AppLovin Shares Sink 17% on Q2 Revenue Miss
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- AppLovin shares tanked 17% on Thursday after the adtech company reported Q2 revenue of $1.92 billion, missing the $1.94 billion Wall Street estimate per LSEG.
- AppLovin's EPS of $3.76 matched analyst expectations and revenue still grew 53% year-over-year despite the narrow quarterly miss.
- CEO Adam Foroughi pinned the miss on the timing of improvements to AppLovin's advertising models as the company expands its AI-powered adtech beyond gaming into e-commerce.
- Foroughi told analysts the company 'fell short of that standard' because 'the pace of meaningful model improvement was lighter than normal during the quarter and the next step up in model performance landed just after quarter ended.'
- Piper Sandler analyst James Callahan downgraded AppLovin to neutral on Thursday, slashing the bank's price target from $665 to $385, roughly a 42% cut, citing 'more questions than answers on beat/raise cadence from here.'
Why it matters: AppLovin's 17% slide and Piper Sandler's price-target cut from $665 to $385 — about a 42% reduction — show how a roughly $20 million revenue miss can crater an adtech stock that otherwise posted 53% year-over-year growth, reflecting Wall Street's elevated bar for companies carrying an AI-expansion narrative.
