Innodata (INOD) Q4 2025 earnings summary

Executive summary

• Q4 2025 revenue reached $72.4 million, up 22% year-over-year, and full-year revenue was $251.7 million, up 48% year-over-year, driven by expanding relationships with major technology companies and enterprise clients.

• Adjusted EBITDA was $15.7 million in Q4 (22% margin) and $57.9 million for the year (23% margin), both surpassing analyst consensus.

• Net income for Q4 was $8.8 million; full-year net income was $32.2 million.

• Ended 2025 with $82.2 million in cash and short-term investments, up from $46.9 million a year earlier, with no external debt.

• Continued innovation in agentic AI, physical AI, and dataset creation for LLMs, robotics, and regulatory change management.

Financial highlights

• Adjusted gross margin was 43% for FY2025 and 42% for Q4 2025.

• Adjusted EBITDA margin was 23% for FY2025 and 22% for Q4 2025.

• Cash flow from operations was $46.8 million for 2025.

• No drawdown on the $30 million credit facility, which is expandable to $50 million.

• Basic EPS for 2025 was $1.01; diluted EPS was $0.92.

Outlook and guidance

• Forecasting 35% or more year-over-year revenue growth for 2026, targeting at least $340 million in revenue, with expanding customer diversification.

• Early 2026 adjusted gross margins expected in the 35%-40% range, normalizing to 40%+ as new programs scale.

• Guidance is conservative, with potential upward revisions as the year progresses.

• Generative AI remains a structural enterprise priority, supporting long-term demand for AI data and enablement.