Innodata (Innodata (INOD)) shares are cooling off Monday, giving back a sliver of Friday's massive 86% rally. The AI data engineering firm reported first-quarter results that blew past expectations, and investors are now taking a moment to catch their breath.
Revenue came in at $90.1 million, up 54% from a year ago and well above the $76.5 million analysts were looking for. Adjusted earnings hit $0.42 per share, more than double the $0.17 consensus. That's the kind of quarter that makes you check the date to make sure it's not a typo.
The pullback is pretty standard stuff — after a move like Friday's, some profit-taking is almost inevitable. But there's more going on under the hood.
Short interest in Innodata actually increased during the latest reporting period, climbing from 5.05 million shares to 5.30 million shares. That means 17.29% of the company's publicly traded shares are now held short. With average daily volume of about 988,640 shares, it would take roughly 5.36 days for short sellers to cover their positions. That's a decent squeeze potential if the stock keeps climbing.
Management is clearly feeling confident. CEO Jack Abuhoff raised the full-year 2026 revenue forecast, now expecting growth of "approximately 40% or more year-over-year." That's a notable upgrade from the 35% guidance issued just 10 weeks ago. The company is targeting annual revenue of $352.38 million.
Innodata also streamlined its reporting structure, now operating as a single segment instead of the previous three (DDS, Agility, and Synodex). The company ended March with $117.4 million in cash, giving it plenty of runway.
As of Monday's premarket, Innodata shares were down about 2.3% at $82.94. After an 86% jump, a little consolidation is healthy — and with a raised outlook and plenty of short interest, the story is far from over.
