The Appen Ltd (ASX: APX) share price continued its positive run on Thursday and climbed to a new all-time high of $24.07.
At that point it meant the shares of the global leader in the development of high-quality, human annotated datasets for machine learning and artificial intelligence had gained an incredible 133% since this time last year.
Why is the Appen share price up 133% in 12 months?
Investors have been fighting to get hold of Appen's shares following an impressive performance in FY 2018.
Even after the company upgraded its earnings guidance twice during the year, it still smashed it and the market's expectations when it released its results earlier this week.
Full year underlying EBITDA guidance started at $50 million to $55 million. It was then upgraded in August to between $54 million and $59 million and then to between $62 million and $65 million in November.
Appen ultimately delivered underlying EBITDA of $71.3 million, up 153% on FY 2017's result and 9.7% ahead of the top end of its November guidance.
Why did Appen outperform its guidance?
Appen's chief executive officer, Mark Brayan, advised that the company's strong growth in FY 2018 was the result of the accelerating AI market and the high and growing demand for quality training data.
This led to the company's Content Relevance business being the key driver of growth. It achieved revenue of $312.8. million (86% of total revenue), which was a 148% increase on the prior corresponding period.
Pleasingly, management is confident that the fast-growing AI market will fuel increasing demand for its services in FY 2019 and beyond.
It has provided underlying EBITDA guidance in the range of $85 million to $90 million, which implies year on year growth of 19% to 26%.
Is it too late to invest?
I believe this result and its positive outlook demonstrates why Appen could be a fantastic buy and hold investment option despite its massive gain over the last 12 months.
All in all, I think it would be a great long-term investment along with fellow tech stars Altium Limited (ASX: ALU) and Afterpay Touch Group Ltd (ASX: APT).
