The Company
AppLovin Corporation is a mobile app technology company that focuses on growing the mobile app ecosystem by enabling the success of mobile app developers. The company’s software solutions provide tools for mobile app developers to grow their businesses by automating and optimizing the marketing and monetization of their applications. Majority of their revenue comes from their mobile advertising platform.
Financials
Bull Case
- Rule of 40 score of 146 with Revenue growing at 68% and Adjusted EBITDA % of 78% for 2025. Very profitable business with Net Income margin of 60% for the latest quarter.
- Transitioning it’s Axon Ad Manager software to a Self Serve Model from Q4 2025 which should grow small and medium customer count and be a strong driver of revenue through 2026.
- Strong moat in a high margin app advertising vertical owning both the supply as well as demand side tools.
- Should benefit from use of Gen for AI automated Ad creation.
Bear Case
- Regulatory scrutiny of Applovin’s use of user data.
Earnings Call Q3 2025 HIghlights
- Max Supply Side platform growing at double digit rates. E-commerce is a new growing segment.
- Self Serve Axon Ad Manager- Oct 1st launch completed successfully, at present only on referral basis. Spend is growing 50% week over week. Monitoring feedback and once satisfactory will be opened broadly.
- Testing Gen AI based Ad creatives. In the future will move to mostly automated Ad creation.
Earnings Call Q2 2025 Highlights
- On June 30, 2025 completed the sale of Apps business to Tripledot Studios for $400 million.
- Gaming advertising can sustain growth rate at 20-30%, however management is actively looking to expand to new areas such as ecommerce.
- Axon Ad Manager now supports self service allowing for faster adoption and expanding to small businesses without the need of hand holding.
- Axon Ad Manager rollout has been testing well and on Oct 1st 2025 will be expanded on a referral basis to more advertisers. Global public launch targeted for 1st half of 2026 under it’s own brand – Axon.
- Q4 should see expanded spend by existing advertisers on Axon Ad Manager due to holiday season but also with the Self Service rollout net new advertisers will be onboarded.
- To date web advertising campaigns were limited to US only, that will expand to most International markets from Oct 1st.
- User reach is now 1 Billion.
- Plans to do paid marketing to make more smaller businesses aware of the Axon Ad Manager.
Total Addressable Market (TAM) and Compound Annual Growth Rate (CAGR)
AppLovin operates within the mobile advertising industry, which has experienced significant growth in recent years. The Total Addressable Market (TAM) for mobile advertising was valued at approximately $231.0 billion in 2024. Projections indicate that this market could reach around $574.9 billion by 2033, reflecting a Compound Annual Growth Rate (CAGR) of 10.13% during the forecast period of 2025 to 2033.
Products
| Product/Service | Description |
|---|---|
| Axon Ad Manager – Ad Network & Demand-Side Platform | An advertising platform that matches advertiser demand with publisher supply through auctions at vast scale and at microsecond-level speeds. Is self service, supports credit car billing, supports a framework for agents that allows workflow automation. |
| MAX – Supply-Side Ad Platform | A supply side platform that helps developers maximize their revenue by optimizing in-app advertising. It allows developers to auction ad space to the highest bidder in real-time. |
| Adjust | A mobile analytics platform that provides insights into app performance and user engagement. |
| Wurl | A platform that connects video producers with distribution channels to monetize content. Through its acquisition of Wurl, AppLovin has entered the CTV ad space, offering tools like AdPool, connects streamers to advertisers and TVBits, an AI-based content recommendation tool. |
- The average ad viewership time on Max is 35 seconds compared to 7 seconds on Social Networks
- Axon Self Seve takes about 7 days for a customer to ramp up and go live.
Customers
AppLovin serves a wide range of mobile app developers across various categories, providing them with tools to improve marketing and monetization efforts.
Competitors
Top Supply Side Tools for advertising in games.
| Platform | Strength | Main Ad Formats | Approx. Market Share (estimate) |
|---|---|---|---|
| AppLovin (MAX + demand) | Leading mediation + owned demand (strong auction power) | Rewarded, interstitial, playable | ~25–40%. |
| Google AdMob / Ad Manager | Ubiquitous demand / global fill | Banner, interstitial, rewarded | ~20–30% |
| ironSource (LevelPlay) | Deep mediation features for games | Rewarded, interstitial, offerwall | ~8–15% |
| Unity Ads / Unity Mediation | Seamless for Unity games; playable + rewarded formats | Rewarded, interstitial, playable | ~6–12% |
| Digital Turbine (FairBid / Fyber lineage) | Independent mediation / transparent auctions | Rewarded, interstitial, native | ~3–8% |
Main Investors
| Shareholder | Shares Held | Percentage of Outstanding Shares |
|---|---|---|
| Vanguard Group Inc. | 23.26 million | 7.79% |
| BlackRock Inc. | 14.41 million | 4.83% |
| Ling Tang | 20.49 million | 6.86% |
| Angel Pride Holdings Ltd. | 17.24 million | 5.77% |
| Adam Foroughi | 36.30 million | 10.8% |
Founding History
AppLovin was founded in 2011 by Adam Foroughi, Andrew Karam, and John Krystynak with the vision of creating a powerful platform to help mobile developers grow their apps through data-driven marketing.
Early Days and Challenges
Adam Foroughi, the company’s CEO, had a background in finance and entrepreneurship, while his co-founders, Andrew Karam and John Krystynak, brought technical expertise in software development. Initially, they struggled to secure funding. Venture capitalists were hesitant about the company’s business model, and the founders faced multiple rejections from investors.
Pivot and Breakthrough
After several funding roadblocks, AppLovin pivoted to focus on mobile advertising technology, leveraging machine learning to optimize user acquisition. Their breakthrough came when they secured a $4 million investment from angel investors, allowing them to expand their platform.
Rapid Growth and Expansion
By 2014, AppLovin was profitable, growing rapidly by helping app developers acquire users at scale. The company initially focused on mobile game publishers, refining its ad technology to ensure effective targeting and monetization.
In 2016, AppLovin agreed to be acquired by a Chinese private equity firm, Orient Hontai Capital, for $1.4 billion, but regulatory concerns led to the deal falling through. Instead, the company took a $140 million investment from Hontai and continued operating independently.
IPO and Market Leadership
In 2021, AppLovin went public on the NASDAQ under the ticker APP, raising $2 billion at a valuation of $28.6 billion. Since then, the company has continued expanding, acquiring mobile game developers and ad-tech companies to strengthen its ecosystem.
Invest Alpha 