# Applovin (APP.US)

Canonical: https://gigainvestors.com/s/APP

Analysis as of: 2026-10-16T07:26:33.390Z. Financial observations: FY2018–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: $279.29 per share; close as of 2026-10-15.

Estimated value: low $110.26 per share, central $124.27 per share, high $142.91 per share. Buy at or below the central value $124.27 per share. Valuation as of 2026-10-16T07:26:33.390Z; scenarios are not confidence intervals.

Expected annual return: 5.9% at the stated quote. About 5.9% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: fail

- 1 revenue decline in the last 10 years (informational)

- more than 2 net loss years

- operating margin variation exceeds 0.35

- Financial history: 9 years

- Years with declining revenue: 1

- Years with a net loss: 3

- Operating margin variation: 0.85×

Chart: Operating margin; fiscal year observations.

- FY2018: 0.50×

- FY2019: 0.20×

- FY2020: -0.04×

- FY2021: 0.05×

- FY2022: -0.02×

- FY2023: 0.42×

- FY2024: 0.59×

- FY2025: 0.76×

- LTM to Jun 2026: 0.77×

### moat: fail

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 37.1%

- ROIC, second-lowest year: -1.7%

- Typical minus recent gross margin: -5.7 pp

- Typical gross margin (annual median): 78.2%

- Recent gross margin (lower of latest and 3-year median): 83.9%

- Years with nonpositive capital: 0

- Capital spending / revenue: 0.2%

- ROIC including acquisitions, ten-year median: 16.4%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2018: >100%

- FY2019: 45.2%

- FY2020: -5.1%

- FY2021: 3.8%

- FY2022: -1.7%

- FY2023: 29.0%

- FY2024: 77.0%

- FY2025: >100%

### economics: pass

- Owner earnings / net income, 5-yr: 1.40×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $7.2B

- Net income, five-year total: $5.1B

- Return on incremental invested capital: >100%

- Working capital / revenue, annual change: 2.0 pp

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 13.01×

- FY2022: -1.83×

- FY2023: 2.36×

- FY2024: 1.28×

- FY2025: 1.05×

### management: pass

- potential debt-funded buybacks (informational)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 45.2% vs 77.0%

- Per-share earnings: -0.58 to 4.54 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 5-year annual growth: 9.7%

- Diluted shares, 5-year annual growth: 9.7%

- Per-share value change: $5.12

- Per-share value, starting three-year median: -$0.58

- Per-share value, ending three-year median: $4.54

- Buybacks concentrated in cheaper years (correlation): -0.20

- Average buyback yield: 4.7%

- Buyback history: 4 years

- Debt-funded buybacks: Yes

- ROIC, first three-year median: 45.2%

- ROIC, last three-year median: 77.0%

Chart: Earnings per share; fiscal year observations.

- FY2018: -$0.80

- FY2019: $0.56

- FY2020: -$0.58

- FY2021: $0.10

- FY2022: -$0.52

- FY2023: $0.99

- FY2024: $4.54

- FY2025: $9.75

### accounting: pass

- Sloan accruals: -8.8%

- Receivables to sales index (DSRI): 0.76×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 5.3%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.19×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.91×

Chart: Sloan accruals; fiscal year observations.

- FY2018: -74.3%

- FY2019: -6.6%

- FY2020: -16.2%

- FY2021: -5.3%

- FY2022: -10.4%

- FY2023: -13.1%

- FY2024: -8.8%

- FY2025: -8.8%

## Holders

- [Pat Dorsey](https://gigainvestors.com/DA): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Christopher Davis](https://gigainvestors.com/DAV): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Terry Smith](https://gigainvestors.com/FS): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Stephen Mandel](https://gigainvestors.com/LPC): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Down 61% since Sep 2025 · "AppLovin drops 3% as Edgewater analyst warns of stalled market share growth" (finance.yahoo.com, Sep 2026) · sales +24.6%

Story as of 2026-10-16T09:58:19.173Z; price observation 2026-10-15.

Price needs cash profits to grow 11.6% a year for ten years

- 2025-05-17: AppLovin (NasdaqGS:APP) Posts Strong Q1 Earnings with Substantial Year-Over-Year Growth ([finance.yahoo.com](https://finance.yahoo.com/news/applovin-nasdaqgs-app-posts-strong-173256678.html))

- 2025-08-07: AppLovin outlines 20–30% annual growth target and expands AXON platform globally as e-commerce ramps ([seekingalpha.com](https://seekingalpha.com/news/4480831-applovin-outlines-20-30-percent-annual-growth-target-and-expands-axon-platform-globally-as-e?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

- 2025-09-29: AppLovin jumps as it prepares to launch self-serve tool, analysts raise estimates ([seekingalpha.com](https://seekingalpha.com/news/4499909-applovin-jumps-as-it-prepares-to-launch-self-serve-tool-analysts-raise-estimates?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

- 2026-02-11: AppLovin misses quarterly revenue estimates amid advertising competition ([finance.yahoo.com](https://finance.yahoo.com/news/applovin-misses-quarterly-revenue-estimates-223737111.html))

- 2026-05-29: AppLovin's Revenue Momentum Reflects AI-Driven Advertising Demand ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/applovins-revenue-momentum-reflects-ai-174400832.html))

- 2026-08-05: AppLovin (NASDAQ:APP) Misses Q2 CY2026 Revenue Estimates, Stock Drops 21% ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/applovin-nasdaq-app-misses-q2-203826929.html))

### Sales · FY2025–2026

sales +24.6%; source https://www.sec.gov/Archives/edgar/data/1751008/000175100826000010/app-20251231.htm; observed 2026-02-19.

- FY2018: $483M 

- FY2019: $994M 

- FY2020: $1.5B 

- FY2021: $2.8B 

- FY2022: $2.8B 

- FY2023: $1.8B 

- FY2024: $3.2B 

- FY2025: $5.5B 

- FY2026: $6.8B 

### Gross margin · FY2025

gross margin 87.9%; source https://www.sec.gov/Archives/edgar/data/1751008/000175100826000010/app-20251231.htm; observed 2026-02-19.

- FY2018: 88.9% 

- FY2019: 75.7% 

- FY2020: 61.7% 

- FY2021: 64.6% 

- FY2022: 55.4% 

- FY2023: 80.6% 

- FY2024: 83.9% 

- FY2025: 87.9% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in advertising agencies; annual sales are USD 5.5 billion.

- Source: https://www.sec.gov/Archives/edgar/data/1751008/000175100826000010/app-20251231.htm (filed 2026-02-19); FY2025: revenue 5480717000; grossProfit 4815577000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); APP.US: AppLovin Corporation provides end-to-end artificial intelligence-powered advertising solutions for businesses in the United States and internationally. It operates through two segments, Advertising and Apps. The company offers Axon Ads Manager, a suite of marketing solutions that enables developers to automate, optimize, and manage marketing efforts; MAX, an in-app bidding technology that optimizes the value of a publisher's advertising inventory by running a real-time competitive auction; Adjust, a measurement and analytics marketing platform; and Wurl, a connected TV platform, which distributes streaming video for content companies, provides advertising and publishing solutions. It serves individuals, small and independent businesses, enterprises, advertisers and advertising networks, mobile app publishers, and indie studio developers. The company was incorporated in 2011 and is headquartered in Palo Alto, California.

### Why customers stay

Margins ranged from 80.6% to 87.9% during 2023–25; it earns 37.1% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2023: grossProfit / revenue = 80.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2024: grossProfit / revenue = 83.9%.

- Source: https://www.sec.gov/Archives/edgar/data/1751008/000175100826000010/app-20251231.htm (filed 2026-02-19); FY2025: grossProfit / revenue = 87.9%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); 8-year return on capital observations [[2018,4.457228130599707],[2019,0.4515696154972671],[2020,-0.05050671404090356],[2021,0.038391281470573954],[2022,-0.016568994670960444],[2023,0.2895894383512198],[2024,0.7700369900082454],[2025,2.182393734360727]]; median 0.37057952692424345. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 3 of 8 years; bought back USD 2.2 billion of shares.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2019: growth capex 0; upkeep 3358000; owner earnings 208488000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2020: growth capex 0; upkeep 3241000; owner earnings 126523000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2021: growth capex 0; upkeep 5457000; owner earnings 461052000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2022: growth capex 0; upkeep 662000; owner earnings 353676000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2023: growth capex 0; upkeep 4246000; owner earnings 841973000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2024: growth capex 0; upkeep 4776000; owner earnings 2023694000. Growth capex / owner earnings = 0.

- Source: https://www.sec.gov/Archives/edgar/data/1751008/000175100826000010/app-20251231.htm (filed 2026-02-19); FY2025: growth capex 0; upkeep 28318000; owner earnings 3500224000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); Dividend observations: [[2018,0],[2019,2637000],[2020,483576000],[2021,2877000],[2022,0],[2023,0],[2024,0],[2025,0]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/1751008/000175100826000010/app-20251231.htm (filed 2026-02-19); FY2025: cash repurchases 2191944000 USD.

### Are managers owners

Insiders own 4.7% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); APP.US SharesStats.PercentInsiders = 4.718 percentage points; cache date 2026-10-16.

### What could break it

"We are subject to governmental export controls and economic sanctions laws" (SEC filing, Feb 2026)

- Source: https://www.sec.gov/Archives/edgar/data/1751008/000175100826000010/app-20251231.htm (filed 2026-02-19); We are subject to governmental export controls and economic sanctions laws

### What the price says

The price assumes cash profits grow 11.6% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); Ten-year compound average after fade. Initial solved rate 0.15440384342259172. Price 279.29; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03.  Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2021-04: $58.01 per share

- 2021-05: $74.31 per share

- 2021-06: $75.17 per share

- 2021-07: $61.47 per share

- 2021-08: $70.40 per share

- 2021-09: $72.37 per share

- 2021-10: $98.25 per share

- 2021-11: $91.11 per share

- 2021-12: $94.26 per share

- 2022-01: $64.42 per share

- 2022-02: $58.08 per share

- 2022-03: $55.07 per share

- 2022-04: $38.15 per share

- 2022-05: $38.11 per share

- 2022-06: $34.44 per share

- 2022-07: $35.54 per share

- 2022-08: $24.63 per share

- 2022-09: $19.49 per share

- 2022-10: $16.96 per share

- 2022-11: $14.41 per share

- 2022-12: $10.53 per share

- 2023-01: $12.70 per share

- 2023-02: $13.50 per share

- 2023-03: $15.75 per share

- 2023-04: $17.00 per share

- 2023-05: $25.01 per share

- 2023-06: $25.73 per share

- 2023-07: $31.40 per share

- 2023-08: $43.22 per share

- 2023-09: $39.96 per share

- 2023-10: $36.44 per share

- 2023-11: $37.48 per share

- 2023-12: $39.85 per share

- 2024-01: $41.13 per share

- 2024-02: $59.72 per share

- 2024-03: $69.22 per share

- 2024-04: $70.57 per share

- 2024-05: $81.48 per share

- 2024-06: $83.22 per share

- 2024-07: $77.10 per share

- 2024-08: $92.87 per share

- 2024-09: $130.55 per share

- 2024-10: $169.39 per share

- 2024-11: $336.75 per share

- 2024-12: $323.83 per share

- 2025-01: $369.59 per share

- 2025-02: $325.74 per share

- 2025-03: $264.97 per share

- 2025-04: $269.31 per share

- 2025-05: $393.00 per share

- 2025-06: $350.08 per share

- 2025-07: $390.70 per share

- 2025-08: $478.59 per share

- 2025-09: $718.54 per share

- 2025-10: $637.33 per share

- 2025-11: $599.48 per share

- 2025-12: $673.82 per share

- 2026-01: $473.11 per share

- 2026-02: $434.77 per share

- 2026-03: $398.00 per share

- 2026-04: $446.35 per share

- 2026-05: $613.09 per share

- 2026-06: $515.23 per share

- 2026-07: $395.90 per share

- 2026-08: $312.06 per share

- 2026-09: $290.43 per share

- 2026-10: $272.28 per share

## Annual estimated value (USD per share)

- FY2022: low $13.16 per share, central $14.59 per share, high $16.50 per share

- FY2023: low $10.45 per share, central $11.71 per share, high $13.39 per share

- FY2024: low $18.67 per share, central $20.98 per share, high $24.05 per share

- FY2025: low $87.04 per share, central $98.08 per share, high $112.78 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/1751008/000175100826000010/app-20251231.htm); period 2025-12-31, filed 2026-02-19.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.