AppLovin: Axon Keeps Getting Smarter

2026-03-31 08:15:08 ET

Investment Thesis

In my last piece on AppLovin Corporation ( APP ), I wrote that "APP was minting cash while it was growing faster than anyone else in the space." Well, that line has aged well. Only now the numbers are bigger, the margins are fatter, and the market mood is strangely worse. In 4Q 2025, revenue came in at $1.66 billion, which represents a 66% y/y increase. Additionally, adjusted EBITDA reached $1.4 billion with an 84% margin, and free cash flow ((FCF)) hit $1.31 billion. It is also important to mention that management guided 1Q 2026 to another 5% to 7% sequential revenue increase with EBITDA margins holding around 84%. I would say that this is the sort of print that makes most software companies look like they forgot how a P&L works. Adam Foroughi, the CEO, framed the disconnect well when he said that there is "...a real disconnect between market sentiment and the reality of our business..." I agree, and this is why I am reiterating a Strong Buy rating....

Read the full article on Seeking Alpha

For further details see: