Appian Corporation (NASDAQ:APPN) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Appian Corporation, a software company that provides low-code design platform in the United States, Mexico, Portugal, and internationally. On 31 December 2023, the US$2.7b market-cap company posted a loss of US$111m for its most recent financial year. The most pressing concern for investors is Appian's path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Appian is bordering on breakeven, according to the 10 American Software analysts. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$699m in 2026. Therefore, the company is expected to breakeven roughly 2 years from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 46%, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Appian's growth isn't the focus of this broad overview, though, take into account that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there's one issue worth mentioning. Appian currently has a debt-to-equity ratio of over 2x. Typically, debt shouldn't exceed 40% of your equity, and the company has considerably exceeded this. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

There are key fundamentals of Appian which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Appian, take a look at Appian's company page on Simply Wall St. We've also put together a list of relevant factors you should further research:

1. Valuation: What is Appian worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Appian is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Appian's board and the CEO's background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.