• Total Revenue: $1.2 billion, a 39% increase year-over-year.

• Adjusted EBITDA: $722 million, a 72% increase year-over-year, with a 60% margin.

• Free Cash Flow: $545 million, up 182% year-over-year and 22% quarter-over-quarter.

• Cash and Cash Equivalents: $568 million at the end of the third quarter.

• Shares Outstanding: 335 million shares.

• Software Platform Revenue: $835 million, a 66% increase year-over-year.

• Software Platform Adjusted EBITDA: $653 million, a 79% increase year-over-year, with a 78% margin.

• Apps Revenue: $363 million, a 1% increase year-over-year.

• Apps Adjusted EBITDA: $68 million, with a 19% margin.

• Share Repurchase: 5 million shares retired and withheld at a cost of $437 million.

• Repurchase Authorization: Increased by $2 billion, totaling $2.3 billion remaining authorization.

• Financial Guidance for Q4 2024: Revenue between $1.24 billion and $1.26 billion; Adjusted EBITDA between $740 million and $760 million, targeting a 60% margin.

• Warning! GuruFocus has detected 5 Warning Sign with UPWK.

Release Date: November 06, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• AppLovin Corp (NASDAQ:APP) reported a 39% increase in revenue and a 72% increase in adjusted EBITDA from the same period last year, showcasing strong financial performance.

• The company achieved a 60% adjusted EBITDA margin, indicating efficient operations and profitability.

• AppLovin Corp (NASDAQ:APP) generated $545 million in free cash flow, marking a 182% year-over-year increase, highlighting strong cash generation capabilities.

• The advancements in AXON technology contributed to significant growth, with the software platform generating $835 million in revenue and $653 million in adjusted EBITDA.

• The company is exploring new verticals, such as e-commerce, with early data from the pilot phase exceeding expectations, indicating potential for future growth.

Negative Points

• The e-commerce pilot is still in its early stages and has not yet made a material financial impact, indicating that it may take time to contribute significantly to revenue.

• AppLovin Corp (NASDAQ:APP) anticipates a slight reduction in software flow-through next quarter due to PSU-related vesting costs and increased data center capacity.

• The company is shifting to an annual shareholder letter, which may reduce the frequency of detailed updates for investors.

• Despite strong performance, the company faces challenges in expanding brand awareness in the e-commerce sector, which could slow the ramp-up of this new vertical.

• There is uncertainty regarding the timing and impact of future AI advancements, which are crucial for sustaining growth in the competitive mobile gaming and advertising markets.