AppLovin Corp. (NASDAQ:APP) shares are finding fresh momentum Monday morning, pushing through a brutal year-to-date slide driven by mixed earnings and Wall Street skepticism.
- AppLovin shares are climbing with conviction. What’s fueling APP momentum?
September’s Dueling Analyst Upgrades and Downgrades
September has been defined by conflicting analyst color, pulling the stock in multiple directions. The stock faced pressure last week when Edgewater Research issued a cautious note regarding the mobile technology platform, which sent shares tanking. Edgewater analyst Joe Wittine warned that AppLovin’s market-share growth has essentially stalled, calling the equity a “show-me story” and suggesting its MAX platform may be hitting a “functional ceiling”.
Providing more color, Wittine flagged rising competition from Unity as an ongoing threat that is compressing AppLovin’s net revenue spreads. He also noted that the algorithm update management touted for the third quarter offered only “spotty” validation in August, characterizing the apparent recovery as mostly just recouping a decline from July rather than generating genuine net growth.
August Earnings Miss Sets the Baseline
AppLovin in August posted a narrow second-quarter revenue miss. During the August earnings call, management directly addressed the miss, attributing the shortfall specifically to the timing of its platform model enhancements. CEO Adam Foroughi explained that while their models are constantly improving, the company simply did not see the same material uplift in the second-quarter that they normally experience.
However, management offered strongly optimistic commentary looking forward, noting that a significant algorithm uplift materialized immediately after the quarter closed. Foroughi reassured investors that advertiser demand remains highly healthy, the third quarter is already off to a “strong start,” and the business is fully back on its expected growth trajectory.
APP Stock Gains Monday Morning
APP Price Action: AppLovin shares were up 0.35% at $311.83 at the time of publication on Monday. The stock is near its 52-week low of $297.50, according to Benzinga Pro data.
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