AppLovin Posts Record Revenue, Q2 Surges 77% to $1.26 Billion, Short-Seller Claims Fail to Impact Stock

AppLovin's revenue surged 77% to $1.26 billion in Q2, with gross margins improving to 87.7% and operating costs reduced by 29%. The company's EPS from continuing operations jumped to $2.39, and adjusted EBITDA nearly doubled to $1 billion. AppLovin is focusing on its core gaming ad business and plans to launch a self-service platform for advertisers next year.

AppLovin Corp (APP) reported strong financial results for the second quarter of 2025, with revenue surging 77% to $1.26 billion. The company's gross margins improved to 87.7%, while operating costs were reduced by 29%. AppLovin's earnings per share (EPS) from continuing operations jumped to $2.39, and adjusted EBITDA nearly doubled to $1 billion [1].

The advertising platform's robust performance was driven by a 77.2% year-over-year (YoY) increase in revenue, which exceeded market expectations. The company's EPS beat the forecast by 22.56%, reflecting its ability to control costs and drive profitability despite revenue challenges [2].

AppLovin's core gaming ad business continues to be a significant driver of growth. The company's Max Marketplace, which creates the supply that drives its growth, has consistently seen double-digit growth rates, far outpacing the in-app purchasing gaming market. Additionally, the company's ongoing improvements in models have driven sustainable growth rates beyond market growth rates, further cementing its dominant leadership position.

Looking ahead, AppLovin plans to launch a self-service platform for advertisers in 2026. The company's new Axon Ads Manager, which was quietly launched recently, will serve as the foundation for this platform. The self-service portal aims to reduce friction for advertisers by putting day-to-day controls directly in their hands, enabling credit card billing, and simplifying onboarding through integrations with attribution providers [2].

The company's strong financial health is reflected in its InvestingPro Overall Score of 3.41 (GREAT), supported by robust profit and growth metrics. AppLovin's continued focus on innovation and expansion in both its core and new markets positions it well for future growth.

References:
[1] http://www.baystreet.ca/stockstowatch/21372/Watch-Applovin-Fortinet-and-Eli-Lilly
[2] https://www.investing.com/news/transcripts/earnings-call-transcript-applovin-beats-eps-expectations-in-q2-2025-93CH-4175343