LDO’s 7% Surge: Can Lido Defy Shrinking Market Share?
Lido's native token defies gravity with 7% rally amid staking dominance decline.
The Staking Shakeup
Market share erosion accelerates as competitors chip away at Lido's once-unassailable position. The protocol that pioneered liquid staking now faces its toughest challenge yet.
Rally Against Reality
LDO's recent surge clashes with fundamental metrics showing decreased protocol dominance. That classic crypto disconnect where token price and actual utility diverge like estranged Wall Street bankers at a holiday party.
Make-or-Break Momentum
The 7% climb either signals renewed confidence or represents another speculative bubble waiting to burst. Either way, it's proving that in crypto, sometimes the numbers do lie—especially when they're green.
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Business performance is exceptional
Starting with fundamentals, AppLovin is executing at a high level. In the second quarter of 2025, revenue jumped 77% year over year to $1.26 billion as the company's ad tools continued to gain traction. Profitability scaled even faster: Adjusted EBITDA nearly doubled to $1.02 billion, good for an 81% margin. Net cash from operating activities was $772 million in the quarter, and free cash FLOW was $768 million. Management also repurchased and withheld 0.9 million shares for a total cost of $341 million.
Looking ahead, the company guided for third-quarter revenue of $1.32 billion to $1.34 billion and targeted another 81% adjusted EBITDA margin.
Also worth noting, on June 30, AppLovin closed the sale of its first-party Apps business to Tripledot Studios for $400 million in cash plus equity, and it now presents that unit as discontinued operations. In other words, reported results will increasingly reflect AppLovin's high-margin software and marketplace businesses that investors care the most about.
Meanwhile, management has said it will open Axon Ads Manager -- a self-serve pathway that lowers onboarding friction for non-gaming and smaller advertisers -- on Oct. 1 on a referral basis. This is designed to broaden demand and speed international expansion before a wider rollout.
What about valuation?
The stock's surge has been extraordinary. AppLovin was added to the S&P 500 effective Sept. 22, and shares have soared past $700. As I write this, the company's market value sits around $243 billion with a forward price-to-earnings ratio of about 40. That's a staggering premium for ad technology -- one that assumes years of near-flawless execution, sustained software-like margins, and smooth expansion beyond gaming.
To be fair, recent performance helps explain the enthusiasm. Revenue growth accelerated, AppLovin's cash generation is robust, and the company's guidance implies continued strength. Further, a self-serve on-ramp could open the door to billions of ad dollars outside the game industry over time. But investors should remember that the tech company still needs to show its self-serve on-ramp can deliver.
Additionally, there are some risks to consider. First, concentration in mobile performance advertising means sensitivity to changes by platform gatekeepers likeand and to cycles in app marketing budgets. Second, competition isn't standing still; large platforms and independent ad-tech players are investing heavily in AI-driven buying tools.
Finally, after the stock's S&P 500 inclusion and an all-time high, sentiment can cut both ways. If early adoption of Axon Ads Manager proves slower than hoped -- or if growth simply normalizes from today's torrid pace -- the current price-to-earnings and implied price-to-sales ratios could compress quickly.
Putting it all together, AppLovin's business is undeniably strong and arguably getting stronger. The company is scaling revenue, expanding margins, and preparing a new self-serve channel that could broaden its customer base. But shares have also sprinted far ahead of what the current financials can easily justify. With the stock now priced for perfection, even small hiccups could lead to outsize downside. That combination makes "hold" the smarter stance today -- and for investors on the sidelines, patience may be rewarded if the stock cools off and fundamentals have time to catch up.
