AppLovin Shares Plummet in After-Hours Trading
AppLovin Corporation experienced a significant decline in its stock value following the release of its fourth-quarter financial results for 2025. The mobile marketing platform provider reported its financial performance after market hours, prompting a notable response from investors.
AppLovin’s Stock Decline in After-Hours Trading
After a regular trading session that saw shares fall by 3.4%, AppLovin’s stock plummeted an additional 7.5% in after-hours trading. This brought the stock price down to $456.81 as of 5:22 p.m. on the day of the report.
Financial Highlights from Q4 2025
- Revenue: $1.66 billion, a 66% increase year-over-year.
- EPS (Earnings Per Share): $3.24, marking an 87% year-over-year growth.
- Analyst Expectations: Estimates were $1.61 billion in revenue and an EPS of $2.94.
Despite beating analyst expectations, the strong financial results did not alleviate concerns among investors. The significant drop highlights issues beyond just numbers.
Key Financial Metrics
- Current Market Capitalization: $154 billion
- Day’s Trading Range: $438.18 to $471.97
- 52-Week Trading Range: $200.50 to $745.61
- Volume: 11 million shares traded
- Average Volume: 5 million shares
- Gross Margin: 82.06%
Future Projections
Looking ahead, AppLovin forecasts revenue between $1.745 billion and $1.775 billion for the first quarter of 2026. Achieving the midpoint will represent an 18.6% year-over-year increase.
Additionally, the company expects adjusted EBITDA for Q1 2026 to range from $1.465 billion to $1.495 billion, implying a potential growth of 47.3% if the midpoint of guidance is realized.
Valuation Concerns Among Investors
Even with strong growth metrics, investors remain cautious about AppLovin’s stock valuation. Recent trading levels indicate a valuation of 45.9 times operating cash flow, substantially higher than the five-year average of 19.7.
Prior to the earnings announcement, AppLovin shares had seen nearly a 12% increase over five days. The strong financial report seemed insufficient to justify the elevated stock price amidst investor skepticism.
For investors seeking exposure to the adtech sector, various alternatives are available, especially given the current climate surrounding AppLovin.
