Shares of AppLovin , a mobile advertising technology company, surged in 2024 and many on Wall Street expect the record run to continue in the new year. AppLovin soared 713% last year, the best performance since it went public in the spring of 2021, as the Palo Alto-based company benefited from online advertising and artificial intelligence growth. Even after soaring to a $117 billion market value at Thursday’s close, Wall Street remains bullish on the company led by Adam Foroughi, with more than three-quarters of analysts holding a buy or overweight rating on the stock, according to FactSet. The average 12-month price target implies 10% upside from current levels. APP 1Y mountain AppLovin shares over the last year “This really may just be the beginning of what’s to come,” said BTIG analyst Clark Lampen. How AppLovin works AppLovin is a mobile technology company founded in 2012 that went public through a special purpose acquisition company in 2021. It primarily caters to mobile game developers, enabling them to acquire new users and boost revenue. “The underlying secret sauce that unlocks a lot of that for AppLovin is the ad algorithm,” explains Lampen. Success last year stemmed from changes in that targeted algorithm, known as AXON, in 2023. The revamp improved conversion rates, unlocked new customers and drove increased advertising spending by clients, Lampen said. Wedbush’s Michael Pachter notes that these changes came amid the rollout of Apple’s identifier for advertiser (IDFA) privacy changes, affecting how companies can access user data. With the new setup, he estimates AppLovin is now getting twice the business from each ad than it was previously. This, coupled with ongoing gains in gaming — where the company is dominant — coupled with a new eCommerce pilot program, also helped lift the stock in 2024, BTIG’s Lampen said. What to expect in 2025 Investors foresee another strong year ahead for shares of AppLovin as it continues to prosper from advertising growth and a ballooning gaming market. Bank of America recently named AppLovin a top pick in gaming and ad networks for 2025, expecting it to benefit from continued growth driven by high returns on advertising spending and new total addressable market opportunities in areas such as pet supplies and vehicle parts. “We think AppLovin has a unique opportunity to transform its gaming inventory into a powerful new eCommerce advertising platform,” the bank wrote. Bank of America also expects AppLovin to benefit from “constructive” feedback on its Audience + initiative, which helps businesses connect with audiences. The bank’s $375 price target implies 13% upside from Wednesday’s close. BTIG’s Lampen also views AppLovin’s commerce opportunity as a tailwind that could position gthe company for strong long-term growth. “That’s the bull case at this point — you’re just scratching the surface on a commerce opportunity that could be multiples of what the gaming business is right now or will be over time,” Lampen said. Analysts surveyed by FactSet see adjusted 2025 earnings of $6.90 per share, up 70% from $4.07 in 2024, on revenue of $5.64 billion that’s estimated as 23% above $4.59 billion last year.