AppLovin's Q2 2025: Conflicting Signals on E-Commerce Growth and Advertiser Strategies

E-commerce revenue projections, advertiser acquisition strategy, self-serve platform launch and impact, web advertiser onboarding and model performance are the key contradictions discussed in AppLovin's latest 2025Q2 earnings call.



Record Revenue and EBITDA Growth:
- AppLovin Corporation reported revenue of approximately $1.260 billion for Q2, marking a 77% year-over-year increase, with an impressive adjusted EBITDA margin of 81%, achieving nearly $1.020 billion in adjusted EBITDA.
- The growth was driven by strong performance in gaming advertising, improved technology, and increased demand, particularly in the core gaming business.

Core Gaming Performance and Growth Opportunities:
- The gaming business experienced a 30% to 40% growth rate, contributing significantly to AppLovin's revenue, with plans to sustain 20% to 30% year-over-year growth driven solely by gaming.
- The growth is attributed to advancements in optimization technology and expansion of supply through the MAX marketplace.

Launch of AXON Ads Manager and Platform Expansion:
- AppLovin announced the launch of AXON ads manager, a self-service platform set to open on a referral basis on October 1, with a global public launch planned by mid-2026.
- The expansion is driven by the expectation that opening the platform to all businesses, regardless of size and location, will create significant demand and drive predictable compounding growth.

E-commerce Growth and Referral Program:
- The e-commerce category grew to approximately 10% of AppLovin's revenue, with plans to increase this proportion through the launch of the AXON platform.
- The growth is supported by the upcoming referral program, which will increase advertiser count and facilitate market expansion beyond gaming.