AppLovin Sells Mobile Gaming Business for $400M, Focuses on Adtech

Written by Emily J. Thompson, Senior Investment Analyst

APP+1.69%

Source: NASDAQ.COM

Updated: 2d ago

0mins

Source: NASDAQ.COM

Business Restructuring: AppLovin sold its mobile gaming business for $400 million in cash and 20% equity in Tripledot, enabling a focus on adtech that enhances growth potential and simplifies investment analysis.
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 strong competitive advantage.
Market Expansion: The company is witnessing robust momentum in both gaming and non-gaming sectors, successfully entering new verticals like e-commerce, demonstrating the effectiveness of its diversification strategy.
Future Outlook: Although AppLovin trades at a high price-to-earnings ratio of 75, its ongoing rapid growth and positive reception of new products suggest the company is poised for continued strong performance as long as the ad market remains robust.

APP

$658.65+Infinity%1D

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: 647.720

Low

650.00

Averages

749.28

High

860.00

Current: 647.720

Low

650.00

Averages

749.28

High

860.00

Wells Fargo

Alec Brondolo

Overweight

maintain

$721 -> $735

2026-01-08

New

Reason

Wells Fargo

Alec Brondolo

Price Target

$721 -> $735

2026-01-08

New

maintain

Overweight

Reason

Wells Fargo analyst Alec Brondolo raised the firm's price target on AppLovin to $735 from $721 and keeps an Overweight rating on the shares. Ahead of quarterly results, the firm is raising Q4 revenues 3% on strong mobile game checks. Web ads trends are mixed, Wells says, adding that advertisers are positive on prospecting but existing advertiser wallet share should be about flat year-over-year. The firm sees Q1 consensus as a high bar given APP history of conservative guidance. Overall, Wells sees another tough setup.

BTIG

Buy

maintain

$705 -> $771

2025-12-17

Reason

BTIG

Price Target

$705 -> $771

2025-12-17

maintain

Buy

Reason

BTIG raised the firm's price target on AppLovin to $771 from $705 and keeps a Buy rating on the shares. The firm is constructive on the setup for the gaming and gambling end markets it covers heading into 2026 and its higher price target is the reflection of expected healthier gaming user acquisition trends in Q4 and beyond, the analyst tells investors in a research note.

Benchmark

Mike Hickey

Buy

maintain

$700 -> $775

2025-12-11

Reason

Benchmark

Mike Hickey

Price Target

$700 -> $775

2025-12-11

maintain

Buy

Reason

Benchmark analyst Mike Hickey raised the firm's price target on AppLovin to $775 from $700 and keeps a Buy rating on the shares. After having reviewed AppLovin's Q3 earnings and management's subsequent discussions at the UBS Global Technology and AI Conference and the Nasdaq Investor Conference, the firm contends that the company's prospects have strengthened, citing accelerating e-commerce traction, a clear roadmap to scale AXON Ads self-serve, expanding Gen AI creative capabilities, and sustained margin durability. AppLovin remains one of the firm's "Best Ideas," the analyst noted.

Jefferies

James Heaney

Buy

maintain

$800 -> $860

2025-12-11

Reason

Jefferies

James Heaney

Price Target

$800 -> $860

2025-12-11

maintain

Buy

Reason

Jefferies analyst James Heaney raised the firm's price target on AppLovin to $860 from $800 and keeps a Buy rating on the shares. The firm recommends staying selective across Internet stocks, as incremental investments could limit margin expansion and concerns around AI disintermediation could limit multiple appreciation, the analyst tells investors in the firm's "2026 Internet Playbook" note.

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.