AppLovin's AI-First Strategy Fuels $1.41B Quarter, 92% Profit Jump

Mobile ad-tech company AppLovin has posted exceptional third-quarter 2025 earnings, proving that its big bet on artificial intelligence is paying off. The company's total revenue hit $1.41 billion, a massive 68% jump compared to the same time last year. This growth was driven almost entirely by its strategic focus on its AI-powered advertising business.

The jump in profit was even more dramatic. AppLovin’s net income skyrocketed 92% year-over-year to $836 million. Net income from continuing operations also landed at $836 million, marking an even greater rise of 93% year-over-year. This powerful performance boosted the company's overall net margin from 52% last year to 59% in this quarter.

Here’s the most interesting part: this explosive growth didn't come from acquiring more users. In fact, the company’s app installations saw a slight 1% dip. Instead, the gains came from massive efficiency. AppLovin’s AI technology got significantly smarter at monetization, causing the net revenue per installation to soar by 75%, showing the platform is making much more money from the users it already has.

The company's core business health looks incredibly strong. Adjusted EBITDA, another key metric for profitability, also rose 79% year-over-year to $1.16 billion, reflecting a powerful 79% profit margin.

A Strategic Pivot to Ad-Tech

This success follows AppLovin's major strategic move in the second quarter. In June, the company sold its mobile games business to Tripledot for $400 million in cash and a 20% stake in Tripledot's equity. That sale allowed the company to go all-in on its high-growth ad-tech division, which now serves over a billion daily active users globally and is expanding into new markets.

During the Q3 earnings call, AppLovin CFO Matt Stumpf called this three-month period "another exceptional quarter". The company provided an optimistic outlook for the rest of the year, projecting that its fourth-quarter revenue will be even higher, up to $1.6 billion. 

Separately, CEO and co-founder Adam Foroughi highlighted the plans to integrate new generative AI for ad creatives through the company's Axon platform, which just launched in Oct 2025.

This "AI-first" strategy reflects a major trend in the wider tech landscape. Just last month, PUBG developer Krafton also announced it is becoming an "AI-first" company, investing over $70 million in its own AI infrastructure to automate workflows and drive new growth. It shows that other companies adopting this model could see similar boosts in the coming months as the race to integrate AI accelerates.