The market may be a sea of red on Wednesday but that hasn't stopped the Appen Ltd (ASX: APX) share price from rocketing higher.
In afternoon trade, the artificial intelligence (AI) data services company's shares are up a sizeable 16% to $13.07.
However, despite this strong gain, the Appen share price is still down a massive 70% from its 52-week high.
Why is the Appen share price rocketing higher today?
The catalyst for the rise in the Appen share price today was the release of a business and trading update this morning.
In respect to the former, Appen is restructuring its business to align to its product-led growth strategy and distinct customer propositions.
This will see the company operate with four customer-facing business units – Global, Enterprise, China, and Government.
Management believes the changes will provide greater visibility of the drivers and performance of the business. Furthermore, it notes that the changes reflect Appen's evolution from being the leading provider of AI data annotation services to a provider of a broad range of AI data annotation products and solutions that unlock growth in new markets.
While the above is a positive move, the main driver of the Appen share price performance today is likely to have been its trading update.
Analysts were very disappointed recently when the company neglected to provide an update on its performance while presenting at the Macquarie Group Ltd (ASX: MQG) conference. Particularly given comments about changing behaviour from its customers and fears over increasing competition.
Positively, this morning the company provided the market with what it wanted and, as you might have guessed from the Appen share price, the news was positive.
According to the release, Appen is on track to achieve underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of US$83 million to US$90 million in FY 2021.
This is in line with its previous guidance of A$120 million to A$130 million (based on constant currency of 1 AUD = US$0.6904) and adjusted into US dollars to reflect a change in its reporting currency. It also represents growth of 18% to 28% year on year.
Shareholders will no doubt be hoping it is onwards and upwards for the Appen share price now things are becoming a little less uncertain.