Key Highlights

● Revenue was $1,923.7 million, up 53% from $1,258.8 million.

● Adjusted EBITDA reached $1,613.8 million, an 84% margin.

● Net income was $1,266.5 million, or $3.76 per diluted share.

● AppLovin guides third-quarter revenue of $2,055 million to $2,085 million.

Strong profitability from advertising

AppLovin Corporation (NASDAQ:APP) announced second-quarter 2026 results on 5 August 2026, reporting revenue of $1,923.7 million, up 53% from $1,258.8 million a year earlier. Adjusted EBITDA, a non-GAAP measure, was $1,613.8 million, up 58%, equal to an 84% margin compared with 81% in the second quarter of 2025. These figures describe an advertising business growing quickly while converting most of its revenue into adjusted EBITDA. Revenue for the six months to 30 June 2026 was $3,766.1 million, up 56%, so growth has been sustained across the first half of the year.

Business and sector position

AppLovin describes itself as a leading marketing platform that offers end-to-end advertising solutions, connecting advertisers with the digital audiences they wish to reach. Its model depends on software that matches advertising demand with available inventory, and its results are therefore closely tied to advertiser budgets and the performance of the campaigns it serves. The company competes with large digital advertising platforms and other advertising technology providers, as well as with the in-house tools of major advertisers. Management reports adjusted EBITDA as a non-GAAP measure alongside GAAP results. Interest on its debt is a fixed cost that continues whatever the level of advertising activity, and quarterly interest expense was $51.2 million.

What the latest report showed

Quarterly net income was $1,266.5 million, up 55% from $819.5 million, and net income from continuing operations was up 64% from $771.9 million. The prior-year period included income from discontinued operations of $47.7 million, which is relevant when comparing the two growth rates. Diluted earnings per share were $3.76, and basic earnings per share were $3.77. Shares outstanding were 335.3 million at 30 June 2026, comprising 305.1 million Class A and 30.2 million Class B shares.

Financial performance and context

Operating cash flow was $869.0 million and free cash flow was $863.3 million. Cash and cash equivalents were $3,053.3 million at 30 June 2026, up from $2,487.1 million at the end of 2025, and long-term debt was $3,515.1 million. Interest expense for the quarter was $51.2 million. The company repurchased and withheld 1.1 million Class A shares at a total cost of $551.3 million in the quarter, including tax withholding on equity awards, and repurchases in the six months totalled $1,533.0 million. Net income margin was roughly 66% of revenue in the quarter, although net income and adjusted EBITDA are measured differently and the latter excludes certain costs.

Risks and uncertainties

The company's profitability depends on advertiser demand, which can change quickly with the wider economy. Platform rules set by mobile operating system providers, privacy regulation and scrutiny of advertising practices could affect its ability to target and measure campaigns. Debt of about $3.5 billion creates fixed obligations, and the scale of share repurchases means cash returns depend on continued strong cash generation. AppLovin has two classes of common stock, which can matter for shareholders considering governance. Revenue and margins can both fall short of the guided ranges if market conditions change.

Tracking the margin and the buyback

For the third quarter of 2026 AppLovin guides to revenue of $2,055 million to $2,085 million, adjusted EBITDA of $1,710 million to $1,740 million and an adjusted EBITDA margin of 83%, which would be slightly below the second-quarter margin. Readers should watch whether revenue growth stays above 50%, how margins evolve, the pace of share repurchases against free cash flow, and any further disclosure on advertiser demand and product developments. The quarterly report will also show whether cash balances continue to build.