NEW YORK - Innodata Inc. (NASDAQ:INOD), a global data engineering firm, has announced the acquisition of three new large language model (LLM) development contracts from a major Big Tech customer, anticipated to boost annualized revenue by approximately $20 million. This expansion is in addition to the existing $23 million annualized run rate revenue from this customer.
The company, which has already commenced work on these programs, expects to finalize an amended agreement in the coming weeks. Innodata CEO Jack Abuhoff expressed enthusiasm about the expansion and the potential for further growth in 2024, citing the customer's satisfaction with the company's high-quality data services for LLM fine-tuning.
Innodata has established itself as a provider of scaled data services for LLMs, with five of the "Magnificent Seven" Big Tech companies utilizing their services by the end of 2023. Two of these companies significantly contributed to Innodata's revenue in 2023, with a third beginning to contribute in the fourth quarter and continuing into the first quarter of 2024.
The company is optimistic about increasing revenues with these customers and making inroads with the remaining two in 2024.
This news is based on a press release statement.
InvestingPro Insights
In the wake of Innodata Inc.'s (NASDAQ:INOD) announcement regarding its new contracts with a major Big Tech customer, the company's financial metrics and market performance provide additional context for investors. With a market capitalization of $165.04 million, Innodata is navigating the competitive landscape of data engineering and AI-driven solutions. Despite a challenging market environment, the company reported a revenue growth of 9.84% for the last twelve months as of Q4 2023, showcasing its ability to expand its business amidst economic headwinds.
However, it's important to note that Innodata has been trading near its 52-week low, with its stock price down by 45.18% over the last three months. This volatility could be attributed to the company's negative earnings per share (EPS) of -0.03 USD, reflecting the challenges of reaching profitability in the short term. Moreover, the stock is currently trading at a high Price / Book multiple of 6.42, which could suggest that the market has high expectations for the company's asset value growth.
For investors considering Innodata's stock, it's essential to be aware of the company's financial health and market performance. Two InvestingPro Tips for Innodata highlight that the company holds more cash than debt on its balance sheet, which can be a positive sign of financial stability, and that the stock generally trades with high price volatility, indicating potential risks for investors. For those interested in a deeper analysis, there are additional InvestingPro Tips available, which can offer further guidance on Innodata's investment potential. To access these tips and gain more comprehensive insights, visit Investing.com/pro/INOD and use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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