AppLovin (NASDAQ:APP) delivers strong Q3 2026 numbers, stock jumps 24.9%
Mobile app technology company AppLovin (NASDAQ:APP) announced better-than-expected revenue in Q3 2026, with revenue up 55.5% year on year to $2.18 billion. In addition, next quarter’s revenue guidance ($2.38 billion at the midpoint) was surprisingly strong and 5.5% above analysts’ consensus estimates. Its GAAP profit of $4.30 per share was 6.6% above analysts’ consensus estimates.
For more on AppLovin, read our free full research report.
AppLovin (APP) Q3 2026 highlights:
- Revenue $2.18 billion vs analysts’ consensus estimates of $2.07 billion, according to S&P (55.5% year-on-year growth, 5.4% beat)
- EPS (GAAP) $4.30 vs analysts’ consensus estimates of $4.03 (6.6% beat)
- Adjusted EBITDA $1.84 billion vs analysts’ consensus estimates of $1.73 billion (84.3% margin, 6.3% beat)
- Revenue guidance $2.38 billion at the midpoint for Q4 2026, above analysts’ consensus estimates of $2.25 billion
- EBITDA guidance $2.01 billion at the midpoint for Q4 2026, above analysts’ consensus estimates of $1.88 billion
- Operating margin 78.2%, up from 76.8% in the same quarter last year
- Free cash flow margin 64.9%, up from 45.2% in the previous quarter
- Market capitalization $82.16 billion
Revenue growth
A company’s long-term revenue performance is one signal of its overall quality. Any business can have short-term success, but a top-tier one grows for years. AppLovin’s revenue grew at a solid 24.8% compounded annual growth rate over the last five years. Its growth surpassed the average software company and shows its offerings resonate with customers.
Long-term growth is the most important, but within software, a half-decade historical view may miss new innovations or demand cycles. AppLovin’s annualized revenue growth of 39.2% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated. 
This quarter, AppLovin reported strong year-on-year revenue growth of 55.5%, and its $2.18 billion of revenue beat Wall Street’s consensus estimates by 5.4%. Management is guiding for a 43.6% year-on-year increase in revenue next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 25.8% over the next 12 months, according to S&P, a deceleration versus the last two years. Despite the slowdown, this projection is strong and suggests the market expects success for its products and services.
Customer acquisition efficiency
The customer acquisition cost, or CAC, payback period measures the months a company needs to recoup the money spent on acquiring a new customer. This metric helps assess how quickly a business can break even on its sales and marketing investments.
AppLovin is highly efficient at acquiring new customers, and its CAC payback period was 1.2 months this quarter. The company’s rapid recovery of its customer acquisition costs indicates it has a highly differentiated product offering and a strong brand reputation. These dynamics give AppLovin more resources to pursue new product initiatives while maintaining the flexibility to increase its sales and marketing investments.
Key takeaways from AppLovin’s Q3 results
AppLovin’s outlook stood out in a quarter with clear positives: EBITDA guidance for next quarter came in well above analysts’ consensus estimates, and revenue guidance also topped Wall Street’s consensus. Shares soared 24.9% to $339.10 immediately after the results.
AppLovin had a solid quarterly earnings result, but is the stock a good investment? The latest quarter matters, but longer-term fundamentals and valuation matter more when deciding whether the stock is a buy. For more on AppLovin, read the full research report here (it’s free).