Third Quarter 2026
Filed Nov 4, 2026AppLovin posted record third quarter earnings: net income grew 72% year-over-year to $1.44 billion on record revenue of $2.18 billion, up 55% year-over-year, with industry-leading 66% net income margin and 84% Adjusted EBITDA margin.
Third-quarter revenue, net income and Adjusted EBITDA increased 55%, 72% and 59% year-over-year, respectively, while net income margin reached 66% and Adjusted EBITDA margin reached 84%. Fourth-quarter guidance calls for revenue of $2,365 million to $2,395 million and Adjusted EBITDA of $1,995 million to $2,025 million.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenue, quarter ended September 30GAAP | $2.18B | – | 55 % |
| Revenue, nine months ended September 30GAAP | $5.95B | – | 56 % |
| Cost of revenue, quarter ended September 30GAAP | 240.8M | – | – |
| Cost of revenue, nine months ended September 30GAAP | 670.2M | – | – |
| Sales and marketing expense, quarter ended September 30GAAP | 68.80M | – | – |
| Research and development expense, quarter ended September 30GAAP | 101.8M | – | – |
| General and administrative expense, quarter ended September 30GAAP | 64.46M | – | – |
| Total costs and expenses, quarter ended September 30GAAP | 475.8M | – | – |
| Income from operations, quarter ended September 30GAAP | 1.71B | – | – |
| Income from operations, nine months ended September 30GAAP | 4.64B | – | – |
| Interest expense, quarter ended September 30GAAP | −51.07M | – | – |
| Other income (expense), net, quarter ended September 30GAAP | 86.03M | – | – |
| Income before income taxes, quarter ended September 30GAAP | 1.74B | – | – |
| Provision for income taxes, quarter ended September 30GAAP | 305.0M | – | – |
| Net income from continuing operations, quarter ended September 30GAAP | $1.44B | – | 72 % |
| Net income, quarter ended September 30GAAP | $1.44B | – | 72 % |
| Net income, nine months ended September 30GAAP | $3.91B | – | 75 % |
| Basic net income per share, quarter ended September 30GAAP | $4.31 | – | – |
| Diluted net income per share, quarter ended September 30GAAP | $4.30 | – | – |
| Basic net income per share, nine months ended September 30GAAP | $11.65 | – | – |
| Diluted net income per share, nine months ended September 30GAAP | $11.61 | – | – |
| Net margin, quarter ended September 30GAAP | 66% | – | – |
| Adjusted EBITDA, quarter ended September 30non-GAAP | $1.84B | – | 59 % |
| Adjusted EBITDA, nine months ended September 30non-GAAP | $5.01B | – | 61 % |
| Adjusted EBITDA margin, quarter ended September 30non-GAAP | 84% | – | – |
| Adjusted EBITDA margin, nine months ended September 30non-GAAP | 84% | – | – |
| Net cash provided by operating activities, quarter ended September 30GAAP | 1.43B | – | – |
| Free Cash Flow, quarter ended September 30non-GAAP | $1.42B | – | – |
| Net cash provided by operating activities, nine months ended September 30GAAP | 3.59B | – | – |
4Q26 outlook
- Revenue$2,365 million to $2,395 million
- NoteAdjusted EBITDA: $1,995 million to $2,025 million
- NoteAdjusted EBITDA Margin: 84 % to 85 %
Capital returns
- During the third quarter 2026, the Company repurchased and withheld 4.1 million shares of its Class A common stock for a total cost of $1.4 billion.
- Repurchases of common stock were $(2,811,222) (in thousands) for the nine months ended September 30, 2026, compared with $(1,774,329) (in thousands) for the nine months ended September 30, 2025.
- Payment of withholding taxes related to net share settlement was $(55,818) (in thousands) for the nine months ended September 30, 2026.
- The board approved an increase to the share repurchase authorization of $3.2 billion, bringing total current share repurchase authorization to $3.6 billion as of the end of October.
What drove it
- Third-quarter revenue was $2,184,815 (in thousands), up 55 % year-over-year.
- Third-quarter net income was $1,438,902 (in thousands), up 72 % year-over-year.
- Third-quarter Adjusted EBITDA was $1,842,230 (in thousands), up 59 % year-over-year.
- Third-quarter other income (expense), net was 86,032 (in thousands), compared with $(6,632) (in thousands) in the prior-year quarter.
Concerns
- Accounts receivable, net were 2,388,782 (in thousands) as of September 30, 2026, versus 1,819,366 (in thousands) as of December 31, 2025.
- Long-term debt was 3,516,136 (in thousands) as of September 30, 2026.
- The filing states that the ability to use the share repurchase authorization depends on legal requirements, contractual restrictions, market conditions, capital allocation strategy and other capital requirements.
What to watch
- Fourth-quarter 2026 revenue guidance of $2,365 million to $2,395 million.
- Fourth-quarter 2026 Adjusted EBITDA guidance of $1,995 million to $2,025 million and Adjusted EBITDA margin guidance of 84 % to 85 %.
- Execution of the $3.6 billion total current share repurchase authorization as of the end of October.
- Accounts receivable and cash conversion following accounts receivable of 2,388,782 (in thousands) as of September 30, 2026.
Balance sheet and cash flow
- Cash and cash equivalents were $3,173,731 (in thousands) as of September 30, 2026, compared with $2,487,096 (in thousands) as of December 31, 2025.
- Accounts receivable, net were 2,388,782 (in thousands) as of September 30, 2026, compared with 1,819,366 (in thousands) as of December 31, 2025.
- Long-term debt was 3,516,136 (in thousands) as of September 30, 2026, compared with 3,512,987 (in thousands) as of December 31, 2025.
- Total assets were $8,582,749 (in thousands) as of September 30, 2026, compared with $7,259,610 (in thousands) as of December 31, 2025.
- Total liabilities were 5,284,047 (in thousands) as of September 30, 2026, compared with 5,124,939 (in thousands) as of December 31, 2025.
- Total stockholders' equity was 3,298,702 (in thousands) as of September 30, 2026, compared with 2,134,671 (in thousands) as of December 31, 2025.
- Net cash used in investing activities was $(17,687) (in thousands) for the quarter ended September 30, 2026, compared with $(19,628) (in thousands) for the quarter ended September 30, 2025.
- Net cash used in financing activities was $(1,290,302) (in thousands) for the quarter ended September 30, 2026, compared with $(560,260) (in thousands) for the quarter ended September 30, 2025.
- The Company had 331 million shares of Class A and Class B common stock outstanding at the end of 3Q 2026.
Analysis
AppLovin reported record third-quarter revenue of $2,184,815 (in thousands), up 55 % year-over-year, and net income of $1,438,902 (in thousands), up 72 %. Net income margin was 66%, compared with 59% in the prior-year quarter. Income from operations was 1,708,968 (in thousands), versus 1,079,007 (in thousands) in the prior-year quarter.
Profitability remained notably high on the company’s reported non-GAAP measures. Adjusted EBITDA was $1,842,230 (in thousands), up 59 %, and Adjusted EBITDA margin was 84%, compared with 82% a year earlier. Third-quarter cost of revenue was 240,765 (in thousands), sales and marketing expense was 68,803 (in thousands), research and development expense was 101,817 (in thousands), and general and administrative expense was 64,462 (in thousands).
Cash generation was substantial. Net cash provided by operating activities was 1,428,842 (in thousands) and Free Cash Flow was $1,418,443 (in thousands) for the quarter. The company repurchased and withheld 4.1 million Class A shares for a total cost of $1.4 billion during the quarter, while cash and cash equivalents stood at $3,173,731 (in thousands) and long-term debt stood at 3,516,136 (in thousands) as of September 30, 2026.
The company increased its repurchase authorization by $3.2 billion, bringing total current authorization to $3.6 billion as of the end of October. For 4Q26, it guided to revenue of $2,365 million to $2,395 million, Adjusted EBITDA of $1,995 million to $2,025 million, and an Adjusted EBITDA margin of 84 % to 85 %. The release does not provide segment revenue or drivers by business line, limiting visibility into the sources of reported growth.
Not in the filing
stated, not guessed- Segment revenue, segment profit and segment-level growth metrics were not provided.
- Gross margin was not reported.
- Prior-quarter comparisons for reported operating metrics were not provided.
- Fourth-quarter guidance for gross margin, operating expenses and tax rate was not provided.
- Forward-looking GAAP equivalents and a GAAP reconciliation for Adjusted EBITDA and Adjusted EBITDA margin guidance were not provided.
- Previous-quarter outlook was not provided, so no comparison against prior guidance is available.
- Named executive commentary and named executive quotes were not provided.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.