Applovin Analysts See 'Muted Upside,' Cautious On Company's Success Outside Of Gaming

Analysts highlight the strong results from Applovin Corporation (NASDAQ:APP) in the second quarter and look to what's ahead for the advertising company.

The Applovin Analysts:

• Bank of America Securities analyst Omar Dessouky reiterated a Buy rating on Applovin and maintained a price target of $580.
• JPMorgan analyst Cory Carpenter maintained a Neutral rating and raised the price target from $400 to $425.
• Goldman Sachs analyst Eric Sheridan maintained a Neutral rating and raised the price target from $420 to $445.

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Bank of America on APP: Second quarter results were "okay," with a beat driven by gaming, Dessouky said in a new investor note.

"Investor focus shifts squarely to eCommerce ramp," Dessouky said.

The analyst said the third quarter could have "muted upside" and disappoint investors. The analyst said the fourth quarter and next fiscal year could see estimate revisions with the launch of self-serve.

"Nonetheless, APP deserves a significant premium to large-scale online advertising comps because it expects to grow 20-30% Y/Y at a minimum based mobile game advertisers, a market it dominates."

JPMorgan on APP: Carpenter is raising estimates for Applovin after a second quarter that beat estimates and saw third quarter guidance come in ahead of analyst estimates.

"Revenue growth of 9% sequentially came in ahead of the 3-5% guide, but was less upside than prior quarters as mgmt limited onboarding of new e-commerce customers ahead of the self-serve launch," Carpenter said.

The analyst said the highlight from the earnings results was clarity around the self-serve launch strategy.

Applovin plans to launch the self-serve platform for referrals on Oct. 1 with a global launch in the first half of fiscal 2026.

"Advertisers will also be able to buy outside the U.S. for the first time on Oct. 1 and APP plans to leverage paid marketing to recruit new advertisers after the global launch. The paid marketing strategy comes as a surprise."

Carpenter said the self-serve platform is likely to be met with "strong initial demand."

The analyst said Applovin has not proven meaningful scale beyond the gaming sector and there is a risk the company could underperform in a weaker macro environment.

Goldman Sachs on APP: The company's strength of advertising was on display in the second quarter with guidance centered around future product launches, Sheridan said in a new investor note.

The analyst said AppLovin emphasized key areas, including advertising revenue performance, a focus on platform tools for advertisers, and the ability to generate high incremental margins.

"We continue to expect near-term investor debates to be anchored around the trajectory of the eCommerce business scaling in the coming quarters," Sheridan said.

The analyst said it remains to be seen whether Applovin can produce strong growth and margins for ads outside of the gaming landscape.

"We continue to monitor the scaling of the company's platform against the broader advertising shift toward AI enablement."

APP Price Action: Applovin stock is up 13.0% to $441.48 on Thursday versus a 52-week trading range of $66.16 to $525.04. Applovin stock is up 36.7% year-to-date in 2025.

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