheet shows a relatively stable equity position, but the debt-to-equity ratio has been increasing due to rising liabilities. The equity ratio remains healthy, suggesting a solid asset base. However, the declining return on equity indicates that the company is struggling to generate returns from shareholder investments.
Cash Flow
30
Negative
Appen Ltd. faces issues with negative free cash flow and inconsistent operating cash flows, reflecting challenges in generating cash from its core operations. The free cash flow to net income ratio is unfavorable, indicating difficulties in converting income into cash flow.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue352.86M234.28M411.31M559.89M615.57M599.39M
Gross Profit30.24M61.18M-34.79M10.07M93.01M111.80M
EBITDA-10.27M3.34M-89.37M11.77M101.30M85.71M
Net Income-32.68M-20.01M-118.08M-344.86M28.52M38.84M
Balance Sheet
Total Assets228.99M170.59M227.65M375.94M690.68M598.21M
Cash, Cash Equivalents and Short-Term Investments92.48M54.81M47.17M34.55M65.85M78.39M
Total Debt15.03M11.04M12.43M15.01M20.71M25.23M
Total Liabilities81.83M56.27M91.50M157.72M151.69M113.94M
Stockholders Equity147.16M114.32M136.00M218.22M538.99M484.27M
Cash Flow
Free Cash Flow-1.47M-3.96M-42.79M-14.00M41.07M63.51M
Operating Cash Flow1.60M-1.07M-22.94M26.29M71.84M94.02M
Investing Cash Flow-21.38M-19.83M-31.48M-46.33M-67.71M-70.92M
Financing Cash Flow56.55M57.22M79.36M-13.74M-18.85M-11.85M

Appen Technical Analysis

Technical Analysis Sentiment
Negative
Last Price0.78
Price Trends
50DMA
0.85
Negative
100DMA
0.95
Negative
200DMA
1.24
Negative
Market Momentum
MACD
-0.02
Negative
RSI
41.56
Neutral
STOCH
66.67
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:APX, the sentiment is Negative. The current price of 0.78 is below the 20-day moving average (MA) of 0.82, below the 50-day MA of 0.85, and below the 200-day MA of 1.24, indicating a bearish trend. The MACD of -0.02 indicates Negative momentum. The RSI at 41.56 is Neutral, neither overbought nor oversold. The STOCH value of 66.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:APX.

Appen Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
AU$106.46M13.3610.79%3.64%14.59%-11.13%
AU$166.36M142.594.26%11.90%42.11%
AU$114.66M32.145.74%11.72%
AU$281.88M29.234.81%23.53%-23.98%
$37.18B12.37-10.20%1.83%8.50%-7.62%
AU$219.13M-24.40%-9.02%80.67%
AU$360.87M33.61-10.10%-3.10%-236.41%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
AU:APX
Appen
0.78
-1.23
-61.19%
AU:KYP
CV Check Ltd
0.37
0.24
184.62%
AU:ATA
Atturra Limited
0.72
-0.44
-37.93%
AU:CCR
Credit Clear Limited
0.28
-0.02
-6.67%
AU:COS
Cosol Limited
0.60
-0.32
-34.78%
AU:DUG
DUG Technology Ltd
2.15
0.29
15.59%

Appen Corporate Events

Appen Limited Issues Performance Rights to Boost Employee Engagement
Oct 13, 2025

Appen Limited has announced the issuance of 71,929 performance rights under an employee incentive scheme, which are unquoted securities subject to transfer restrictions. This move is part of the company’s strategy to incentivize employees and align their interests with the company’s growth objectives. The issuance of these securities is expected to enhance employee engagement and retention, potentially impacting Appen’s operational efficiency and competitive positioning in the AI data solutions market.

The most recent analyst rating on (AU:APX) stock is a Hold with a A$1.00 price target. To see the full list of analyst forecasts on Appen stock, see the AU:APX Stock Forecast page.

Appen Limited Announces Leadership Transition with New Chair Appointment
Sep 24, 2025

Appen Limited announced a leadership transition with Richard Freudenstein stepping down as Non-Executive Chair, to be succeeded by Vanessa Liu, effective December 31, 2025. Liu, who brings over 25 years of experience in scaling global technology businesses and expertise in AI, is expected to guide Appen through its next phase of growth, capitalizing on the increasing demand for AI-driven solutions. This transition is seen as a strategic move to strengthen Appen’s market position and expand its reach in the rapidly evolving AI industry.

The most recent analyst rating on (AU:APX) stock is a Hold with a A$1.00 price target. To see the full list of analyst forecasts on Appen stock, see the AU:APX Stock Forecast page.

Appen Limited Issues New Shares to Enhance Market Position
Sep 10, 2025

Appen Limited has announced the issuance of 707,939 fully paid ordinary shares following the vesting of performance and retention rights. This move reflects Appen’s compliance with relevant corporate regulations and indicates a strategic step in enhancing shareholder value, potentially impacting its market positioning positively.

The most recent analyst rating on (AU:APX) stock is a Hold with a A$1.00 price target. To see the full list of analyst forecasts on Appen stock, see the AU:APX Stock Forecast page.

Appen Limited Announces Quotation of New Securities on ASX
Sep 10, 2025

Appen Limited has announced the quotation of 707,939 ordinary fully paid securities on the Australian Securities Exchange (ASX) with the issue date of September 4, 2025. This move is part of the company’s strategy to enhance its market presence and provide liquidity for its securities, potentially impacting its operational capabilities and positioning within the technology sector.

The most recent analyst rating on (AU:APX) stock is a Hold with a A$1.00 price target. To see the full list of analyst forecasts on Appen stock, see the AU:APX Stock Forecast page.

Appen Announces Director’s Interest Change
Sep 8, 2025

Appen Limited has announced a change in the director’s interest notice involving Mr. Richard Freudenstein. The change pertains to the transfer of 66,847 ordinary shares from Bond Street Custodians Limited to Invia Custodian Pty Ltd, acting as a nominee for Ansime Pty Ltd ATF R & JF Superannuation Fund. This adjustment reflects an internal reorganization of shareholding structures, with no impact on the total number of shares held. This change is not expected to have significant implications for the company’s operations or market positioning.

The most recent analyst rating on (AU:APX) stock is a Hold with a A$1.00 price target. To see the full list of analyst forecasts on Appen stock, see the AU:APX Stock Forecast page.

Citigroup Alters Substantial Holding in Appen Ltd
Sep 1, 2025

Citigroup Global Markets Australia Pty Limited has ceased to be a substantial holder in Appen Ltd as of August 28, 2025. This change in substantial holding involves a series of transactions related to securities lending agreements, impacting the voting securities of Appen. The adjustments in Citigroup’s holdings could influence Appen’s market dynamics and stakeholder perceptions, reflecting shifts in investment strategies by significant shareholders.

The most recent analyst rating on (AU:APX) stock is a Hold with a A$1.00 price target. To see the full list of analyst forecasts on Appen stock, see the AU:APX Stock Forecast page.

Appen Ltd. Earnings Call: Growth Amid Challenges
Sep 1, 2025

Appen Ltd. recently held its earnings call, revealing a mixed sentiment among stakeholders. The company showcased positive revenue growth, particularly driven by the burgeoning Chinese market and strategic cost efficiency initiatives. However, challenges such as losses in EBITDA, volatility in the U.S. market, and uncertainties surrounding large LLM projects were also highlighted. Despite these hurdles, Appen’s robust cash position and the strong performance in China provide a promising outlook for future growth.

Appen Ltd. Reports Mixed Earnings Amid Market Volatility
Aug 28, 2025

Appen Ltd., a global leader in data for the AI lifecycle, specializes in data sourcing, annotation, and model evaluation to support innovative AI systems across various sectors. In its latest earnings report for the first half of 2025, Appen reported a 9.2% decrease in total sales revenue and other income, amounting to $103.2 million, compared to the same period in 2024. The company’s Global Services segment saw a significant decline in revenue by 33.3%, while the New Markets segment experienced a 19.7% increase, driven largely by strong growth in the China business unit. Despite the overall revenue decline, Appen’s cash balance increased to $60.9 million, and the company maintained a debt-free status. Looking ahead, Appen’s management remains focused on capturing growth opportunities by enhancing data quality, operational efficiency, and technology innovation, while managing costs prudently.

Appen Limited Releases Half-Year 2025 Financial Results
Aug 28, 2025

Appen Limited announced its half-year results for the period ending June 30, 2025, and shared an investor presentation detailing these results. The announcement underscores Appen’s continued influence in the AI data industry, highlighting its extensive global reach and expertise in supporting AI product development, which is crucial for stakeholders in maintaining competitive advantage in AI-driven markets.

The most recent analyst rating on (AU:APX) stock is a Sell with a A$1.00 price target. To see the full list of analyst forecasts on Appen stock, see the AU:APX Stock Forecast page.

Appen Limited to Release 1H FY25 Financial Results and Host Investor Webinar
Aug 6, 2025

Appen Limited announced it will release its financial results for the first half of the fiscal year 2025 on August 28, 2025. The company will host an investor webinar on the same day, featuring discussions led by CEO Ryan Kolln and CFO Justin Miles. This announcement is part of Appen’s ongoing efforts to engage with stakeholders and provide transparency regarding its financial performance.

The most recent analyst rating on (AU:APX) stock is a Buy with a A$2.35 price target. To see the full list of analyst forecasts on Appen stock, see the AU:APX Stock Forecast page.

Appen Reports Q2 FY25 Results with Strong Growth in China Amid US Market Volatility
Jul 29, 2025

Appen Limited reported a revenue of $51.9 million for Q2 FY25, a 6% decrease compared to the previous corresponding period, but a 3% increase from Q1 FY25. The company saw significant growth in its China business, with a 77% increase in revenue compared to the previous year, achieving an annualized revenue run-rate exceeding $100 million. However, this growth was offset by volatility in the US AI market. Appen is implementing a technology innovation and automation strategy to achieve cost efficiencies, with $10 million in annualized savings identified. The company maintains a strong cash balance and is tracking towards the low end of its FY25 revenue guidance range of $235 million to $260 million.

The most recent analyst rating on (AU:APX) stock is a Buy with a A$0.80 price target. To see the full list of analyst forecasts on Appen stock, see the AU:APX Stock Forecast page.

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.Date of analysis: Oct 22, 2025