Aegon Capital

[Aegon Capital @aegoncap]

My thesis is that if APP can seize the ecom opportunity it will accelerate gaming ad revenue even more.

More games will be ok monetizing with ads that aren't for competing games.

More inventory + more ads + more demand + more data

Same problem Meta solved not too long ago $APP

[Zachary Drake | zdrake314 on Threads @zdrake]

@aegoncap This is accurate. E-commerce vendors are tired of their whole world being dominated by Meta. They are very eager for a challenger to provide a meaningful alternative. They’ve hoped that other players (e.g. TikTok) would be that new channel. So if $APP can deliver, they will come.

[Aegon Capital @aegoncap]

@zdrake Yes, even if APP gets like 10% budget share, business will 3-4x. And I believe it will happen because it's such an easy port over from Meta/other social platforms. It's not like TV where you need a totally dif type of creative and team to run it.

[Aegon Capital @aegoncap]

$APP

I find it funny how every big operator I've reached out to in ecom is extremely excited about AppLovin as a channel and long the business

Yet these WS analysts are not and thinks ecom is hopium

Don't underestimate the Meta-dependency risk APP solves for ecom brands

[amit @amitisinvesting]

$APP

Talked to a former Applovin employee over the weekend, here’s some of his thoughts:

- Applovin’s business has been ads within mobile games. It is very profitable, 1B people per day play games, and $META or $GOOGL have not been able to break their moat. But, growth rates have slowed down from 70% to now 55% which is incredible, but not good enough for the street because they don’t see the TAM expanding yet.

- Mobile gaming opportunity is large but viewed as saturated and very high growth rates likely aren’t sustainable in this one category.

- Company has guided to keeping their growth at 30%+ but the decline in YoY growth rates have hurt sentiment. Applovin can change this by showing their Ecom expansion can increase the TAM but the company has failed to meaningfully show this which is why the stock has been stuck. The Q2 call didn’t really address the TAM expansion either which is why the stock has been falling so rapidly since then.

- He said management is exceptional and understands what they are doing, it’s not a team to bet against, but the problem is the street is not convinced their growth can expand beyond gaming yet. He himself is also not fully convinced and feels ready to sell a significant portion of stock if the Q after holiday season doesn’t show the TAM expanding beyond mobile games.

- He also said the short reports are pretty much just noise. Nothing ever serious has come from them and they aren’t rooted in anything real.

Stock is down 50% YTD…obviously looks like a bargain and I wonder how much lower the street can send it. Only major software large cap that hasn’t recovered…is anyone buying it here?

[Aegon Capital @aegoncap]

If I am scrolling on Instagram Reels, X, Youtube, Facebook, the ad inventory is as diverse as possible: ecommerce, insurance, financial services, gaming ads, etc...

If I am playing a mobile game, though, the ad inventory is only for other mobile games.

Why is that?

$APP

[Aegon Capital @aegoncap]

@amitisinvesting Very long $APP

[Aegon Capital @aegoncap]

$APP will hit $1,000 this year, no question about it

[Aegon Capital @aegoncap]

@roanokecap @Ad_Quant It's just the market we are in mate. Every other high beta is acting like this, not specific to applovin.