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What this page is: Delvantic's full research page for AppLovin Corporation Class A Common Stock (APP) — AI-driven forensic equity research: mechanical valuation models (DCF, EPV, anchored-PE, scenario) plus three independent AI lenses (Quality / Value / Sentiment). Everything below is rendered server-side; you are not missing content that requires JavaScript. All scores are predictions and research opinions, not financial advice.
Our current read (analysis of 2026-08-23): Designation Watch · Gem Score -11 (−100…+100 Quality+Value blend) · Quality 76 · Value -83 · Sentiment -86 (timing only, not weighted) · Composite fair value $149.51 vs $417.80 at analysis
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AppLovin Corporation Class A Common Stock
APP NASDAQAppLovin Corporation Class A Common Stock represents ownership in a technology company that provides AI-powered advertising and marketing software for mobile and connected TV applications. AppLovin focuses on enabling app developers and other digital businesses to acquire users efficiently and maximize revenue from their advertising inventory. Its key products include Axon Ads Manager, a suite of automated marketing tools; AppDiscovery, a demand-side platform that helps advertisers reach targeted audiences; MAX, an in-app bidding solution that optimizes ad monetization; Adjust, a measurement and analytics platform; and Wurl, which supports connected TV content distribution and advertising. AppLovin operates across the advertising and apps segments in the United States and internationally, serving mobile app publishers, marketers, and streaming media companies as a critical infrastructure provider in the digital advertising ecosystem. Founded in 2011 and headquartered in Palo Alto, California, the company plays a significant role in performance-based advertising and app monetization worldwide.
Price Overview
Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 9.75
Total Equity: $2.13B
Shares: 341,970,000
Total Debt: $3.51B
Cash: $2.49B
EBITDA: $4.35B
Total Debt: $3.51B
Cash: $2.49B
Revenue: $5.48B
Revenue: $5.48B
Revenue: $5.48B
Total Equity: $2.13B
Tax Rate: 13.1%
Equity: $2.13B
Total Debt: $3.51B
Cash: $2.49B
Current Liabilities: $1.33B
Long-Term Debt: $3.51B
Total Debt: $3.51B
Total Equity: $2.13B
Shares: 341,970,000
Shares: 341,970,000
CapEx: $0.00
Shares: 341,970,000
Stock Price: $429.97
Net Income: $3.33B
Industry Benchmarks
Income Statement (Annual)
Last updated: Jul 30, 2026 5:42pm (24d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $2.8B | $2.8B | $3.3B | $4.7B | $5.5B |
| Cost of Revenue | $988.1M | $1.3B | $1.1B | $1.2B | $665.1M |
| Gross Profit | $1.8B | $1.6B | $2.2B | $3.5B | $4.8B |
| Operating Expenses | $1.7B | $1.6B | $1.6B | $1.7B | $663.7M |
| Operating Income | $150.0M | -$47.8M | $648.2M | $1.9B | $4.2B |
| Net Income | $35.4M | -$192.7M | $356.7M | $1.6B | $3.3B |
| EBITDA | $581.1M | $499.3M | $1.1B | $2.3B | $4.3B |
| EPS | $0.10 | $-0.52 | $1.01 | $4.68 | $9.84 |
| EPS (Diluted) | $0.09 | $-0.52 | $0.98 | $4.53 | $9.75 |
Balance Sheet (Annual)
Last updated: Aug 5, 2026 9:35am (18d ago)| Metric | 2022 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | — | $1.1B | $502.2M | $741.4M | $2.5B |
| Total Current Assets | — | $1.9B | $1.6B | $2.3B | $4.4B |
| Total Assets | — | $5.8B | $5.4B | $5.9B | $7.3B |
| Current Liabilities | — | $579.0M | $944.1M | $1.1B | $1.3B |
| Long-Term Debt | — | $3.2B | $2.9B | $3.5B | $3.5B |
| Total Liabilities | — | $3.9B | $4.1B | $4.8B | $5.1B |
| Total Equity | — | $1.9B | $1.3B | $1.1B | $2.1B |
| Retained Earnings | — | -$1.2B | -$813.0M | $599.2M | $1.7B |
Cash Flow (Annual)
Last updated: Jul 30, 2026 5:42pm (24d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $361.9M | $412.8M | $1.1B | $2.1B | $4.0B |
| Capital Expenditure | -$1.4M | $-662,000 | -$4.2M | -$4.8M | — |
| Free Cash Flow | $360.5M | $412.1M | $1.1B | $2.1B | — |
| Acquisitions (net) | -$1.2B | -$1.3B | -$63.9M | — | — |
| Net Debt Issued / (Repaid) | -$719.8M | -$25.8M | -$102.7M | $389.6M | $0 |
| Dividends Paid | — | — | — | — | — |
| Stock Buybacks | $0 | -$338.9M | -$1.2B | -$981.3M | -$2.2B |
| Net Change in Cash | $2.3B | -$1.5B | -$578.3M | $239.3M | $1.7B |
Growth Trends (YoY %)
Last updated: Jul 30, 2026 5:42pm (24d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | +0.9% | +16.5% | +43.4% | +16.4% |
| Gross Profit Growth | -13.5% | +42.5% | +59.3% | +35.9% |
| Operating Income Growth | -131.9% | +1,456.3% | +189.0% | +121.6% |
| Net Income Growth | -643.8% | +285.1% | +342.9% | +111.0% |
| EBITDA Growth | -14.1% | +127.8% | +104.2% | +87.2% |
Deep Analysis
Risk : Reward — if the last quarter repeats
Live · as of 2026-08-19 08:31Even the bull case prices 24% below today — the ratio here measures the model-vs-market gap, not payoff odds. Another quarter like the worst recent one costs 94%.
| Case | Growth | Margin | Fair value | vs price ($417.80) |
|---|---|---|---|---|
| Bull — recovery | +81% | 35.0% | $315.58 | -24% |
| Base — stabilizes | +54% | 35.0% | $175.42 | -58% |
| Bear — keeps slipping | +27% | 35.0% | $91.27 | -78% |
| Stress — last quarter repeats | -21% | 35.0% | $23.23 | -94% |
Narrative Economics
market-narrative step).
Claude Reading
The raw trajectory is genuinely stunning: quarterly revenue went from $711M (Q2 2024) to $1.84B (Q1 2026), and net income from $310M to $1.21B — margins expanding from 44% to 65%. Full-year 2025 delivered $5.48B revenue, $4.15B operating income, $3.33B net income, $3.97B operating cash flow. On trailing numbers that's ~26x sales, ~42x earnings, ~35x OCF — rich but not absurd for a business compounding earnings triple-digits with 76% operating margins. However, one thing jumps out that the models glossed over: Q4 2024 printed $2.10B revenue at 28.5% margin, and every quarter since has been *lower revenue* at *much higher margin*. That's not a smooth growth curve — that suggests either a business-mix divestiture (the mobile gaming apps sale to Tripledot closed in 2025) or a discontinued-operations reclassification. The apparent "deceleration" the momentum module flagged (16.4% YoY recent) is almost certainly an apples-to-oranges comparison against a consolidated Q4 2024. Underlying advertising-segment growth is likely materially higher — closer to 70%+ YoY on a like-for-like basis.
That reframing matters because the synthesis verdict ($110 fair value, -74% downside) leans heavily on a DCF assuming ~15% growth and 25-30% EBITDA margins. Those inputs look stale for a business currently running 75% operating margins and doubling advertising-segment earnings. I think the synthesis and narrative modules are anchoring on ad-tech comps (Trade Desk, Criteo trade at 8-12x EBITDA) that no longer describe this business's unit economics. That said, the bear thesis module's top argument — "margin peak reflects cyclical tailwind, not structural shift" — is the right question. A 65% net margin in advertising is historically anomalous; Meta at peak ran ~40%, Google ~30%. Either AppLovin has genuinely invented a lower-cost advertising primitive via Axon, or these margins normalize toward 40% as customer acquisition costs rise, competition catches up, and reinvestment resumes. At 40% net margin on flat $7B revenue that's $2.8B earnings — still ~50x on current cap.
The contrarian case the models underweight: AppLovin's balance sheet is thin ($2.13B equity against $3.51B debt), ROE of 156% and ROIC of 114% are mathematically flattering signs of capital-light economics but also of near-zero reinvestment — which is either brilliant capital discipline or evidence that the business doesn't need much capex because it's harvesting rather than building. The insider selling pattern (steady small sales, no cluster buys) is boilerplate for post-vest liquidation but the *complete absence* of open-market insider buying at $429 tells you management isn't seeing a screaming bargain either. Also worth flagging: pb_ratio of 68 and the anomaly note about intangibles-heavy balance sheet — most of the "book value" here is goodwill from Adjust/Wurl, which the bear narrative correctly notes has a mixed M&A track record. If Axon is the whole story, the acquired assets are worth less than carried.
My read: the synthesis fair value of $110 is too low by roughly 2x — it's fighting last war's ad-tech multiples against a business currently generating $4B+ of operating cash flow annually with expanding margins. But $430 also embeds the assumption that 65% net margins are the new normal and that revenue re-accelerates through 2026, and I think there's ~40% probability margins compress toward 45-50% as the Axon advantage narrows. Fair value on a probability-weighted basis is closer to $260-$300: roughly 25-30x sustainable earnings of ~$4-5B on a 20% grower normalizing to 15%. So I dissent from the synthesis's "-74% overvalued" call — that's overkill — but I agree with the *direction*: this is overvalued, just modestly (~30-35%), not catastrophically. The market forces module's "neutral" call is closer to correct than the narrative module's "$308 premium is pure story." I would not short at $430 — the momentum and earnings surprises can easily justify the price for another 2-3 quarters — but I wouldn't own it here either. Wait for either a Q4 print that confirms margin durability at 60%+ (buy signal toward $500+) or a deceleration that cracks the narrative (buy signal at $250-280).
GPT Reading
What jumps out is not that AppLovin is “just ad tech,” but that the income statement has become almost absurdly efficient in a way public markets rarely trust for long. Revenue went from $3.28B in 2023 to $4.71B in 2024 and $5.48B in 2025, while net income exploded from $356.7M to $1.58B to $3.33B. That is not ordinary operating leverage; it is a full economic regime change. The latest five quarters reinforce it: revenue rose from $1.16B in 2025-03 to $1.84B in 2026-03, up 59% in a year, while net margin expanded from 49.7% to 65.4%. Even if one normalizes the clearly odd 2024-12 quarter against the annuals, the direction is unmistakable: AppLovin has found a product mix and algorithmic monetization engine that throws off software-like profits on ad-tech revenue. Operating cash flow of $3.97B against 2025 net income of $3.33B says the earnings are not obviously fake.
That said, the stock price already assumes this exceptional economics profile is durable. At roughly $141B market cap, investors are paying about 26.8x sales, 44x earnings, and 32.7x EV/EBITDA on 2025 numbers for a company whose most recent stated YoY revenue growth signal is only 16.4%, even though quarterly revenue in the raw series accelerated more sharply. The key issue is not whether the business is good; it plainly is. The issue is whether a company with $5.48B of annual revenue can sustain anything close to 60% net margins and high-teens-to-30% growth while competing in performance advertising, where advantages tend to get copied, traffic sources change, and customers ruthlessly follow ROI. A business can deserve a premium for proving superior optimization, but the current multiple prices AppLovin more like a dominant software platform than an ad intermediary. I do not think the evidence here is enough to underwrite that distinction at $430.
The strongest counterargument is that the valuation looks expensive only if you force old ad-tech priors onto a business that has already escaped them. Gross margin at 87.9%, operating margin at 75.8%, ROIC above 100%, and quarterly net income north of $1.2B on $1.84B of revenue suggest the market may be right to reject peer comparisons. If 2026 annualized revenue is now running above $7B and annualized earnings power is more like $4.5B-$5.0B, then the “real” forward P/E is not 44x but closer to the high 20s to low 30s, which is not insane for a company still growing this quickly. The balance sheet is also fine for a company with $3.51B debt and $2.49B cash, especially given nearly $4B of operating cash flow. If Axon truly compounds from more data, more demand, and more advertiser ROI, then the premium multiple could persist longer than bears think.
I still weigh those bullish facts less generously because the market is paying for near-perfection in a business model that has only recently become this profitable. AppLovin’s annual net margin was 10.8% in 2023, 33.5% in 2024, and 60.8% in 2025. That kind of jump can happen, but markets often overcapitalize a step-change before seeing whether it survives tougher comps, broader vertical expansion, or platform response from Meta and Google. The tiny insider sales listed are not a serious red flag, but they also do nothing to counter the sense that management is not signaling obvious cheapness. More importantly, equity is only $2.13B, which is why the 68.9x book value is meaningless, but it also reminds you how little asset backing there is if the multiple contracts. For me, this is a great company with a stock still priced for the best version of the next three years.
What would change my mind is straightforward. If AppLovin can put up another two or three quarters with revenue above 35% YoY while keeping net margins above 50%, then the present valuation starts to look merely full rather than excessive, because earnings power would outrun the multiple compression risk. I would also get more constructive if 2026 annual revenue clears roughly $7.0B with operating cash flow scaling proportionately and no sign of deterioration in margin. On the other hand, if revenue growth slips into the mid-teens while net margin falls back toward 35%-40%, the stock is far too expensive and could de-rate hard toward a much lower multiple on still-good earnings.
Grok Reading
The raw numbers describe a business that has been fundamentally remade, not merely improved. AppLovin went from $357M of net income on $3.28B revenue in 2023 to $3.33B of net income on $5.48B in 2025, with operating margin exploding from roughly 20% to 75.8% and net margin settling in the 60% range. The last five reported quarters show net margins of 49.7%, 65.1%, 59.5%, 66.5%, and 65.4%—this is not a one-quarter spike. Sequential revenue has climbed from $1.16B in Q1 2025 to $1.84B in Q1 2026, and the Q1-on-Q1 comparison is +59%. Operating cash flow of $3.97B against $5.48B of revenue confirms the earnings are real cash, not accounting fiction. The 2024 Q4 revenue print of $2.10B sitting awkwardly above the subsequent run-rate is the tell: the Apps segment was shed, and what remains is a pure-play AI ad-tech engine with software-like gross margins of 87.9%. ROE of 156% and ROIC of 114% on a lightly capitalized balance sheet are the arithmetic consequence of that mix shift, not financial engineering.
The market is not wrong that something structural changed; it is wrong about how much permanence and scarcity to assign it at $430 and a $141B enterprise. Trailing P/E of 44x, EV/revenue of 25.9x, and EV/EBITDA of 32.7x price AppLovin as if Axon’s advantage is a durable platform monopoly compounding at 30%+ with 60% net margins indefinitely. Annual revenue growth compressed to 16.4% in 2025 even as earnings CAGR printed 206%, which means nearly all of the equity story has been margin expansion and mix clean-up rather than top-line domination of a expanding TAM. At a $4.6–5.0B forward earnings run-rate implied by the last two quarters, the stock still asks roughly 28–30x for an advertising business that remains exposed to budget cyclicality, Apple/Google platform risk, and direct competition from two companies with larger closed-loop data advantages. The valuation synthesis fair value near $110 is too punitive because it anchors on 25–30% EBITDA margins the company has already left behind, but the direction of that signal is correct: a large narrative premium is embedded, and the cult coefficient around “AI advertising OS” is doing heavy lifting that cash flows have not yet fully validated at this scale.
The strongest counter-argument is simply the trajectory if the current run-rate holds. Annualizing Q1 2026 produces roughly $7.4B of revenue and $4.8B of net income; sustain 25% growth and mid-50s margins for three years and you are looking at a $10B+ earnings stream that makes today’s $141B cap look ordinary rather than extreme. Network effects in training data and automated creative via Axon are plausible, the balance sheet is not stressed (net debt ~$1B against nearly $4B of OCF), and insider sales in the July 2026 tape are trivial share counts consistent with 10b5-1 noise rather than distribution. A smart bull also notes that rule-based classification as “mature earner” undersells residual growth optionality in CTV and international, and that 30x forward earnings for 60% incremental margins is not outrageous inside a software multiple framework. I weigh this less heavily because advertising has never sustained software multiples through a full cycle without growth staying unambiguously above 25%, and the secondary signal already flags decelerating quarterly revenue confidence plus macro headwinds to ad spend. The margin peak-as-cyclical-tailwind bear case (weight 78 in the thesis engine) is the one that keeps me from flipping bullish: five strong quarters is impressive, not yet proof of a permanent escape from ad-tech economics.
I would reverse to a clear undervalued stance if two more quarters deliver simultaneous >35% year-on-year revenue growth and net margins holding above 55%, or if management reports measurable share gains against Meta/Google in app-install and CTV that show up in third-party spend data. I would become decisively more bearish on any quarter where net margin compresses below 45% while revenue growth falls under 15%, or on evidence that large advertisers are reallocating budgets back to walled gardens at Axon’s expense.
Big-3 Panel — where each AI stands
Advanced Analysis Forensic deep-dive · separate lenses
Revenue nearly doubled from 2.79B in 2021 to 5.48B in 2025, but the real story is operating leverage: gross margin expanded from 64.6% to 87.9% and operating margin went from 5.4% to a remarkable 75.8%, driving net income from 35M to 3.33B and FCF from 360M to 3.97B. OCF/NI of 2.71x and accruals of -10.3% of assets indicate reported earnings are more than backed by cash. Beneish M at -2.82 and Altman Z at 20 show no mechanical red flags. Diluted share count actually shrank slightly (342.8M in 2021 to 342.0M in 2025) despite 3.8% SBC/revenue, because buybacks ran at 368% of SBC - genuinely rare capital discipline for a tech company. Net debt of roughly 1B against 3.97B annual FCF means leverage is trivial; the balance sheet is not a cushion but also not a constraint. Insider activity is one-sided selling (97 sales, zero buys, 115M sold), which is normal for a company of this trajectory but worth noting as absence of conviction buying. The 87.9% gross margin in 2025 is extraordinary and warrants scrutiny - it implies either a genuinely software-like unit economics profile after divesting the apps business, or classification changes that need verification against filings.
Verify before trusting this (5)
- Confirm the driver of gross margin expansion from 67.7% to 87.9% - specifically the apps-business divestiture and any reclassification of costs.
- Customer/advertiser concentration in the AXON/ad platform revenue base.
- Terms of remaining debt (maturity, covenants, fixed vs floating) given 1.03B net debt.
- 10b5-1 plan status behind the Vivas and Webb sales to distinguish programmatic from discretionary selling.
- Segment disclosure post-apps sale to verify the software-platform is truly the go-forward business.
The gap is stark: price is $417.80 versus composite FV $97.23 and signal-adjusted FV $110.14, implying roughly 74% downside on the base case. Even the most generous method in the stack, anchored-PE at $192.32, sits more than 50% below spot; the DCF ($74.16) and EPV floor ($48.28) suggest the market is capitalizing something like a permanent extension of today's 75.8% operating margins and Axon-driven growth well beyond any reasonable competitive fade. That is a heroic set of assumptions for a company facing Google/Meta, cyclical ad budgets, and an M&A-heavy history. Earnings quality is genuinely high, so I will not haircut deserved value further - but high-quality earnings on a rich multiple is exactly the trap this lens exists to flag. A Fortress-grade business deserves a premium to peers, not a 4x premium to its own composite fair value. Even generously weighting the anchored-PE (which itself bakes in continued exceptional growth) and giving full credit for AI optionality, deserved value lands somewhere in the $150-$220 zone. At $418, the stock needs the platform-monopoly narrative to fully play out with no advertiser churn, no competitive response, and continued operating leverage - priced for perfection.
Verify before trusting this (5)
- Axon ad revenue growth durability in next 2-3 quarters (does it decelerate?)
- CTV/web expansion traction and unit economics vs mobile
- Any softening in advertiser retention or take-rate compression
- Management commentary on competitive response from Google/Meta
- Sustainability of 75%+ operating margins as mix shifts
The dominant force on APP right now is a live narrative fracture. Hours before this read, APP printed a Q2 revenue miss and guided Q3 below the Street, and the stock is down 20-28% after-hours. For a platform-monopoly story trading on AI-superpower belief at ~3.8x sales, the ONE thing that cannot happen is a top-line miss plus a soft guide - and that is exactly what happened. The bear script (unproven AI scale, cyclical ad spend, expensive on fundamentals) just got its first piece of tape-based evidence, and momentum longs who owned this for the 29% CAGR now have a broken chart to defend. The macro tape is mildly risk-on, but that is almost irrelevant here - the idiosyncratic shock dwarfs it, and on a 2.53 beta any subsequent risk-off wobble will be amplified. The SEC-probe-closed line is a minor offset but gets drowned by the guide. Expect analyst target cuts, momentum-fund forced selling, and the cult coefficient to be tested as the 'AI moat' framing gets re-underwritten. Sentiment pressure is decisively negative and will persist for weeks, not days.
Verify before trusting this (5)
- Magnitude of sell-side target cuts over the next 5 trading days
- Whether the after-hours 20-28% gap holds or gets bought at the open (dip-buy conviction test)
- Q3 print vs the softened guide - a beat re-opens the narrative, a second miss ends it
- Options skew and short interest evolution over the next 2 weeks
- Any sympathy damage to the broader ad-tech/AI-advertising cohort (TTD, META ad commentary)
This lens hasn't been run for this ticker yet.
When we made this prediction on Aug 6, 2026, APP was $417.80. We expect it to be $335.00 by Feb 2027, and we consider it great value under $175.00. This is an early model (v0.6.0) — the direction is more reliable than the exact price. Made Aug 6, 2026.
Blue is our prediction, starting the day we made it. Grey is a slower route to the same place — the same destination, taking longer. Black is the actual price, so you can see how we are doing.