AppLovin IPO Plops As Trading In Game Software Firm Starts



AppLovin’s initial public offering failed to excite investors Thursday as shares for the software company plunged when it began trading on the Nasdaq. Filed under the ticker APP, the AppLovin IPO raised $2 billion.


AppLovin (APP) offered 25 million shares at $80, the midpoint of its estimated price range of $75 to $85. At that price, the IPO gave it a fully diluted market valuation near $31 billion.

However, AppLovin stock dropped 14%, near 67.55, during afternoon action on the stock market today.

Founded in 2011, the Palo Alto, Calif.-based company provides a software platform that developers use for marketing and monetizing mobile apps, with an emphasis on games.

The company says it has more than 410 million active users. It’s suite of software tools help developers to “get their mobile apps discovered and downloaded by the right users, optimize return on marketing spend, and maximize monetization of engagement,” according to the AppLovin IPO filing.

“AppLovin is critical to the success of mobile app developers, in particular mobile game developers, solving key marketing and monetization challenges,” the filing said.

In addition, the company also has a globally diversified portfolio of over 200 free-to-play mobile games across five genres, run by 12 studios. They include studios owned by AppLovin as well as partner studios.

AppLovin IPO: $1.4 Billion In Revenue

For 2020, AppLovin reported revenue of $1.4 billion, up 45% from the year-ago period, with a net loss of $125 million. AppLovin estimates its total market opportunity in 2020 was $189 billion.

According to IPO research and advisory firm IPO boutique, companies comparable to AppLovin include Roblox (RBLX) and Unity Software (U).

The Roblox IPO was the first direct listing this year. Shares jumped 54% on its first day of trading. The Unity Software IPO raised $1.3 billion, in September.

The lead underwriters of the AppLovin IPO are Morgan Stanley and JPMorgan.

Recent IPO stocks are where you often find some of the market’s best stocks. Moreover, new IPOs are typically in their early stages of growth. Big earnings growth potential is generally what fuels an IPO stock’s price performance. IBD’s IPO Leaders section has special screening criteria to find up-and-coming stocks with strong fundamental and technical traits.

Please follow Brian Deagon on Twitter at @IBD_BDeagon for more on tech stocks, analysis and financial markets.



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