AppLovin (APP) stock fell 38% after earnings — but is the digital advertising thesis actually broken, or is this a buying opportunity?
Shares dropped roughly 38% after AppLovin's latest report, and investors are asking whether the mobile-ad-turned-AI-advertising company can keep growing into its valuation. In this episode, we map the entire digital ad supply chain, from the walled gardens (Google, Meta, Amazon) that control roughly two-thirds of digital ad spend, down to the demand-side and supply-side platforms competing around them.
We trace AppLovin's path from a 2012 mobile-game user-acquisition tool into one of the largest software companies in digital advertising, powered by its Axon 2.0 AI algorithm. We cover the sale of its game studios to Tripledot, its push into e-commerce through a Shopify integration, and why the market is worried about decelerating revenue growth alongside historically high operating and free cash flow margins. Using our new Custom Supply Chain tool, we compare AppLovin against Omnicom, The Trade Desk, Google, and Magnite to show where value actually accrues and share our own take as long-time shareholders.
If you're deciding whether AppLovin is a buy after this sell-off, this is the fundamentals-first framework to make that call yourself.
If you want the reasoning behind more names like this one, Semiconductor Insider covers the process in more depth. Get access to all our research, weekly live Q&A events, and a growing set of tools to build your process: https://www.chipstockinvestor.com
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Content in this episode is for general information or entertainment only and is not specific or individual investment advice. Forecasts and information presented may not develop as predicted, and there is no guarantee any strategies presented will be successful. All investing involves risk, and you could lose some or all of your principal.
CSI owns shares of AppLovin.