APPEN LIMITED (APX)
Share Price Analysis and Chart

31/07/2025

1

Buy

$1.65

81.32%

Ord Minnett explains Appen announced a mixed 2Q2025 update, with revenue of $52m, down -6% on a year earlier, and 1H25 revenue falling -10%, which was approximately -11% below expectations.

The analyst highlights ex-Google and China revenue fell -20%, reflecting pressures in the US.

China managed a 77% rise year-on-year to $24m, with the region now running at an annualised level of $100m.

Earnings (EBITDA) of $2m came in well below the broker’s $5m forecast. Management lowered 2025 revenue guidance to the lower end of the $235–$260m range, and no earnings guidance was offered. Cost-out initiatives are continuing.

Buy rating is retained, but due to earnings downgrades, the target price is reduced to $1.65 from $2.70.

04/08/2025

1

Buy

$1.60

75.82%

The highlight of Appen's 2Q25 update is identified as the growing China business, with revenue up 77% y/y but offsetting this was the non-China revenue, which Canaccord Genuity estimates was down -32% y/y on a weak US market.

Margin in 2Q was down, revenue for 2Q and 1H fell short of the broker's and the consensus forecasts. On the positive side, 1H EBITDA marginally beat the broker's forecast, indicating costs are under control.

The company guided to broadly unchanged 2H revenue outlook, leading the broker to downgrade FY25 EBITDA estimate only modestly.

Buy. Target cut to $1.60 from $2.35 as the broker put a discount on the multiple used in valuation modeling.

FORECAST
Canaccord Genuity forecasts a full year FY25 dividend of 0.00 cents and EPS of minus -3.09 cents.
Canaccord Genuity forecasts a full year FY26 dividend of 0.00 cents and EPS of minus -0.15 cents.