I feel like I owe everyone a few thoughts on the latest $APP and $U earnings.
First, Unity. I wasn’t particularly surprised by the results. Unity has been doing really well, and the massive influx of prediction market advertisers has certainly provided additional tailwinds to an already improving business.
AppLovin, on the other hand, genuinely surprised me.
The rumors about changes to their models turned out to be true, and I was somewhat skeptical they could sustain their previous pace of revenue growth.
But there’s something I’ve been telling friends I regularly discuss AppLovin with: never underestimate this company’s ability to punch above its weight.
They’ve consistently managed to surprise the market for six or seven quarters now, and this quarter was no exception. Credit where credit is due. Incredible execution by the entire team.
Looking ahead, I’m expecting a very strong Q4 across the board.
AppLovin’s recent model improvements should benefit advertisers across the platform, while e-commerce is poised to become an increasingly important growth driver.
Prediction markets continue to spend aggressively, benefiting both Unity and AppLovin. I wouldn’t be surprised if Liftoff and other ad networks see similar tailwinds.
All in all, there’s a lot to be optimistic about heading into Q4. And if the last few quarters have taught us anything, it’s that this industry still has plenty of surprises left.