Core Viewpoint - AppLovin has experienced significant stock price volatility following its Q2 2025 earnings release, with a notable initial drop of 13% in after-hours trading, which later stabilized and even rebounded by over 10% the following day as investors reassessed the results and management's commentary [2][12]. Financial Performance - In Q2 2025, AppLovin reported revenues of approximately $1.26 billion, reflecting a 77% increase compared to Q2 2024, although this figure was below Wall Street's expectation of $1.37 billion [4]. - The diluted earnings per share (EPS) for the quarter was $2.26, exceeding the estimate of $2.05 and representing a substantial 163% increase year-over-year [5]. - The company achieved an EBITDA margin of 81%, a significant improvement from 67.7% in Q1 2025, following the sale of its Apps business [5][6]. - AppLovin's free cash flow margin was just under 61%, with a last-12-months free cash flow margin of 66%, the highest among large-cap U.S. software stocks [6]. E-Commerce Strategy - AppLovin is focusing on expanding into the e-commerce market, reporting an annual run rate of $1 billion with around 600 customers [7]. - The company has intentionally limited the onboarding of new advertisers in e-commerce to enhance product quality, with plans to resume onboarding on October 1, 2025, requiring referrals from existing customers [8][10]. - AppLovin is currently less than 1% penetrated in the e-commerce sector, indicating substantial growth potential [11]. Analyst Outlook - Analysts have raised their price targets for AppLovin, with Morgan Stanley and Piper Sandler setting targets at $480 and $500, respectively, suggesting significant upside potential [13]. - Despite the mixed Q2 results, analysts remain optimistic about AppLovin's future, particularly regarding its e-commerce initiatives [12].

Core Viewpoint - AppLovin has demonstrated significant growth and strong performance in Q2, leading to a notable increase in stock price and investor interest [1][2]. Financial Performance - Q2 sales increased by 16% year over year to $1.25 billion, surpassing estimates of $1.21 billion by 4% [2]. - Q2 earnings per share (EPS) rose 154% from $0.89 to $2.26, exceeding EPS expectations of $1.99 by 13% [3]. - AppLovin has achieved over $1 billion in sales for six consecutive quarters [2]. Future Guidance - For Q3, AppLovin expects sales between $1.32 billion and $1.34 billion, above the Zacks Consensus of $1.31 billion, indicating a 9% growth [4]. - The company forecasts Q3 adjusted EBITDA at $1.07 billion to $1.09 billion, maintaining an 81% margin [4]. Market Position and Valuation - AppLovin's stock has surged nearly 1000% over the last three years, with a recent spike of +16% in trading [1]. - The stock currently trades at 46.5X forward earnings, compared to the S&P 500's 24.2X and the industry average of 21X [9]. - In terms of price-to-forward-sales, AppLovin trades at a high premium of 24.8X against the S&P 500's 5.4X and the industry average of 2.1X [9]. Technical Analysis - AppLovin's stock has recently surpassed its 50-day simple moving average (SMA) of $365, indicating short-term strength [8]. - The stock remains above its 200-day SMA of $331, which may present a buying opportunity for investors [8]. Investment Outlook - AppLovin holds a Zacks Rank 3 (Hold), suggesting potential for continued growth, but future upside may depend on positive earnings estimate revisions following the favorable Q2 report [13].

Core Viewpoint - AppLovin's stock has experienced a significant rally following better-than-expected earnings for Q2, driven by growth from artificial intelligence technology in mobile advertising [1] Group 1: Financial Performance - AppLovin shares surged 11% after the earnings report and are up 34% year-to-date, having increased more than eightfold in 2024 [1] - The company is benefiting from advancements in AI technology that enhance advertisers' targeting capabilities in mobile games [1] Group 2: Legal Context - CEO Adam Foroughi indicated potential for further growth linked to the ongoing legal issues between Apple and Epic Games, which may impact the advertising landscape [2] - A recent ruling found that Apple violated a previous court order, necessitating changes to its linking out policy under California law [2] - The U.S. Court of Appeals for the Ninth Circuit denied Apple's emergency application to halt changes to its App Store, further complicating the situation for Apple [3] Group 3: Market Dynamics - Foroughi noted that gaming companies have not yet altered their user acquisition spending in response to the Epic case, suggesting that any significant changes may take longer than anticipated, with benefits expected in four to eight quarters [4]

Core Insights - AppLovin Corp (APP) reported second-quarter earnings that exceeded analyst expectations for earnings per share but fell short on revenue [1] - The company's shares experienced a significant increase of 13.2% following the earnings announcement [1] Financial Performance - Second-quarter revenue was reported at $1.26 billion, which was below the analyst estimates of $1.31 billion [1] - Earnings per share for the second quarter were $2.39, surpassing analyst expectations of $2.04 [1] Analyst Ratings and Price Targets - Piper Sandler analyst James Callahan maintained an Overweight rating and raised the price target from $470 to $500 [6] - Wells Fargo analyst Alec Brondolo also maintained an Overweight rating, increasing the price target from $405 to $480 [6] - Morgan Stanley analyst Matthew Cost kept the stock at Overweight and raised the price target from $460 to $480 [6] - Scotiabank analyst Nat Schindler maintained a Sector Outperform rating and increased the price target from $430 to $450 [6]

盘前市场动向 1. 8月7日(周四)美股盘前，美股三大股指期货齐涨。截至发稿，道指期货涨0.54%，标普500指数期货涨0.61%，纳指期货涨 0.74%。 市场消息 俄美首脑峰会在即，外交曙光提振全球市场。克里姆林宫周四宣布，俄罗斯总统弗拉基米尔·普京与美国总统唐纳德·特朗普将于 未来几天内举行峰会会谈。克里姆林宫外交政策顾问尤里·乌沙科夫向记者表示，俄美双方已就会议地点达成一致，"正与美国同 事共同推进具体议题磋商"，目标是下周举行会谈。他同时透露，峰会举办地将在后续公布。消息公布后，欧洲股市及美国股指 期货应声上涨。 美联储三官员齐发警告：劳动力市场持续疲软，9月降息预期升温。旧金山联储主席戴利指出，当前劳动力市场已显现疲软迹 象，若进一步恶化将引发政策调整需求。美联储理事库克表示，前三个月就业数据累计下调近26万个岗位(其中7月新增就业仅 7.3万个)，这种大幅修正往往是经济周期转折的典型特征。明尼阿波利斯联储主席卡什卡利更是直言："经济正在放缓，短期内 启动联邦基金利率调整是合适的。" "旺季已过"?汇丰预计美股盈利增长将在下半年踩刹车。汇丰表示，美股又经历了一轮业绩大爆发的财报季，标普500指数在 ...

Core Insights - AppLovin (APP) reported quarterly earnings of $2.26 per share, exceeding the Zacks Consensus Estimate of $1.99 per share, and showing a significant increase from $0.89 per share a year ago, representing an earnings surprise of +13.57% [1] - The company achieved revenues of $1.26 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 3.74% and up from $1.08 billion year-over-year [2] - AppLovin's stock has increased approximately 16.7% since the beginning of the year, outperforming the S&P 500's gain of 7.1% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $2.18 on revenues of $1.31 billion, and for the current fiscal year, it is $8.39 on revenues of $5.51 billion [7] - The estimate revisions trend for AppLovin was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Technology Services industry, to which AppLovin belongs, is currently ranked in the top 41% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Data and Key Metrics Changes - In Q2 2025, revenue increased by 77% year-over-year to approximately $1.26 billion, while adjusted EBITDA nearly doubled to $1.02 billion, achieving an 81% adjusted EBITDA margin [13][14]. - Free cash flow reached $768 million, up 72% year-over-year, with a slight decrease from the previous quarter due to timing of bond interest payments and taxes [14][15]. - The company ended the quarter with $1.2 billion in cash and cash equivalents, including $425 million from the sale of its apps business [14]. Business Line Data and Key Metrics Changes - The majority of revenue growth was driven by the core gaming business, which continues to grow at a rate of 30% to 40% [14][36]. - E-commerce, while performing well, was constrained in onboarding new customers to prepare for the self-serve launch, maintaining around 10% of the business [36][37]. Market Data and Key Metrics Changes - The Max Marketplace has consistently shown double-digit growth, outpacing the in-app purchasing gaming market growth rates of 3% to 5% [6][24]. - The company plans to open its platform to most major international markets on October 1, 2025, expanding its reach beyond the United States [10][38]. Company Strategy and Development Direction - The company is focused on expanding its platform with the launch of the Axon Ads Manager, which aims to simplify the advertising process and enhance user experience [8][11]. - The strategy includes building world-class products and launching them when they meet high standards, with a goal of achieving 20% to 30% year-over-year growth driven by gaming and expanding into new markets [6][12]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining strong growth rates due to improvements in technology and demand, with expectations of significant opportunities outside the core gaming market [5][7]. - The company anticipates a substantial ramp-up in e-commerce as it opens its platform to new advertisers, particularly during the holiday shopping season [36][37]. Other Important Information - The company has been actively managing its share count, reducing the weighted average diluted common shares outstanding from 346 million to 342 million [15]. - The self-service platform is expected to significantly increase advertiser count and revenue, with a referral-based opening planned for Q4 2025 [32][33]. Q&A Session Summary Question: Plans for paid marketing to acquire advertisers - Management indicated that the decision to start paid marketing is driven by the strong performance of their platform and the potential to reach small businesses globally [18][20]. Question: Supply growth and mediation share - Management clarified that supply growth is driven by improvements in technology and demand rather than taking share from other platforms, with the Max mediation platform experiencing swift growth [23][24]. Question: Impact of self-serve platform on overall business - Management expects the self-serve platform to have a material impact, particularly as it allows for rapid onboarding of new advertisers and increased revenue [28][33]. Question: E-commerce contribution to growth - Management confirmed that e-commerce remains around 10% of the business, with growth limited by the onboarding process but expected to ramp up significantly in Q4 [36][37]. Question: International expansion and customer onboarding - Management anticipates a gradual increase in international customer onboarding, leveraging existing relationships and referrals from current advertisers [109][110]. Question: User acquisition spend changes post-Apple vs. Epic lawsuit - Management noted no immediate changes in user acquisition spend from gaming companies, expecting a gradual impact over the next few quarters [97][99]. Question: Capital allocation strategy - The company plans to continue investing in organic growth initiatives and return capital to shareholders through share buybacks [101]. Question: Differences in onboarding international customers - Management indicated that onboarding will be broad-reaching, with no constraints on the types of advertisers as the platform opens up [111][112].

Financial Data and Key Metrics Changes - In Q2 2025, revenue increased by 77% year-over-year to approximately $1.26 billion, while adjusted EBITDA nearly doubled to $1.02 billion, achieving an 81% adjusted EBITDA margin [12][14]. - Free cash flow reached $768 million, up 72% year-over-year, with cash and cash equivalents totaling $1.2 billion, including $425 million from the sale of the apps business [13][14]. - The company anticipates Q3 2025 advertising revenue between $1.003 billion and $1.34 billion, with adjusted EBITDA between $1.007 billion and $1.09 billion, targeting an 81% adjusted EBITDA margin [14][15]. Business Line Data and Key Metrics Changes - The majority of revenue growth was driven by the core gaming business, while e-commerce performance was strong but limited due to constrained onboarding of new customers in preparation for the self-serve launch [12][13]. - Gaming continues to grow at a rate of 30% to 40%, exceeding the long-term goal of 20% to 30% [39]. Market Data and Key Metrics Changes - The Max Marketplace has consistently shown double-digit growth, significantly outpacing the in-app purchasing gaming market growth rates of 3% to 5% [5][24]. - The company plans to open its platform to most major international markets on October 1, 2025, expanding beyond the current U.S.-only web advertising campaigns [8][41]. Company Strategy and Development Direction - The company is focused on expanding its platform with the launch of the Axon Ads Manager, which aims to simplify the advertising process for businesses of all sizes [6][9]. - The strategy includes building world-class products and launching them when they meet high standards, with a focus on patient and disciplined execution for sustainable growth [11]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining 20% to 30% year-over-year growth driven by gaming, while also excited about opportunities to expand outside the core market [5][11]. - The company anticipates a substantial ramp-up in e-commerce as the holiday shopping season approaches, with expectations for increased advertiser onboarding [40]. Other Important Information - The company closed the sale of its apps business to Triple Dot Studios, with financial results for the apps business included in discontinued operations [12]. - The company repurchased approximately 900,000 shares for a total cost of $341 million, reducing the weighted average diluted common shares outstanding [14]. Q&A Session Summary Question: Plans for paid marketing to acquire advertisers - Management indicated that the decision to start paid marketing is driven by the strong performance of their platform and the potential to reach small businesses globally, utilizing their own advertising models for recruitment [17][20][22]. Question: Supply growth in the Max Marketplace - Management clarified that supply growth is driven by improvements in technology and demand, rather than taking share from other platforms, with the audience inside Max growing swiftly [24][25]. Question: Impact of self-serve platform launch - Management expects the self-serve platform to significantly increase advertiser count and drive growth, with a referral-based opening planned for Q4 2025 [31][36]. Question: E-commerce contribution to revenue - Management confirmed that e-commerce is expected to remain around 10% of the business for the year, with limited onboarding impacting growth rates [39][40]. Question: International expansion and onboarding pace - Management anticipates a gradual increase in international onboarding as the platform opens up, with a mix of referrals from existing customers [100][105].

Financial Performance - Revenue for the three months ended June 30, 2025, increased 77% year-over-year to $1.3 billion, up from $711 million in the same period of 2024[111] - Net income for the three months ended June 30, 2025, was $819.5 million, compared to $310 million for the same period in 2024, reflecting a significant increase[111] - Adjusted EBITDA for the three months ended June 30, 2025, was $1.0 billion, up from $511.2 million in the same period of 2024, indicating strong operational performance[111] - Revenue for Q2 2025 reached $1,258.8 million, a 77% increase from $711.0 million in Q2 2024, driven by improved AppDiscovery performance[150] - For the first half of 2025, revenue increased by $1.0 billion, or 74%, compared to the same period in 2024, primarily due to a 59% increase in net revenue per installation and a 15% increase in installation volume[151] - Net income from continuing operations for Q2 2025 was $771.9 million, compared to $301.0 million in Q2 2024, marking a significant improvement in profitability[147] Cash Flow and Investments - Free Cash Flow for the six months ended June 30, 2025, was $1.6 billion, compared to $833.1 million for the same period in 2024, demonstrating improved cash generation[124] - Net cash provided by operating activities for the six months ended June 30, 2025 was $1,603.9 million, significantly higher than $847.3 million in the same period in 2024, primarily due to increased cash collection from customers[172] - Net cash provided by investing activities for the six months ended June 30, 2025 was $378.9 million, primarily driven by proceeds from divestiture[175] - Net cash used in financing activities for the six months ended June 30, 2025 was $1,539.6 million, primarily due to $1.3 billion in stock repurchases[177] - During the six months ended June 30, 2025, the company repurchased 3,663,841 shares of Class A common stock for an aggregate amount of $1.3 billion[180] - As of June 30, 2025, $1.0 billion remained available for repurchases under the stock repurchase program[180] - In February 2025, the Board modified the stock repurchase program to make $500.0 million immediately available for share repurchase[180] Expenses and Cost Management - Cost of revenue for Q2 2025 was $155.1 million, up from $121.8 million in Q2 2024, reflecting ongoing growth in business operations[147] - Sales and marketing expenses for Q2 2025 were $46.9 million, down from $67.0 million in Q2 2024, indicating a strategic shift in spending[147] - Research and development expenses decreased to $44.0 million in Q2 2025 from $99.1 million in Q2 2024, suggesting improved efficiency in R&D investments[147] - General and administrative expenses increased to $55.0 million in Q2 2025 from $38.7 million in Q2 2024, reflecting investments to support business growth[147] - Cost of revenue for the three months ended June 30, 2025 increased by $33.3 million, or 27%, to $155.1 million compared to the same period in 2024, primarily due to increased network infrastructure expenses[152] - Sales and marketing expenses for the three months ended June 30, 2025 decreased by $20.0 million, or 30%, to $67.0 million compared to the same period in 2024, mainly due to a reduction in personnel-related expenses[156] - Research and development expenses for the three months ended June 30, 2025 decreased by $55.1 million, or 56%, to $44.0 million compared to the same period in 2024, primarily due to a decrease in personnel-related expenses[158] - General and administrative expenses for the three months ended June 30, 2025 increased by $16.3 million, or 42%, to $55.0 million compared to the same period in 2024, driven by higher bad debt expenses and professional services costs[160] Strategic Initiatives - The company completed the sale of its Apps Business to Tripledot for $400 million in cash on June 30, 2025, enhancing its focus on core operations[113] - The company plans to continue investing in AI-powered advertising solutions, including the AXON recommendation engine, to enhance client effectiveness[127] - The company aims to expand its client base beyond mobile gaming, targeting sectors like e-commerce and connected TV (CTV) for future growth[130] - Strategic partnerships and potential acquisitions, including an indication of interest to purchase TikTok outside of China, are being explored to drive growth[131] Tax and Accounting - The effective tax rate may vary based on the proportion of foreign to domestic income and changes in tax laws, impacting overall financial results[145] - Provision for income taxes for the three months ended June 30, 2025 increased by $95.3 million to $112.1 million compared to the same period in 2024, driven by higher pre-tax income[167] - The company has not experienced any material changes to its critical accounting estimates during the six months ended June 30, 2025[184] - The preparation of the condensed consolidated financial statements requires the company to make estimates and assumptions that affect reported amounts[182] - The company evaluates its accounting estimates based on reasonable assumptions and acknowledges that actual results could differ materially[182] - The company’s accounting estimates are considered critical if they involve significant subjectivity and judgment[183] - There have been no material changes in market risk from the information presented in the Annual Report for the year ended December 31, 2024[186]

Exhibit 99.1 PALO ALTO – August 6, 2025 – AppLovin Corporation (NASDAQ: APP) ("AppLovin"), a leading marketing platform, today announced financial results for the quarter ended June 30, 2025 and posted a financial update on its Investor Relations website located at https://investors.applovin.com. Second Quarter 2025 Financial Highlights: | (In millions, except percentages) | Quarter Ended June 30, | | | Six Months Ended June 30, | | | | --- | --- | --- | --- | --- | --- | --- | | | 2025 | 2024 | % Change | ...