AppLovin (APP) has seen significant growth in 2025, transitioning from a mobile gaming ad platform to an AI-powered advertising technology leader. Analysts at Wedbush project continued growth, despite a recent SEC inquiry. APP’s market cap is $213.7 billion, with shares up 84.2% YTD and a price target of $745.
Wedbush analysts anticipate ongoing momentum in mobile gaming and e-commerce to drive AppLovin’s growth. The company’s deliberate expansion into e-commerce includes a self-serve tool rollout and international growth. While public enthusiasm may be overstating progress, analysts remain optimistic about AppLovin’s future potential, particularly in Connected TV advertising.
An initial selloff of AppLovin shares followed reports of an SEC inquiry into the company’s data practices. However, the stock rebounded over 7% after Citigroup recommended buying the shares, citing management’s clear handling of the situation. Despite potential short-term volatility, long-term bullish sentiment remains strong.
AppLovin’s second-quarter results showed impressive growth, with revenue up 77% YoY to $1.26 billion and adjusted EBITDA nearly doubling to $1.02 billion. Net income from continuing operations, accounting for losses related to the App Portfolio divestiture, soared 156% YoY to $772 million. The company’s strong financial performance indicates continued success in the evolving advertising technology industry. AppLovin sold its first-party apps business to Tripledot Studios for $400 million in cash plus equity, focusing on high-margin software and marketplace segments. Q2 saw $768 million in free cash flow, $772 million from operating activities, and $341 million used for share repurchases. Q3 guidance includes $1.33 billion in advertising revenue and an 81% adjusted EBITDA margin.
Analysts expect AppLovin’s profit to double to $9.15 per share in FY25, with revenue increasing 18.57% to $5.58 billion. Stock valuation is high, with a forward P/E of 58.81x and forward EV/Sales of 38.69x, leaving little room for error. Wall Street analysts rate APP stock as a top-tier “Strong Buy.”
APP stock trades slightly below its average price target of $611.91, with a Street-high target of $860 indicating potential upside. Oleksandr Pylypenko had no positions in the securities mentioned. Information in the article is for informational purposes.
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