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AppLovin Crushes Earnings: Time to Buy the Stock?

AppLovin ((APP - Free Report) ) delivered another blowout quarter, solidifying its position as one of the most profitable and efficiently run companies in the market today. The firm reported earnings of $2.45 per share, topping estimates of $2.37, on revenue of $1.41 billion, above expectations of $1.34 billion. While peers like Palantir Technologies ((PLTR - Free Report) ) and Robinhood Markets ((HOOD - Free Report) ), among others, also posted earnings beats only to see their stocks slide, AppLovin shares are climbing. It seems they may be doing something special.

Management revealed during the earnings call that AppLovin’s self-service ad platform, launched October 1, is already showing early momentum, with spending from new advertisers rising roughly 50% week-over-week. The company plans to broaden access in 2026, with onboarding and customer support increasingly handled by AI agents. CEO Adam Foroughi also highlighted experiments in generative AI for automated ad creation, potentially driving higher engagement and conversion rates over time.

Financially, the results were exceptional: revenue up 68% year-over-year, adjusted EBITDA up 79% to $1.16 billion at 82% margins, and free cash flow up 92% to over $1 billion. The firm also repurchased $571 million in shares and expanded its buyback authorization by $3.2 billion. The market may be sniffing out more bullish catalysts as there is also a clear technical setup to watch as momentum builds.

Zacks Investment Research
Image Source: Zacks Investment Research

Shares of AppLovin Near Break Out

After a sharp pullback in early October, triggered by what now appears to be an unfounded short-seller accusation, AppLovin stock has spent the past several weeks consolidating in a range. The price action is forming a clear bull flag pattern, suggesting healthy digestion of gains within an ongoing uptrend.

While broader market volatility could extend this consolidation phase, traders should monitor the upper boundary of the range for a breakout signal. The stock’s relative strength is notable, and if the market can firm up, I believe AppLovin may emerge as a market leader again.

TradingView
Image Source: TradingView

Should Investors Buy APP Stock?

Unlike Palantir or Robinhood, which seem to be trading more on narrative and sentiment swings, AppLovin is delivering tangible growth backed by expanding margins and massive free cash flow. Its combination of operational discipline, AI-driven efficiency, and shareholder friendly buybacks gives it a fundamentally different profile than most of its growth-oriented peers.

If Palantir represents the promise of AI and Robinhood the cyclical volatility of retail trading, AppLovin is quietly executing on both innovation and profitability. With a new self-service platform scaling faster than expected and generative AI tools set to enhance performance advertising, the company has multiple tailwinds heading into year end and 2026.

For investors seeking exposure to AI’s practical and commercial upside, and with real earnings power, AppLovin stands out. The stock’s current consolidation could prove to be a launchpad in one of the most compelling names in the market.


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