AppLovin (APP, Financial) reported impressive first-quarter results, with revenue reaching $1.48 billion, marking a 40% increase year-over-year and surpassing market expectations. Adjusted earnings per share came in at $1.67, also beating forecasts.
The company has decided to sell its mobile gaming division to Tripledot Studios, based in London, to concentrate on its advertising technology business. This transaction will involve $400 million in cash and a 20% stake in Tripledot. AppLovin’s CEO, Adam Foroughi, previously mentioned that the company has never been primarily a game developer and was in exclusive talks to sell the gaming unit to a private entity.
Tripledot Studios, founded in 2017, is known for popular mobile games such as Woodoku and Solitaire. In 2022, the company raised $116 million, reaching a valuation of $1.4 billion.
In Q1, AppLovin's advertising revenue was $1.16 billion, a 71% increase from the previous year, exceeding expectations. The company also provided strong guidance for Q2, projecting advertising revenue between $1.195 billion and $1.215 billion, with adjusted EBITDA expected to be between $970 million and $990 million.
Following the announcement, AppLovin's shares rose by 12.91% in after-hours trading.
