AppLovin Corp

AppLovin Corporation operates in the advertising ecosystem, providing end-to-end artificial intelligence-powered advertising solutions for businesses to reach, monetize, and grow their global audience. The company's scaled business model is intricately linked to the advertising ecosystem, providing a durable competitive advantage. AppLovin generates revenue when its advertisers achieve their return on advertising spend targets with its advertising solutions, ensuring that their success directly fuels the company's growth. The company is critical to the success of advertisers and publishers seeking to solve marketing and monetization challenges.

The company operates in a fragmented advertising ecosystem composed of divisions of large, well-established companies as well as privately-held companies. Primary competitors named in the filing include Meta, Google, Amazon, and Unity Software, as well as various private companies, several of which are also partners and clients. The principal competitive factors in the market include the ability to enhance and improve technologies and offerings, knowledge and experience in the advertising ecosystem, relationships with third parties, the ability to reach and target a large number of users, the ability to identify and execute on strategic transactions, pricing and perceived value of offerings, brand and reputation, and ability to expand into new offerings and geographies. Management believes the company competes favorably with respect to these factors.

AppLovin generates substantially all of its revenue from fees paid by advertisers who use its advertising solutions to grow and monetize their content. Revenue from Axon Ads Manager comprises substantially all of the company's revenue. The company is able to grow its revenue by improving its various technologies, including improvements to its Axon AI recommendation engine. Advertising clients include a wide variety of advertisers, from indie developer studios to some of the largest global internet platforms, such as Meta and Google. The company sees multiple opportunities to gain new clients and to increase spend from existing clients as it helps them grow their businesses. Revenue from Axon Ads Manager is determined dynamically based on advertisers' campaign goals. Revenue from MAX is generated based on a percentage of client spend. Revenue from Adjust is primarily generated from an annual software subscription fee. Revenue from Wurl is primarily generated from content companies, streamers, and advertisers, typically on a usage-based and/or CPM model.

AppLovin's advertising solutions include a comprehensive suite of tools. Axon Ads Manager, the user acquisition solution, is the cornerstone of the advertising solutions, powered by the Axon AI advertising recommendation engine, matching advertiser demand with publisher supply through auctions at vast scale and at microsecond-level speeds. MAX is the 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 the 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 the connected TV platform that both distributes streaming video for content companies and provides advanced advertising and publishing solutions to attract viewers and maximize revenue.

The company's strategy for growth includes existing market expansion within the mobile app ecosystem, enhancing and extending AI-based technologies including Axon AI, and new market expansion into new verticals such as web-based e-commerce and social media, as well as other content industries like the growing CTV industry through Wurl. The company also intends to continue to attract and retain the best talent and pursue strategic transactions. As of December 31, 2025, the company had approximately 380 employees, or 42% of its total headcount, involved in research and development and related activities. The company's research and development organization is based in Palo Alto, California with additional resources around the world.

On June 30, 2025, the company completed the sale of its Apps business to Tripledot for $400 million in cash, subject to closing adjustments, and equity consideration representing approximately 20% of Tripledot's fully-diluted equity at the time of closing. In connection with the transaction, the company received $715.6 million in total consideration, consisting of $430.6 million in cash and 596.9 million ordinary shares of Tripledot, valued at $285.0 million. In 2025, the company repurchased and retired 5.5 million shares of Class A common stock for $2.2 billion and the board of directors authorized an incremental increase to the stock repurchase program totaling $3.2 billion. As of December 31, 2025, $3.3 billion remained available for repurchases under the program. In March 2025, the company borrowed $200.0 million under its revolving credit facility to fund share repurchases and repaid $100.0 million in April 2025 and the remaining $100.0 million in May 2025.

For the fiscal year ended December 31, 2025, total revenue was $5,480,717 thousand, compared to $3,224,058 thousand in fiscal 2024 and $1,841,762 thousand in fiscal 2023. Net income from continuing operations was $3,433,195 thousand in fiscal 2025, compared to $1,589,524 thousand in fiscal 2024 and $457,826 thousand in fiscal 2023. Net income was $3,333,751 thousand in fiscal 2025, compared to $1,579,776 thousand in fiscal 2024 and $356,711 thousand in fiscal 2023. Diluted net income per share was $9.75 in fiscal 2025, compared to $4.53 in fiscal 2024 and $0.98 in fiscal 2023. Adjusted EBITDA was $4,512,452 thousand in fiscal 2025, compared to $2,411,764 thousand in fiscal 2024 and $1,236,284 thousand in fiscal 2023. Adjusted EBITDA margin was 82.3% in fiscal 2025, compared to 74.8% in fiscal 2024 and 67.1% in fiscal 2023.

A primary growth vector is existing market expansion within the mobile app ecosystem, which the company intends to address through the optimization of its advertising solutions. Another major growth vector is new market expansion into new verticals not historically addressed, including web-based e-commerce and social media. The company has made its advertising solutions available to web-based advertisers, and while early in this market expansion, new customers have experienced positive results, demonstrating the flexibility and future growth potential of the advertising solutions. The company also plans to expand into other content industries, such as the growing CTV industry through Wurl, by continuing to expand its CTV business through the addition of new content advertisers and supply channels as well as through the application of Axon AI to CTV.

The company expects to continue to invest in its technology and solutions and to incur related costs, including costs to attract and retain critical engineering talent, such as stock-based compensation, as well as datacenter costs as it continues to launch enhancements to its Axon AI recommendation engine. The company believes investments in its technology will further improve effectiveness for advertisers. The company also expects to continue to invest in sales and marketing to enhance awareness of the Axon brand and drive new client acquisition.

As of December 31, 2025, the company had a total of 898 employees, comprised of 876 full-time and 22 part-time/intern employees, located in 15 countries. Approximately 60% of global employees were located outside of the U.S. and 40% in the U.S. The company benefits from a distributed global workforce and plans to continue investing in its employees. The company provides competitive compensation packages designed to attract and retain talent, as informed by market compensation surveys and data, with multiple incentive programs including base cash, equity and/or performance cash awards.

In 2025, the company repurchased and retired 5.5 million shares of Class A common stock for $2.2 billion and the board of directors authorized an incremental increase to the stock repurchase program totaling $3.2 billion. As of December 31, 2025, $3.3 billion remained available for repurchases under the program. The company has never paid cash dividends on its capital stock and does not anticipate paying any cash dividends in the foreseeable future. As of December 31, 2025, the company had $3.6 billion of senior unsecured notes outstanding, issued in multiple series that mature between 2029 and 2054 and bear fixed annual interest rates ranging from 5.125% to 5.950%. The company also had $1.0 billion of commitments under its senior unsecured credit agreement that provides for an unsecured revolving credit facility, with no outstanding borrowings as of December 31, 2025.

The company's revenue may experience seasonality during several periods throughout the year driven by fluctuations in advertising demand associated with mobile gaming and e-commerce activity, influenced by factors such as major holidays, promotional events, school-related cycles, and broader shifts in consumer spending patterns. As the breadth and scale of advertisers using the platform continues to expand, including increased participation from large e-commerce advertisers, the magnitude and impact of these seasonal trends may become more pronounced over time. The company also faces risks from general macroeconomic conditions, including tariffs, trade wars, inflation, and high interest rates, political uncertainty and international conflicts around the world, such as in Ukraine and the Middle East, as well as friction between the United States and China.

The company faces structural headwinds from changes to the policies or practices of third-party platforms, such as the Apple App Store and the Google Play Store, including with respect to Apple's Identifier for Advertisers and transparency regarding data processing. The company also faces an evolving legal and regulatory landscape, including with respect to data protection, privacy, and AI. The company must continue to innovate and stay ahead of developments in the advertising and mobile app ecosystems in order for its business to succeed and its results of operations to continue to improve.

The company's results of operations are likely to fluctuate from period-to-period due to factors including its ability to maintain and grow its client base, changes to its advertising solutions, the timing and efficacy of improvements to its algorithms and Axon AI, and changes to the policies or practices of third-party platforms such as the Apple App Store and the Google Play Store. The company is highly dependent on its co-founder and chief executive officer, Adam Foroughi, as well as its senior management team, and does not maintain key-man insurance. The advertising ecosystem is intensely competitive, with primary competitors including Meta, Google, Amazon, and Unity Software. The company faces concentration risk in that its advertising solutions primarily operate in the mobile app ecosystem and specifically mobile gaming. The company is subject to laws and regulations concerning privacy, information security, data protection, consumer protection, advertising, tracking, targeting, and protection of minors, which are continually evolving, and failure to comply could adversely affect the business. As of December 31, 2025, the company had $3.6 billion in aggregate principal amount of senior unsecured notes outstanding, and its obligations thereunder may limit operational flexibility.

Management's message emphasizes the company's mission to create meaningful connections between companies and their ideal customers through end-to-end AI-powered advertising solutions. The tone is forward-looking, highlighting the company's scaled business model intricately linked to the advertising ecosystem as a durable competitive advantage. Key strategic priorities emphasized for the period ahead include existing market expansion within the mobile app ecosystem, enhancing and extending AI-based technologies including Axon AI, and new market expansion into new verticals such as web-based e-commerce and social media, as well as other content industries like the growing CTV industry through Wurl. Management also intends to continue to attract and retain the best talent and pursue strategic transactions.