AI stock Innodata crashes 25% on job cuts, lost contract

Innodata, a trendy AI stock that hit a $1 billion market cap in the past two years of AI euphoria, crashed by over 25% yesterday after it fired 550 employees. The drastic cut spooked investors that the company might have lost its most important customer. Indeed, termination emails blamed the wind-down of a business assignment from a customer. Investors sold down the market cap of INOD — common shares that trade on the Nasdaq despite the company’s substantial overseas presence — by $500 million within a single trading session. By the close of trading yesterday, Innodata had erased all market cap gains its shareholders earned since November 11, 2024. Innodata fired approximately 550 workers in India this week, and made additional layoffs in the Philippines.

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