INOD

Innodata Inc. INOD has delivered a strong run over the past six months, with shares gaining 40%. The performance comfortably exceeds the Zacks Engineering - R and D Services industry's 11.1% rise and the S&P 500 Index's 13.1% advance over the same period. INOD’s 6-Month Price Performance Image Source: Zacks Investment Research The rally has been supported by rapid AI-driven growth, expanding margins and a broader customer base. Innodata's record second-quarter 2026 results strengthened that case, with revenues rising 58% year over year to $92.1 million. Adjusted EBITDA jumped 92% to $25.4 million, while adjusted gross margin reached 49%.However, after the sharp share-price gain, Innodata carries a sizable valuation premium. Mixed estimate revisions and customer concentration also warrant attention. Investors therefore need to weigh the company's expanding AI opportunity against the expectations already reflected in INOD shares. Innodata's second-quarter performance showed that its AI strategy continues to translate into financial growth. Revenues of $92.1 million marked the company's 12th consecutive quarter of year-over-year growth and exceeded the Zacks Consensus Estimate by about $5.8 million, or 7%. Adjusted EBITDA of $25.4 million represented 27.5% of revenues. Earnings per share (EPS) reached 41 cents, nearly double the consensus estimate of 21 cents.Importantly, growth is being accompanied by stronger profitability. Adjusted gross margin expanded two percentage points sequentially to 49%, nine percentage points above Innodata's publicly stated 40% target. Management attributed the improvement to a greater mix of high-margin programs, including pretraining work and off-the-shelf datasets for which Innodata retains intellectual property and can monetize the same asset across multiple customers. One of the strongest arguments for further upside is the breadth of Innodata's emerging AI opportunities. Management reiterated its expectation for full-year 2026 revenue growth of at least 40%. More importantly, several large potential engagements with existing and new customers have not been included in that forecast because their scope and timing are not yet finalized.Research and innovation are also opening new markets. Innodata has established an early position in agentic reinforcement learning and is working on long-horizon agent personalization and reinforcement-learning environments for computer-use tasks. It is also expanding model evaluation and benchmarking capabilities.Beyond frontier AI models, Innodata is pursuing enterprise, cybersecurity, federal and physical AI opportunities. During second-quarter 2026, the company ran successful egocentric data-collection pilots with robotics companies and began scoping enterprise-scale multimodal programs, including a roughly 2-million-hour egocentric data opportunity. These initiatives could widen the addressable market beyond Innodata's current core programs. Customer diversification represents another encouraging development. Innodata's largest customer accounted for 37% of second-quarter revenues, down sharply from 56% in the first quarter. Meanwhile, a Big Tech customer announced in the prior quarter increased its contribution to 34% from 17%. Innodata also added a new customer described as one of the fastest-scaling frontier AI labs.The shift is important because Innodata's rapid growth has historically depended heavily on a small group of large technology customers. A broader mix of customers and programs should make growth more durable if the trend continues.The balance sheet also provides flexibility. Innodata ended the second quarter with $250.4 million in cash and short-term investments. Excluding customer prepayments, the amount was approximately $134 million, up $37 million sequentially, while the company had no debt outstanding at quarter-end. Despite the strong operating picture, INOD's valuation leaves less room for disappointment. The stock trades at 43.22X forward 12-month earnings, well above the Zacks Engineering - R and D Services industry's 27.25X. Such a premium implies that investors are already pricing in substantial earnings growth. INOD Stock’s Valuation (P/E F12M) Image Source: Zacks Investment Research Estimate revisions also send a mixed signal. Over the past 60 days, the Zacks Consensus Estimate for 2026 earnings has climbed to $1.18 per share from 99 cents, indicating growing confidence in near-term execution. However, the 2027 estimate has declined to $1.67 from $1.78. The current estimates still imply earnings growth of 28.3% in 2026 and 41.7% in 2027, while the consensus mark for revenue projections suggests growth of 42.1% and 28.1%, respectively. INOD EPS Estimate Revision Trend Image Source: Zacks Investment Research Margins may also fluctuate. Management acknowledged that Innodata could accept large projects carrying lower gross margins if their cash-flow economics are attractive. Therefore, the 49% adjusted gross margin achieved in second-quarter 2026 should not necessarily be viewed as a new quarterly floor. Management expects revenue quality to improve over time, but quarter-to-quarter margins will depend on program mix.Customer concentration remains another risk despite the recent improvement. The top two customers together represented 71% of second-quarter revenues. Moreover, project-based work can create uneven quarterly trends, and management acknowledged that sequential revenue declines in individual quarters remain possible. Innodata's rally looks particularly strong against Genpact Limited G, Accenture plc ACN and TaskUs, Inc. TASK. Over the past six months, Innodata has gained 40%, while Genpact has lost 8%, Accenture has plunged 20.4% and TaskUs has dipped 27.5%. Genpact and Accenture compete with Innodata across enterprise AI, data engineering and AI transformation services, while TaskUs has greater overlap in AI data services, model training, annotation and human-in-the-loop work.The valuation gap, however, is substantial. Innodata trades at 43.22X forward earnings compared with 8X for Genpact, 12.2X for Accenture and 4.89X for TaskUs. Innodata's faster growth helps explain part of the premium, but Genpact, Accenture and TaskUs offer investors much lower earnings multiples. As a result, Innodata must sustain strong revenue growth and margin execution to justify its premium over Genpact, Accenture and TaskUs. Innodata's record second-quarter results offer strong support for the six-month rally. Revenues and adjusted EBITDA growth remain robust, margins have expanded, customer diversification is improving and management's 40%-plus 2026 growth outlook excludes several potentially large opportunities. Agentic AI, model evaluation, cybersecurity, robotics and enterprise AI could provide additional growth avenues.Still, the stock's 43.22X forward P/E represents a meaningful premium to the industry and its three discussed peers. Mixed 2027 estimate revisions, continued customer concentration and potential quarterly swings in revenue and margins add reasons for caution.With INOD currently carrying a Zacks Rank #3 (Hold), existing investors may prefer to stay invested and watch whether new AI programs convert into revenue and support further estimate increases. The long-term growth story remains attractive, but after a 40% six-month rally, the current valuation argues against aggressively chasing the stock at this point. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Innodata Inc (INOD) : Free Stock Analysis Report Accenture PLC (ACN) : Free Stock Analysis Report Genpact Limited (G) : Free Stock Analysis Report TaskUs, Inc. (TASK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Interested in Innodata Inc.? Here are five stocks we like better. Record Q2 performance: Revenue rose 58% year over year to $92.1 million, while adjusted EBITDA increased 92% to $25.4 million and adjusted gross margin reached 49%. Innodata reiterated its forecast for at least 40% full-year revenue growth. Broader customer base and expanding AI work: Revenue concentration declined as a major technology customer’s share doubled to 34%, and Innodata added a fast-growing frontier AI lab. Growth initiatives include agentic reinforcement learning, model benchmarking, reasoning-data generation, robotics data and cybersecurity training datasets. Strong balance sheet and leadership transition: Innodata ended the quarter with $250.4 million in cash and short-term investments, no debt and plans for a selective at-the-market equity program. On Sept. 30, Rahul Singhal will become CEO, while Jack Abuhoff will move to executive chairman. Palantir Bulls Face a Reality Check Before Earnings Innodata (NASDAQ:INOD) reported record second-quarter results for 2026, with revenue, adjusted gross profit, adjusted EBITDA and cash reaching new highs as the company continued to expand its work with AI model developers and large technology customers. Revenue for the quarter was $92.1 million, up 58% from a year earlier and 2% sequentially, marking Innodata’s 12th consecutive quarter of year-over-year growth. Chairman and CEO Jack Abuhoff said the result exceeded analyst consensus by approximately $5.8 million. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth Let the Good Times Roll: 2 Stocks Showing No Signs of Slowing Adjusted gross profit totaled $45.4 million, producing an adjusted gross margin of 49%, compared with the company’s publicly stated 40% target. Adjusted EBITDA rose 92% year over year to $25.4 million, or 27.5% of revenue. Net income doubled from the prior-year period to $14.4 million, while fully diluted earnings per share reached $0.41. Abuhoff said Innodata’s customer concentration shifted during the quarter. Its largest customer accounted for 37% of revenue, down from 56% in the first quarter, following a change in program structure and service mix. The company said it still expects that customer to grow year over year for the full year. → Visa’s BioCatch Deal Could Make Fraud Prevention a Bigger Business 3 AI Stocks in Correction Mode: Can They Rebound? Meanwhile, a big technology customer announced in the prior quarter increased from 17% of revenue to 34% and became Innodata’s second-largest customer. The company also said it added a new customer that it described as one of the fastest-scaling frontier AI labs. “Our base continues to broaden in both customers and customer programs,” Abuhoff said. → Ulta's Growth Is Real, But So Are the Risks The company reiterated its forecast for at least 40% year-over-year revenue growth. Abuhoff said Innodata has large potential engagements in its pipeline involving existing and new customers, but it has not included them in its forecast because the work has not yet been fully secured and the timing of revenue recognition is not yet known. President and Chief Revenue Officer Rahul Singhal said research and innovation are increasingly becoming a growth engine for Innodata, supporting work across model pre-training, post-training, evaluation and benchmarking. Singhal highlighted the company’s work in agentic reinforcement learning, including a program with a large AI lab related to personalizing long-horizon agents and a separate program involving reinforcement-learning environments for desktop computer tasks. He said Innodata deepened delivery of these capabilities with one large technology customer during the quarter and began delivery with another. Innodata also released two public benchmarks designed to assess frontier models on multi-turn, long-context and multimodal interactions. Singhal said the benchmarks are intended to identify failure modes that conventional leaderboards may miss, including grounding drift and instruction forgetting. The company said benchmark engagements can lead to data strategy recommendations and potential scaled data-generation work. The company expanded training-data generation for reasoning capabilities across five frontier labs and five domains, Singhal said. It also signed two research agreements with a leading university and committed to a motion-capture lab expected to come online in coming months. The lab is intended to collect sub-millimeter-precision data for robots and physical-AI foundation models. In addition, Innodata released the first stage of its AI Cyber Training Suite, consisting of 12 datasets and evaluation systems intended to help AI coding agents write more secure code and repair software vulnerabilities. Singhal said that, when testing leading open-weight models, the rate of repair for verified flaws more than doubled after one round of fine-tuning on a portion of the company’s data. Abuhoff attributed the 49% adjusted gross margin partly to a higher mix of high-value pre-training programs and off-the-shelf datasets. He said some datasets are engineered around model weaknesses identified through Innodata’s benchmarking work, with the company retaining intellectual property and making the assets available across multiple customers. In response to an analyst question, Abuhoff said gross margin may vary by quarter because Innodata could pursue larger projects with lower margins. However, he said the company’s long-term strategic focus is on higher-quality revenue, defined by both gross margin and recurring characteristics. Innodata ended the quarter with $250.4 million in cash and short-term investments. Excluding customer prepayments, which Chief Financial Officer Jayant Chauhan described as pass-through items, cash and short-term investments were approximately $134 million, up $37 million sequentially. The company had no debt outstanding and remained undrawn on its Wells Fargo credit facility. Chauhan said Innodata planned to file a prospectus supplement establishing an at-the-market equity program led by Goldman Sachs alongside a broader syndicate. He said the program would provide a supplemental capital-markets tool that the company could use selectively for growth initiatives, strategic opportunities and balance-sheet flexibility. Innodata also announced a planned leadership transition effective Sept. 30. Singhal will become president and chief executive officer and join the board of directors. Abuhoff will transition to executive chairman. Abuhoff said he will remain deeply engaged and focus on partnering with Singhal to build capabilities enabled by Innodata’s research team, particularly in federal government and enterprise markets. The company also recently appointed Chauhan as CFO, while Marissa Espineli was identified on the call as chief accounting officer. Abuhoff said Innodata sees potential federal opportunities in model benchmarks, evaluations and red-teaming work, as government agencies seek AI solutions and frontier-model developers engage with government on regulation. He also cited enterprise demand for greater assurance around agentic AI deployment and cybersecurity as areas where Innodata believes its data engineering and evaluation capabilities can be applied. Innodata Inc (NASDAQ: INOD) is a digital services and technology company that specializes in data engineering and artificial intelligence solutions. Founded in 1988 and headquartered in East Brunswick, New Jersey, the company provides structured content and digital transformation services to publishers, media companies, legal and compliance organizations, and other information-intensive industries. Innodata's platform enables clients to convert unstructured text, images and multimedia into high‐quality, machine‐readable formats that support search, analytics and AI model training. The firm's offerings include content enrichment, metadata management, taxonomy development, digital asset management and data annotation services. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Innodata Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Innodata Inc. INOD reported exceptional second-quarter 2026 results, with earnings and revenues topping the Zacks Consensus Estimate and growing year over year.The company continued to benefit from strong demand for data engineering services supporting advanced artificial intelligence systems. Customer diversification improved meaningfully, while a favorable business mix drove further margin expansion. Following the results, the company’s shares gained around 14.6% in the after-hour trading session yesterday. The gain likely reflected the solid earnings and revenue beat, record profitability and continued confidence in the 2026 growth outlook. Quarterly earnings were 41 cents per share, up 105% year over year. The figure surpassed the Zacks Consensus Estimate of 21 cents by 95.2%. Innodata Inc price-consensus-eps-surprise-chart | Innodata Inc Quote Revenues climbed 58% to $92.14 million year over year and beat the consensus estimate of $86.32 million by 7%. The quarter marked Innodata’s 12th consecutive quarter of year-over-year revenue growth.Customer diversification also improved significantly. Innodata’s largest customer accounted for 37% of second-quarter revenues, down from 56% in the first quarter. Meanwhile, the Big Tech customer announced in the prior quarter increased to 34% of revenues from 17%. Adjusted gross profit reached $45.38 million, up 81.2% from $25.05 million in the year-ago quarter. Adjusted gross margin expanded to 49% from 43%, standing 9 percentage points above the company’s publicly stated 40% target.The margin expansion was driven by a favorable revenue mix, including off-the-shelf datasets, where Innodata retains intellectual property and can monetize the same assets across multiple customers, as well as high-value pre-training programs.Adjusted EBITDA was $25.36 million, or 27.5% of revenues, compared with $13.23 million in the prior-year quarter. The 91.6% increase in adjusted EBITDA outpaced revenue growth, reflecting meaningful operating leverage.Selling and administrative expenses rose to $26.60 million from $14.11 million. Even with the higher cost base, income before taxes increased to $17.56 million from $9.49 million, while net income nearly doubled to $14.41 million from $7.22 million. Cash provided by operating activities totaled $164.44 million for the first six months of 2026, sharply higher than $14.99 million in the year-ago period. Capital expenditures were $5.31 million, while the company invested $10.08 million in short-term investments.Cash and cash equivalents increased to $240.28 million at June 30, 2026, from $82.22 million at the end of 2025. Including short-term investments, cash and investments totaled $250.4 million.The quarter-end cash balance included customer prepayments related to pass-through costs. Excluding these prepayments, management stated that cash was approximately $134 million, providing the company with substantial liquidity to support continued investments in growth initiatives. Management reiterated its full-year 2026 revenue growth forecast of 40% or more year over year. The outlook reflects continued momentum across existing customer programs and a broadening customer base.Importantly, management said several large potential programs from new and anticipated customers that it considers likely wins are not included in the 40% growth forecast. Once the scope and timing of these programs are finalized, the company plans to incorporate them and update guidance accordingly. Innodata added an important new customer during the quarter, described by management as one of the fastest-scaling frontier labs. The company also expanded programs in agentic reinforcement learning, including work involving personalization of long-horizon agents and reinforcement-learning environments for computer-use agentic tasks.The company released two public AI benchmarks and the first stage of its AI Cyber Training Suite, consisting of 12 datasets and evaluation systems designed to train coding agents to write secure code and repair vulnerabilities.Innodata also completed successful egocentric data-collection pilots with leading robotics companies and is moving from individual pilots toward enterprise-scale multimodal programs. These initiatives broaden the company’s exposure across the AI development lifecycle and support management’s focus on research-led growth. Innodata currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Martin Marietta Materials, Inc. MLM reported outstanding second-quarter 2026 results, wherein adjusted earnings (from continuing operations) and revenues topped the Zacks Consensus Estimate and increased year over year.Martin Marietta’s results benefited from strong organic performance and contributions from acquisitions. Aggregates shipments increased 17% to a record 61.6 million tons, supported by infrastructure and heavy nonresidential demand. Heavy nonresidential demand also benefits from data center, power-generation and warehouse construction. Martin Marietta raised its 2026 revenue guidance to a range of $7.2-$7.4 billion, with a midpoint of $7.3 billion.CRH plc CRH reported exceptional second-quarter 2026 financial results with adjusted earnings and total revenues topping the Zacks Consensus Estimate and growing year over year. Positive pricing, favorable demand and acquisition contributions supported the quarterly growth. CRH completed 11 acquisitions during the quarter for $1.1 billion.CRH reaffirmed 2026 net income guidance of $3.9-$4.1 billion, adjusted EBITDA guidance of $8.1-$8.5 billion and earnings guidance of $5.60-$6.05 per share. The company expects public infrastructure spending and reindustrialization activity to support demand, while new-build residential conditions remain subdued.Quanta Services, Inc. PWR reported better-than-expected second-quarter 2026 results, with adjusted earnings and revenues beating the Zacks Consensus Estimate. Quanta’s performance benefited from strong demand for grid, generation and data-center infrastructure, broader self-perform capabilities, efficient resource utilization and solid execution across both segments.Quanta increased its 2026 revenue forecast to $39.3-$39.7 billion, representing a $4.55 billion increase at the midpoint from its prior outlook. Adjusted earnings are now projected to be in the range of $16.45-$16.95 per share, while adjusted EBITDA is expected to be between $4.09 billion and $4.21 billion. Free cash flow is forecast to be in the $2-$2.5 billion range. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Innodata Inc (INOD) : Free Stock Analysis Report Quanta Services, Inc. (PWR) : Free Stock Analysis Report Martin Marietta Materials, Inc. (MLM) : Free Stock Analysis Report CRH PLC (CRH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Innodata Inc. INOD used its second-quarter 2026 earnings call to emphasize broader customer diversification, expanding AI research capabilities and a disciplined approach to revenue guidance. Chairman and CEO Jack Abuhoff also outlined a planned CEO transition as the company scales. The quarter combined 58% year-over-year revenue growth with a 49% adjusted gross margin. President and chief revenue officer Rahul Singhal highlighted new programs spanning agentic AI, model evaluation, cybersecurity and physical AI. Abuhoff said that Innodata’s largest customer represented 37% of second-quarter revenues, down from 56% in the first quarter. A Big Tech customer announced last quarter rose to 34% of revenues from 17%. Abuhoff said that the largest customer generated less revenue sequentially because of changes in program structure and service mix, while he still expects that customer’s full-year revenues to increase year over year. Abuhoff also pointed to the addition of a new frontier-lab customer, emphasizing that Innodata is broadening both its customer base and the number of programs it supports. Abuhoff reiterated guidance for full-year 2026 revenue growth of 40% or more. He said that several large potential engagements with existing and new customers are excluded from the forecast. Abuhoff said that those programs will enter the forecast only after Innodata has fully won the business and can determine the timing of revenue recognition. A Craig-Hallum analyst pressed for detail on the excluded opportunities. Abuhoff said that the pipeline spans frontier-model, enterprise and government work, with agentic AI prominent among current opportunities. Singhal said that research and innovation are becoming a growth engine across pre-training, post-training, model evaluation and benchmarking. He highlighted new work in long-horizon agent personalization and reinforcement-learning environments for computer-use agents. Singhal also said that Innodata released two public benchmarks designed to identify model failure modes and support follow-on data-generation work. Singhal said that the company is also developing physical-AI capabilities through robotics data collection and a planned motion-capture lab, with successful pilots moving discussions toward enterprise-scale multimodal programs. The company reported second-quarter revenues of $92.1 million, up 58% year over year and 2% sequentially. The metric beat the Zacks Consensus Estimate of $86.3 million. Reported earnings of $0.41 per share topped the consensus estimate of $0.21. Innodata Inc price-consensus-eps-surprise-chart | Innodata Inc Quote CFO Jayant Chauhan said that adjusted gross margin reached 49%, two percentage points above the first quarter and nine points above management’s 40% target. Adjusted EBITDA was $25.4 million, or 27.5% of revenue. A Maxim Group analyst asked whether the richer margin profile should persist. Abuhoff said that strategic initiatives should improve revenue quality over time, but quarterly margins can fluctuate if Innodata wins large projects with lower gross margins. Singhal said that Innodata released the first stage of its AI Cyber Training Suite, including 12 datasets and evaluation systems focused on secure coding and vulnerability repair by AI agents. In Q&A, a Craig-Hallum analyst asked about federal opportunities. Abuhoff said that Innodata is discussing partnerships with government agencies and sees evaluation, benchmarking and red-teaming work as areas of opportunity. Abuhoff also said that enterprise adoption of agentic AI is creating demand for assurance capabilities tied to the research platform Innodata uses with frontier-model customers. Abuhoff said that Singhal will become president and CEO on Sept. 30, while he will move to executive chairman and focus on research-enabled enterprise and federal opportunities. Singhal said he plans to build on Innodata’s research-driven strategy. Chauhan’s expanded remit includes capital allocation, capital markets, customer partnerships and potential M&A. The earnings call left research-led expansion, customer diversification and disciplined treatment of pipeline opportunities as Innodata’s central priorities heading into the second half. INOD currently carries a Zacks Rank #2 (Buy). Its Growth Score is A, while it has a Value Score of F, a Momentum Score of F and a VGM Score of D. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Zacks Style Scores complement the Zacks Rank, with A and B grades representing stronger characteristics for their respective styles. INOD, therefore, pairs a favorable Zacks Rank with mixed Style Score signals. The Zacks Rank can change as earnings estimates are revised following the just-reported results. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Innodata Inc (INOD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Revenue: $92.1 million, up 58% year-over-year and 2% sequentially, marking the 12th consecutive quarter of year-over-year growth. Adjusted Gross Profit: $45.4 million, with an adjusted gross margin of 49%, up 2 points sequentially and 9 points above the company's 40% target. Adjusted EBITDA: $25.4 million, up 92% year-over-year, representing 27.5% of revenue. Net Income: $14.4 million, double the $7.2 million reported in Q2 of the prior year. Earnings Per Share (EPS): Fully diluted EPS of $0.41, nearly double the analyst consensus of $0.21. Cash and Short-Term Investments: $250.4 million at quarter end; approximately $134 million excluding customer prepayments, up $37 million sequentially. Customer Concentration: Largest customer represented 37% of revenue, down from 56% in Q1; second-largest customer scaled to 34% of revenue. Effective Tax Rate: Approximately 18% for the quarter, below the long-term target range of 23% to 25% due to tax benefits recognized. Warning! GuruFocus has detected 2 Warning Sign with NATR. Is INOD fairly valued? Test your thesis with our free DCF calculator. Release Date: August 06, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Revenue grew 58% year-over-year to $92.1 million, marking the 12th consecutive quarter of growth and beating analyst consensus by 7%. Adjusted EBITDA surged 92% year-over-year to $25.4 million, exceeding consensus by 50%, with adjusted gross margin at 49%, well above the 40% target. Customer diversification improved, with the largest customer dropping to 37% of revenue (from 56% in Q1) and a new big-tech customer scaling to 34% of revenue. Research and innovation are driving growth, with new capabilities in agentic reinforcement learning, benchmarks, and AI cyber training, opening opportunities in enterprise and federal markets. Strong balance sheet with $134 million in cash (net of customer prepayments) and no debt, plus a new ATM program for strategic flexibility. Revenue growth slowed sequentially to just 2% from Q1, indicating potential quarter-to-quarter volatility. The largest customer's revenue declined in Q2 due to changes in program structure and service mix, though growth is still expected for the full year. Management acknowledged that gross margins could decline if they win large, lower-margin projects, which may pressure profitability. The company has not factored several large potential engagements into guidance, creating uncertainty about future revenue visibility. The effective tax rate was lower than the long-term target due to one-time benefits, which may not be sustainable. Q: Can you provide a bigger picture of the opportunities that are not factored into your guidance, and will you give more regular updates?A: Jack Abuhoff (Chairman and CEO) confirmed that while the company is excited about several large potential engagements across government, enterprise, and frontier model sidesparticularly in agentic AI deployment and trainingthey maintain discipline and will only factor these into forecasts once they are 100% won and revenue timing is certain. He indicated the second half of the year should be exciting as they share more progress. Q: How do recent AI security incidents and your new AI Cyber Training Suite create opportunities for Innodata?A: Jack Abuhoff (Chairman and CEO) explained that frontier models built on training data containing unpatched code pose security risks. Innodata's new suite trains AI coding agents to write secure code and repair vulnerabilities, with tests showing repair rates more than doubled after fine-tuning. This capability addresses enterprise trust concerns and positions the company as a key player in AI deployment assurance. Q: What is your involvement in the federal government's AI testing and red-teaming efforts?A: Jack Abuhoff (Chairman and CEO) noted that Innodata is having discussions with government players about partnerships and leveraging the Tradewinds marketplace. He highlighted that frontier model companies are inviting government regulation, creating demand for benchmarks, evaluations, and red-teaming servicesareas where Innodata's newly released benchmarks could play a significant role. Q: Should we view the higher mix of high-margin projects as a trend or a one-quarter event?A: Jack Abuhoff (Chairman and CEO) stated it's both. While the company may bid on large, lower-margin projects that could temporarily reduce weighted gross margins, the strategic direction toward higher revenue qualitydefined by both gross margin and recurring natureshould trend upward over time. Quarter-by-quarter results will depend on product mix. Q: Can you explain how your off-the-shelf datasets workdo you own the data and use it multiple times?A: Jack Abuhoff (Chairman and CEO) clarified that Innodata engineers datasets around model deficiencies detected through benchmarking, retaining IP rights. These datasets are then offered to frontier labs for training, contributing to higher margins. In some cases, they represent third-party data owners, but most current revenue comes from internally engineered datasets. Q: Is there any reason to expect a sequential revenue decline in Q3 or Q4?A: Jack Abuhoff (Chairman and CEO) acknowledged that a sequential decline is possible within the business model's constraints, but emphasized he focuses on long-term company trajectory rather than quarter-to-quarter performance. He would not view a temporary dip after a large one-time project as a failure, provided the company maintains customer relevance and identifies major market opportunities. Q: What are the key drivers behind the record Q2 2026 financial results?A: Jayant Chauhan (CFO) reported revenue of $92.1 million, up 58% year-over-year, with adjusted gross margin of 49% (9 points above target) and adjusted EBITDA of $25.4 million, up 92%. Net income doubled to $14.4 million with EPS of $0.41, significantly beating consensus. The company ended with $250.4 million in cash and short-term investments. Q: How is customer diversification progressing?A: Jack Abuhoff (Chairman and CEO) highlighted that the largest customer declined to 37% of revenue (down from 56% in Q1), while a big-tech customer scaled to 34%, becoming the second largest. A new fast-scaling frontier lab was also added, demonstrating the customer base is diversifying across both customers and programs. Q: What is the significance of the leadership transition announced during the call?A: Jack Abuhoff (Chairman and CEO) announced that Rahul Singhal will become President and CEO on September 30, with Jack transitioning to Executive Chairman. This planned transition positions Rahul, a principal architect of the company's transformation, to lead while Jack focuses on enterprise and federal market capabilities. Jayant Chauhan also joined as CFO, strengthening financial leadership. Q: How is research and innovation driving growth beyond traditional data services?A: Rahul Singhal (President and CRO) detailed expansions into agentic reinforcement learning, long-horizon agent personalization, and reinforcement learning environments for desktop computer usage. The company also released two public benchmarks for multi-turn, long-context evaluations and signed research agreements for embodied intelligence data collection, including a motion capture lab for physical AI foundation models. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Innodata Inc (INOD) came out with quarterly earnings of $0.41 per share, beating the Zacks Consensus Estimate of $0.21 per share. This compares to earnings of $0.2 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +95.24%. A quarter ago, it was expected that this company would post earnings of $0.13 per share when it actually produced earnings of $0.42, delivering a surprise of +223.08%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Innodata Inc, which belongs to the Zacks Engineering - R and D Services industry, posted revenues of $92.14 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 6.75%. This compares to year-ago revenues of $58.39 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Innodata Inc shares have added about 36.2% since the beginning of the year versus the S&P 500's gain of 12.8%. While Innodata Inc has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Innodata Inc was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #1 (Strong Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.20 on $86.98 million in revenues for the coming quarter and $1.08 on $357.01 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Engineering - R and D Services is currently in the top 32% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Amentum Holdings (AMTM), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 11. This government services company is expected to post quarterly earnings of $0.63 per share in its upcoming report, which represents a year-over-year change of +12.5%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Amentum Holdings' revenues are expected to be $3.6 billion, up 1% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Innodata Inc (INOD) : Free Stock Analysis Report Amentum Holdings, Inc. (AMTM) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Revenue Up 58% Year-Over-Year, Beats Consensus by 7% Adjusted EBITDA of $25.4 Million, Beats Consensus by 50% Adjusted Gross Margin Expands to 49% Announces Planned Leadership Transition Effective September 30: Rahul Singhal to Become President and CEO, Jack Abuhoff to Become Executive Chairman NEW YORK, NY / ACCESS Newswire / August 6, 2026 / INNODATA INC. (NASDAQ:INOD) today reported results for the second quarter ended June 30, 2026. Revenue of $92.1 million, representing 58% year-over-year revenue growth. Adjusted Gross Profit of $45.4 million, representing Adjusted Gross Margin of 49%.* Adjusted EBITDA of $25.4 million, or 27.5% of revenue, an increase of $12.1 million from $13.2 million in the same period last year.* Net income of $14.4 million, or $0.43 per basic share and $0.41 per diluted share for the three-month period ended June 30, 2026, compared to net income of $7.2 million, or $0.23 per basic share and $0.20 per diluted share, in the same period last year. Cash, cash equivalents and short-term investments of $250.4 million as of June 30, 2026, an increase of $168.2 million from $82.2 million as of December 31, 2025. Cash as of June 30, 2026 includes customer prepayments related to pass-through costs; net of these prepayments, cash was approximately $134 million as of June 30, 2026. * Adjusted Gross Profit, Adjusted Gross Margin, and Adjusted EBITDA are non-GAAP financial measures and are defined below. Jack Abuhoff, CEO, said, "Q2 was another record quarter for Innodata - and another across-the-board beat. Revenue, Adjusted Gross Profit, Adjusted EBITDA, and cash all reached new highs, and we exceeded analyst consensus on every key metric. Revenue of $92.1 million grew 58% year-over-year while Adjusted EBITDA grew 92% - operating leverage by definition. This was our 12th consecutive quarter of year-over-year growth, and, as in Q1, our quarterly revenue exceeded our annual revenue of just three years ago. Adjusted Gross Margin of 49% now stands nine points above our publicly stated 40% target, driven by mix: off-the-shelf datasets, where we retain intellectual property and monetize the same asset across multiple customers, as well as high-value pre-training programs. Once again, we delivered growth, margin expansion, and cash generation together - while investing in innovation that converts to revenue within quarters, not years. That is the business model working as designed. "The diversification we planned for has now been delivered. In Q2, our largest customer represented 37% of revenue, down from 56% in Q1, while the Big Tech customer we announced last quarter scaled from 17% of revenue to 34%. While our largest customer contributed less revenue in Q2 than in Q1, we continue to forecast it to grow year-over-year for the full year. We also landed an important new customer in the quarter, one of the fastest-scaling frontier labs. Our base continues to broaden, in both customers and customer programs. "We are reiterating our full-year 2026 revenue growth guidance of 40% or more year-over-year. There are large potential programs from both new and anticipated customers - likely wins, in our judgment - that are not factored into our 40% number. Once their scope and timing are finalized, we will include them and update guidance accordingly. "Our growth is increasingly research driven. Through our research efforts, we have established an early position in agentic reinforcement learning, one of the most important frontiers in AI development, winning a significant new program with our largest customer covering personalization of long-horizon agents - now scaling - and a second program covering reinforcement-learning environments for computer-use agentic tasks. We released two public benchmarks designed to surface the failure modes that standard leaderboards miss as well as the first stage of our AI Cyber Training Suite - twelve datasets and evaluation systems that train AI coding agents to write secure code and repair vulnerabilities. We also ran successful egocentric data-collection pilots with leading robotics companies and shifted our data-collection practice from individual pilots to scoping enterprise-scale, multi-modal programs." A Planned Leadership Transition Innodata also announced today a planned leadership transition. Effective September 30, 2026, Rahul Singhal will become President and Chief Executive Officer of Innodata and will join the Company's Board of Directors, and Jack Abuhoff, the Company's founder and CEO, will transition into the role of Executive Chairman. "This is a planned transition, made from a position of strength," said Abuhoff. "Rahul has been a principal architect of Innodata's transformation into a strategic partner to the world's leading AI builders. He knows our customers, he knows our technology, and he knows our people - and he has been central to every element of the strategy behind the results you have seen quarter after quarter. The Board and I didn't have to look far for the right leader. Rahul earned this role - taking on expanding responsibility year after year and delivering every time. As Executive Chairman, I will remain deeply engaged, focused on partnering with Rahul to build capabilities enabled by our research team. Bringing these capabilities to the federal government and to the enterprise, I believe, is where I can best contribute to creating significant shareholder value, and as one of the company's largest shareholders, that is exactly what I want to be doing. Our work with the Mag 7 and the leading AI labs is on a firm path to greater heights and greater diversification. Our Enterprise AI and Federal strategies - built on the differentiated technology we develop for the frontier labs - represent opportunities for potentially driving high quality recurring revenue that results in significant value creation." Rahul Singhal, incoming President and Chief Executive Officer, said, "I am truly honored by the confidence Jack and the Board have placed in me, and I intend to repay it with results. Innodata has extraordinary momentum, an extraordinary team, and an extraordinary opportunity in front of it. I intend to build on all three. Research and innovation have become our growth engine - the means by which we differentiate, expand existing partnerships, and forge new customer relationships across the full model training lifecycle, from pre-training and post-training to model evaluation and benchmarking." The Company also recently announced that Jayant Chauhan has joined Innodata as Chief Financial Officer, with Mariz Espineli stepping into the role of Chief Accounting Officer. Beyond the traditional CFO mandate, Jayant will work strategically on capital allocation and capital markets, customer partnerships, M&A, and investor communications. Abuhoff concluded, "We are confident that 2026 will be a tremendous year for Innodata and its shareholders, and we are excited about the opportunities that lie ahead in 2027 and beyond." Amounts in this press release have been rounded. All percentages have been calculated using unrounded amounts. Timing of Conference Call with Q&A Innodata will conduct an earnings conference call, including a question-and-answer period, at 5:00 PM eastern time today. You can participate in this call by dialing the following call-in numbers: The call-in numbers for the conference call are: For Replay: It is recommended that participants dial in approximately 10 minutes prior to the start of the call. Investors are also invited to access a live Webcast of the conference call at the Investor Relations section of Innodata's website at https://investor.innodata.com/events-and-presentations/. Please note that the Webcast feature will be in listen-only mode. Call-in replay will be available for seven days following the conference call, and Webcast replay will be available for 30 days following the conference call, at the Investor Relations section of Innodata's website at https://investor.innodata.com/events-and-presentations/. About Innodata Innodata (Nasdaq: INOD) is a global data engineering company. We believe that data and Artificial Intelligence (AI) are inextricably linked. Our mission is to enable the responsible advancement of artificial intelligence by providing the data, evaluation frameworks, and human expertise required to build AI systems that can be trusted at scale. We provide a range of transferable solutions, platforms, and services for Generative AI / AI builders and adopters. In every relationship, we honor our 36+ year legacy delivering the highest quality data and outstanding outcomes for our customers. Visit www.innodata.com to learn more. Forward-Looking Statements This press release may contain certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. These forward-looking statements include, without limitation, statements concerning our operations, economic performance, financial condition, developmental program expansion and position in the AI services market. Words such as "project," "forecast," "believe," "expect," "can," "continue," "could," "intend," "may," "should," "will," "anticipate," "indicate," "guide," "predict," "likely," "estimate," "plan," "potential," "possible," "promises," or the negatives thereof, and other similar expressions generally identify forward-looking statements. These forward-looking statements are based on management's current expectations, assumptions and estimates and are subject to a number of risks and uncertainties, including, without limitation, impacts resulting from ongoing geopolitical conflicts; anticipated and actual use cases and outcomes; investments in large language models; that contracts may be terminated by customers; projected or committed volumes of work may not materialize; pipeline opportunities and customer discussions which may not materialize into work or expected volumes of work; the likelihood of continued development of the AI markets, particularly new and emerging markets, that our services support; the ability and willingness of our customers and prospective customers to execute business plans that give rise to requirements for our services; continuing reliance on project-based work and the primarily at-will nature of such contracts and the ability of these customers to reduce, delay or cancel projects; potential inability to replace projects that are completed, canceled or reduced; revenue concentration among a limited number of customers; our dependency on third-party providers and partners; our ability to achieve revenue and growth targets; difficulty in integrating and deriving synergies from acquisitions, joint ventures and strategic investments; potential undiscovered liabilities of companies and businesses that we may acquire; potential impairment of the carrying value of goodwill and other acquired intangible assets of companies and businesses that we acquire; a continued downturn in or depressed market conditions; changes in external market factors; the potential effects of U.S. global trade and monetary policy, including the interest rate policies of the Federal Reserve; changes in our business or growth strategy; the emergence of new, or growth in existing competitors; various other competitive and technological factors; our use of and reliance on information technology systems, including potential security breaches, cyber-attacks, privacy breaches or data breaches that result in the unauthorized disclosure of consumer, customer, employee or company information, or service interruptions; and other risks and uncertainties indicated from time to time in our filings with the Securities and Exchange Commission ("SEC"). Our actual results could differ materially from the results referred to in any forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the risks discussed in Part I, Item 1A. "Risk Factors," Part II, Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations," and other parts of our Annual Report on Form 10-K, filed with the SEC on February 26, 2026, and in our other filings that we may make with the SEC. In light of these risks and uncertainties, there can be no assurance that the results referred to in any forward-looking statements will occur, and you should not place undue reliance on these forward-looking statements. These forward-looking statements speak only as of the date hereof. We undertake no obligation to update or review any guidance or other forward-looking statements, whether as a result of new information, future developments or otherwise, except as may be required by the U.S. federal securities laws. Company Contact Aneesh [email protected](201) 371-8000 Non-GAAP Financial Measures In addition to the financial information prepared in conformity with U.S. GAAP ("GAAP"), we provide certain non-GAAP financial information. We believe that these non-GAAP financial measures assist investors in making comparisons of period-to-period operating results. In some respects, management believes non-GAAP financial measures are more indicative of our ongoing core operating performance than their GAAP equivalents by making adjustments that management believes are reflective of the ongoing performance of the business. We believe that the presentation of this non-GAAP financial information provides investors a more complete understanding of our financial performance, competitive position, and prospects for the future, particularly by providing the same information that management and our Board of Directors use to evaluate our performance and manage the business. However, the non-GAAP financial measures presented in this press release have certain limitations in that they do not reflect all of the costs associated with the operations of our business as determined in accordance with GAAP. Therefore, investors should consider non-GAAP financial measures in addition to, and not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. Further, the non-GAAP financial measures that we present may differ from similar non-GAAP financial measures used by other companies. Adjusted Gross Profit and Adjusted Gross Margin We define Adjusted Gross Profit as revenues less direct operating costs attributable to Innodata Inc. and its subsidiaries in accordance with GAAP, plus depreciation and amortization of intangible assets, stock-based compensation and other one-time costs included within direct operating cost. We define Adjusted Gross Margin by dividing Adjusted Gross Profit over total GAAP revenues. We use Adjusted Gross Profit and Adjusted Gross Margin to evaluate results of operations and trends between fiscal periods and believe that these measures are important components of our internal performance measurement process. A reconciliation of Adjusted Gross Profit and Adjusted Gross Margin to the most directly comparable GAAP measure is included in the tables that accompany this release. Adjusted EBITDA We define Adjusted EBITDA as net income attributable to Innodata Inc. and its subsidiaries in accordance with GAAP before interest expense, income taxes, depreciation and amortization of intangible assets (which derives EBITDA), plus additional adjustments for loss on impairment of intangible assets and goodwill, stock-based compensation, income attributable to non-controlling interests and other one-time costs. We use Adjusted EBITDA to evaluate core results of operations and trends between fiscal periods and believe that these measures are important components of our internal performance measurement process. A reconciliation of Adjusted EBITDA to the most directly comparable GAAP measure is included in the tables that accompany this release. INNODATA INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)(In thousands, except per-share amounts) INNODATA INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited)(In thousands) INNODATA INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)(In thousands) INNODATA INC. AND SUBSIDIARIESRECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES(Unaudited)(In thousands) Adjusted Gross Profit and Adjusted Gross Margin Adjusted EBITDA SOURCE: Innodata Inc. View the original press release on ACCESS Newswire

Innodata Inc. INOD is slated to release second-quarter 2026 results on Aug. 6, after the closing bell. The upcoming results are expected to reflect continued strength in demand for the company's artificial intelligence (AI) data engineering, model evaluation and trust-and-safety services, supported by expanding engagements with large technology customers and increasing adoption of agentic AI applications.In the last reported quarter, Innodata delivered exceptional numbers. Adjusted earnings and revenues topped the Zacks Consensus Estimate by 223.1% and 17.8%, while growing  90.9% and 54.4% year over year, respectively. Adjusted EBITDA was $25 million, or 28% of revenues, compared with $12.7 million in the prior-year quarter. The 96% increase in adjusted EBITDA outpaced revenue growth, demonstrating meaningful operating leverage despite continued investments in data science, engineering and customer-facing capabilities.INOD’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 98.9%, as shown in the chart below. Image Source: Zacks Investment Research The Zacks Consensus Estimate for the second-quarter EPS has increased to 21 cents from 18 cents over the past 30 days. The estimated figure indicates 5% growth from the year-ago reported EPS of 20 cents. The consensus mark for revenues is pegged at $86.3 million, suggesting 47.8% year-over-year growth.For 2026, Innodata is expected to register a 17.4% increase from a year ago in revenues. Its EPS is expected to witness 41.9% growth year over year. Below is what to expect for INOD stock. INOD EPS Estimate Image Source: Zacks Investment Research INOD Revenue Estimate Image Source: Zacks Investment Research Our proven model predicts a likely earnings beat for INOD for the quarter to be reported. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) for this to happen. This is exactly the case here, as you will see below.Earnings ESP: INOD has an Earnings ESP of +17.65%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.Zacks Rank: The company currently carries a Zacks Rank #1.You can see the complete list of today’s Zacks #1 Rank stocks here. Expanding AI Programs to Drive Revenues: The second quarter is likely to have benefited from continued ramp-up of recently secured customer engagements, particularly with large technology companies. During the first-quarter 2026 earnings call, management highlighted that new programs span the entire AI development lifecycle, including pre-training, post-training, evaluation, trust and safety, and agent improvement. Growing customer diversification, deeper relationships with existing hyperscaler clients and increasing demand for enterprise AI solutions are also expected to have supported revenue growth during the quarter. The company further noted that several sizeable opportunities remain under discussion, suggesting growth potential beyond its current outlook.AI Platform Adoption and Business Expansion: Management expects continued momentum from higher-value offerings such as evaluation infrastructure, synthetic data, trust and safety services and its recently launched agent observability platform. The company also anticipates increasing opportunities in physical AI, federal AI programs and enterprise agent deployments as customers expand the use of autonomous AI systems across more applications.Proprietary Solutions to Support Margins: Second-quarter profitability is expected to benefit from a richer mix of proprietary data assets and software-enabled solutions. Management indicated that reusable data sets, AI platforms and operating leverage should continue supporting margins while ongoing investments in research, product development and commercial expansion position the business for long-term growth.During the first-quarter earnings call, Innodata raised its full-year 2026 revenue growth outlook to approximately 40% or more, indicating improved visibility into customer demand. The company also stated that multiple large programs have not yet been included in its forecast because their timing and scope are still being finalized, suggesting potential upside if those engagements materialize. INOD stock has gained 24.1% year to date, lagging the Zacks Engineering - R and D Services industry but performing better than its industry peers.Innodata competes with EXLService Holdings, Inc. EXLS, Cognizant Technology Solutions Corporation CTSH and EPAM Systems, Inc. EPAM in AI-enabled digital engineering, data management and enterprise AI services. So far this year, EXLService has been the best performer in the group despite declining 19.3%, reflecting investors' confidence in its AI-driven analytics and digital operations business. Cognizant has fallen 33.5%, while EPAM has declined 47.7% amid a slower recovery in enterprise IT spending. Innodata differentiates itself through its specialized focus on AI data engineering, foundation model training, evaluation, trust and safety, and agentic AI solutions for hyperscalers and frontier AI developers. As demand for generative AI infrastructure continues to expand, the company's execution across these high-value AI workflows will remain a key differentiator relative to its broader digital services peers. INOD Price Performance (YTD) Image Source: Zacks Investment Research In terms of the forward 12-month price/earnings (P/E), INOD stock is currently trading at a premium to its industry at 44.49X. INOD’s P/E Ratio (Forward 12-Month) vs. Industry Image Source: Zacks Investment Research Innodata shares are currently trading at a forward 12-month P/E ratio of 44.49X, well above both its industry average and those of its closest peers, reflecting investors' expectations for sustained AI-driven growth. By comparison, EXLService, Cognizant and EPAM trade at forward P/E multiples of 14.14X, 9.15X and 7.83X, respectively. While Innodata commands a significantly higher valuation, the premium underscores the market's confidence in its specialized AI data engineering capabilities and long-term growth prospects. Despite its premium valuation, Innodata appears well positioned ahead of its second-quarter results. Strong demand for AI data engineering, model evaluation and trust-and-safety services, expanding relationships with hyperscalers, growing adoption of higher-value AI platforms and improving operating leverage provide a solid foundation for continued growth. The company also has a strong history of earnings beats and rising earnings estimates, all of which point to the potential for another solid quarterly performance. These factors make INOD an attractive stock to buy before its second-quarter earnings release. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Innodata Inc (INOD) : Free Stock Analysis Report Cognizant Technology Solutions Corporation (CTSH) : Free Stock Analysis Report ExlService Holdings, Inc. (EXLS) : Free Stock Analysis Report EPAM Systems, Inc. (EPAM) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

The market expects Shimmick Corporation (SHIM) to deliver a year-over-year increase in earnings on lower revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates. The earnings report, which is expected to be released on August 10, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower. While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. This company is expected to post quarterly loss of $0.02 per share in its upcoming report, which represents a year-over-year change of +85.7%. Revenues are expected to be $121.85 million, down 5.1% from the year-ago quarter. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. Our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction) -- has this insight at its core. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For Shimmick Corporation, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -50.00%. On the other hand, the stock currently carries a Zacks Rank of #3. So, this combination makes it difficult to conclusively predict that Shimmick Corporation will beat the consensus EPS estimate. Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that Shimmick Corporation would post a loss of$0.08 per share when it actually produced a loss of -$0.07, delivering a surprise of +12.50%. Over the last four quarters, the company has beaten consensus EPS estimates three times. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. Shimmick Corporation doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Innodata Inc (INOD), another stock in the Zacks Engineering - R and D Services industry, is expected to report earnings per share of $0.21 for the quarter ended June 2026. This estimate points to a year-over-year change of +5%. Revenues for the quarter are expected to be $86.32 million, up 47.8% from the year-ago quarter. The consensus EPS estimate for Innodata Inc has been revised 11.8% lower over the last 30 days to the current level. However, a higher Most Accurate Estimate has resulted in an Earnings ESP of +17.65%. This Earnings ESP, combined with its Zacks Rank #1 (Strong Buy), suggests that Innodata Inc will most likely beat the consensus EPS estimate. The company beat consensus EPS estimates in each of the trailing four quarters. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Shimmick Corporation (SHIM) : Free Stock Analysis Report Innodata Inc (INOD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

If you are looking for a stock that has a solid history of beating earnings estimates and is in a good position to maintain the trend in its next quarterly report, you should consider Innodata Inc (INOD). This company, which is in the Zacks Engineering - R and D Services industry, shows potential for another earnings beat. When looking at the last two reports, this company has recorded a strong streak of surpassing earnings estimates. The company has topped estimates by 121.06%, on average, in the last two quarters. For the last reported quarter, Innodata Inc came out with earnings of $0.42 per share versus the Zacks Consensus Estimate of $0.13 per share, representing a surprise of 223.08%. For the previous quarter, the company was expected to post earnings of $0.21 per share and it actually produced earnings of $0.25 per share, delivering a surprise of 19.05%. For Innodata Inc, estimates have been trending higher, thanks in part to this earnings surprise history. And when you look at the stock's positive Zacks Earnings ESP (Expected Surprise Prediction), it's a great indicator of a future earnings beat, especially when combined with its solid Zacks Rank. Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Innodata Inc currently has an Earnings ESP of +17.65%, which suggests that analysts have recently become bullish on the company's earnings prospects. This positive Earnings ESP when combined with the stock's Zacks Rank #1 (Strong Buy) indicates that another beat is possibly around the corner. We expect the company's next earnings report to be released on August 6, 2026. With the Earnings ESP metric, it's important to note that a negative value reduces its predictive power; however, a negative Earnings ESP does not indicate an earnings miss. Many companies end up beating the consensus EPS estimate, but that may not be the sole basis for their stocks moving higher. On the other hand, some stocks may hold their ground even if they end up missing the consensus estimate. Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Innodata Inc (INOD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Find winning stocks in any market cycle. Join 7 million investors using Simply Wall St's investing ideas for FREE. Innodata (INOD) has set August 6, 2026, as the date for releasing its second quarter results. An investor conference call is scheduled for 5:00 PM Eastern to discuss the figures. See our latest analysis for Innodata. Recent trading has been volatile for Innodata, with the share price down 43.24% over the past 30 days but still showing a 15.06% year to date share price return and a very large 5 year total shareholder return. This combination points to long term momentum despite near term weakness. If this kind of AI focused story has your attention, it could be a good moment to broaden your search using our screener of 31 AI small caps Bulls view Innodata as a fast growing AI data partner whose recent pullback simply resets expectations, while bears see a crowded AI story priced for perfection. Which side does the current valuation actually support next? Against Innodata's last close of $60.97, the most widely followed narrative sets a fair value at $122.75, framing a large valuation gap that hinges on how AI demand plays out. Read the complete narrative. Curious what kind of revenue build, margin profile, and valuation multiple need to line up for that fair value on Innodata to hold? The narrative leans heavily on sustained AI data demand, larger enterprise contracts, and a rich earnings multiple that assumes continued execution. The exact mix of growth and profitability baked into that view might surprise you. Result: Fair Value of $122.75 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, Innodata’s story also leans on a concentrated group of large tech clients and rising investment costs, so any contract setbacks or weaker demand could quickly challenge that bullish narrative. Find out about the key risks to this Innodata narrative. While the AI narrative points to a fair value of $122.75 for Innodata, the current valuation on simple earnings metrics tells a different story. At a P/E of 50.7x, the stock is priced well above the US Professional Services industry at 21x and above its own fair ratio of 44.9x. This implies the market may already be baking in a lot of optimism. If expectations reset, how much room is there for that multiple to compress? See what the numbers say about this price — find out in our valuation breakdown. With mixed sentiment around Innodata, this is a good time to review the numbers, weigh both concerns and positives, and form your own view using our summary of 3 key rewards and 2 important warning signs If Innodata has sharpened your focus on where to put fresh capital, do not stop here. Your next strong idea could be just one screen away. Target long term upside by scanning for quality companies trading below their estimated worth using the 49 high quality undervalued stocks. Strengthen your income stream by zeroing in on higher yielding opportunities with resilient payouts through the 8 dividend fortresses. Prioritize resilience by focusing on companies with healthier finances and sturdier fundamentals using the solid balance sheet and fundamentals stocks screener (48 results). This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include INOD. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]