AppLovin (APP) was historically known as a leading mobile app company that provided end-to-end software and solutions that helped businesses and app developers market, monetize, analyze, and publish their apps globally. In recent times, the company has shifted toward advertising technology as it divests its gaming development division.
AppLovin’s stock has a YTD return of 42%, dramatically outpacing the S&P 500 Index’s ($SPX) 8.7% climb. Over the past 12 months, AppLovin shares have soared by nearly 500% and are now trading 12% below their 52-week high set in February. The stock is also up 21% in the past 5 days and 33% in a month.
AppLovin posted its second-quarter results on Aug. 6, in which it easily outperformed estimates on both earnings and revenue. The company posted earnings of $2.26 per adjusted share, beating Wall Street’s $1.99 per share estimate. Revenue surged 77% to $1.26 billion, topping the analyst estimate of $1.21 billion.
Net income from continuing operations soared 156% to $772 million, driven by strong performance in AppLovin’s advertising technology segment as the business sharpened its focus on AI-powered ad solutions after divesting the gaming apps division.
Other financial highlights include remarkable adjusted EBITDA of $1.02 billion, up 99% year-over-year. AppLovin ended the quarter with $1.2 billion in cash and equivalents as free cash flow spiked 72% to $768 million during Q2.
Looking ahead, AppLovin guided for Q3 2025 revenue between $1.32 billion and $1.34 billion, and adjusted EBITDA of $1.07 billion to $1.09 billion, signaling expectations for continued high growth and sustained healthy margins.
AppLovin shares surged following Q2 earnings and received renewed optimism from analysts. Oppenheimer analysts Martin Yang and Jason Helfstein have named the company as their “top pick” with an “Outperform” rating and a price target of $500, indicating upside potential of 9.2%. The analysts highlighted management’s increasing confidence that e-commerce advertising will exceed 10% of total ad revenue this year, pointing toward the AXON Ad Manager launch along with a new self-service portal for U.S. and international clients coming on Oct. 1.
