Appen is now valued at $ 1.75 billion as investors look forward to the results of 2018

Appen is now valued at $ 1.75 billion as investors look forward to the results of 2018

In Australia, Appen is surfing in booming markets for all things artificial intelligence. The Sydney-listed company, which provides annotated data sets for machine learning and artificial intelligence to technology companies and governments, exceeded expectations by publishing its 2018 annual results on February 25, 2019. Investors appreciated the results and transmitted the actions of Appen 22%.

Appen's revenues increased 119% to $ 364.3 ($ 260.9 million) from the previous year. Underlying EBITDA, which excludes transaction costs related to mergers and acquisitions, increased by 153% to 71.3 AUD (51.1 million USD).

The main driver of growth was Appen's November 2017 acquisition of US competitor Leapforce, whose integration is now "nearing completion," said Mark Brayan, CEO of Appen.

China is rapidly emerging as the leader of AI. According to Appen, this is the largest AI market outside the United States. The company said it was making a "sound investment" in China and was a team, customer and operations in Shanghai.

According to Appen, she employs 513 full-time people and, like Language Service Providers (LSPs), relies heavily on freelancers (more than a million, according to the company). But unlike language service providers, Appen freelancers, who occupy roles such as search engine evaluators, typically do not demand the level of qualification expected of professional linguists. "It's not like we have to find certified translators," Brayan's general manager told Slator during an interview in 2016.

Appen operates two divisions called content relevance and language resources. After the acquisition of Post Leapforce, the relevance of the content now generates the bulk of revenues (AUD 312.8 million for the 2018 financial year). The unit helps to improve search engine relevance algorithms with learning data and by evaluating specific search results, pages of complete search engine results, multimedia functions, maps and reports. some news. Major customers include Google and Microsoft.

At the same time, Appen's Language Resources division experienced organic growth of 27% in FY 2018. It has expanded its offering since Slator's 2016 interview and now provides annotated speech, natural language, and images, used for speech and visual recognition, machine translation, speech synthesizers, and other machine learning technologies to provide more engaging and smoother devices, including Internet-connected devices, embedded automotive systems and consumer electronics with speech (as reported by the company).

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While Language Resources revenues increased sharply in 2018, EBITDA margins narrowed from 30.1% to 21.8% due to a "significant reduction in complex value government work." added ".

Appen said his "successful expansion of the technology sales pipeline" mitigated the problem and led to an increase in the division's revenues and earnings for the second half of 2018. Big Tech's desire acquiring linguistic data has been a boon to a number of niche players. In addition, some of the largest language service providers have begun to highlight this industry much more aggressively. In an interview for January 2019, Lionbridge's director, John Fennelly, told Slator that he had acquired Gengo and that he "could consider a day when our AI business would actually be more important. as our localization business.

This messaging change is understandable given the exceptional performance of Appen's actions. Since the IPO of 2015, the shares of Appen have increased by 4,480%. Appen's market capitalization now stands at A $ 2.44 billion (US $ 1.74 billion) or US $ 1.65 billion, a figure comparable to that of RWS. Attracted perhaps by the rise of Appen, Lionbridge private equity investors would currently be working on an IPO in Sydney.

Finally, Appen has provided solid guidance for 2019 and expects EBITDA for the 2019 financial year to be in the range of 85 to 90 million AUD. The company said the turnover as well as the pending orders for delivery in 2019 already amounted to 165 million Australian dollars by mid-February 2019.