"Analyst Alicia Reese said AppLovin has a "significant data moat" from its MAX product, which allows users to run real-time bidding for advertising space on their apps. AppLovin feeds the valuable data into the company's AXON algorithm, the tool behind the ad-to-app matching process. Reese said this creates a cycle of continuous model optimization that competitors struggle to match. Wedbush is also impressed by Applovin's expansion into e-commerce."
"Wedbush is also impressed by Applovin's expansion into e-commerce. Some believe that core gaming ad spend is nearing a capped saturation point, but Reese said the e-commerce pivot insulates AppLovin from this ceiling. In its most recent quarter, Applovin beat Wedbush's and the overall market's expectations for revenue and adjusted EBITDA. Applovin reported $1.405 billion in revenue versus the firm's estimate of $1.35 billion and market consensus of $1.34 billion. The company also beat market expectations for earnings-per-share, reporting $2.45 compared to a consensus of $2.41."
Wedbush holds an Outperform rating on AppLovin with an $800 price target following an advisor call that highlighted accelerating mobile gaming eCPMs ahead of the holiday season. The firm attributed the eCPM lift to AppLovin's e-commerce initiative and increased game volume. MAX captures real-time bidding data and feeds the AXON algorithm, driving continuous ad-to-app matching optimization and creating a competitive data moat. The e-commerce pivot helps insulate the company from potential saturation in core gaming ad spend. Recent results exceeded revenue and adjusted EBITDA expectations, and Axon Ads public rollout with AI support targets further long-term growth.
Read at Benzinga
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