Key Takeaways
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AppLovin is down 64% from its high, making it the worst performer in the S&P 500 this year. It reports third-quarter results after the close on Wednesday, Nov. 4.
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Nearly all of that drop has come from a lower multiple: analysts now expect $16.65 of normalized EPS in 2026, more than the $13.67 they expected a year ago.
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The stock trades under 13x forward earnings, half its five-year average of 25x.
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The fourth-quarter outlook matters most: a guide below the roughly 36% growth that consensus implies would push 2027 estimates lower.
AppLovin ( APP:NASDAQ )is down 60% in 2026, making it the worst performer in the S&P 500 this year. It reports third-quarter results after the close on Wednesday, Nov. 4.
A drop that size usually means investors expect profits to shrink. But Wall Street's earnings estimates have barely moved, and the bulls haven't given up either. Citi says the stock could double , and RBC cut its target to $500 on Oct. 28 and still saw 93% upside.
Wednesday's report will show how that gap closes: either the estimates come down, or the stock comes back.
Analysts still see earnings climbing
Analysts expect AppLovin's normalized EPS to jump 56% this year to $16.65, then grow about 20% a year in 2027 and 2028:
That $16.65 is more than the $13.67 analysts expected for 2026 a year ago. They've cut their 2027 estimate by 5% since the end of June, after management said its models improved more slowly than usual in the second quarter .
That's a small cut next to the stock's [64%] slide.
Priced at half its usual multiple
The stock has lost its premium instead. AppLovin ended 2025 at 51x forward earnings. Today it trades under 13x, half its five-year average of 25x:
My read: the market is pricing in an earnings cut that analysts haven't made yet.
TIKR tracks 33 analysts on AppLovin. How many say "Buy"?
See the full breakdown of Buy, Hold, and Sell ratings on AppLovin, along with Wall Street's revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See AppLovin's Analyst Ratings
The cash is still coming in
AppLovin spent just $0.5 million on capital projects in all of 2025, so nearly all of its cash from operations is free cash flow. Cash from operations rose from $551 million in the third quarter of 2024 to $869 million in the second quarter of 2026:
That second-quarter figure was up 11% from $781 million a year earlier. It was below the $1.31 billion and $1.29 billion of the two quarters before it, though.
Taxes are taking a bigger cut now. AppLovin paid $639.8 million in cash taxes in the first half of 2026, against $100.6 million a year earlier. Management guides 2026 free cash flow to about 75% of adjusted EBITDA, down from 87.6% in 2025, so 75% is the bar Wednesday's cash figures have to clear.
Watch the fourth-quarter guide
The third quarter has a clear bar. Management guided revenue to $2.06 billion to $2.09 billion, which would be 46% to 48% growth from a year earlier, and adjusted EBITDA to $1.71 billion to $1.74 billion.
Even so, I'd care more about the fourth-quarter outlook. Analysts' full-year estimate implies fourth-quarter revenue of about $2.25 billion, roughly 36% growth. A guide below that would push 2027 estimates lower. And a cheap multiple wouldn't help the stock much if the earnings behind it started shrinking.
Plus: I want an update on the consumer advertisers AppLovin is courting beyond mobile games. Management said their second-quarter spend was 28% above its fourth-quarter 2025 peak.
Cheap, if the guide holds
So far, AppLovin's earnings outlook hasn't fallen with the stock. At this multiple, I think it's cheap as long as Wednesday's fourth-quarter guide lands near that 36%. If the guide comes in well short, expect analysts to cut their numbers, and the stock will look a lot less cheap.
Of course, I'd want more than one strong quarter before calling the model gains back for good. Management was talking up faster improvements in May, three months before it said they'd slowed.
So what is AppLovin stock actually worth?
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