AppLovin’s revenue exceeded all analysts’ forecasts

02/09/2023

1 minute read

2023.02.09 09:46

By Kristina Sobol

Budrigannews.com – AppLovin shares (NASDAQ:) are up about 30% in pre-market Thursday following the mobile application technology company’s better-than-expected revenue forecast and forecast for the new fiscal year’s first quarter.

APP reported a loss per share of $0.21 on $702 million in revenue, which was lower than the analyst consensus of $0.05 on $691.5 million in revenue. However, adjusted EBITDA was $259.6 million higher than the $253.7 million consensus.

“In the fourth quarter, our company performed as anticipated, with steady results in our Software Platform segment and near completion of the operational optimization of our Apps segment.

In comparison to the third quarter, underlying trends in the mobile gaming and app market remained moderate but stable. In a letter to shareholders, the company stated, “We continue to invest in our strong team who are expanding our leading ad solutions, improving our Apps portfolio, and pursuing several growth initiatives.”

Morgan Stanley analysts stated that shares are up sharply as the Q4 earnings report and guidance show signs of business stability. On the guidance front, the company sees Q1 revenue of $695 million (up or down $10 million), beating the consensus for revenue of $687.2 million. Additionally, the company sees Q1 adjusted EBITDA in the range of $250 million to 270 million.

“App’s solid results in the fourth quarter were slightly ahead of expectations, but the sequential stability in the guidance for the first quarter was a pleasant surprise. “Stability counts as a win in this environment and is a modestly positive read-through for U,” the analysts wrote in a note. “We remain cautious on the in-app advertising market in ’23.”

Analysts at BTIG added:

“With “soft, but stable” trends translating into steady q/q Software performance and better-than-feared forward guidance, the mobile gaming market appears to be in a holding pattern.”