Why Innodata Stock Jumped 29% in 2025

• Innodata's gross jumped successful the archetypal fractional of the year.

• It launched a caller national practice.

• The institution is delivering coagulated profits.

• These 10 stocks could mint the adjacent question of millionaires ›

Shares of Innodata (NASDAQ: INOD), the data-labeling specialist, were among the winners past twelvemonth arsenic a operation of beardown growth, continued involvement successful AI stocks, Meta Platforms' acquisition of rival Scale AI, and a tenable valuation pushed the banal higher.

According to information from S&P Global Market Intelligence, the banal finished past twelvemonth up 28.9% connected the news. As you tin spot from the illustration below, it was a volatile twelvemonth for Innodata, and it pulled backmost sharply from its highest successful October, though it inactive finished with important gains.

An earlier surge successful Innodata's gross has faded, but the institution is inactive increasing quickly. Through the archetypal 3 quarters of the year, gross jumped 61% to $179.3 million. In the 3rd quarter, however, gross maturation slowed to conscionable 20%.

Innodata is simply a small-cap stock, making it somewhat unsocial successful the AI abstraction arsenic astir AI stocks are mega-cap stocks. Innodata is profitable arsenic well, dissimilar a fig of smaller tech stocks.

Through the archetypal 3 quarters, adjusted net earlier interest, taxes, depreciation, and amortization (EBITDA) jumped 106% to $42.2 million.

Innodata gets overmuch of its concern from large tech companies, and Meta's woody to wage $14 cardinal for 49% of Scale AI and prosecute its CEO seemed to validate the data-labeling sector. Companies similar Innodata and Scale assistance companies signifier and way AI data, truthful it's easier to negociate and use.

The institution has expanded into a national practice, serving the national authorities astatine a clip erstwhile the authorities is embracing AI.

The banal pulled backmost successful the past 4th of the year, seemingly connected concerns astir slowing maturation and that a bubble could beryllium forming successful AI. Innodata's guidance called for 45% gross maturation for the afloat year, implying 17% growth.

Looking up to 2026, the institution touted further maturation opportunities successful summation to the caller national practice, which it said had engaged a new, high-profile customer, which would bring successful $25 cardinal successful revenue, mostly this year.

It's besides invested successful pre-training information capabilities that person led to $68 cardinal successful expected revenue, based connected contracts it's signed oregon expected to sign.

Innodata's maturation is apt to beryllium volatile arsenic the institution has a batch of lawsuit concentration, but there's a batch of upside imaginable for the banal arsenic it moves into caller markets similar the national government.