Innodata announces new AI platform using Nvidia technology; stock jumps

Shares of small cap Innodata, which develops LLMs for training other companies’ AI, surged more than 6% yesterday, March 19, after the company announced a new platform, which runs on Nvidia technology, for testing and evaluating generative AI models. Analysts see that as a promising area.

Innodata jumped more than 6% on the Nasdaq yesterday to close at $43.93 per share. In premarket trading today, however, shares dipped as low as 1.6%. Over the last 12 months, the share price has soared nearly sevenfold.

On the evening of March 18, Innodata unveiled the beta version of its Generative AI Test & Evaluation platform, designed to assess and compare generative AI models. Built on Nvidia technology, the platform identifies vulnerabilities, tests performance, and provides companies with tools to safeguard and optimize their AI systems throughout their life cycle, the company says.

“We believe the key to generative AI shifting from development to production will be arming enterprises with the tools they need to monitor model integrity and performance, and our platform can be an important contributor to meeting these goals,” said CEO Jack Abuhoff in a company statement.

As more businesses shift from developing generative AI to deploying LLMs, security and reliability have become increasingly relevant, Zacks notes. It believes Innodata’s beta launch comes at a pivotal time for the AI industry.

The full rollout of the platform is scheduled for the second quarter of 2025.

Founded nearly 40 years ago, Innodata began as a data digitization service. As e-books gained popularity, the company pivoted to digitizing printed works.

For years, it was considered a slow-growth company, according to the Motley Fool. That changed six years ago when Innodata shifted focus to AI. Today, the company specializes in generative AI and LLM development for other companies. It lists Google, Amazon, Microsoft, and Apple as partners.

In 2024, Innodata reported a near-doubling ( 96% growth) in revenue to $170.5 million. It also posted a net profit of $28.7 million, reversing a $0.9 million loss the previous year. The company has guided for at least 40% revenue growth in 2025.

Following the earnings report, BWS Financial raised its target price for Innodata by 64% to $74 per share — the second upward revision in three months. In November, the firm had lifted its target price by 50% to $45 per share.

According to MarketWatch, the four analysts currently covering the company all have  “buy” recommendations. Their average target price stands at $74 per share, suggesting upside of more than 68% versus the last closing price.

Not all analysts are so bullish. Zacks has warned that the stock appears overvalued, trading at a higher price-to-sales ratio than peers. This suggests that much of the company’s growth potential may already be priced in.