AppLovin shares dive as much as 40% this year despite strong earnings growth

• Q4 revenue surged 66% yoy to $1.66bn, beating expectations.
• Earnings per share jumped 87% to $3.24 in the fourth quarter.
• AppLovin forecasts up to 50% revenue growth in Q1 with stable margins.

Shares in AppLovin have fallen by as much as 40% this year despite delivering strong financial results. 

As of the latest trading session, the stock was changing hands around $390.66, with a market cap near $132 billion, down sharply from recent peaks.

The stock’s decline comes despite robust fourth-quarter results where AppLovin reported revenue of $1.66bn in Q4 2025, up 66% year over year, beating expectations.

Market pressure

However, broader weakness across software stocks in 2026 has weighed on sentiment. Shares fell 16% on February 4th, coinciding with adtech startup CloudX, formed by MoPub and Max founders, announcing the general availability of its platform.

Unity later released its financials on February 11th, with the company bullish on the performance of its ads platform Vector.

Despite beating expectations last quarter, Applovin's stock slid nearly 20% on February 12th after its earnings release.

AppLovin projected first-quarter revenue between $1.745bn and $1.775bn, implying growth of around 50%, with adjusted EBITDA margins expected to remain stable at 84%.

For the past year, AppLovin has contended with short-seller reports about its business practices, which it hwas previously labelled as "nefarious" and "misleading".

CapitalWatch, which recently released its own report, has since issued an apology and retracted allegations relating to connections between AppLovin shareholder Hao Tang and criminal syndicates.