• The company is opening its platform up to more advertisers, which will unlock additional revenue streams.
• For the first quarter, revenue rose nearly 59% to $1.84 billion, and adjusted earnings per share were $3.56, both ahead of estimates.
• For the second quarter, AppLovin expects revenue between $1.92 billion and $1.95 billion.

Shares of AppLovin (APP) are up on Thursday after the mobile app advertising company delivered solid first-quarter results and provided commentary on growth opportunities enabled by a more open platform, from which it stands to benefit, as well as advertisers.

At the time of writing, APP stock was up more than 7%.

Growth Opportunities For APP

During an earnings call with analysts, CEO Adam Foroughi said that its platform is opening up to more advertisers, which unlocks additional revenue streams. “For 14 years, we have been a closed platform. Come June, advertisers across the world will be able to sign up for Axon and start running campaigns,’ Foroughi said on the call.

AppLovin also noted that many game companies that monetize solely through in-app purchases are now considering advertising on its platform as competition fears ease.

“For years, a lot of these IAP-only games would not run ads because they did not want to promote competing titles. But as we scale advertisers who are not gaming companies, those concerns go away,” Foroughi said. “A cookware company or a fashion brand is not a competition to a puzzle game. So we fully expect to see a lot of IAP-only games start monetizing with ads that will not be deemed competitive.”

APP Q1 Results At A Glance

For the first quarter (Q1), revenue rose nearly 59% to $1.84 billion, ahead of the Fiscal AI estimate of $1.78 billion. The company's adjusted earnings per share (EPS) were $3.56, exceeding the consensus estimate by $0.10.

For the second quarter (Q2), the company expects revenue between $1.92 billion and $1.95 billion, largely in line with the $1.94 billion estimate.

At least four analysts raised their price target on the APP stock, with Piper Sandler notably calling the results a “clean beat and raise.”

What Retail Traders Think Of APP Stock

On Stocktwits, retail sentiment about APP turned ‘extremely bullish’ from ‘bullish’ amid ‘extremely high’ message volumes over the last 24 hours.

One user said the company’s fundamentals are “just too strong to ignore.”

APP stock is down more than 25% so far this year, but has gained 65% over the past 12 months.

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