Will the New AI Platforms Keep Innodata Ahead of Competitors?

Innodata Inc. INOD is shifting its focus from scale data to smart data to strengthen the prospects of the large language models (LLMs). Moreover, it is positioning itself in the market to offer Agentic AI services to its clients, as the prospects of agent-based AI remain strong because of its ability to unravel the full value of LLMs and generative AI for enterprises.

Through the smart data approach, the ability to understand the variability of post-training data is required to achieve specific improvements in factuality, safety, coherence and reasoning. Moreover, Innodata believes that the market for simulation data and evaluation services is expected to fuel Agentic AI and robotics demand in the upcoming period, and with the ongoing enhancements in the current market state, it will increase its competitive edge over its rivals.

To stand out amid market competitors, INOD aims to continue investing in several growth opportunities through its short-cycle, high-return growth initiatives. The initiatives are expected to be undertaken across custom annotation pipelines, verticalized agent development and expanded global delivery, accompanied by strategic platform development, especially for LLM testing, safety and real-world deployment. Besides, Innodata also aims to offer advisory and integration services to companies building AI native systems, alongside expanding into new domains like multi-agent systems and robotics and new markets.

During the first six months of 2025, INOD witnessed 97.7% year-over-year revenue growth to $116.7 million, attributable to increased demand volumes from its existing clients, with higher subscription volumes witnessed in its Agility AI-enabled industry platform. Moving forward, with the ongoing strategic investments and market trends, Innodata is expected to scale and stand out among competitors, thus witnessing profitability growth in the long term.

Competition Status for Innodata?

In the market for agentic or agent-based AI solutions providers, Innodata faces substantial competition from Microsoft Corporation MSFT and Unisys Corporation UIS.

Microsoft, with its Azure AI Foundry & Agent Service, Copilot Tuning & Multi-agent Orchestration and GitHub Copilot Agent, offers substantial competition in the market that Unisys operates in. Already achieving market share with these innovations, Microsoft is also actively investing in increasing its agentic AI offerings across several fields.

On the other hand, Unisys is currently stepping up its game in the agentic AI solutions genre through active investments, substantiated by its recent rollout of three major cloud AI solutions, Cloud AI Foundation, Cloud AI Enablement and Cloud AI Customer Experience under its Cloud, Applications & Infrastructure unit, which are built on Unisys Intelligence Accelerator. These are engineered to drive operational efficiency, streamline decision-making processes and enable organizations to maximize resources while integrating AI into core operations.

INOD Stock’s Price Performance & Valuation Trend

Shares of this New Jersey-based data engineering company have gained 20.8% in the past three months, outperforming the Zacks Computer - Services industry, the broader Zacks Computer and Technology sector and the S&P 500 index, as evidenced by the chart below.

INOD stock is currently trading at a premium compared with the industry peers, with a forward 12-month price-to-sales (P/S) ratio of 4.91, as evidenced by the chart below. The overvaluation of the stock compared with its industry peers indicates its strong potential in the market, given the favorable trends backing it up.

EPS Trend of Innodata

For 2025 and 2026, Innodata’s earnings estimates have trended upward in the past 30 days to 71 cents and $1.05 per share, respectively. Although the revised estimated figure for 2025 reflects a 20.2% year-over-year decline, estimates for 2026 indicate 48.2% growth.

INOD stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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