AppLovin reported $1.92 billion in revenue for the second quarter of 2026, a 53% year-over-year increase, as the company continued expanding its AI-powered advertising platform beyond mobile gaming into ecommerce and broader consumer advertising. Despite the strong growth, executives cautioned that building these newer business segments will take time, even as advertiser demand continues to increase.
Net income reached $1.27 billion, up 55% from a year earlier, while adjusted EBITDA increased 58% to $1.61 billion. AppLovin also generated $863 million in free cash flow during the quarter, maintaining profitability as it invests in new advertising verticals.
The company’s largest growth opportunity continues to come from ecommerce advertising, where CEO Adam Foroughi said advertiser spending reached another record during the quarter. According to AppLovin, consumer advertiser spend was 28% higher than the previous peak recorded during the 2025 holiday shopping season, reflecting continued adoption of its AI-driven advertising platform outside its traditional gaming customer base.
Executives said the company remains focused on expanding into consumer categories beyond retail, but emphasized that these initiatives are still in the early stages. During the earnings call, Foroughi asked investors to be patient as AppLovin scales its newer advertising businesses, noting that each vertical requires time to gather data, optimize machine learning models, and improve campaign performance before reaching maturity.
AppLovin also discussed the continued rollout of its self-serve advertising platform, which opened to all advertisers earlier this year. The company said broader access is expected to support long-term growth by allowing more businesses to launch campaigns directly through its platform while expanding its reach beyond gaming advertisers.
Although quarterly results exceeded the prior year’s performance across nearly every financial metric, management acknowledged that revenue landed near the lower end of its guidance after improvements to its advertising models were introduced later than expected. The company said advertiser demand remained healthy and that the slower rollout reflected execution timing rather than weaker market conditions.
For the third quarter, AppLovin expects revenue of $2.055 billion to $2.085 billion and adjusted EBITDA of $1.71 billion to $1.74 billion. While the outlook signals continued growth, it came in slightly below some analyst expectations, contributing to a decline in the company’s share price following the earnings release.
As AppLovin continues to diversify beyond mobile gaming, the company is positioning AI-powered advertising for e-commerce and consumer brands as its next major growth driver. Management indicated that expanding into these markets remains a long-term strategy, with further gains expected as its advertising models continue to improve and attract a broader range of advertisers.
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