Adjustments for Non-Cash Items (USD, thousands)

Stock-Based Compensation (USD, thousands)

Changes in Working Capital (USD, thousands)

Capital Expenditures (CapEx) (USD, thousands)

Proceeds from / Repayments of Debt (USD, thousands)

Share Repurchases (USD, thousands)

Dividend Payments (USD, thousands)

Net Change in Cash (USD, thousands)

204d6d18755643c3ec7e6b8f37c7dba9db497d46249b9bbe089e20b4921ccc4b

Monthly Active Payers (millions)

Average Revenue Per Monthly Active Payer (USD)

dbe7616f682b28626f5c8e147a70383e6bfcdf0973d4e19ecbe4a8cf422072dd

Revenue (USD, thousands)

Cost of revenue (USD, thousands)

Sales and marketing (USD, thousands)

Research and development (USD, thousands)

General and administrative (USD, thousands)

Total costs and expenses (USD, thousands)

Income from operations (USD, thousands)

Interest expense (USD, thousands)

Other income, net (USD, thousands)

Total other expense, net (USD, thousands)

Income before income taxes (USD, thousands)

Provision for income taxes (USD, thousands)

Net income (USD, thousands)

Net income attributable to participating securities (USD, thousands)

Net income attributable to common stock—Basic (USD, thousands)

Net income attributable to common stock—Diluted (USD, thousands)

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Cash and Cash Equivalents (USD, thousands)

Accounts Receivable, Net (USD, thousands)

Prepaid Expenses and Other Current Assets (USD, thousands)

Total Current Assets (USD, thousands)

Property and Equipment, Net (USD, thousands)

Goodwill (USD, thousands)

Intangible Assets, Net (USD, thousands)

Other Assets (USD, thousands)

Total Assets (USD, thousands)

Accounts Payable (USD, thousands)

Accrued and Other Current Liabilities (USD, thousands)

Short-term Debt (USD, thousands)

Deferred Revenue (USD, thousands)

Total Current Liabilities (USD, thousands)

Long-term Debt (USD, thousands)

Other Non-Current Liabilities (USD, thousands)

Total Liabilities (USD, thousands)

Preferred Stock (USD, thousands)

Additional Paid-in Capital (USD, thousands)

Accumulated Other Comprehensive Loss (USD, thousands)

Retained Earnings (Accumulated Deficit) (USD, thousands)

Total Stockholders’ Equity (USD, thousands)

Total Liabilities and Stockholders’ Equity (USD, thousands)

5ab5b3559d001f37e3757b97f990e06f6fdee5764ca0b200cf70e7a2097c2d2a

The net income turnaround in Q1 2024 was driven by **robust revenue growth**—with total revenue increasing by **48% year-over-year** due mainly to a **91% jump in Software Platform revenue** and a moderate increase in Total Apps revenue—along with **improved operating leverage**, which saw income from operations rise substantially and cost ratios decline. Additionally, **lower cost ratios** (notably in cost of revenue and sales & marketing) and a **twice-as-high Adjusted EBITDA** margin further supported the turnaround. The impact of a higher tax provision, reflecting increased pre-tax income, and **improved market conditions** (driven by the adoption of real-time bidding and advancements in AXON technology boosting advertiser spending) also contributed significantly to the dramatic shift from a net loss in Q1 2023 to a net income in Q1 2024.  **[0001751008-24-000043_app-20240331.htm:32]** **[0001751008-24-000043_app-20240331.htm:34]** **[0001751008-24-000041_q124shareholderletter-53.htm:0]** **[APP_3387419_1]** 

What drove the net income turnaround in Q1 2024?

Net income surged in Q3 2024 due to several factors. **Total revenue increased by 39%**, driven by a **66% rise in Software Platform Revenue** along with improvements such as a **22% increase in net revenue per installation** and a **39% boost in installation volume**.  **[0001751008-24-000062_app-20240930.htm:35]**  Additionally, **operating efficiency improved significantly**; total costs and expenses dropped from **78% to 55%** of revenue, with specific reductions in sales and marketing expenses (from **25% to 17%**) and cost of revenue (from **31% to 23%**).  **[0001751008-24-000062_app-20240930.htm:34]**  Furthermore, higher income from operations and lower other expenses—despite a higher provision for income taxes—also contributed to the substantial net income growth.  **[0001751008-24-000062_app-20240930.htm:5]** **[0001751008-24-000062_app-20240930.htm:38]** 

Why did net income surge in Q3 2024?

The revenue jump in Q4 2023 was driven primarily by **robust growth in the Software Platform segment**, which saw its revenue surge by **88% to $576 million**. This impressive performance was attributed to a combination of factors including a **strong holiday season**, a **shift toward real-time bidding in the mobile advertising market**, significant **enhancements in the company’s AI advertising engine (AXON) and expansion of its advertiser base**, **early contributions from a new array business**, and **increased advertiser budgets**.  **[0001751008-24-000004_exhibit992-applovinx4q23.htm:2]** **[APP_3373279_2]** 

What factors contributed to the revenue jump in Q4 2023?

The operating income in Q3 2024 climbed sharply due to a combination of **substantial revenue growth** and **effective cost management**. **Revenue increased by 39%**, largely driven by a **66% rise in Software Platform Revenue** fueled by improved AppDiscovery performance, while **total costs and expenses decreased slightly**, which enhanced the operating margin and consequently boosted the income from operations.  **[0001751008-24-000062_app-20240930.htm:5]** **[0001751008-24-000062_app-20240930.htm:35]** **[0001751008-24-000062_app-20240930.htm:34]** 

Why did operating income climb so sharply in Q3 2024?

The **revenue growth** in FY 2023 was primarily driven by the **76% increase in Software Platform Revenue**, which was fueled by improved AppDiscovery performance and adjustments such as the treatment of publisher bonuses that reduced revenue in FY 2022. This robust growth in the software segment more than offset the decline in Apps Revenue, leading to the overall revenue increase.  **[0001751008-24-000012_app-20231231.htm:102]** 

What drove the revenue growth in FY 2023?

5ed3cc137b5f299af96738411acc0e8c8c1f040bf49e687e76766527c10f321b

The documents do not provide specific reasons for the high **short-term debt** in Q4 2023, even though the data shows it reached **$215,000 thousand**, a significant increase over previous periods.  **[0001751008-24-000012_app-20231231.htm:122]** 

Why was Short-term Debt so high in Q4 2023?

The jump in long-term debt in Q1 2024 was primarily driven by **debt refinancing and issuance activities**, where the company issued **$1,072,330** in new debt, and by the **repayment of short-term debt** amounting to **$668,972**, which was reclassified as long-term debt. Additionally, **debt refinancing activities** that resulted in lower interest rates played a role in restructuring the company’s debt profile.  **[0001751008-24-000041_q124shareholderletter-53.htm:6]** **[0001751008-24-000043_app-20240331.htm:6]** **[0001751008-24-000043_app-20240331.htm:34]** 

What drove the jump in Long-term Debt in Q1 2024?

The decrease in **Cash and Cash Equivalents** to **436,336 (USD, thousands)** in Q1 2024 was primarily driven by a net outflow from financing activities, which included significant cash used for **stock repurchases**, **debt principal repayments**, and related payments. These financing outflows were only partially offset by cash generated from operating activities—despite positive contributions from net cash from operations—and by some proceeds from debt issuance and stock options exercise. Additionally, a small outflow for investing activities contributed to the decrease, resulting in an overall net reduction in cash during the period.  **[0001751008-24-000043_app-20240331.htm:36]** **[0001751008-24-000041_q124shareholderletter-53.htm:6]** 

Why did Cash and Cash Equivalents fall to 436,336 in Q1 2024?

9623d539df44119e6a8c88e8ef196d74f1d61a651f137abc9b735106eb5a9b15

Total Revenue (USD)

Cost of Goods Sold (COGS) (USD)

Selling, General, and Administrative Expenses (SG&A) (USD)

Research and Development (R&D) (USD)

Depreciation and Amortization (D&A) (USD)

Interest Expense (USD)

Operating Income (EBIT) (USD)

Net Income (USD)

Earnings Per Share (EPS) - Basic (USD)

Earnings Per Share (EPS) - Diluted (USD)

41c35a272455e7e85d3eafc77cb2622f33bf56b36aaf0af93463d560359f01d0

Current Assets (USD, thousands)

Accounts Receivable (USD, thousands)

Inventory (USD, thousands)

Non-Current Assets (USD, thousands)

Property, Plant, and Equipment (PP&E) (USD, thousands)

Intangible Assets (USD, thousands)

Current Liabilities (USD, thousands)

Accrued Expenses (USD, thousands)

Non-Current Liabilities (USD, thousands)

Lease Liabilities (USD, thousands)

Deferred Tax Liabilities (USD, thousands)

Shareholders' Equity (USD, thousands)

Retained Earnings (USD, thousands)

Common Stock (USD, thousands)

78ab79420d967f08174f57901bec078fc3624b1eb6d5ef94ed6a6796ee328b5e

United States

Rest of the World

Total Revenue

29af0a2f6aa8b7b727094291f0f6b22d5ed50b4452cbf679ec98e4037ce7125a

Net income (loss) [USD, thousands]

Amortization, depreciation and write-offs [USD, thousands]

Stock-based compensation [USD, thousands]

Other adjustments [USD, thousands]

Changes in accounts receivable [USD, thousands]

Changes in prepaid expenses and other assets [USD, thousands]

Changes in accounts payable [USD, thousands]

Changes in accrued and other liabilities [USD, thousands]

Net cash provided by operating activities [USD, thousands]

Purchase of non-marketable equity securities [USD, thousands]

Acquisition of intangible assets [USD, thousands]

Other investing activities [USD, thousands]

Net cash used in investing activities [USD, thousands]

Repurchases of stock [USD, thousands]

Principal repayments of debt [USD, thousands]

Payment of withholding taxes related to net share settlement of equity awards [USD, thousands]

Payments of licensed asset obligation [USD, thousands]

Proceeds from issuance of debt [USD, thousands]

Proceeds from issuance of common stock upon exercise of stock options and purchase of ESPP shares [USD, thousands]

Other financing activities [USD, thousands]

Net cash used in financing activities [USD, thousands]

Effect of foreign exchange rate on cash and cash equivalents [USD, thousands]

Net increase (decrease) in cash and cash equivalents [USD, thousands]

Cash paid for interest, net [USD, thousands]

Cash paid for income taxes, net of refunds [USD, thousands]

Purchase of property and equipment [USD, thousands]

Principal payments of finance leases [USD, thousands]

Free Cash Flow [USD, thousands]

Change in operating right-of-use asset [USD, thousands]

Amortization of debt issuance costs and discount [USD, thousands]

Impairment of investments [USD, thousands]

Payments of debt issuance cost [USD, thousands]

Payments of deferred acquisition costs [USD, thousands]

Proceeds from sale of assets and other [USD, thousands]

Payments of related party notes [USD, thousands]

Proceeds from issuance of common stock in initial public offering, net of issuance costs as adjusted for cost reimbursement [USD, thousands]

Cash and cash equivalents at beginning of the period [USD, thousands]

Cash and cash equivalents at end of the period [USD, thousands]

de035778293815bd357e3ca4ae59aa9925f25dd90b5529a1cfc93bfe4052fac6

Software Platform

Apps

- In-App Purchases

- In-App Advertising

Consumer Revenue

Business Revenue

Advertising

c4ee5c3a999b8b39d08dbd907f1e7404949bf4019472679409e813e3781d9939

Applovin Corp (APP)

Financials