AppLovin (APP) — Q2 2026 Earnings Preview
Key Preview Takeaways
| Factor | Details |
|---|---|
| Consensus Q2 2026 Revenue | $1,942M (+52% YoY, +4% QoQ) |
| Guidance Q2 2026 Revenue | $1,915M–$1,945M |
| Consensus Q2 2026 Adj. EBITDA | $1,639M (+66% YoY, +5% QoQ) |
| Guidance Q2 2026 Adj. EBITDA | $1,615M–$1,645M, margin 84–85% |
| Q1 2026 Actuals | Revenue $1,842M (+59% YoY), Adj. EBITDA $1,557M (85% margin), Net Income $1,206M |
| Q2 2025 Actuals | Revenue $1,259M, Adj. EBITDA $1,018M, Net Income $820M |
| YoY Comparable | Lapping a very strong Q2 2025 (+77% YoY revenue then); Q2 2026 guide/consensus implies another +50% YoY growth on top of that high base. |
| Key Focus Areas |
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Table 1: Q2 2026 Guidance vs. Consensus
| Metric | Company Guidance (Q2 2026) | Consensus Estimate (Q2 2026) | Q1 2026 Actual | Q2 2025 Actual | YoY Change (Guidance Midpoint vs. Q2 2025) |
|---|---|---|---|---|---|
| Revenue ($M) | $1,915–$1,945 | $1,942 | $1,842 | $1,259 | +54% |
| Adj. EBITDA ($M) | $1,615–$1,645 | $1,639 | $1,557 | $1,018 | +61% |
| Adj. EBITDA % | 84–85% | 85% | 81% | +400 bps |
Table 2: Quarterly Actuals — Recent Trend
| Quarter | Revenue ($M) | YoY Growth | Adj. EBITDA ($M) | Adj. EBITDA % | Net Income ($M) |
|---|---|---|---|---|---|
| Q1 2026 | $1,842 | +59% | $1,557 | 85% | $1,206 |
| Q4 2025 | $1,658 | +66% | $1,399 | 84% | $1,102 |
| Q3 2025 | $1,405 | +68% | $1,158 | 82% | $836 |
| Q2 2025 | $1,259 | +77% | $1,018 | 81% | $820 |
Table 3: Full-Year Actuals — FY2025 vs. FY2024
| Fiscal Year | Revenue ($M) | YoY Growth | Adj. EBITDA ($M) | Adj. EBITDA % | Net Income ($M) |
|---|---|---|---|---|---|
| 2025 | $5,481 | +70% | $4,512 | 82% | $3,334 |
| 2024 | $3,224 | $2,412 | 75% | $1,580 |
What to Watch for This Quarter
1. Axon Self-Serve Platform Launch (June 2026)
- Management confirmed the public GA launch of Axon in June 2026, opening the platform to all advertisers globally.
- Key focus: Initial adoption rates, onboarding friction, and early spend ramp from new cohorts.
- Management expects this to be a "major milestone" and a "meaningful change in trajectory" for the company.
2. Consumer (Web/E-Commerce) Vertical Acceleration
- The consumer vertical (formerly e-commerce) is scaling rapidly, with March 2026 up ~25% vs. January and April reaching a record month, higher than any Q4 peak.
- Management highlighted a "material model release" in late Q1 that drove significant uplift in scale and ROAS for consumer advertisers.
- Watch for commentary on continued acceleration, cohort retention, and incremental contribution to overall revenue.
3. Gaming Ad Business Durability and Hybrid Monetization
- Gaming remains the foundation; management continues to guide for 20–30% long-term growth, but actuals have consistently exceeded this.
- Key trend: More IAP-only games are adopting hybrid monetization (ads + IAP), unlocking new supply and demand.
- Management expects this to be a "strong tailwind for many quarters," with no signs of cannibalization between gaming and consumer verticals.
4. Model Improvements and Conversion Rate Expansion
- Ongoing rapid pace of directed model enhancements, both in gaming and consumer.
- Management cited a current conversion rate of ~1.3%, with a path to >5% as advertiser density and model sophistication increase.
- Each model improvement is driving higher same-store growth and unlocking incremental budget from existing advertisers.
5. Margin Sustainability Amid Performance Marketing Ramp
- Adj. EBITDA margin guidance for Q2 2026 is 84–85%, at the high end of software peers.
- Management is ramping performance marketing spend to support Axon GA launch, but insists spend will be disciplined and ROI-driven (still seeing <30-day payback).
- Any sign of margin compression or commentary on marketing efficiency will be closely scrutinized.
