The Appen Ltd (ASX: APX) share price slumped 4.59% today to close at $29.08.
Why the Appen share price fell today
The drop came Friday after an after-market announcement on Thursday that revealed a number of Appen's directors have been selling shares.
The company chair, Chris Vonwiller, sold 18% of his holding for an average price of $29 per share. He sold them for personal reasons, including philanthropy. This left him with a total of 9 million shares.
CEO and managing director Mark Brayan sold 18.6% of his holding at an average price of $30.60 per share. Brayan sold in order to meet tax obligations and to diversify his personal wealth. He continues to hold 418,309 Appen shares.
Non-executive director Bill Pulver sold just over 45% of his holding in Appen at an average of $30.69 per share. This director sold in order to diversify his personal wealth and has a remaining holding of 332,384 shares.
Together, the directors sold an aggregate of 2.37 million shares, representing a total value of $68,919,600 at today's share price.
While the directors each gave reasons why they sold some of their holdings, this didn't stop the Appen share price from falling in response today.
The company's share price today is down from its 52 week high of $32.30 reached in May. It has, however, risen 11.20% compared to this time last year. The company's share price has also risen significantly since the beginning of January when it sat at $22.18.
Appen has seen considerable success lately through the development of its artificial intelligence (AI) products. The company builds software that can recognise language and images. At its AGM in May, Appen outlined that global AI spending is rising at 28% per year. This demonstrates that it has the ability to reach a rapidly growing market.
The company's revenue has grown at a compound annual growth rate (CAGR) of 59% since 2015. Underlying earnings before interest, tax, depreciation and amortisation have risen at a CAGR of 64% over the same timeframe.
Appen had $100 million in cash on its balance sheet in May.
