AppLovin Corp (NASDAQ:APP) reported better-than-expected first quarter results and raised its outlook for the current quarter, driven by continued strength in its AI-powered advertising business.
The marketing and advertising technology company posted first-quarter revenue of $1.84 billion, up 59% from a year earlier and ahead of analyst estimates of about $1.77 billion.
Adjusted earnings per share came in at $3.56, above expectations of roughly $3.43.
Net income rose to $1.21 billion from $576 million a year earlier, while adjusted EBITDA increased 66% year over year to $1.56 billion. The company reported an adjusted EBITDA margin of approximately 85%.
AppLovin also generated $1.3 billion in operating cash flow and $1.3 billion in free cash flow during the quarter.
During the first quarter, the company repurchased and withheld 2.2 million shares of its Class A common stock for a total cost of about $1 billion.
Looking ahead, AppLovin forecast second quarter revenue between $1.915 billion and $1.945 billion, above analyst expectations.
The company also projected adjusted EBITDA in the range of $1.615 billion to $1.645 billion, representing an adjusted EBITDA margin of 84% to 85%.
Despite the strong “beat-and-raise” quarter, AppLovin shares were down about 5% in early trade on Thursday. The decline followed an initial roughly 10% jump in after-hours trading after the earnings release, suggesting a potential “sell-the-news” reaction.