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APP (AppLovin) Degree of Operating Leverage : 3.36 (As of Mar. 2025)


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What is AppLovin Degree of Operating Leverage?

Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. AppLovin's Degree of Operating Leverage for the quarter that ended in Mar. 2025 was 3.36. The higher Degree of Operating Leverage, the higher operating risk the company will take.

The industry rank for AppLovin's Degree of Operating Leverage or its related term are showing as below:

APP's Degree of Operating Leverage is ranked worse than
68.29% of 984 companies
in the Media - Diversified industry
Industry Median: 1.22 vs APP: 3.36

AppLovin Degree of Operating Leverage Historical Data

The historical data trend for AppLovin's Degree of Operating Leverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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AppLovin Degree of Operating Leverage Chart

AppLovin Annual Data
Trend Dec19 Dec20 Dec21 Dec22 Dec23 Dec24
Degree of Operating Leverage
Get a 7-Day Free Trial -2.80 -3.88 -142.59 -125.12 4.34

AppLovin Quarterly Data
Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24 Dec24 Mar25
Degree of Operating Leverage Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 18.85 9.64 6.98 4.34 3.36

Competitive Comparison of AppLovin's Degree of Operating Leverage

For the Advertising Agencies subindustry, AppLovin's Degree of Operating Leverage, along with its competitors' market caps and Degree of Operating Leverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


AppLovin's Degree of Operating Leverage Distribution in the Media - Diversified Industry

For the Media - Diversified industry and Communication Services sector, AppLovin's Degree of Operating Leverage distribution charts can be found below:

* The bar in red indicates where AppLovin's Degree of Operating Leverage falls into.


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AppLovin Degree of Operating Leverage Calculation

AppLovin's Degree of Operating Leverage for the quarter that ended in Mar. 2025 is calculated as:

Degree of Operating Leverage=% Change in EBIT**/% Change in Revenue
=( 2223.42 (Mar. 2025) / 927.204 (Mar. 2024) - 1 )/( 5135.154 (Mar. 2025) / 3625.797 (Mar. 2024) - 1 )
=1.398/0.4163
=3.36***

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

** TTM data of EBIT and Revenue was used to calculate Degree of Operating Leverage.
*** Please be aware that the Degree of Operating Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.


AppLovin  (NAS:APP) Degree of Operating Leverage Explanation

Degree of Operating Leverage (DOL) is a leverage ratio that measures the sensitivity of a company’s operting income, also referred to as Earnings Before Interest and Taxes (EBIT), to fluctuations in its Revenue. DOL is a method used to quantify a company’s operating risk. This risk is related to the company's structure of variable costs and fixed costs. Since the fixed costs do not allow the company to adjust the operating costs, the operating risk rises with a higher fixed-to-variable costs proportion.

A high Degree of Operating Leverage indicates that the company’s fixed costs exceed its variable costs. By increasing the sales, the company can earn more profits. In addition, the company must be able to maintain relatively high sales to cover all fixed costs.

Be Aware

The use of operating leverage varies across different industries and business sectors, and the application of Degree of Operating Leverage (DOL) should be adjusted accordingly.


AppLovin Degree of Operating Leverage Related Terms

Thank you for viewing the detailed overview of AppLovin's Degree of Operating Leverage provided by GuruFocus.com. Please click on the following links to see related term pages.


AppLovin Business Description

Traded in Other Exchanges
Address
1100 Page Mill Road, Palo Alto, CA, USA, 94304
AppLovin is a vertically integrated advertising technology company that acts as a demand-side platform for advertisers, a supply-side platform for publishers, and an exchange facilitating transactions between the two. About 80% of AppLovin's revenue comes from the DSP, AppDiscovery, while the remainder comes from the SSP, Max, and gaming studios, which develop mobile games. AppLovin announced in February 2025 its plans to divest from the lower-margin gaming studios to focus exclusively on the ad tech platform. AppLovin's primary tool for future growth is Axon 2, which is an ad optimizer operating within the DSP that allows advertisers to place ads according to specified return thresholds.
Executives
Vasily Shikin officer: Chief Technology Officer 1100 PAGE MILL ROAD, PALO ALTO CA 94304
Arash Adam Foroughi director, 10 percent owner, officer: CEO & Chairperson 1100 PAGE MILL, PALO ALTO CA 94304
Victoria Valenzuela officer: CLO & Corp. Secretary 1100 PAGE MILL RD, PALO ALTO CA 94304-1047
Herald Y Chen director, officer: President & CFO 950 TOWER LANE, SUITE 1150, FOSTER CITY CA 94404-2127
Dawson Alyssa Harvey director 1100 PAGE MILL RD, PALO ALTO CA 94304-1974
Craig Scott Billings director C/O WYNN RESORTS, LIMITED, 3131 LAS VEGAS BOULEVARD SOUTH, LAS VEGAS NV 89109
Georgiadis Mary Margaret Hastings director 2500 LAKE COOK ROAD, RIVERWOODS IL 60015
Eduardo Vivas director 1100 PAGE MILL ROAD, PALO ALTO CA 94304
Kkr Denali Holdings L.p. 10 percent owner C/O KOHLBERG KRAVIS ROBERTS & CO. L.P., 30 HUDSON YARDS, NEW YORK NY 10001
Kkr Group Partnership L.p. 10 percent owner C/O KOHLBERG KRAVIS ROBERTS & CO. L.P., 30 HUDSON YARDS, NEW YORK NY 10001
Katie Kihorany Jansen officer: Chief Marketing Officer 1100 PAGE MILL RD, PALO ALTO CA 94304-1047
Todd R Morgenfeld director C/O PINTEREST, INC., 651 BRANNAN STREET, SAN FRANCISCO CA 94107
Kkr Group Co. Inc. 10 percent owner 30 HUDSON YARDS, NEW YORK NY 10001
Elena Arutunian officer: Chief Accounting Officer 1100 PAGE MILL RD, PALO ALTO CA 94304-1047
Angel Pride Holdings Ltd 10 percent owner ROOM 710, 7/F, WING ON HOUSE, NO. 71 DES VOREX ROAD CENTRAL, HONG KONG F4 0000