Appen Ltd (ASX: APX) shares have tumbled by nearly 5% on Monday despite no price-sensitive news from the company.
The AI stock is now swapping hands at $1.82 apiece, bringing losses to nearly 12% for the past week of trade.
All amid an AI-boom, mind you. Here's the latest for Appen shares.
Image source: Getty Images
What's triggering the drop in Appen shares?
Appen's recent share price woes seem tied to an ongoing unflavouresome recipe of operational hiccups, the fallout from Google's exit as a major client, and a disappointing revenue report.
Appen reported its revenues declined 13% year on year for the September quarter, booking $54 million at the top line.
Pundits might remember Appen lost tech colossus Google as a client earlier in the year. This hammered its stock price at the time given the business looked quite different as a result of this one customer's absence.
Excluding Google, Appen's revenues were up nearly 35%. Oh, what could have been.
But the market doesn't live in terms of 'could haves' and 'what ifs'. It is grounded in economic reality. And the reality is that Appen's revenues were down double digits over the year.
Potentially adding to investor concerns was Appen's recent $50 million capital raise.
Here, it issued 26 million new shares at a discounted price of $1.92 each, which was 11.5% down from its closing price just before the raise.
What about today?
While nothing price-sensitive has been released by the company today, investors continue to sell Appen shares.
Reports have surfaced today, noting how the company faced criticism from its contractor workforce after a system change left some of the company's contractors weeks without pay.
Appen had earlier transitioned to a new contractor management platform, CrowdGen. But, according to The Australian Financial Review, this has encountered technical issues, leaving some workers unpaid.
CEO Ryan Kolln reportedly apologised for the inconvenience, acknowledging the stress it caused for many of Appen's workers. Per The AFR:
We are truly sorry for the stress and frustration that this has caused. We are working diligently to fix the issue with the payment implementation.
Trusting a vendor to ethically source data for AI applications is critical, and we are committed to learning from this and improving our processes to ensure this does not happen again.
The workers are expected to receive their money by the end of this week.
Whilst not market-sensitive in any way at all, the news isn't a positive catalyst, put it that way. And, as famed technical analyst and energy trader David Linton says, "bad news happens in downtrends – get used to it".
Appen shares have galaxies to cross before hitting their all-time highs of $$31.51 during mid-2020.
Whilst the stock is up 185% this year after a sharp rally from July, buying has shut off for now, with shares down 8% in a month.
Foolish takeaway
Appen shares continue their slide today despite no company news. The company has apologised for a mishap in its services that's left contractors unpaid for several weeks.
Whether or not this has a direct impact on the stock today is up for debate. But shares are down nearly 12% in the past week.
Zooming out, the stock is up more than 120% in the past year.
