AppLovin Q4 Earnings Preview: Key Things to Watch

AppLovin, a prominent mobile app technology company listed on the NASDAQ under the ticker symbol APP, is set to release its fourth-quarter earnings report after the market closes on Wednesday. In the previous quarter, AppLovin exceeded analysts’ revenue projections by 4.5%, reporting a total revenue of $1.41 billion, representing a 17.3% increase compared to the previous year. The company outperformed expectations not only in terms of revenue but also in terms of EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). Looking ahead, investors are curious about what to expect in this upcoming earnings report.

Analysts are forecasting a year-on-year revenue growth of 18.1% to reach $1.62 billion for AppLovin this quarter. This growth rate is notably lower than the 44% increase observed in the same quarter of the previous year. Expected adjusted earnings per share are $3.07. Analysts who cover the company have largely maintained their estimates in the last month, indicating confidence in the company’s performance leading up to this earnings release.

Over the past two years, AppLovin has missed Wall Street’s revenue estimates on three occasions. Analyzing the results of its peers in the sales and marketing software sector, it seems that there is potential insight into what could be expected. For instance, LiveRamp reported a revenue growth of 8.6% year-on-year, meeting analysts’ expectations, while ZoomInfo saw a revenue increase of 3.2%, surpassing estimates by the same percentage. LiveRamp’s shares rose by 3.5% following the release of their results.

While the outlook for 2025 remains uncertain due to potential changes in trade policies and corporate tax discussions that may impact business confidence and growth, sales and marketing software stocks have been facing challenges. On average, share prices in this sector have dropped by 17.9% in the last month, with AppLovin experiencing a decline of 26.9% during the same period. The current average analyst price target for AppLovin stands at $721.85, compared to the current share price of $473.96.

When a company finds itself in a position with excess cash, one strategic move it can make is buying back its own shares, provided the price is favorable. This strategy can be beneficial for both the company and its shareholders. If executed correctly, it can help boost shareholder value and demonstrate confidence in the company’s future prospects.
Investors are curious to see how AppLovin will navigate the current market conditions and whether it can deliver another strong performance in this upcoming earnings report.