AppLovin Announces Fourth Quarter and Full Year 2025 Financial Results

PALO ALTO, Calif.--( BUSINESS WIRE)--AppLovin Corporation (NASDAQ: APP) (“AppLovin”), a leading marketing platform, today announced financial results for the quarter and full year ended December 31, 2025 and posted a financial update on its Investor Relations website located at https://investors.applovin.com.

Fourth Quarter and Full Year 2025 Financial Highlights:

Quarter Ended

Year Ended

December 31,

(In millions, except percentages)

2025

2024

% Change

2025

2024

% Change

Revenue

1,658

999

5,481

3,224

Net Income

1,102

599

3,334

1,580

111

Net Income from Continuing Operations

1,102

596

3,433

1,590

116

Adjusted EBITDA

1,399

770

4,512

2,412

Additional Financial Highlights:

First Quarter 2026 Financial Guidance Summary 2

1Q26

(In millions, except percentages)

Low

High

Revenue

1,745

1,775

Adjusted EBITDA

1,465

1,495

Adjusted EBITDA Margin

Webcast and Conference Call

AppLovin will host a webinar today at 2:00 PM PT / 5:00 PM ET, during which management will discuss the Company’s fourth quarter and full year 2025 results and provide commentary on its business performance. A question-and-answer session will follow the prepared remarks.

The webinar may be accessed on the Company’s investor relations website or via webinar registration. A replay of the webinar will also be available under the Events & Presentations section of our Investor Relations website.

About AppLovin

AppLovin makes technologies that help businesses of every size connect to their ideal customers. The company provides end-to-end software and AI solutions for businesses to reach, monetize and grow their global audiences. For more information about AppLovin, visit: www.applovin.com.

Source: AppLovin Corp.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “going to,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, priorities, plans, or intentions. Forward-looking statements in this press release include our expected financial results and guidance. Our expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties, including changes in our plans or assumptions, which could cause actual results to differ materially from those projected. These risks include our inability to forecast our business effectively, the macroeconomic environment, fluctuations in our results of operations, our ability to execute on our operational and financial priorities, our ability to scale our business to support new users, the competitive advertising ecosystem, and our inability to adapt to emerging technologies and business models. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in our Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2025. Additional information will also be set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. The forward-looking statements in this press release are based on information available to us as of the date hereof, and we disclaim any obligation to update any forward-looking statements, except as required by law.

Non-GAAP Financial Measures

To supplement our financial information presented in accordance with generally accepted accounting principles in the United States (“GAAP”), this press release includes certain financial measures that are not prepared in accordance with GAAP, including Adjusted EBITDA, Adjusted EBITDA margin, and Free Cash Flow. A reconciliation of each such non-GAAP financial measure to the most directly comparable GAAP measure can be found below.

We define Adjusted EBITDA for a particular period as net income adjusted for loss from discontinued operations, net of income taxes, interest expense and loss on settlement of debt, other income, net (excluding certain recurring items), provision for (benefit from) income taxes, amortization, depreciation and write-offs and as further adjusted for non-operating foreign exchange (gain) loss, stock-based compensation, transaction-related expense, restructuring costs, as well as certain other items that we believe are not reflective of our core operating performance. We define Adjusted EBITDA margin as Adjusted EBITDA divided by revenue for the same period.

We define Free Cash Flow as net cash provided by operating activities less purchases of property and equipment and principal payments on finance leases. We subtract both purchases of property and equipment and payment of finance leases in our calculation of Free Cash Flow because we believe these items represent our ongoing requirements for property and equipment to support our business, regardless of whether we utilize a finance lease to obtain such property or equipment.

We believe that the presentation of these non-GAAP financial measures provides useful information to investors regarding our results of operations and operating performance, as they are similar to measures reported by our public competitors and are regularly used by securities analysts, institutional investors, and other interested parties in analyzing operating performance and prospects.

Adjusted EBITDA and Adjusted EBITDA margin are key measures we use to assess our financial performance and are also used for internal planning and forecasting purposes. We believe Adjusted EBITDA and Adjusted EBITDA margin are helpful to investors, analysts, and other interested parties because they can assist in providing a more consistent and comparable overview of our operations across our historical financial periods. We use Adjusted EBITDA and Adjusted EBITDA margin in conjunction with GAAP measures as part of our overall assessment of our performance, including the preparation of our annual operating budget and quarterly forecasts, to evaluate the effectiveness of our business strategies, and to communicate with our board of directors concerning our financial performance. We use Free Cash Flow in addition to GAAP measures to help manage our business and prepare budgets and annual planning, and we believe Free Cash Flow provides useful supplemental information to help investors understand underlying trends in our business and our liquidity.

These measures have certain limitations in that they do not include the impact of certain expenses that are reflected in our consolidated statement of operations that are necessary to run our business. Free Cash Flow reflects cash flows from both of continuing and discontinued operations. Our definitions may differ from the definitions used by other companies and therefore comparability may be limited. In addition, other companies may not publish these or similar metrics. Thus, our non-GAAP financial measures should be considered in addition to, not as substitutes for, or in isolation from, measures prepared in accordance with GAAP.

AppLovin Corporation

Consolidated Balance Sheets

(In thousands, except per share data)

(Unaudited)

As of December 31,

2025

2024

Assets

Current assets:

Cash and cash equivalents

2,487,096

697,030

Accounts receivable, net

1,819,366

1,283,335

Prepaid expenses and other current assets

124,330

140,470

Current assets of discontinued operations

—

191,355

Total current assets

4,430,792

2,312,190

Property and equipment, net

122,445

159,970

Operating lease right-of-use assets

25,457

36,473

Goodwill

1,539,986

1,457,685

Intangible assets, net

396,714

472,851

Equity method investments

287,666

—

Other assets

456,550

492,841

Non-current assets of discontinued operations

—

937,249

Total assets

7,259,610

5,869,259

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable

746,977

504,302

Accrued and other current liabilities

572,868

401,531

Operating lease liabilities, current

13,943

14,526

Current liabilities of discontinued operations

—

137,113

Total current liabilities

1,333,788

1,057,472

Long-term debt

3,512,987

3,508,983

Operating lease liabilities, non-current

17,811

31,101

Other non-current liabilities

260,353

180,471

Non-current liabilities of discontinued operations

—

1,414

Total liabilities

5,124,939

4,779,441

Stockholders’ equity:

Preferred stock, $0.00003 par value—100,000 shares authorized, no shares issued and outstanding as of December 31, 2025 and 2024

—

Class A, Class B, and Class C Common Stock, $0.00003 par value—1,850,000 (Class A 1,500,000, Class B 200,000, Class C 150,000) shares authorized, 338,313 (Class A 307,955, Class B 30,358, Class C nil) and 340,042 (Class A 309,353, Class B 30,689, Class C nil) shares issued and outstanding as of December 31, 2025 and 2024, respectively

Additional paid-in capital

446,550

593,699

Accumulated other comprehensive loss

(46,987

)

(103,096

)

Retained earnings

1,735,097

599,204

Total stockholders’ equity

2,134,671

1,089,818

Total liabilities and stockholders’ equity

7,259,610

5,869,259

AppLovin Corporation

Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)

Quarter Ended December 31,

Year Ended December 31,

2025

2024

2025

2024

Revenue

1,657,944

999,487

5,480,717

3,224,058

Costs and expenses:

Cost of revenue .

183,529

153,393

665,140

520,613

Sales and marketing

48,776

62,004

203,651

252,863

Research and development

82,220

105,863

226,510

374,710

General and administrative

68,176

49,893

233,502

164,916

Total costs and expenses

382,701

371,153

1,328,803

1,313,102

Income from operations

1,275,243

628,334

4,151,914

1,910,956

Other income (expense):

Interest expense and loss on settlement of debt .

(51,290

)

(93,929

)

(207,016

)

(317,209

)

Other income, net .

29,401

323

8,012

18,196

Total other expense, net

(21,889

)

(93,606

)

(199,004

)

(299,013

)

Income before income taxes

1,253,354

534,728

3,952,910

1,611,943

Provision for (benefit from) income taxes

151,098

(61,384

)

519,715

22,419

Net income from continuing operations .

1,102,256

596,112

3,433,195

1,589,524

Income (loss) from discontinued operations, net of income taxes

—

3,092

(99,444

)

(9,748

)

Net income

1,102,256

599,204

3,333,751

1,579,776

Net income (loss) per share attributed to Class A and Class B common stockholders - Basic:

Continuing operations

3.26

1.76

10.13

4.71

Discontinued operations .

—

0.01

(0.29

)

(0.03

)

Basic net income per share .

3.26

1.77

9.84

4.68

Net income (loss) per share attributed to Class A and Class B common stockholders - Diluted:

Continuing operations

3.24

1.72

10.04

4.56

Discontinued operations .

—

0.01

(0.29

)

(0.03

)

Diluted net income per share

3.24

1.73

9.75

4.53

Weighted-average common shares used to compute net income (loss) per share attributable to Class A and Class B common stockholders:

Basic .

338,159

339,168

338,781

336,922

Diluted .

339,898

346,424

341,970

347,808

AppLovin Corporation

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

Year Ended December 31,

2025

2024

Operating Activities

Net income .

$ 3,333,751

$ 1,579,776

Adjustments to reconcile net income to net cash provided by operating activities:

Amortization, depreciation and write-offs

194,778

448,680

Goodwill impairment

188,943

—

Stock-based compensation, excluding cash-settled awards

210,421

369,367

Gain on divestiture, net of transaction costs

(106,229)

—

Impairment of investments

50,000

—

Loss on settlement of debt

—

28,375

Change in operating right-of-use assets

12,295

12,689

Other

9,213

9,663

Changes in operating assets and liabilities: .

Accounts receivable

(542,219)

(467,028)

Prepaid expenses and other assets

134,658

(185,331)

Accounts payable

232,486

189,585

Operating lease liabilities

(15,229)

(14,106)

Accrued and other liabilities

268,226

127,341

Net cash provided by operating activities .

3,971,094

2,099,011

Investing Activities

Purchase of intangible assets

(28,318)

(25,553)

Purchase of non-marketable equity securities

(20,178)

(76,983)

Proceeds from divestiture, net of cash divested

407,297

—

Other investing activities

(373)

(4,218)

Net cash provided by (used in) investing activities

358,428

(106,754)

Financing Activities

Repurchases of common stock

(2,191,944)

(981,297)

Payments of withholding taxes related to net share settlement

(392,410)

(1,143,525)

Principal repayments of debt

(200,000)

(4,225,223)

Principal payments of finance leases

(18,669)

(20,875)

Payments of licensed asset obligation

(13,532)

—

Payments of debt issuance cost

(1,843)

(35,563)

Proceeds from issuance of debt

200,000

4,614,841

Proceeds from issuance of common stock upon exercise of stock options and purchase of ESPP shares

25,329

41,798

Net cash used in financing activities .

(2,593,069)

(1,749,844)

Effect of foreign exchange rate on cash and cash equivalents

9,232

(3,154)

Net increase in cash and cash equivalents, including cash classified within current assets of discontinued operations

1,745,685

239,259

Less: net decrease in cash classified within current assets of discontinued operations

(44,381)

—

Net increase in cash and cash equivalents

1,790,066

239,259

Cash and cash equivalents at beginning of the period

697,030

502,152

Cash and cash equivalents at end of the period

$ 2,487,096

$ 741,411

AppLovin Corporation

Reconciliation of Net Cash Provided By Operating Activities to Free Cash Flow

(In thousands)

The following table provides a reconciliation of net cash provided by operating activities to Free Cash Flow for the periods presented:

Quarter Ended December 31,

Year Ended December 31,

2025

2024

2025

2024

Net cash provided by operating activities

1,313,734

701,003

3,971,094

2,099,011

Less:

Purchase of property and equipment

(188)

(490)

(473)

(4,776)

Principal payments on finance leases

(4,387)

(5,351)

(18,669)

(20,875)

Free Cash Flow

$ 1,309,159

$ 695,162

$ 3,951,952

$ 2,073,360

Net cash provided by (used in) investing activities

$ (828)

$ (367)

$ 358,428

$ (106,754)

Net cash used in financing activities

$ (493,215)

$ (523,157)

$ (2,593,069)

$ (1,749,844)

AppLovin Corporation

Reconciliation of Net Income to Adjusted EBITDA

(In thousands, except percentages)

The following table provides our Adjusted EBITDA and Adjusted EBITDA Margin and a reconciliation of Net Income to Adjusted EBITDA for the periods presented:

Quarter Ended December 31,

Year Ended December 31,

2025

2024

2025

2024

Revenue

1,657,944

999,487

5,480,717

3,224,058

Net income

1,102,256

599,204

3,333,751

1,579,776

Net margin

Loss from discontinued operations, net of income taxes

—

3,092

99,444

9,748

Net income from continuing operations

1,102,256

596,112

3,433,195

1,589,524

Net margin from continuing operations

Adjusted as follows:

Interest expense and loss on settlement of debt

51,290

93,929

207,016

317,209

Other income, net

(28,927

)

(7,841

)

(15,694

)

(23,396

)

Provision for (benefit from) income taxes

151,098

(61,384

)

519,715

22,419

Amortization, depreciation and write-offs

32,736

34,263

130,724

128,791

Non-operating foreign exchange (gain) loss

(1,849

)

2,710

(3,949

)

1,642

Stock-based compensation

80,524

97,526

207,958

357,431

Transaction-related expense

11,334

27,579

885

Restructuring costs

217

14,512

5,908

17,259

Adjusted EBITDA

1,398,679

769,832

4,512,452

2,411,764

Adjusted EBITDA margin

1Includes repurchased shares as well as withholdings upon net share settlement of vested equity awards. Total cost includes repurchase costs, including commissions and fees, as well as cash paid in connection with tax withholding and remittance obligations upon net share settlement

2 We have not provided the forward-looking GAAP equivalents for forward-looking non-GAAP metrics, specifically Adjusted EBITDA and Adjusted EBITDA margin, or a GAAP reconciliation as a result of the uncertainty regarding, and the potential variability of, reconciling items such as stock-based compensation expense. Accordingly, a reconciliation of these non-GAAP guidance metrics to their corresponding GAAP equivalents is not available without unreasonable effort. However, it is important to note that material changes to reconciling items could have a significant effect on future GAAP results. We have provided historical reconciliations of GAAP to non-GAAP metrics in tables at the end of this press release.