NASDAQ$INOD

Innodata Inc · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

Innodata's Q3 2023 earnings showcased strong year-over-year revenue growth and significant sequential Adjusted EBITDA growth.

Innodata reported a 20% year-over-year increase in revenue for Q3 2023, reaching $22.2 million. Adjusted EBITDA saw a 100% sequential quarter-on-quarter growth, amounting to $3.2 million. The growth was driven by generative AI development work with new big tech customers, with further revenue expansion anticipated in Q4 and 2024.

  • Q3 2023 revenue reached $22.2 million, a 20% increase year-over-year.
  • Adjusted EBITDA for Q3 2023 was $3.2 million, reflecting a 100% sequential quarter-on-quarter growth.
  • Growth was fueled by generative AI development work with new big tech customers.
  • Forecasted Q4 revenue is expected to be $24.5 million or more, representing a 26% or higher year-over-year growth.

Headline financials

Total Revenue

$22.2M

Previous: $18.4M+20.2%
EPS (adj)

$0.01

Previous: -$0.12+108.3%
Capital Expenditures

-$4.32M

Previous: -$5.25M+17.8%
Free Cash Flow

-$3.95M

Previous: -$8.58M+54.0%
Net Income

$371K

Previous: -$3.33M+111.2%
Operating Income

$1.24M

Previous: -$4.56M+127.2%
Gross Profit

$8.22M

Previous: $6.06M+35.8%
Cash & Equivalents

$14.8M

Previous: $10.7M+37.9%
Total Assets

$56.4M

Previous: $47.8M+18.0%
Stock-Based Comp

$1.02M

Previous: $805K+26.3%

Revenue & EPS history

Innodata · Revenue · Quarterly

$22.2M

Q3 2023+20.2%vs Q3 2022
Beat estimate in 5 of 6 quarters(83%)
ActualEstimate

Forward guidance

Innodata anticipates continued revenue expansion in Q4 and 2024, driven by generative AI development programs with large tech customers. The company forecasts revenue of $24.5 million or more for Q4, representing at least 26% year-over-year growth, and Adjusted EBITDA of $3.7 million or more.

Tailwinds

  • Revenue is forecasted to reach $24.5 million or more in Q4, representing 26% or higher year-over-year growth.
  • Adjusted EBITDA is projected to be $3.7 million or more in Q4.
  • The company has signed a master services agreement for AI development with another large tech company.
  • Innodata has master service agreements in place with five of the largest technology companies.
  • Company expects generative AI development work with one customer to potentially reach a $23 to $25 million runrate at the end of the year

Headwinds

  • Revenue from a large social media company decreased, impacting year-over-year growth comparisons.
  • The new relationship with a large tech company is at an early stage
  • Company is dependent on content providers in its Agility segment
  • Company relies on project-based work in the Digital Data Solutions segment
  • Company is subject to risks discussed in its Annual Report on Form 10-K

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2023

Historical avgQ3 2023

+3.9%

Avg return

Earnings day

+8.8%

Avg return

5 days after

+9.4%

Avg return

30 days after

45%

29 / 65 earnings

Positive

+77.7%

Q3 2024

Best reaction

-25.0%

Q2 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-2.1%+97.5%+119.2%
Q4 2025-7.2%-6.6%-22.0%
Q3 2025+7.0%+1.7%-5.1%
Q1 2025-15.7%-15.2%+24.6%
Q4 2024+13.5%+17.6%-23.4%
Q3 2024+77.7%+91.0%+85.0%
Q2 2024+20.0%+6.3%-9.0%
Q1 2024+55.3%+59.9%+124.9%
Q4 2023-16.8%-11.2%-26.0%
Q3 2023+18.8%+16.1%-1.6%
Q2 2023+27.9%+25.1%-3.5%
Q1 2023+15.3%+7.1%+30.0%
Q4 2022+10.2%+3.2%+13.4%
Q3 2022+16.6%+13.8%+7.2%
Q2 2022-25.0%-32.0%-48.5%
Q1 2022+11.1%+2.0%-26.9%
Q4 2021+42.5%+45.7%+33.6%
Q3 2021-18.3%-25.3%-44.4%
Q2 2021+20.5%+13.1%+15.3%
Q1 2021+6.3%-1.0%+13.8%
Q4 2020+39.7%+57.5%+20.8%
Q3 2020+41.8%+31.4%+73.6%
Q2 2020+4.3%+9.9%+43.3%
Q1 2020+11.7%+7.8%+21.4%
Q4 2019+2.3%-3.8%-16.2%
Q3 2019-5.4%-4.3%-12.1%
Q2 2019+7.8%+12.9%+8.6%
Q1 2019-9.5%-12.9%-14.7%
Q4 2018-4.1%-2.0%-15.6%
Q3 2018+6.3%-1.4%+27.5%
Q2 2018+0.8%-4.8%+12.1%
Q1 2018-0.9%-0.9%-1.7%
Q4 2017+0.9%+6.4%+3.6%
Q3 2017-8.7%-14.8%-3.5%
Q2 2017-3.2%+0.0%-3.2%
Q1 2017-15.4%-17.9%-17.9%
Q4 2016-2.4%-7.3%+2.4%
Q3 2016-12.0%-22.0%-10.0%
Q2 2016+2.0%-1.2%-7.7%
Q1 2016+0.0%
Q4 2015-3.7%
Q3 2015+8.3%
Q2 2015+0.4%
Q1 2015-0.7%
Q4 2014-0.4%
Q3 2014-1.9%
Q2 2014-1.6%
Q1 2014-6.9%
Q4 2013+2.9%
Q3 2013-1.7%
Q2 2013-1.8%
Q1 2013-2.6%
Q4 2011-0.5%
Q4 2012-0.5%
Q3 2012-12.1%
Q2 2012-2.3%
Q1 2012+2.2%
Q3 2011-6.8%
Q4 2009-8.3%
Q2 2011-8.3%
Q4 2010-8.3%
Q1 2011-1.5%
Q3 2010+5.6%
Q2 2010-4.3%
Q1 2010-7.5%

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