Appen surges on restructure plans
Appen shares surged on Wednesday after the company announced it will restructure its operations, cut jobs and report in US dollars, along with providing a trading update.
The artificial intelligence company announced a new organisational structure aligned to its product-led and customer-centric strategy. Its new organisational structure consists of four customer-facing business units - Global, Enterprise, China and Government:
Global will focus on providing data annotation services and products to major US technology (Global) customers.
Enterprise will drive growth outside of Global customers by leveraging the company’s product suite to serve new customers and AI use cases.
China and Government will focus on capturing share in their high growth markets.
The new leadership structure, together with P&L responsibility, should increase the visibility of, and accountability for, performance. Organisation alignment and technology-enabled productivity will allow resources to be optimised and right-sized. While new segment reporting according to product and service offerings will provide greater transparency on performance, growth and market dynamics.
Appen said the changes reflect its evolution from being a provider of AI data annotation services to a broad range of AI products and solutions. “Our new structure will drive performance and growth by aligning our business with market opportunities and customer needs”, said Mark Brayan, Chief Executive Officer. “Value will be created by pursuing product-led expansion and by giving our teams end-to-end responsibility and control over delivery for their customers.”
The company’s year-to-date revenue plus orders in hand for delivery in FY21 is approximately US$260 million at the end of April 2021, consistent with the methodology and timing used for the update provided at the Annual General Meeting in May 2020.
Underlying EBITDA for the year ending 31 December 2021 is expected to be US$83-90 million, as per the guidance provided to the market at Appen’s FY20 full-year results in February.