AppLovin shares rocket nearly 30% on impressive Q4 results, strong outlook

Investing.com -- Applovin Corp (NASDAQ:APP) shares rocketed more than 28% after the closing bell as the company reported fourth-quarter earnings that topped Wall Street estimates.

The mobile technology company posted earnings per share of $1.73 for the fourth quarter, surpassing analysts' expectations of $1.25.

Revenue rose to $1.37 billion, exceeding the consensus estimate of $1.26 billion.

Advertising revenue surged 73% in the quarter, reaching nearly $1 billion. The ad business was previously classified under Software (ETR:SOWGn) Platform.

Bank of America (NYSE:BAC) (BofA) analysts said the "magnitude of Q4 beat [was] completely unexpected," hiking their price target on the stock to $580 from $375. 

AppLovin projected revenue in the range of $1.355 billion to $1.385 billion for the first quarter of 2025, above analysts’ expectations of $1.321 billion.

Over $1 billion of that total will be generated from its advertising segment, with the company stating it is “still in the early stages” of enhancing its AI models.

BofA analysts believe the Q1 guidance is "conservative."

Pratyush Thakur contributed to this report.