Marketing platform AppLovin generated $953 million in revenue, marking a 36% year-over-year increase as well as achieved a net income of $172 million, resulting in a net margin of 18%.
This comes from the company’s Q4 2023 financial results which also show that AppLovin’s adjusted EBITDA soared to $476 million, reflecting an 83% year-over-year growth with an Adjusted EBITDA margin of 50%.
Exceeding projections
Net cash generated from operating activities amounted to $344 million, while free cash flow reached $340 million. As of the end of Q4 2023, there were approximately 340 million shares outstanding.
AppLovin’s total revenue in 2023 amounted to $3.3 billion, marking a 17% year-over-year increase. The company also achieved a net income of $357 million, resulting in a net margin of 11%. Also, its adjusted EBITDA reached $1.5 billion, reflecting a 41% year-over-year growth with an Adjusted EBITDA margin of 46%.
During the same period, net cash generated from operating activities surged to $1.1 billion, representing a significant 157% year-over-year increase while free cash flow reached $1 billion, a 167% year-over-year growth. As of the end of 2023, the company held $502 million in cash and cash equivalents.
Delivery long-term value
According to AppLovin in its letter to shareholders, ”Our team’s focus on execution and innovation in 2023 exceeded our expectations, driving double-digit revenue growth in our Software Platform business every quarter this year.”
The company went on to say that Software Platform revenue for 2023 surged to a record $1.8 billion, a 76% year-over-year growth. This resulted in an adjusted EBITDA of $1.3 billion, marking a 58% year-over-year increase, with an adjusted EBITDA margin of 69%.
“We remain focused on delivering long-term shareholder value through a combination of share management and free cash flow generation. During 2023,” the company wrote. “We repurchased and withheld a total of 54.3 million shares of our Class A common stock, which, net of share issuances during the year, reduced our total shares outstanding by nearly 10%.”
“We continue to remain committed to further share management through an increase to our share repurchase program of $1.25 billion.”
Looking ahead
For the first quarter of 2024, AppLovin expects “further stability and growth” as its 1Q 2024 outlook shows total revenue of $955 to $975 million, adjusted EBITDA stands at $475 to $495 million while adjusted EBITDA margin is at 50% to 51%.
AppLovin’s share price has seen a notable trajectory in recent times, buoyed by its strong performance in the mobile app ecosystem. The company made headlines during its attempt to acquire Unity but the deal fell through. Interestingly, since then, Unity has experienced a downward trend in its share price, while AppLovin has seen a more favorable outcome.
Unity on the other hand, continues to weather its own storm with six ironSource co-founders stepping down as part of the company’s restructuring plans.
