AppLovin Stock Soars: Here’s Why Investors Are Flocking In
Another day, another tech stock defying gravity—this time it's AppLovin's turn. The mobile ad tech player just caught a bullish tailwind, and Wall Street's scrambling to place bets. Here's the breakdown.
The Catalyst No One Saw Coming
Rumors of a secret AI play? A surprise partnership? Whatever the trigger, traders are piling in like it's 2021 all over again. The stock ripped through resistance levels—no courtesy pullbacks, just straight-up FOMO.
Ad Tech's Silent Revenge
While crypto bros were busy chasing memecoins, AppLovin quietly rebuilt its ad stack. Now it's printing cash while competitors bleed out. Ironic, given how many 'web3 ad platforms' vaporized last cycle.
Warning: Contains Actual Fundamentals
Shockingly, this rally might have legs. Earnings multiples aren't completely detached from reality—yet. But let's see how long that lasts once the private equity vultures start circling.
Another reminder that in tech, the real money's made by those who ignore the hype—and just execute. Now watch as hedge funds 'discover' this story three months late.
Image source: Getty Images.
AppLovin stays hot
Revenue in the quarter jumped 77% to $1.26 billion, adjusted for the sale of its mobile-game developer Apps to Tripledot Studios. That beat analyst expectations at $1.22 billion. Revenue per installation ROSE 70% and installations increased 8%. As previously announced, AppLovin completed the sale of Apps for $400 million and 20% of Tripledot's equity.
On the bottom line, the company continued to deliver incredibly high margins with adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) nearly doubling to $1.02 billion, while net income rose 164% to $820 million.
Earnings per share (EPS) rose from $0.89 to $2.39, according to generally accepted accounting principles (GAAP). Backing out the Apps business, it reported $2.26 in EPS.
What's next for AppLovin
Management's guidance was also strong, calling for revenue of $1.32 billion to $1.34 billion, which represents 59% growth at the midpoint on a comparable basis. It also sees adjusted EBITDA of $1.07 billion to $1.09 billion, representing a margin of 81%.
The sale of the Apps business should allow management to focus on only the high-growth advertising business, which continues to deliver incredible results.
AppLovin is also set to launch a new self-serve feature for its e-commerce platform, which could accelerate its growth further. Considering its growth rate, the stock looks well priced at a forward price-to-earnings ratio of 44 after today's jump.
