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- Artificial intelligence data specialist Appen (APX) flags a weaker-than-expected second half of 2022
- The company says it has seen “no improvement” in trading conditions in August and September despite forecasting its 2022 full-year revenue to be weighted to this period
- Appen forecasts “materially lower” earnings and revenue compared to last year, with EBITDA to land between US$13 million and US$18 million in 2022 and revenue between US$375 million and US$395 million
- CEO Mark Brayan says despite the “challenging operating conditions”, Appen remains committed to diversifying its revenue and products to improve productivity
- Appen shares are down 14.1 per cent to $2.86 at 2:34 pm AEDT
Shares in artificial intelligence (AI) data specialist Appen (APX) have nosedived after the company flagged a weaker-than-expected second half of the year.
In August, Appen told investors it expected its 2022 full-year revenue to be weighted to the latter part of the second half of the year, citing the upcoming delivery of some seasonal global projects, growth in China and a forecast increase in customers.
However, the company today said it had seen “no improvement” in trading conditions in August and September.
As such, Appen now forecasts 2022 full-year revenue of between US$375 million and US$395 million (A$576 million and A$606 million).
The company also said its earnings before interest, tax, depreciation and amortisation (EBITDA) and EBITDA margins would remain “materially lower” than last year, with EBITDA to land in the range of US$13 million and US$18 million in 2022.
The company said this was largely due to lower profit and lower revenue for the year, as well as a change in its revenue mix.
Appen CEO Mark Brayan said despite the “challenging operating conditions”, the company remained committed to its long-term strategy of diversifying its revenue and products to improve productivity.
“While our plans to increase the use of offshore facilities are gathering pace as well as our actions to reduce costs, the full benefits of these programs will not be evident in FY2022,” Mr Brayan said.
“Appen has a strong balance sheet with no debt. Additionally, the business has solid cash conversion, and we remain confident in our ability to invest and implement our strategy during this transitional period.”
Appen said its non-core global business had continued to grow, while momentum in its Enterprise business was “building”, with year-to-date bookings up 22 per cent compared to this time last year.
Appen shares were down 14.1 per cent to $2.86 at 2:34 pm AEDT.
