Appen (APX) Q3 2025 TU earnings summary

Executive summary

• Q3 FY25 revenue reached $55.3 million, up 2% year-over-year, with underlying EBITDA (before FX) of $1.0 million, matching the prior year and improving $1.6 million sequentially from Q2 FY25.

• China business delivered standout performance: $28.6 million in revenue (+81% year-over-year), annualized run-rate over $115 million, and $3.3 million underlying EBITDA, marking six consecutive profitable quarters.

• A major project with $10 million+ annual revenue potential transitioned from pilot to full production in Q3 FY25.

• Growth in China offset by ongoing volatility in the US AI market, particularly around large LLM project timing and volumes.

Financial highlights

• Group revenue for Q3 FY25 was $55.3 million, up 2% year-over-year; YTD revenue (excluding Google) was $157.3 million, up 2% year-over-year.

• Gross margin for Q3 FY25 was 39.2%, down 2.0 percentage points year-over-year; YTD gross margin was 37.8%, down 1.0 percentage point.

• Underlying EBITDA (before FX) for Q3 FY25 was $1.0 million, flat year-over-year; YTD underlying EBITDA was -$1.2 million.

• Cash balance at 30 September 2025 was $50.9 million, down from $60.9 million at 30 June 2025.

• Net cash used in operating activities for Q3 FY25 was $4.9 million, with $8.3 million generated YTD.

Outlook and guidance

• FY25 revenue is tracking toward the low end of the $235–$260 million range, with positive full-year underlying EBITDA reaffirmed.

• Limited visibility remains on timing and volumes for large LLM projects, but long-term revenue opportunity is viewed as strong.