AppLovin’s AI models drive 66% revenue increase to $1.66B in quarter

AppLovin Corporation shared its financial outcomes for the fourth quarter of 2025, which experts have labeled as one of the most outstanding demonstrations in the history of advertising technology. The mobile marketing platform located in Palo Alto disclosed revenues of $1.66 billion on February 11, 2026, highlighting a 66% increase compared to the previous year. Additionally, the company recorded adjusted EBITDA of $1.40 billion at an 84% margin. The quarterly results exceeded Wall Street predictions, with earnings per share reaching $3.24, surpassing anticipated figures by 9.46%. The revenue of $1.657 billion also exceeded analysts’ projected $1.61 billion. Over the course of 2025, the company’s revenue grew to $5.48 billion, an uptick of 70% from the previous year’s $3.22 billion. Moreover, net income from continuing operations achieved $3.43 billion compared to $1.59 billion in the previous year.

According to the analysis published by W Media Research on February 13, the performance of AppLovin was deemed a remarkable feat in the landscape of public AdTech companies. The research highlighted the company’s exceptional profitability, stating that it remains unmatched by many others in the industry. The 84% adjusted EBITDA margin was likened to software-type economics at a corporate scale reaching multi-billion dollars. Free cash flow also experienced an 88% increase in the fourth quarter, reaching $1.31 billion. This upward trend continued throughout the year, as free cash flow saw a 91% surge to $3.95 billion in 2025 from the prior year’s $2.07 billion. This capital was used to fund $2.58 billion in share buybacks while maintaining a position of $2.5 billion in cash and cash equivalents. In total, the company redeemed and retained 6.4 million shares in 2025, decreasing the weighted average diluted shares outstanding from 346 million to roughly 340 million.

An indicator known as the Rule of 40 score, which combines the revenue growth rate and adjusted EBITDA margin, reached an impressive 150 in the fourth quarter for AppLovin. This particular metric, widely relied upon to assess the performance of software companies, typically considers scores above 40 as excellent. CFO Matt Stumpf described AppLovin’s feat, blending 66% revenue growth with an 84% adjusted EBITDA margin, as exceptional, heralding it as an uncommon achievement at the company’s vast scale. Stumpf expressed during the earnings call that the combination of growth, profitability, free cash flow, and capital returns delivered by AppLovin is exceptionally uncommon. The quarter-over-quarter flow-through to adjusted EBITDA was comparable to unprecedented scales.