01—Abstract
Summary
Summary of the 10-Q filed November 6, 2024. Cited figures are marked; the original filing is the authoritative source.
AppLovin Corporation (APP) demonstrated robust financial performance in the third quarter of 2024, with significant year-over-year growth in revenue and profitability.
Total revenue reached $1.20 billiona, a 39% increase driven primarily by a strong performance in the Software Platform segment, which grew 66% year-over-year. The Apps segment also saw modest growth, contributing to the overall positive trend. Net income surged to $434.4 million, a substantial improvement from $108.6 million in the prior year's quarter, reflecting improved operational efficiencies and strong revenue growth.
The company's operational efficiency is highlighted by a substantial increase in Adjusted EBITDA to $721.6 millionb, up from $419.3 million in Q3 2023, with an improved Adjusted EBITDA margin of 60.2%. This strong profitability has allowed AppLovin to continue investing in innovation and return capital to shareholders, evidenced by substantial share repurchases.
The balance sheet remains solid, with a healthy cash position, though long-term debt has increased. The company's strategic focus on its Software Platform, particularly its AI-powered solutions, appears to be driving significant value for investors.
02—Key points
Key Highlights
- Total revenue for the third quarter of 2024 increased by 39% year-over-year to $1.20 billion.
- Software Platform revenue saw a significant 66% year-over-year increase to $835.2 million, driven by AppDiscovery performance.
- Net income grew substantially to $434.4 million, a significant increase from $108.6 million in the prior year quarter.
- Adjusted EBITDA reached $721.6 million, up 72% year-over-year, with an improved Adjusted EBITDA margin of 60.2%.
- The company repurchased approximately $981.3 million of Class A common stock in the first nine months of 2024.
- Cash and cash equivalents stood at $567.6 million as of September 30, 2024.
- Despite growth, long-term debt increased to $3.47 billion from $2.91 billion at the end of 2023.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2024, AppLovin Corp kept $0.52.
- Revenue$835.2M100.0%
- Cost of revenue−$120.9M14.5%
- Gross profit$714.3M85.5%
- Operating costs−$180.0M21.5%
- Operating income$534.3M64.0%
- Interest, other & tax−$99.9M12.0%
- Net income$434.4M52.0%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed November 6, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $835.19M$864.26M | −3.4% |
| Cost of Revenue | $120.92M$265.05M | −54.4% |
| Gross Profit | $714.27M$599.21M | +19.2% |
| R&D Expenses | $80.78M$159.29M | −49.3% |
| Operating Expenses | $300.89M$677.94M | −55.6% |
| Operating Income | $534.30M$186.32M | +186.8% |
| Net Income | $434.42M$108.64M | +299.9% |
| EPS (Basic) | $1.29$0.32 | +303.1% |
| EPS (Diluted) | $1.25$0.30 | +316.7% |
| Shares Outstanding (Basic) | 336.93M341.44M | −1.3% |
| Shares Outstanding (Diluted) | 348.23M356.91M | −2.4% |
05—Questions
Frequently Asked Questions
What was the primary driver of AppLovin's revenue growth in Q3 2024?
The primary driver of AppLovin's revenue growth in Q3 2024 was the Software Platform segment, which experienced a 66% year-over-year increase in revenue. This growth was largely attributed to improved performance in AppDiscovery, with increases in both net revenue per installation and the volume of installations.
How has AppLovin's profitability changed compared to the prior year?
AppLovin's profitability has significantly improved. Net income increased from $108.6 million in Q3 2023 to $434.4 million in Q3 2024. Adjusted EBITDA also saw a substantial increase of 72% year-over-year, reaching $721.6 million, with the Adjusted EBITDA margin expanding to 60.2% from 48.5% in the prior year.
What is the company's financial position regarding cash and debt?
As of September 30, 2024, AppLovin had $567.6 million in cash and cash equivalents. However, its long-term debt increased to $3.47 billion from $2.91 billion at the end of 2023. The company generated strong operating cash flow, providing liquidity.
How is AppLovin managing its capital through share repurchases?
AppLovin actively returned capital to shareholders through share repurchases. In the first nine months of 2024, the company repurchased approximately $981.3 million of its Class A common stock. The board also authorized an increase to the share repurchase program, demonstrating confidence in the company's financial health.
06—Continue