Core Viewpoint - AppLovin reported strong Q4 performance with significant revenue and EBITDA growth, exceeding analyst expectations, despite a decline in stock price [1] Financial Performance - Revenue for Q4 increased by 66% year-over-year to $1.66 billion, surpassing analyst expectations of $1.6 billion [1] - Adjusted EBITDA rose by 82% year-over-year to $1.4 billion, with an EBITDA margin of 84% [1] - Earnings per share reached $3.24, exceeding the analyst forecast of $2.95 [1] Future Outlook - For Q1, AppLovin expects revenue to be between $1.745 billion and $1.775 billion, maintaining a high EBITDA margin of 84% [1] - CEO Adam Foroughi emphasized the disconnect between market sentiment and the company's strong fundamentals, highlighting the potential of AI in enhancing content distribution [1]

Core Insights - AppLovin (APP.US) experienced a decline of 5.2% in after-hours trading, with shares priced at $433 [1] Company Summary - AppLovin is an AI marketing platform that has seen a notable drop in its stock price during after-hours trading [1]

Core Viewpoint - AppLovin reported strong Q4 performance with significant revenue and EBITDA growth, but the stock experienced a decline in after-hours trading, indicating a disconnect between market sentiment and the company's fundamentals [1] Financial Performance - AppLovin's Q4 revenue increased by 66% year-over-year to $1.66 billion, surpassing analyst expectations of $1.6 billion [1] - Adjusted EBITDA rose by 82% year-over-year to $1.4 billion, with an EBITDA margin of 84% [1] - Earnings per share reached $3.24, exceeding analyst forecasts of $2.95 [1] Future Outlook - For Q1, AppLovin expects revenue to be between $1.745 billion and $1.775 billion, maintaining an EBITDA margin of 84% [1] Management Commentary - CEO Adam Foroughi emphasized a disconnect between market sentiment and reality, asserting that the explosion of AI-generated content will enhance the company's traffic distribution capabilities [1] - He noted that increased bidding density is expected to boost platform revenues [1]

Market Overview - Major U.S. indices closed lower, with the Dow Jones Industrial Average down 0.13% to 50,121.40, the S&P 500 finishing flat at 6,941.47, and the Nasdaq falling 0.16% to 23,066.46 [1] AppLovin Corporation - AppLovin stock decreased by 3.41% to close at $456.81, trading between an intraday high of $471.97 and a low of $438.18, remaining below its 52-week peak of $745.61 but above its 52-week low of $200.50 [2] McDonald's - McDonald's shares fell 0.85% to finish at $323.21, with an intraday high of $325.20 and a low of $320.81, just under its 52-week high of $328.06 and above its 52-week low of $283.47 [2] Cisco Systems - Cisco Systems stock eased 0.84% to close at $85.54, trading between an intraday high of $87.14 and a low of $85.12, hovering near a 52-week high of $88.18 and well above a 52-week low of $52.11; in after-hours trading, the stock fell 7.3% to $79.26 [3] - Cisco projected third-quarter revenue between $15.4 billion and $15.6 billion, exceeding estimates of $15.18 billion, and adjusted earnings of $1.02 to $1.04 per share, compared to estimates of $1.03 per share; the company also raised its fiscal 2026 revenue guidance to $61.20 billion to $61.7 billion from a prior outlook of $60.20 billion to $61 billion [4] QuantumScape Corporation - QuantumScape stock declined 1.34% to end at $8.82, with an intraday high of $9.13 and a low of $8.60, trading well below its 52-week high of $19.07 but above its 52-week low of $3.40; shares fell nearly 10.5% to $7.89 in extended trading [5] - The company reported a fourth-quarter loss of 17 cents per share, better than the expected 18-cent loss; capital expenditures totaled $12.3 million for the fourth quarter and $36.3 million for the full year 2025, with customer billings reaching $19.5 million for the year [6] AST SpaceMobile - AST SpaceMobile shares increased by 0.68% to close at $96.92, trading between a session high of $102.85 and a low of $93.20, still below its 52-week high of $129.87 but far above its 52-week low of $18.22 [7] - Cisco stock has a Momentum ranking in the 81st percentile and a Value ranking in the 18th percentile according to Benzinga Edge Stock Rankings [7]

Core Viewpoint - Applovin's strong performance demonstrates that the market's fears regarding the "software apocalypse" triggered by AI agents are exaggerated, and that platform software giants focusing on "AI + core operations" will benefit from AI rather than be replaced by it [1][3][9]. Financial Performance - For Q4 2025, Applovin reported total revenue of approximately $1.658 billion, exceeding Wall Street's revised expectations of about $1.61 billion, representing a significant year-over-year growth of 66% [4][5]. - The company's net income for Q4 was approximately $1.102 billion, a substantial increase of 84% year-over-year, with a GAAP EPS of $3.24, surpassing the average analyst expectation of $2.96 [4][5]. - For the full fiscal year 2025, Applovin's total revenue reached about $5.481 billion, a 70% increase from 2024, with net income of approximately $3.334 billion, reflecting a 111% growth [5]. Future Outlook - Applovin's management anticipates Q1 2026 total revenue in the range of $1.745 billion to $1.775 billion, which is significantly higher than the average analyst expectation of around $1.7 billion [6]. - The company has successfully integrated generative AI and deep machine learning into its advertising technology, enhancing revenue and profit growth through its AXON 2.0 engine and MAX/AppDiscovery [6]. Market Context - The software sector has faced significant sell-offs, with the S&P 500 Software and Services Index dropping about 13% since late January, erasing nearly $1 trillion in market value [7]. - Despite fears of AI undermining traditional SaaS models, there is a growing narrative that platform software companies may experience enhanced efficiency and stronger unit economics due to AI [7][9]. Strategic Implications - Companies that manage critical enterprise workloads are likely to benefit from AI technologies, as opposed to being entirely replaced, reinforcing the long-term bullish logic for these platform software firms [9][12]. - Analysts suggest that high-quality software companies embracing AI represent a buying opportunity during market corrections, as they are expected to rebound strongly [11][12].

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Core Viewpoint - Applovin has demonstrated strong performance and future revenue outlook, surpassing Wall Street analysts' expectations, amidst a market narrative that has exaggerated fears regarding AI's impact on software stocks [1][2][3] Financial Performance - For Q4 2025, Applovin reported total revenue of approximately $1.658 billion, a significant increase of 66% year-over-year, exceeding the analyst expectation of around $1.61 billion [3][4] - The net income for Q4 was approximately $1.102 billion, reflecting an 84% year-over-year growth, with GAAP earnings per share at $3.24, well above the expected $2.96 [3][4] - For the full fiscal year 2025, total revenue reached about $5.481 billion, a 70% increase from 2024, with net income of approximately $3.334 billion, up 111% [4] Future Outlook - Applovin's management anticipates Q1 2026 revenue in the range of $1.745 billion to $1.775 billion, indicating a potential sequential growth and exceeding the average analyst expectation of around $1.7 billion [5] - The adjusted EBITDA forecast for Q1 2026 is projected between $1.465 billion and $1.495 billion, also above analyst expectations [5] Market Context - The software sector has faced significant sell-offs, driven by fears of AI disrupting traditional SaaS models, yet Applovin's results counter this narrative, suggesting that platform software companies may benefit from AI rather than be replaced by it [2][6][8] - The introduction of AI tools by competitors like Anthropic has raised concerns about the viability of traditional software models, but Applovin's performance indicates a different trajectory for companies that integrate AI into their core operations [6][7][10] Strategic Positioning - Applovin has successfully embedded generative AI and deep machine learning into its advertising technology, creating a closed-loop system that enhances revenue and profit growth [5][9] - The company exemplifies how platform software can leverage AI to improve operational efficiency and economic metrics, reinforcing the long-term bullish outlook for such firms [9][10]

Core Viewpoint - AppLovin's management emphasizes that competition and AI advancements will not diminish the value of its platform, but rather enhance content supply and discovery, leading to increased opportunities for the company [1][3]. Financial Performance - AppLovin reported Q4 revenue of $1.66 billion, a 66% year-over-year increase, with adjusted EBITDA of $1.4 billion, reflecting an 84% margin [6][7]. - Full-year revenue reached $5.48 billion, up 70% year-over-year, with adjusted EBITDA of $4.51 billion, an 87% increase [8]. - Free cash flow for Q4 was $1.31 billion, up 88% year-over-year, and for the full year, it totaled $3.95 billion, a 91% increase [8]. E-commerce Initiative - AppLovin is expanding its e-commerce push with a self-service platform currently in a referral-only phase, targeting general availability in H1 2026 [4][11]. - The e-commerce business has shown significant growth, with some customers experiencing a "sizable uplift" in spending as models improve [11][13]. Competitive Landscape - Management asserts that higher bid density in the MAX auction can expand the overall advertising market, benefiting publishers and supporting ecosystem growth [2][5]. - AppLovin's MAX auction is viewed as a foundational component of the mobile gaming ecosystem, with the company not fearing competition from larger players like Google LevelPlay [2][5][18]. Capital Returns - The company has been actively repurchasing shares, buying back approximately 800,000 shares for $482 million in Q4 and 6.4 million shares for $2.58 billion over the full year [9]. - The share repurchase program is funded entirely by free cash flow, with about $3.28 billion remaining under its authorization [9]. Future Outlook - AppLovin plans to focus on model improvement, expanding advertiser diversity, and a controlled ramp of self-service and marketing initiatives, particularly leveraging AI-driven creative generation [19].

Core Viewpoint - AppLovin's stock is experiencing a significant decline following the release of its Q4 2025 financial results, which, despite beating analyst expectations, have not satisfied investor sentiment [1][4]. Financial Performance - AppLovin reported Q4 2025 revenue of $1.66 billion, marking a 66% year-over-year increase, and diluted EPS of $3.24, an 87% year-over-year increase, surpassing analyst expectations of $1.61 billion in sales and EPS of $2.94 [4]. - The company generated free cash flow of $1.31 billion in Q4 2025, compared to $695.2 million in the same period of 2024 [4]. Future Projections - For Q1 2026, AppLovin projects revenue between $1.745 billion and $1.775 billion, indicating an 18.6% year-over-year sales growth at the midpoint [5]. - The projected adjusted EBITDA for Q1 2026 is between $1.465 billion and $1.495 billion, suggesting a 47.3% growth at the midpoint [5]. Market Sentiment - Despite strong financial results, investors are concerned about AppLovin's high stock valuation, with shares trading at 45.9 times operating cash flow, significantly above the five-year average of 19.7 [6]. - The stock had risen nearly 12% in the days leading up to the earnings report, but the current valuation is viewed as excessive given the Q1 2026 forecast [6]. Investment Alternatives - For investors interested in adtech but cautious about AppLovin's valuation, there are numerous other adtech stocks available for consideration [7].

AppLovin (APP) came out with quarterly earnings of $3.24 per share, beating the Zacks Consensus Estimate of $2.89 per share. This compares to earnings of $1.73 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of +12.12%. A quarter ago, it was expected that this mobile app technology company would post earnings of $2.37 per share when it actually produced earnings of $2.45, delivering a surprise of +3.38%.Over the last four quarter ...