AppLovin - Break... Part 2

Hello friends,

It's proving more difficult than anticipated to churn through the K-10's other reading to form a solid understanding of what went on with AL's business strategy over time.

From some light reading, it seems like AL always intended to be a platform marketing business, and simply entered the app development market to 'buy' first-party data (if that's not a baller move, I don't know what is) to train its AXON algorithm. AXON, a match-making algorithm, seems to be the engine driving the performance of AL's other key software offerings (I admit I have a very limited view on this as of right now, but will do a deep dive to better understand the link between the products in the coming deep dive).

However, their apps business generated a LOT of revenue, and with growth rates of 56% and 70% in 2020 and 21, which made them a market favourite. I'm unaware of what market sentiment was like at this time but will do a deep dive into what the perspective was at the time (i.e. if they were valued like an app publishing company, rather than an ad network)

As they continued the transition into ad networking, financials expectedly took a hit, which was reflected in their valuation. What exactly happened here will also be detailed in posts in thecoming days.

Now, it seems like they're on track to completing their strategy. A review of their future strategy and industry outlook here will help form an informed view of the prospects of the company.

Anyhow, I'll be doing a proper write-up over the weekend with details of the above, which will hopefully allow us to dive into some financials/modelling next week.

I hope everyone's had a good week so far. Please enjoy your weekend and I'll see you all tomorrow.

Price at time of writing: $83.23