AppLovin Sells Gaming Business for $400M, Stock Rises 108%
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 8h ago
0mins
Source: Fool
- Business Restructuring: AppLovin sold its mobile gaming business for $400 million in cash and 20% equity in Tripledot, successfully transforming into a pure-play adtech company, which enhances the company's growth potential and investment appeal.
- Financial Performance: Over the past year, AppLovin's revenue surged 72% to $3.82 billion, while GAAP net income rose 128% to $2.23 billion, reflecting a nearly 60% profit margin that indicates a competitive advantage.
- Market Expansion: The company is experiencing momentum in both gaming and non-gaming sectors, demonstrating that its strategy to diversify into new verticals is paying off, particularly with rapid growth in the Asian market.
- Future Outlook: Although AppLovin's price-to-earnings ratio stands at 75, the market remains optimistic about its future performance due to ongoing strong growth, with expectations that the stock still has room to rise as the ad market remains robust.
Analyst Views on APP
Wall Street analysts forecast APP stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for APP is 749.28 USD with a low forecast of 650.00 USD and a high forecast of 860.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
20 Analyst Rating
17 Buy
3 Hold
0 Sell
Strong Buy
Current: 616.530
Low
650.00
Averages
749.28
High
860.00
Current: 616.530
Low
650.00
Averages
749.28
High
860.00
About APP
AppLovin Corporation is a marketing platform. The Company provides end-to-end software and artificial intelligence (AI) solutions for businesses to reach, monetize and grow their global audiences. Its advertising solutions include a comprehensive suite of tools including AppDiscovery, MAX, Adjust, Wurl and Axon Ads Manager. AppDiscovery is powered by AXON, its AI-powered advertising engine, and matches advertiser demand with publisher supply through auctions at vast scale and at microsecond-level speeds. MAX is its monetization solution, utilizing an advanced in-app bidding technology that optimizes the value of a publisher’s advertising inventory by running a real-time competitive auction, driving more competition, and higher returns for publishers. Adjust is its measurement and analytics marketing platform which provides marketers with the visibility, insights, and data needed to scale their apps marketing and drive more informed results. Wurl is its connected TV (CTV) platform.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
