AppLovin (APP) AI Stock Analysis

• Market Cap: $113.93B
• Dividend Yield: N/A
• Average Volume (3M): 5.99M
• Price to Earnings (P/E): 60.8
• Beta (1Y): 3.15
• Revenue Growth: 41.63%
• EPS Growth: 224.65%
• Country: US
• Employees: 1,533
• Sector: Technology
• Sector Strength: 84
• Industry: Software - Application
• EPS (TTM): 1.67
• Shares Outstanding: 307,698,330
• 10 Day Avg. Volume: 6,794,658
• 30 Day Avg. Volume: 5,992,091
• PEG Ratio: 0.02
• Price to Book (P/B): 2.06
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 9.63
• Enterprise Value/Market Cap: 0.05
• Enterprise Value/Revenue: 0.34
• Enterprise Value/Gross Profit: 1.54
• Enterprise Value/Ebitda: 0.71
• 1Y Price Target: $515.69
• Price Target Upside: 53.16% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 18

• Rating: 72 Outperform
• Price Target: $374.00 ▲(11.08%Upside)

AppLovin's strong financial performance, strategic focus on advertising, and positive earnings call sentiment contribute significantly to its score. Despite technical challenges and high valuation, the company's robust revenue growth and strategic initiatives position it well for future growth.

Positive Factors

Business Expansion

The company has recently expanded beyond the mobile gaming market to e-commerce, a new demand-side vertical that is a much larger advertising market.

Earnings

AppLovin has largely recovered since the short report claims, spurred by a strong beat in first quarter 2025 earnings.

Negative Factors

Data Misuse Allegations

Two firms released reports alleging the misuse of data, improper ad placements, and a fraudulent business model by AppLovin.

Growth Constraints

The current managed service offering is seen as a constraint on growth until the self-service option launches.

AppLovin Business Overview & Revenue Model

Company Description

AppLovin Corporation engages in building a software-based platform for mobile app developers to enhance the marketing and monetization of their apps in the United States and internationally. The company's software solutions include AppDiscovery, a marketing software solution, which matches advertiser demand with publisher supply through auctions; Adjust, an analytics platform that helps marketers grow their mobile apps with solutions for measuring, optimizing campaigns, and protecting user data; and MAX, an in-app bidding software that optimizes the value of an app's advertising inventory by running a real-time competitive auction. Its business clients include various advertisers, publishers, internet platforms, and others. The company was incorporated in 2011 and is headquartered in Palo Alto, California.

How the Company Makes Money

AppLovin makes money primarily through its advertising and marketing services. The company generates revenue by providing app developers with tools to monetize their apps through in-app advertising and purchases. AppLovin's AppDiscovery platform enables targeted user acquisition campaigns, where advertisers pay the company for promoting their apps to potential users. Additionally, the MAX mediation platform helps developers optimize ad revenue by managing and maximizing fill rates and eCPMs across multiple ad networks. AppLovin also earns from in-app purchases made within its portfolio of owned and operated mobile games, further diversifying its revenue streams. The company has established significant partnerships with major ad networks and app developers, enhancing its ability to drive revenue growth through an expansive ecosystem.

AppLovin Financial Statement Overview

Summary

AppLovin shows strong financial performance with impressive revenue and profit margins, supported by robust cash flow generation. High profitability and cash flow stability position the company well for growth, although the high leverage poses a risk if market conditions deteriorate. The company's ability to maintain profitability and manage debt levels effectively will be crucial for sustained financial health.

Income Statement

AppLovin has demonstrated strong revenue growth with a Revenue Growth Rate of 9.03% TTM and significant improvements in profitability. The Gross Profit Margin is robust at 77.41% TTM, and the Net Profit Margin is impressive at 37.38% TTM, reflecting efficient cost management and strong pricing power. The EBIT Margin of 42.86% TTM and EBITDA Margin of 51.23% TTM also highlight operational efficiency. However, historical profitability volatility and past net losses are points of concern.

Balance Sheet

The balance sheet shows a moderate level of leverage, with a Debt-to-Equity Ratio of 6.45 TTM, indicating significant reliance on debt financing. The Return on Equity (ROE) is high at 333.74% TTM, driven by strong net income, though this is partly due to low equity levels. The Equity Ratio of 10.09% TTM indicates that only a small portion of assets is funded by equity, which represents a potential risk during downturns. Overall, while profitability is strong, high leverage is a concern.

Cash Flow

Operating cash flow is strong, with a high Operating Cash Flow to Net Income Ratio of 1.32 TTM, indicating efficient conversion of income into cash. The Free Cash Flow to Net Income Ratio also highlights robust cash generation at 1.32 TTM. Free Cash Flow Growth Rate is significant at 20.95% TTM, reflecting healthy cash flow improvements. The cash flow stability and growth are major strengths, supporting high liquidity and financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.14B	4.71B	3.28B	2.82B	2.79B	1.45B
Gross Profit	3.97B	3.54B	2.22B	1.56B	1.81B	895.51M
EBITDA	2.63B	2.32B	1.15B	513.77M	597.74M	186.79M
Net Income	1.92B	1.58B	356.71M	-217.41M	35.45M	-125.93M
Balance Sheet
Total Assets	5.71B	5.87B	5.36B	5.85B	6.16B	2.15B
Cash, Cash Equivalents and Short-Term Investments	551.02M	741.41M	502.15M	1.08B	1.52B	317.24M
Total Debt	3.71B	3.56B	3.18B	3.30B	3.31B	1.69B
Total Liabilities	5.13B	4.78B	4.10B	3.95B	4.03B	2.31B
Stockholders Equity	575.42M	1.09B	1.26B	1.90B	2.14B	-158.54M
Cash Flow
Free Cash Flow	2.53B	2.09B	1.06B	406.16M	356.39M	219.64M
Operating Cash Flow	2.54B	2.10B	1.06B	412.77M	361.85M	222.88M
Investing Cash Flow	-97.78M	-106.75M	-77.83M	-1.37B	-1.21B	-679.89M
Financing Cash Flow	-2.33B	-1.75B	-1.56B	-526.85M	3.11B	377.86M

AppLovin Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 336.69
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For APP, the sentiment is Negative. The current price of 336.69 is below the 20-day moving average (MA) of 363.61, below the 50-day MA of 345.70, and above the 200-day MA of 295.69, indicating a neutral trend. The MACD of -5.94 indicates Positive momentum. The RSI at 44.01 is Neutral, neither overbought nor oversold. The STOCH value of 45.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for APP.

AppLovin Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TTD	80 Outperform	$36.12B	89.87	16.88%	―	25.07%	103.30%
SNOW	78 Outperform	$72.06B	―	-40.16%	―	27.50%	-49.96%
NOW	75 Outperform	$209.61B	137.07	16.86%	―	21.01%	-20.93%
DDOG	73 Outperform	$45.70B	292.48	6.48%	―	25.54%	40.02%
APP	72 Outperform	$113.93B	60.80	287.44%	―	41.63%	224.65%
GWRE	71 Outperform	$19.47B	587.33	2.61%	―	18.61%	―
Sector *	63 Neutral	$33.24B	5.92	-11.55%	1.90%	5.54%	-20.14%

AppLovin Corporate Events

AppLovin Finalizes Strategic Transaction with Tripledot

On June 30, 2025, AppLovin Corporation finalized a significant transaction with Tripledot, amending a previous Purchase Agreement from May 7, 2025. The amendment allowed for cash payment instead of a secured promissory note to fund part of the purchase. At the closing, AppLovin transferred equity interests of its mobile gaming subsidiaries to Tripledot for $400 million in cash and equity shares representing about 20% of Tripledot’s fully-diluted equity capitalization. This transaction marks a strategic shift in AppLovin’s operations, potentially impacting its market positioning and stakeholder interests.

The most recent analyst rating on (APP) stock is a Buy with a $100.00 price target. To see the full list of analyst forecasts on AppLovin stock, see the APP Stock Forecast page.

AppLovin Approves Directors and Accounting Firm at Meeting

On June 4, 2025, AppLovin held its annual meeting of stockholders where two key proposals were voted on. The election of nine directors to serve until the 2026 annual meeting was approved, and the appointment of Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025, was ratified.

The most recent analyst rating on (APP) stock is a Buy with a $100.00 price target. To see the full list of analyst forecasts on AppLovin stock, see the APP Stock Forecast page.

AppLovin Sells Mobile Gaming Business to Tripledot

On May 7, 2025, AppLovin Corporation announced a definitive agreement to sell its mobile gaming business to Tripledot Studios for $400 million in cash and a 20% equity stake in Tripledot. The transaction, expected to close in the second quarter of 2025, aims to streamline AppLovin’s focus on its core marketing platform operations, potentially enhancing its industry positioning and financial performance. The deal includes a $150 million cash payment at closing and a $250 million promissory note, with the transaction subject to regulatory approvals and customary closing conditions.

AppLovin Appoints Maynard Webb to Board of Directors

On April 9, 2025, AppLovin Corporation announced the appointment of Maynard Webb to its Board of Directors, where he will also serve on the Audit Committee and Nominating and Corporate Governance Committee. Webb, a seasoned executive with extensive experience in technology and venture capital, is expected to bring valuable insights to AppLovin’s strategic direction. Additionally, Edward Oberwager, a current board member, notified the company on April 8, 2025, that he will not stand for re-election at the upcoming 2025 Annual Meeting of Stockholders, although his decision was not due to any disagreements with the company.