Investors weren’t loving AppLovin’s (NASDAQ: APP) Q2 results, and a difficult year for the stock just got worse.
The stock crashed last week after it missed revenue expectations, and its shares have been cut in half this year, as of this writing
Let’s dig into the adtech company’s results and prospects to see if this dip is a good buying opportunity. Strong growth but missed expectations Since the launch of its artificial intelligence (AI) adtech platform, Axon 2.0, in 2023, AppLovin has seen tremendous growth. While its Q2 results came up short of analyst expectations, its growth was still strong.
The company’s revenue climbed 53% to $1.92 billion, which was just shy of the $1.94 billion analyst consensus. The company said the miss was due to its model not improving at its typical pace, and that the next big boost in model performance did not occur until after the quarter ended. Axon 2.0 helps gaming-industry advertisers attract more customers, and as its AI model improves and advertisers see better returns on their spending, ad spending on its platform tends to increase.