Applovin Reviews Its App Business for a Possible Sale. The Stock Soars.

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Applovin trimmed its estimate for full-year revenue but the stock was soaring early Thursday after executives at the app-monetization company raised the possibility of selling the apps business.

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“Given our recent outperformance of our technology, our Software Platform’s current scale, and the immense reach of our MAX solution, we can greatly reduce our reliance on the data from our Apps,” the company said in a letter to shareholders.

Applovin said it would be operating its apps business “as if a standalone business rather than a strategically integrated asset.”

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“As we review our Apps portfolio and its cost structure, we will focus on how best to optimize each asset’s contribution to our overall financial metrics. Our review could result in the retention, restructure or sale of certain assets, or no change at all to our Apps portfolio,” Applovin added.

The stock rose 13.5% in premarket trading to $30.97. Coming into Thursday, the stock has declined 71.1% in 2022.

The company trimmed revenue expectations for its software platform this year to $1.14 billion to $1.29 billion from a prior forecast of $1.35 billion to $1.5 billion. Apps revenue was forecast at $2 billion to $2.15 billion vs. prior guidance of $2.2 billion to $2.35 billion.

AppLovin said it expects total revenue in 2022 of $3.14 billion to $3.44 billion, down from its prior estimate of $3.55 billion to $3.85 billion. Wall Street estimates 2022 revenue of $3.62 billion.

Applovin said the adjustments for total revenue and software-platform revenue reflect $210 million of non-recurring publisher bonuses as contra-revenue.

The company also reported a first-quarter loss of 31 cents a share, wider than the year-earlier loss of 5 cents. Revenue in the quarter was $625 million. Software-platform revenue was $119 million.

Applovin also said its board authorized a buyback program of $750 million in the quarter.

Write to Joe Woelfel at [email protected]


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