AppLovin Corporation Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

A week ago, AppLovin Corporation (NASDAQ:APP) came out with a strong set of third-quarter numbers that could potentially lead to a re-rate of the stock. It was overall a positive result, with revenues beating expectations by 5.9% to hit US$1.2b. AppLovin also reported a statutory profit of US$1.25, which was an impressive 35% above what the analysts had forecast. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on AppLovin after the latest results.

Check out our latest analysis for AppLovin

Taking into account the latest results, the most recent consensus for AppLovin from 25 analysts is for revenues of US$5.44b in 2025. If met, it would imply a huge 27% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to shoot up 62% to US$5.57. In the lead-up to this report, the analysts had been modelling revenues of US$5.17b and earnings per share (EPS) of US$4.64 in 2025. So it seems there's been a definite increase in optimism about AppLovin's future following the latest results, with a solid gain to the earnings per share forecasts in particular.

It will come as no surprise to learn that the analysts have increased their price target for AppLovin 47% to US$217on the back of these upgrades. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic AppLovin analyst has a price target of US$315 per share, while the most pessimistic values it at US$66.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of AppLovin'shistorical trends, as the 21% annualised revenue growth to the end of 2025 is roughly in line with the 21% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 12% annually. So it's pretty clear that AppLovin is forecast to grow substantially faster than its industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards AppLovin following these results. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple AppLovin analysts - going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 3 warning signs for AppLovin that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.