Appen APX has been an awful story for investors since COVID-19, yet it was an AI-focused business. They provide data sets to underpin AI and machine learning models, however, their problem has been simple: major customers, such as Alphabet (GOOGL US) has brought this in-house to have more control on the process. i.e. they didn’t have a clear competitive advantage forcing companies to use APX, such is the case with NVDA at the extreme.
As we said earlier, it is a case of “get big or get out”. APX shares surged in July following the company’s 2nd quarter update, which highlighted some promising developments despite a decline in overall revenue. We’ll get more information on this today when they release 1H24 results. While many of the high notes would have been provided in the quarterly, the focus today will be squarely on guidance.
- We can see APX delivering volatile gains to nimble investors/traders, but it needs to clearly reinvent itself before MM will be interested.
MM is neutral towards APX
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