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Innodata
(NASDAQ:INOD)
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Rating:73Outperform
Price Target:
$62.00
▲(8.45% Upside)
Action:Reiterated
Date:08/07/26
INOD scores well primarily on strong financial performance (profitability and free-cash-flow strength with low leverage) and a highly positive earnings call (raised guidance and substantial beats). Offsetting the score are a demanding valuation (high P/E, no dividend support) and mixed/weak technical signals (negative MACD and trading below key medium-term moving averages).
Positive Factors
Accelerating Revenue and Margin Expansion
Rapid growth combined with expanding gross profit and EBITDA margins indicates operating leverage as AI programs scale. Off-the-shelf datasets, platform tools, and synthetic-data capabilities may allow revenue to grow faster than headcount over the medium term.
Negative Factors
Unproven Durability of Recent Profitability
The recent turnaround is strong but has not yet been demonstrated across multiple business cycles. Earlier losses and weaker cash performance create risk that current margins depend on unusually favorable program mix, customer demand, or temporary operating conditions.
Read all positive and negative factors
Positive Factors
Negative Factors
Accelerating Revenue and Margin Expansion
Rapid growth combined with expanding gross profit and EBITDA margins indicates operating leverage as AI programs scale. Off-the-shelf datasets, platform tools, and synthetic-data capabilities may allow revenue to grow faster than headcount over the medium term.
Read all positive factors
Innodata Key Performance Indicators (KPIs)
Any
Adjusted EBITDA by Segment
Provides a view of operating performance by segment, excluding non-cash items and one-time charges, to assess underlying profitability and cash flow potential.
Provides a view of operating performance by segment, excluding non-cash items and one-time charges, to assess underlying profitability and cash flow potential.
Data provided by:
The Fly
The FlyInnodata (INOD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.97B
Dividend YieldN/A
Average Volume (3M)1.14M
Price to Earnings (P/E)39.0
Beta (1Y)3.98
Revenue Growth39.02%
EPS Growth0.49%
CountryUS
Employees10,064
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)1.43
Shares Outstanding34,382,652
10 Day Avg. Volume817,111
30 Day Avg. Volume1,139,886
Financial Highlights & Ratios
PEG Ratio16.48
Price to Book (P/B)15.14
Price to Sales (P/S)6.44
P/FCF Ratio45.46
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$122.75Price Target Upside114.71% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)1.08
Revenue Forecast (FY)$357.00M
Innodata Business Overview & Revenue Model
Company Description
Innodata Inc. is a global enterprise specializing in data engineering, with operations spanning the United States, the United Kingdom, the Netherlands, Canada, and other international locations. The firm conducts its business across three distinct...
How the Company Makes Money
Innodata makes money primarily by delivering services to enterprise and institutional customers that require high-volume, quality-controlled data work to support AI and digital information systems. Revenue is typically generated through (1) projec...
Innodata Earnings Call Summary
Earnings Call Date:May 07, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call conveyed strong, broad-based operational and financial progress: a record quarter with substantial revenue, margin, EBITDA, cash generation, and multiple new high-value engagements and platform traction. Management raised full-year revenue guidance and highlighted durable operating leverage, product milestones, research recognition, and federal and trust & safety wins. Noted caution points include quarter-to-quarter phasing variability, certain one-time items (prepayments and tax benefits) supporting results, reduced segment disclosure, and potential concentration from a rapid-rise large customer. Overall, the positive operational momentum and sizable beats materially outweigh the cautions.Positive Updates
Record Quarter Across Key Metrics
Revenue of $90.1M, up 54% year-over-year and 24% sequentially; adjusted gross profit $42.6M (adjusted gross margin 47%), a 6 percentage-point sequential improvement and 7 points above the 40% target; adjusted EBITDA $25M (28% of revenue), representing ~96% growth in adjusted EBITDA versus 54% revenue growth.
Negative Updates
Quarterly Variability and Phasing Risk
Management noted that work phases (pretraining, mid-training, post-training) start and stop unevenly, creating quarter-to-quarter variability; company declined to issue quarter-by-quarter revenue guidance due to timing uncertainty of program phases.
Read all updates
Q1-2026 Updates
Positive
Negative
Record Quarter Across Key Metrics
Revenue of $90.1M, up 54% year-over-year and 24% sequentially; adjusted gross profit $42.6M (adjusted gross margin 47%), a 6 percentage-point sequential improvement and 7 points above the 40% target; adjusted EBITDA $25M (28% of revenue), representing ~96% growth in adjusted EBITDA versus 54% revenue growth.
Read all positive updates
Company Guidance
Management raised 2026 revenue growth guidance to approximately 40% or more (up from 35%+ ten weeks ago), citing a record Q1 that delivered $90.1M revenue (+54% YoY, +24% QoQ), beating consensus ~$76.5M by ~$13.6M (≈18%); adjusted gross profit of $42.6M (47% adjusted gross margin, +6 pts QoQ and +7 pts above the 40% public target); adjusted EBITDA $25M (28% of revenue, ≈96% YoY growth vs. 54% revenue growth, and ~6-pt margin expansion QoQ), which exceeded consensus $10.4M by ~139%; net income $14.9M, diluted EPS $0.42 (vs. $0.08 consensus), effective tax rate ~14% (below the 23–25% long‑term target), cash $117.4M (up $35.1M QoQ from $82.2M), undrawn $50M Wells Fargo facility (expanded from $30M), and noted upside not included in the baseline—including a potential $51M big‑tech engagement this year, ~453% YoY growth from other tech customers, a ~$3M annual run‑rate trust & safety SOW, a $1M platform deal and 15 active platform trials.Innodata Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
82
Very Positive
Cash Flow
88
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 317.16M | 251.66M | 170.46M | 86.78M | 79.00M | 69.75M |
| Gross Profit | 135.20M | 99.83M | 66.93M | 31.91M | 27.66M | 26.26M |
| EBITDA | 67.81M | 48.31M | 30.28M | 5.03M | -6.59M | 1.22M |
| Net Income | 46.48M | 32.18M | 28.66M | -908.00K | -11.94M | -1.67M |
Balance Sheet | ||||||
| Total Assets | 356.67M | 168.59M | 113.45M | 59.43M | 48.04M | 59.22M |
| Cash, Cash Equivalents and Short-Term Investments | 250.37M | 82.23M | 46.90M | 13.82M | 10.30M | 18.90M |
| Total Debt | 15.03M | 4.43M | 4.66M | 5.48M | 4.73M | 6.31M |
| Total Liabilities | 197.14M | 61.53M | 50.06M | 34.44M | 30.00M | 32.81M |
| Stockholders Equity | 159.53M | 107.06M | 63.47M | 25.70M | 18.77M | 29.93M |
Cash Flow | ||||||
| Free Cash Flow | 218.57M | 35.65M | 27.27M | 339.00K | -7.74M | 783.00K |
| Operating Cash Flow | 233.35M | 46.75M | 35.02M | 5.90M | -1.22M | 5.15M |
| Investing Cash Flow | -24.86M | -11.10M | -7.74M | -5.07M | -7.03M | -4.37M |
| Financing Cash Flow | 9.20M | -426.00K | 6.06M | 2.87M | -307.00K | 773.00K |
Innodata Technical Analysis
Negative
57.17
Price Trends
68.07
Negative
70.14
Negative
60.93
Negative
Market Momentum
-2.41
Positive
36.46
Neutral
3.06
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For INOD, the sentiment is Negative. The current price of 57.17 is below the 20-day moving average (MA) of 62.59, below the 50-day MA of 68.07, and below the 200-day MA of 60.93, indicating a bearish trend. The MACD of -2.41 indicates Positive momentum. The RSI at 36.46 is Neutral, neither overbought nor oversold. The STOCH value of 3.06 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for INOD.
Innodata Risk Analysis
Innodata disclosed 14 risk factors in its most recent earnings report. Innodata reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Innodata Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $1.97B | 39.05 | 37.78% | ― | 39.02% | 0.49% | |
73 Outperform | $1.73B | 15.03 | 5.33% | ― | -1.26% | 2.59% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | AU$409.50M | -12.32 | -22.79% | ― | 0.60% | 4.13% | |
49 Neutral | $1.48B | -17.94 | -12.34% | ― | -13.72% | 87.44% | |
45 Neutral | $1.52B | -2.90 | -63.91% | ― | -35.67% | -49.96% |
* Technology Sector Average
INOD
Innodata
55.84
16.33
41.33%
GLOB
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-28.66
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1.45
0.60
70.59%
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9.70
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3.05
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Innodata Corporate Events
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Innodata Establishes $300 Million At-The-Market Equity Program
Neutral
Aug 6, 2026
On August 6, 2026, Innodata Inc. entered into an equity distribution agreement with Goldman Sachs, Craig-Hallum Capital Group, Wells Fargo Securities, Maxim Group and Wedbush Securities that allows it to offer and sell up to $300 million of common...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Innodata Appoints New CFO to Drive AI Growth
Positive
Jun 17, 2026
On June 17, 2026, Innodata Inc. (Nasdaq: INOD), a global data engineering company that provides data, evaluation frameworks, and services for generative AI builders and adopters, announced a leadership change in its finance organization. The compa...
Executive/Board ChangesShareholder Meetings
Innodata Shareholders Back Directors, Auditor and Pay Plan
Positive
Jun 8, 2026
Innodata Inc. held its Annual Meeting of Stockholders on June 4, 2026, where shareholders elected all five director nominees and ratified the appointment of BDO India Services Private Limited as the independent auditor for the fiscal year ending D...
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.