AppLovin (APP)
Market Price (3/1/2026): $434.17 | Market Cap: $146.8 BilSector: Information Technology | Industry: Application Software
AppLovin (APP)
Market Price (3/1/2026): $434.17Market Cap: $146.8 BilSector: Information TechnologyIndustry: Application Software
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
| Strong revenue growthRev Chg LTMRevenue Change % Last Twelve Months (LTM) is 61% | Expensive valuation multiplesP/SPrice/Sales ratio is 25x |
| Attractive operating marginsOp Mgn LTMOperating Margin = Operating Income / Revenue Reflects profitability before taxes and before impact of capital structure (interest payments). is 72% | Short seller reportMuddy Waters Research report on 3/27/2025. |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 68%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 68%, CFO LTM is 4.0 Bil, FCF LTM is 4.0 Bil | Key risksAPP key risks include [1] ongoing government investigations (SEC, Show more. |
| Valuation becoming less expensiveP/S 6M Chg %Price/Sales change over 6 months. Declining P/S indicates valuation has become less expensive. is -46% | |
| Megatrend and thematic driversMegatrends include Digital Advertising, Social Media & Creator Economy, and Digital Content & Streaming. Themes include Ad-Tech Platforms, Show more. |
| Strong revenue growthRev Chg LTMRevenue Change % Last Twelve Months (LTM) is 61% |
| Attractive operating marginsOp Mgn LTMOperating Margin = Operating Income / Revenue Reflects profitability before taxes and before impact of capital structure (interest payments). is 72% |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 68%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 68%, CFO LTM is 4.0 Bil, FCF LTM is 4.0 Bil |
| Valuation becoming less expensiveP/S 6M Chg %Price/Sales change over 6 months. Declining P/S indicates valuation has become less expensive. is -46% |
| Megatrend and thematic driversMegatrends include Digital Advertising, Social Media & Creator Economy, and Digital Content & Streaming. Themes include Ad-Tech Platforms, Show more. |
| Expensive valuation multiplesP/SPrice/Sales ratio is 25x |
| Short seller reportMuddy Waters Research report on 3/27/2025. |
| Key risksAPP key risks include [1] ongoing government investigations (SEC, Show more. |
Qualitative Assessment
AI Analysis | Feedback
1. High Valuation and Subsequent Profit-Taking.
AppLovin's stock experienced a significant rally through 2024 and much of 2025, reaching an all-time high closing price of $733.60 on December 22, 2025. This elevated valuation led to investor concerns about the stock being stretched, triggering substantial profit-taking and contributing to a sharp reversal. From its peak in December 2025 to late February 2026, the stock declined by approximately 33%.
2. Market Skepticism Regarding Future Growth and AI Thesis.
Despite AppLovin reporting strong fourth-quarter 2025 financial results on February 11, 2026, where revenue increased 66% year-over-year to $1.66 billion and EPS of $3.24 topped analyst estimates of $2.89, the stock fell nearly 20% on February 12, 2026. This indicates that the market may be anticipating a peak in future growth and harbors skepticism about the long-term advantages and scalability of the company's AI platform, such as its AXON AI engine, despite management attributing record results to it.
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Stock Movement Drivers
Fundamental Drivers
The -27.5% change in APP stock from 11/30/2025 to 2/28/2026 was primarily driven by a -38.5% change in the company's P/E Multiple.| (LTM values as of) | 11302025 | 2282026 | Change |
|---|---|---|---|
| Stock Price ($) | 599.48 | 434.77 | -27.5% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 5,147 | 5,806 | 12.8% |
| Net Income Margin (%) | 55.0% | 57.4% | 4.4% |
| P/E Multiple | 71.7 | 44.1 | -38.5% |
| Shares Outstanding (Mil) | 339 | 338 | 0.1% |
| Cumulative Contribution | -27.5% |
Market Drivers
11/30/2025 to 2/28/2026| Return | Correlation | |
|---|---|---|
| APP | -27.5% | |
| Market (SPY) | 0.4% | 49.3% |
| Sector (XLK) | -3.0% | 62.0% |
Fundamental Drivers
The -9.2% change in APP stock from 8/31/2025 to 2/28/2026 was primarily driven by a -33.9% change in the company's P/E Multiple.| (LTM values as of) | 8312025 | 2282026 | Change |
|---|---|---|---|
| Stock Price ($) | 478.59 | 434.77 | -9.2% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 4,577 | 5,806 | 26.8% |
| Net Income Margin (%) | 53.1% | 57.4% | 8.2% |
| P/E Multiple | 66.7 | 44.1 | -33.9% |
| Shares Outstanding (Mil) | 339 | 338 | 0.1% |
| Cumulative Contribution | -9.2% |
Market Drivers
8/31/2025 to 2/28/2026| Return | Correlation | |
|---|---|---|
| APP | -9.2% | |
| Market (SPY) | 6.6% | 42.6% |
| Sector (XLK) | 5.9% | 52.5% |
Fundamental Drivers
The 33.5% change in APP stock from 2/28/2025 to 2/28/2026 was primarily driven by a 61.1% change in the company's Total Revenues ($ Mil).| (LTM values as of) | 2282025 | 2282026 | Change |
|---|---|---|---|
| Stock Price ($) | 325.74 | 434.77 | 33.5% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 3,604 | 5,806 | 61.1% |
| Net Income Margin (%) | 43.8% | 57.4% | 31.0% |
| P/E Multiple | 69.9 | 44.1 | -36.9% |
| Shares Outstanding (Mil) | 339 | 338 | 0.3% |
| Cumulative Contribution | 33.5% |
Market Drivers
2/28/2025 to 2/28/2026| Return | Correlation | |
|---|---|---|
| APP | 33.5% | |
| Market (SPY) | 16.5% | 50.8% |
| Sector (XLK) | 23.6% | 57.4% |
Fundamental Drivers
The 3120.5% change in APP stock from 2/28/2023 to 2/28/2026 was primarily driven by a 1324.1% change in the company's P/S Multiple.| (LTM values as of) | 2282023 | 2282026 | Change |
|---|---|---|---|
| Stock Price ($) | 13.50 | 434.77 | 3120.5% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 2,817 | 5,806 | 106.1% |
| P/S Multiple | 1.8 | 25.3 | 1324.1% |
| Shares Outstanding (Mil) | 371 | 338 | 9.7% |
| Cumulative Contribution | 3120.5% |
Market Drivers
2/28/2023 to 2/28/2026| Return | Correlation | |
|---|---|---|
| APP | 3120.5% | |
| Market (SPY) | 79.6% | 45.1% |
| Sector (XLK) | 107.4% | 46.8% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| APP Return | 45% | -89% | 278% | 713% | 108% | -34% | 582% |
| Peers Return | -1% | -62% | 46% | 16% | 48% | -26% | -30% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 1% | 84% |
Monthly Win Rates [3] | |||||||
| APP Win Rate | 67% | 8% | 83% | 83% | 58% | 0% | |
| Peers Win Rate | 47% | 32% | 63% | 50% | 50% | 20% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 50% | |
Max Drawdowns [4] | |||||||
| APP Max Drawdown | -24% | -90% | -8% | -4% | -32% | -46% | |
| Peers Max Drawdown | -31% | -73% | -26% | -34% | -31% | -32% | |
| S&P 500 Max Drawdown | -1% | -25% | -1% | -2% | -15% | -1% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: U, TTD, META, APPS, MGNI.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 2/27/2026 (YTD)
How Low Can It Go
| Event | APP | S&P 500 |
|---|---|---|
| 2022 Inflation Shock | ||
| % Loss | -91.9% | -25.4% |
| % Gain to Breakeven | 1134.9% | 34.1% |
| Time to Breakeven | 629 days | 464 days |
Compare to U, TTD, META, APPS, MGNI
In The Past
AppLovin's stock fell -91.9% during the 2022 Inflation Shock from a high on 11/11/2021. A -91.9% loss requires a 1134.9% gain to breakeven.
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About AppLovin (APP)
AI Analysis | Feedback
Analogy 1: It's like **Zynga** (a mobile game publisher) combined with **Google AdMob** (a platform for app advertising and monetization).
Analogy 2: Imagine the **Google Ads** and **AdMob** of the mobile app world, but the company also owns and publishes many popular mobile games itself.
AI Analysis | Feedback
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AppLovin Software Platform: This comprehensive suite of services empowers mobile app developers to manage user acquisition, advertising monetization, and creative development for their applications.
- AppDiscovery: A user acquisition service that helps mobile app developers find and acquire high-value users through targeted advertising campaigns.
- MAX: An in-app bidding monetization service that optimizes ad placements and demand sources to maximize advertising revenue for app developers.
- SparkLabs: A creative automation service that uses AI to generate and optimize mobile ad creatives for marketing campaigns.
- First-Party Mobile Games: A portfolio of mobile games developed and published by AppLovin, generating revenue primarily through in-app purchases and advertising.
AI Analysis | Feedback
AppLovin (symbol: APP) primarily sells its services and technology to other companies (B2B).
Based on AppLovin's public filings (e.g., their most recent 10-K report), the company explicitly states that no single customer accounted for 10% or more of its revenue in recent fiscal years. This indicates that AppLovin does not have major customers in the traditional sense, where a few entities drive a significant portion of its business. Instead, its customer base is highly diversified across numerous companies.
The companies that utilize AppLovin's platform and services primarily fall into the following categories:
- Mobile App Developers: These are companies that create and develop mobile applications, with a significant focus on mobile games. They leverage AppLovin's tools for user acquisition (to get more people to download and use their apps), monetization (to generate revenue from their apps through advertising), and analytics to optimize their app performance and growth.
- Mobile App Publishers: Businesses that publish and distribute mobile applications, often managing a portfolio of various apps. They use AppLovin's integrated platform to efficiently monetize their app inventory through advertising and to cross-promote their apps across different platforms.
- Advertisers: This category often overlaps with app developers, as many developers are also advertisers seeking to promote their own apps. Other advertisers might include brands or businesses looking to reach mobile users through in-app advertising. They utilize AppLovin's extensive advertising network to acquire new users and drive engagement for their mobile products.
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Major Suppliers:
- Amazon Web Services (AWS), a subsidiary of Amazon.com, Inc. (Symbol: AMZN)
AI Analysis | Feedback
Adam Foroughi, Chief Executive Officer & Co-Founder
Adam Foroughi co-founded AppLovin in 2012. Before AppLovin, he founded two other marketing technology companies, LifeStreet Media Inc. and Social Hour Inc. He also worked as a derivatives trader. Foroughi led AppLovin through its successful initial public offering (IPO) in 2021, which valued the company at approximately $24 billion.
Todd Morgenfeld, Chief Financial Officer
Todd Morgenfeld has served as AppLovin's Chief Financial Officer since 2023. Prior to joining AppLovin, he was the CFO of Pinterest for seven years. Before Pinterest, he served as Vice President of Finance at Twitter and also held roles at Silver Lake Partners, a private equity firm, and Goldman Sachs. He holds a Master of Business Administration from Stanford University and a Bachelor of Arts in Economics from Princeton University.
Basil Shikin, Chief Technology Officer
Basil Shikin serves as the Chief Technology Officer at AppLovin. He is also a co-founder of the company. Shikin has been instrumental in building the technology and infrastructure that powers AppLovin's platform.
Victoria Valenzuela, Chief Administrative & Legal Officer
Victoria Valenzuela serves as the Chief Administrative & Legal Officer for AppLovin. She is responsible for the company's legal and administrative functions.
Katie Jansen, Chief Marketing Officer
Katie Jansen is the Chief Marketing Officer at AppLovin. She oversees the company's global marketing strategies. Prior to her role at AppLovin, Jansen held marketing leadership positions at other technology companies, including serving as Vice President of Marketing at PlayPhone.
AI Analysis | Feedback
The key risks to AppLovin's (APP) business are primarily centered around regulatory and legal challenges, intense competition in the mobile advertising sector, and its high market valuation.
- Regulatory Scrutiny and Legal Challenges: AppLovin is currently facing significant regulatory pressure, including an ongoing investigation by the Securities and Exchange Commission (SEC) and probes from multiple state attorneys general. These inquiries focus on the company's data collection practices, alleged violations of platform partner agreements, and accusations of utilizing unauthorized tracking methods, such as "fingerprinting," and engaging in deceptive advertising practices. Additionally, AppLovin has been a target of short-seller reports alleging manipulative tactics like "clickjacking" and "backdoor installations," which have led to securities class-action lawsuits accusing the company of securities fraud and misrepresenting its AI capabilities. The discontinuance of its "Array" product due to allegations of unauthorized app installations highlights the immediate impact of this scrutiny. These legal and regulatory headwinds pose a substantial risk of financial penalties, reputational damage, and mandated changes to AppLovin's core business model.
- Intense Competition: AppLovin operates in a highly competitive and rapidly evolving mobile advertising and app monetization industry. The company faces formidable competition from tech giants such as Google (AdMob, Google Ad Manager, AdSense), Meta Platforms (Meta Audience Network, Advantage+), and Apple (Apple Ads), all of whom possess vast user bases and extensive data. This fierce competition could lead to erosion of AppLovin's cost advantage and compression of its profitability. The need to continuously innovate with its AI-powered advertising engine, AXON, to optimize campaigns and adapt to privacy-first approaches, such as Apple's ATT and Google's Privacy Sandbox, adds to the competitive pressure.
- High Valuation and Market Volatility: AppLovin's stock currently trades at a substantial premium, with high valuation multiples, including a P/E ratio of 82.69 and a P/S ratio of 37.82 as of October 2025, and a forward P/E of 74.1x FY2025 EPS. While analysts see growth trajectory, particularly with their AI platform, as justifying the premium, this high valuation implies that the market has priced in significant future growth and performance. If the company fails to deliver anticipated results, or if its growth stalls, there is a risk of a significant stock price correction. The stock has experienced considerable volatility in the past, including a notable 14% drop following reports of the SEC investigation and a 32.3% plunge earlier in 2025 due to short-seller allegations.
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The evolving and increasingly restrictive mobile platform privacy policies, exemplified by Google's ongoing implementation of its Privacy Sandbox for Android, represent a clear emerging threat. While AppLovin successfully navigated Apple's App Tracking Transparency (ATT) framework, the Privacy Sandbox is designed to significantly limit third-party tracking and targeting on Android devices. If AppLovin's technology and solutions fail to adapt effectively to these fundamental changes, or if these changes severely diminish the efficiency of mobile advertising and user acquisition methods that are central to AppLovin's business model, it could significantly impact its revenue and competitive positioning.
AI Analysis | Feedback
AppLovin (symbol: APP) primarily operates in the mobile technology sector, offering an end-to-end software platform for businesses to reach, monetize, and grow their global audiences. While historically involved in mobile games, the company is strategically divesting its mobile game development business to focus on its high-margin advertising technology platform.
The addressable markets for AppLovin's main products and services, which include its software platform for user acquisition, ad monetization, and analytics (such as AppDiscovery, MAX, and Adjust), are as follows:
- Global In-App Advertising Market: The global in-app advertising market size was valued at approximately USD 390.5 billion in 2024 and is projected to reach USD 952 billion by 2034. Asia Pacific is noted as a dominant region in this market.
- Global Mobile Gaming Market (a key segment for AppLovin's software platform): The global mobile gaming market size was estimated at USD 139.38 billion in 2024 and is projected to reach USD 256.19 billion by 2030. The Asia Pacific region accounts for a significant share of this market.
AppLovin's AI-driven platform (AXON) is also expanding beyond mobile gaming into broader digital advertising categories, including e-commerce and Connected TV (CTV) advertising, unlocking larger potential addressable markets:
- U.S. Connected TV (CTV) Ad Spend: The U.S. CTV ad spend is projected to reach USD 34.3 billion in 2025.
- Global E-commerce Market: The global e-commerce market has a footprint of USD 5.4 trillion.
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AppLovin (APP) is anticipated to drive future revenue growth over the next two to three years through several key strategies:
- Expansion into New Advertising Verticals: AppLovin is strategically pivoting from primarily gaming-focused advertising to a broader, multi-vertical platform, with a significant emphasis on e-commerce and retail advertising. The launch of the Axon Ad Manager and a self-serve platform tailored for e-commerce and non-gaming advertisers is a pivotal move, with early results showing promising growth in advertiser spend. This diversification is expected to broaden its advertiser base and reduce dependence on the gaming sector.
- Advancements and Optimization of the AXON AI Platform: Continuous enhancements to AppLovin's proprietary AI-driven AXON engine are a core driver of future growth. These advancements include continuously upgraded ad delivery optimization algorithms, expanding self-learning capabilities, and the testing of generative AI for automated ad creatives to improve engagement and conversion rates.
- Growth of the Self-Service Platform: The successful introduction and planned full opening of AppLovin's self-service platform, Axon Ads Manager, are expected to significantly broaden the company's advertiser base. This platform, operating on a self-serve, invite-only model initially, aims to open global opportunities for advertisers of all sizes and is seen as foundational for long-term growth.
- International Market Expansion: AppLovin plans to focus on expanding its international footprint, particularly in non-English core markets such as Japan and South Korea. This initiative is aimed at broadening the reach of its platform and is considered a key growth focus for 2026 and beyond.
- Continued Strength in Mobile Gaming Advertising: While diversifying, AppLovin anticipates continued strong growth in its core mobile gaming advertising business. This sustained performance is driven by ongoing model updates and enhancements to its AXON algorithm, which contribute to improved ad targeting and efficiency for mobile game developers.
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Share Repurchases
- AppLovin's board increased its share repurchase authorization by an incremental $3.2 billion in October 2025, raising the total remaining authorization to $3.3 billion.
- During the third quarter of 2025, AppLovin repurchased and withheld 1.3 million shares of Class A common stock for a total cost of $571 million.
- Annual share buybacks were $981.297 million in 2024, $1.154 billion in 2023, and $338.88 million in 2022.
Share Issuance
- AppLovin's shares outstanding declined by 4.08% in 2024 to 0.348 billion from 2023, and by 2.42% in 2023 to 0.363 billion from 2022.
- Proceeds from the issuance of common stock upon the exercise of stock options and purchase of ESPP shares were $21.014 million for the six months ended June 30, 2025, and $28.800 million for the six months ended June 30, 2024.
Outbound Investments
- In February 2024, AppLovin agreed to invest $50.0 million in the Series C preferred stock financing of Humans, Inc., the developer of the Flip Shop social shopping app.
- The company announced the sale of its mobile gaming division to Tripledot Studios for $800 million, receiving half in cash and half in equity, making AppLovin a minority shareholder in Tripledot.
Capital Expenditures
- AppLovin's capital expenditures for the latest twelve months were $4.776 million.
- Capital expenditures averaged $2.863 million for the fiscal years ending December 2020 to 2024.
- Capital expenditures peaked in December 2024 at $4.776 million and increased in 2023 by 541.4% to $4.246 million.
Latest Trefis Analyses
| Title | Date | |
|---|---|---|
| DASHBOARDS | ||
| How AppLovin Stock Slipped -30% | 02/25/2026 | |
| With AppLovin Stock Sliding, Have You Assessed The Risk? | 02/19/2026 | |
| AppLovin Stock (-20%): Growth Deceleration Spooks High-Multiple Holders | 02/13/2026 | |
| AppLovin Stock Dips 20% In One Day, Things To Be Wary Of When Buying The Stock | 02/13/2026 | |
| Does AppLovin Stock Lead the Pack? | 02/05/2026 | |
| AppLovin Stock (-17%) : Short Report Alleges Fraud, Ignites Sell-Off | 01/31/2026 | |
| How AppLovin Stock Gained 90% | 01/30/2026 | |
| Is 22.5% Fall In AppLovin (APP) Stock A Buying Opportunity? | 01/17/2026 | |
| Why AppLovin Stock Jumped 100%? | 01/10/2026 | |
| What Could Go Wrong With AppLovin Stock? | 01/03/2026 | |
| ARTICLES | ||
| APP Looks Smarter Buy Than Workday Stock | 02/28/2026 | |
| Is AppLovin a Better Buy Than Synopsys? | 02/27/2026 | |
| AppLovin Stock Dropped -30%, Here’s Why | 02/25/2026 | |
| Can AppLovin Outrun Shopify in the Next Rally? | 02/24/2026 | |
| APP Tops Shopify Stock on Price & Potential | 02/21/2026 |
Trade Ideas
Select ideas related to APP.
| Date | Ticker | Company | Category | Trade Strategy | 6M Fwd Rtn | 12M Fwd Rtn | 12M Max DD |
|---|---|---|---|---|---|---|---|
| 01302026 | ROP | Roper Technologies | Dip Buy | DB | FCFY OPMDip Buy with High FCF Yield and High MarginBuying dips for companies with high FCF yield and meaningfully high operating margin | -7.3% | -7.3% | -15.0% |
| 01302026 | TDC | Teradata | Dip Buy | DB | FCFY OPMDip Buy with High FCF Yield and High MarginBuying dips for companies with high FCF yield and meaningfully high operating margin | 6.6% | 6.6% | -8.7% |
| 01302026 | CVLT | CommVault Systems | Dip Buy | DB | CFO/Rev | Low D/EDip Buy with High Cash Flow MarginsBuying dips for companies with significant cash flows from operations and reasonable debt / market cap | 1.0% | 1.0% | -5.1% |
| 01302026 | NTNX | Nutanix | Dip Buy | DB | CFO/Rev | Low D/EDip Buy with High Cash Flow MarginsBuying dips for companies with significant cash flows from operations and reasonable debt / market cap | -2.3% | -2.3% | -6.3% |
| 01302026 | FICO | Fair Isaac | Monopoly | MY | Getting CheaperMonopoly-Like with P/S DeclineLarge cap with monopoly-like margins or cash flow generation and getting cheaper based on P/S multiple | -11.1% | -11.1% | -16.1% |
| 01232026 | APP | AppLovin | Monopoly | MY | Getting CheaperMonopoly-Like with P/S DeclineLarge cap with monopoly-like margins or cash flow generation and getting cheaper based on P/S multiple | -19.6% | -19.6% | -30.0% |
Research & Analysis
Invest in Strategies
Wealth Management
Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 21.02 |
| Mkt Cap | 9.7 |
| Rev LTM | 2,297 |
| Op Inc LTM | 307 |
| FCF LTM | 535 |
| FCF 3Y Avg | 412 |
| CFO LTM | 647 |
| CFO 3Y Avg | 499 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 16.4% |
| Rev Chg 3Y Avg | 18.3% |
| Rev Chg Q | 15.1% |
| QoQ Delta Rev Chg LTM | 3.7% |
| Op Mgn LTM | 15.6% |
| Op Mgn 3Y Avg | 4.7% |
| QoQ Delta Op Mgn LTM | 1.2% |
| CFO/Rev LTM | 31.6% |
| CFO/Rev 3Y Avg | 32.4% |
| FCF/Rev LTM | 22.9% |
| FCF/Rev 3Y Avg | 25.8% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 9.7 |
| P/S | 4.2 |
| P/EBIT | 20.4 |
| P/E | 26.8 |
| P/CFO | 13.7 |
| Total Yield | 2.6% |
| Dividend Yield | 0.0% |
| FCF Yield 3Y Avg | 2.9% |
| D/E | 0.2 |
| Net D/E | 0.0 |
Returns
| Median | |
|---|---|
| Name | |
| 1M Rtn | -23.7% |
| 3M Rtn | -21.4% |
| 6M Rtn | -29.8% |
| 12M Rtn | -8.2% |
| 3Y Rtn | -6.5% |
| 1M Excs Rtn | -21.1% |
| 3M Excs Rtn | -20.1% |
| 6M Excs Rtn | -36.1% |
| 12M Excs Rtn | -26.8% |
| 3Y Excs Rtn | -98.0% |
Segment Financials
Revenue by Segment| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| End-to-end advertising solutions including Axon Ads Manager, MAX, Adjust, and Wurl, that allow | 3,224 | ||||
| Advertising | 1,842 | 1,049 | 674 | ||
| Apps | 1,441 | 1,768 | 2,119 | ||
| Business Revenue | 711 | ||||
| Consumer Revenue | 740 | ||||
| Total | 3,224 | 3,283 | 2,817 | 2,793 | 1,451 |
| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| End-to-end advertising solutions including Axon Ads Manager, MAX, Adjust, and Wurl, that allow | 1,590 | ||||
| Total | 1,590 |
Price Behavior
| Market Price | $434.77 | |
| Market Cap ($ Bil) | 147.0 | |
| First Trading Date | 04/15/2021 | |
| Distance from 52W High | -40.7% | |
| 50 Days | 200 Days | |
| DMA Price | $547.26 | $508.55 |
| DMA Trend | up | down |
| Distance from DMA | -20.6% | -14.5% |
| 3M | 1YR | |
| Volatility | 92.5% | 82.3% |
| Downside Capture | 573.69 | 248.58 |
| Upside Capture | 361.64 | 241.72 |
| Correlation (SPY) | 48.0% | 50.7% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | 7.15 | 4.43 | 4.18 | 2.88 | 2.15 | 2.25 |
| Up Beta | 2.79 | 3.13 | 2.53 | 2.79 | 1.87 | 1.99 |
| Down Beta | 8.35 | 3.69 | 4.30 | 2.78 | 2.28 | 2.29 |
| Up Capture | 912% | 374% | 445% | 354% | 545% | 15342% |
| Bmk +ve Days | 9 | 20 | 31 | 70 | 142 | 431 |
| Stock +ve Days | 12 | 20 | 32 | 67 | 138 | 415 |
| Down Capture | 691% | 530% | 416% | 245% | 154% | 112% |
| Bmk -ve Days | 12 | 21 | 30 | 54 | 109 | 320 |
| Stock -ve Days | 9 | 21 | 29 | 57 | 112 | 335 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with APP | |
|---|---|---|---|---|
| APP | 28.0% | 82.2% | 0.67 | - |
| Sector ETF (XLK) | 20.8% | 27.5% | 0.67 | 57.5% |
| Equity (SPY) | 16.5% | 19.4% | 0.66 | 51.1% |
| Gold (GLD) | 81.3% | 25.7% | 2.29 | 14.1% |
| Commodities (DBC) | 13.4% | 16.9% | 0.58 | 25.0% |
| Real Estate (VNQ) | 7.3% | 16.6% | 0.25 | 21.8% |
| Bitcoin (BTCUSD) | -22.0% | 44.9% | -0.42 | 27.5% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with APP | |
|---|---|---|---|---|
| APP | 45.4% | 78.1% | 0.83 | - |
| Sector ETF (XLK) | 16.7% | 24.8% | 0.61 | 49.6% |
| Equity (SPY) | 13.6% | 17.0% | 0.63 | 47.8% |
| Gold (GLD) | 23.5% | 17.1% | 1.12 | 10.9% |
| Commodities (DBC) | 10.6% | 19.0% | 0.44 | 11.8% |
| Real Estate (VNQ) | 5.1% | 18.8% | 0.18 | 29.0% |
| Bitcoin (BTCUSD) | 4.0% | 57.0% | 0.29 | 23.2% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with APP | |
|---|---|---|---|---|
| APP | 20.6% | 78.1% | 0.83 | - |
| Sector ETF (XLK) | 22.5% | 24.2% | 0.85 | 49.6% |
| Equity (SPY) | 15.4% | 17.9% | 0.74 | 47.8% |
| Gold (GLD) | 15.3% | 15.6% | 0.82 | 10.9% |
| Commodities (DBC) | 8.7% | 17.6% | 0.41 | 11.8% |
| Real Estate (VNQ) | 6.6% | 20.7% | 0.28 | 29.0% |
| Bitcoin (BTCUSD) | 65.8% | 66.8% | 1.05 | 23.2% |
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Returns Analyses
Earnings Returns History
Expand for More| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 2/11/2026 | -19.7% | -9.8% | |
| 11/5/2025 | 0.7% | -5.2% | 11.8% |
| 8/6/2025 | 12.0% | 14.3% | 25.5% |
| 5/7/2025 | 11.9% | 24.1% | 37.7% |
| 2/12/2025 | 24.0% | 18.3% | -23.0% |
| 11/6/2024 | 46.3% | 68.5% | 138.2% |
| 8/7/2024 | 14.2% | 26.0% | 25.9% |
| 5/8/2024 | 14.4% | 13.6% | 10.7% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 14 | 16 | 12 |
| # Negative | 6 | 4 | 7 |
| Median Positive | 21.7% | 23.5% | 32.3% |
| Median Negative | -5.6% | -13.3% | -20.8% |
| Max Positive | 46.3% | 68.5% | 138.2% |
| Max Negative | -19.7% | -25.4% | -31.5% |
SEC Filings
Expand for More| Report Date | Filing Date | Filing |
|---|---|---|
| 12/31/2025 | 02/19/2026 | 10-K |
| 09/30/2025 | 11/05/2025 | 10-Q |
| 06/30/2025 | 08/06/2025 | 10-Q |
| 03/31/2025 | 05/07/2025 | 10-Q |
| 12/31/2024 | 02/27/2025 | 10-K |
| 09/30/2024 | 11/06/2024 | 10-Q |
| 06/30/2024 | 08/07/2024 | 10-Q |
| 03/31/2024 | 05/08/2024 | 10-Q |
| 12/31/2023 | 02/26/2024 | 10-K |
| 09/30/2023 | 11/08/2023 | 10-Q |
| 06/30/2023 | 08/09/2023 | 10-Q |
| 03/31/2023 | 05/10/2023 | 10-Q |
| 12/31/2022 | 02/28/2023 | 10-K |
| 09/30/2022 | 11/10/2022 | 10-Q |
| 06/30/2022 | 08/12/2022 | 10-Q |
| 03/31/2022 | 05/13/2022 | 10-Q |
Insider Activity
Expand for More| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Valenzuela, Victoria | CALO & Corp. Secretary | Direct | Sell | 12192025 | 657.13 | 7,609 | 5,000,102 | 182,097,294 | Form |
| 2 | Harvey, Dawson Alyssa | Direct | Sell | 12102025 | 693.32 | 150 | 103,998 | 1,961,402 | Form | |
| 3 | Shikin, Vasily | Chief Technology Officer | See footnote | Sell | 11262025 | 549.09 | 15,540 | 8,532,891 | 19,706,366 | Form |
| 4 | Shikin, Vasily | Chief Technology Officer | See footnote | Sell | 11262025 | 548.45 | 14,708 | 8,066,634 | 19,683,399 | Form |
| 5 | Shikin, Vasily | Chief Technology Officer | See footnote | Sell | 11262025 | 546.93 | 14,867 | 8,131,244 | 19,628,857 | Form |
APP Trade Sentinel
ACCUMULATE (Score 7-8)
CONVICTION RATIONALE
AppLovin scores a 7 (Accumulate) due to its elite financial profile, exceptional growth, and a widening competitive moat driven by superior technology. The business quality is undeniable. However, the conviction is capped by the significant, unquantified regulatory risk from the SEC investigation, which represents the primary friction on the thesis and prevents a higher, 'Overweight' rating.
STOCK ARCHETYPE
High-Beta CompounderAppLovin's classification is driven by its exceptionally high revenue growth (+66% YoY in the last reported quarter, +41% consensus for FY26) and its dominant position in a high-growth market. Following the divestiture of its lower-margin Apps business, it operates as a pure-play, high-margin (82-84% Adj. EBITDA) software platform, fitting the profile of a company where growth durability and competitive moat are the primary investment considerations.
INVESTMENT THESIS
The primary long thesis is that AppLovin's proprietary AXON AI engine provides a durable technological advantage, delivering superior Return on Ad Spend (ROAS) that is causing a structural market share shift away from competitors, particularly Unity. This technology moat, combined with the network effects of its dominant MAX mediation platform, allows AppLovin to capture a disproportionate share of the growing mobile advertising and e-commerce markets.
- Software Platform revenue grew 66% YoY to $1.66B in Q4 2025, significantly outpacing key competitor Unity's Grow Solutions segment.
- AXON 2.0 rollout led to a quadrupling of ad spend on the platform, indicating a step-change in performance and advertiser adoption.
- The company is successfully expanding its Total Addressable Market (TAM) beyond mobile gaming into the larger e-commerce vertical, with a self-service platform launched in H2 2025.
- Adjusted EBITDA margins of 82-84% and FCF margins of ~72% demonstrate significant pricing power and operating leverage.
PRIMARY RISK
The most significant risk is the ongoing SEC investigation and inquiries from multiple state attorneys general into AppLovin's data collection and ad targeting practices. Adverse findings could force fundamental changes to its core AXON AI model, which relies on vast data sets for its performance advantage. This represents a Type 4 (Regulatory) risk that could impair the company's primary competitive moat.
- Bloomberg reported an active SEC investigation in October 2025, spurred by a whistleblower complaint and short-seller reports.
- Attorneys general of Delaware, Oregon, and Connecticut have concurrent inquiries into the company's handling of consumer data.
- The risk is a 'New Shock' with multiple investigations launched in the last six months, creating a high level of uncertainty around the outcome.
| KPI | Threshold | Rationale |
|---|---|---|
| Software Platform Revenue Growth YoY | > 35% | This is the primary driver of the business. A sustained growth rate above 35% validates the 'High-Beta Compounder' thesis and justifies the premium valuation. A drop below this level would signal market saturation or competitive pressure. |
| Adjusted EBITDA Margin | > 75% | The elite margin profile is a key differentiator and evidence of pricing power. Any meaningful compression below 75% would suggest a degradation of its competitive advantage or a need to increase spending to defend its position. |
| E-commerce Revenue Contribution | Disclosure of metric & >10% of Software Revenue | This is the most important leading indicator for TAM expansion. Management needs to provide specific disclosures on this new vertical. Achieving a meaningful contribution (>10%) would validate the growth runway beyond mobile gaming. |
Execution vs. Existential Regulatory Risk
BULL VIEW
The AXON AI engine's superior ROAS is driving durable market share gains from competitors like Unity, justifying a premium valuation and sustaining >35% growth.
CORE TENSION
Can elite operational performance, driven by the AXON AI, continue to outweigh the significant, unquantified risk of a regulatory crackdown on its core data collection practices?
PREVAILING SENTIMENT
Software Platform revenue grew 66% YoY in Q4 2025, while an SEC investigation was reported in October 2025. The bull case is winning on metrics, the bear case on risk.
BEAR VIEW
The active SEC and State AG investigations will force changes to data collection, impairing the AXON engine's effectiveness, causing growth to decelerate sharply.
| Timeline | Event & Metric To Watch |
|---|---|
Anytime | SEC Investigation Update Watch: Any announcement regarding the investigation's status (conclusion, enforcement action, or settlement). This is the primary overhang on the stock. |
Late April 2026 | Q1 2026 Earnings Call Watch: Software Platform Revenue Growth YoY. Must remain above 35% to support the bull thesis and premium valuation. |
Next 30-90 Days | Major Publisher Partnership with CloudX Watch: Press releases or earnings call mentions from major publishers (Tencent, Take-Two) validating CloudX's technology, signaling a credible threat. |
Ongoing | EU Digital Markets Act (DMA) Enforcement Watch: Policy updates from Apple or Google regarding API deprecations or data access restrictions on mobile OS to comply with DMA. |
| Date | Event | Stock Impact |
|---|---|---|
Sep 8, 2025 | E-commerce Self-Service Platform Launch Details: The company launched its self-service platform for the e-commerce vertical, a key strategic initiative to expand its Total Addressable Market beyond mobile gaming, driving positive sentiment. | Surged +11.6% $490.24 -> $547.04 |
Oct 6, 2025 | SEC Investigation & State AG Inquiries Reported Details: Bloomberg reported an active SEC investigation into data collection practices, spurred by a whistleblower. This news introduced a major regulatory overhang, causing a sharp stock decline. | Plummeted -14.0% $682.76 -> $587.00 |
Nov 5, 2025 | Q3 2025 Earnings Report Details: The company reported its third-quarter financial results. The market reaction was muted, suggesting the results were in line with expectations during this period of high growth. | Flat (0.7%) $617.05 -> $621.36 |
Jan 15, 2026 | Short-Seller Report (CapitalWatch) Details: A short-seller report alleged ties to criminal enterprises. The company denied the claims and the source later retracted key parts, resulting in a muted market reaction. | Slight -1.7% pullback $617.76 -> $606.99 |
Jan 29, 2026 | Q4 2025 Earnings & Q1 Guidance Details: Despite reporting strong 66% YoY revenue growth, the stock fell sharply. The negative reaction was attributed to broader ad-tech sector concerns, overshadowing the company's strong execution. | Plummeted -16.9% $569.24 -> $473.11 |
Feb 2, 2026 | New Competitor Launch (CloudX) Details: New AI ad-stack CloudX became generally available, aiming to disrupt incumbents with SDK-less bidding. The news created immediate, significant pressure on APP's stock. | Plummeted -18.1% $473.11 -> $387.34 |
Position Sizing
4%-6%
NORMAL
Stock is in an Explosive Volatility regime (6.5x S&P). While fundamentals like a widening moat and high visibility are strong, the Neutral sentiment and high volatility cap sizing to manage drawdown risk.
Diversification Alternatives
TTD
SECTORSuperior alternative to APP due to its diversification beyond mobile gaming into CTV/web, reducing exposure to mobile-specific regulatory and saturation risks.
DDOG
SECTOROffers a comparable high-growth, high-margin software model but avoids APP's primary risk factor of consumer data privacy regulation by selling to enterprise IT departments.
AppLovin has transformed from a hybrid mobile game publisher into a pure-play, high-margin (84% Adj. EBITDA Margin) AI-driven advertising software platform, with its stock now trading at a ~39x P/E ratio as of Feb 2026.
Filter all news through the lens of a pure-play AI advertising platform's ability to maintain hyper-growth and elite margins as it scales beyond gaming into e-commerce.
Sustained revenue growth >20% YoY; evidence of scaling and increasing spend from e-commerce customers on the self-service platform; announcements of new AI-driven creative or optimization tools (part of AXON engine); maintaining Adjusted EBITDA margins above 80%.
Deceleration of revenue growth below management's guidance (Q1'26 guided at 5-7% sequential growth); any negative regulatory action from the SEC or other bodies regarding data privacy or ad practices; signs of market share loss to competitors like Unity/ironSource or increased competitive pressure from Meta.
Short-term stock price volatility despite strong earnings; individual mobile game market fluctuations (company is now diversified); insider selling (has been consistent); new AI startups in ad-tech (AppLovin's scale and data are the moat).
Repricing Catalyst
The primary catalyst is the successful expansion into the e-commerce advertising vertical via its new self-service platform. Management noted on the Q4 2025 earnings call that spend from these customers is a key driver of growth, demonstrating the AXON AI engine's applicability beyond the mobile gaming market and significantly expanding the company's Total Addressable Market.
AI-Powered Advertising & Monetization Platform
$5481000.0B TTM (100% of Total) · 88.6% MarginWhat It Is
A suite of software tools including Axon Ads Manager (a demand-side platform), MAX (a supply-side mediation platform), and Adjust (a mobile measurement partner).
Who Pays & How
Mobile app developers and e-commerce businesses pay AppLovin to acquire high-value users and maximize ad revenue. They pay because AppLovin's AXON AI engine provides superior return on ad spend (ROAS) through performance-based campaigns, creating a data-driven network effect that is difficult to replicate.
Competition
External Quote Links
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| FinViz |
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