AppLovin’s 84% Q4 EBITDA Margin Sparks Google Competition Concerns
AppLovin delivered an 84% adjusted EBITDA margin in Q4 and generated $1.309 billion in free cash flow, up 88% year-over-year, bringing annual free cash flow to $3.952 billion. Jim Cramer warns that such high margins could attract Google, recalling The Trade Desk’s 56% stock plunge under competitive pressure.
1. Cramer’s Warning on Google Threat
Jim Cramer cautioned that AppLovin’s exceptionally high margins could invite Google to enter its ad-tech market, using The Trade Desk’s 56% stock decline under similar pressure as a precedent.
2. AppLovin’s Q4 Financial Performance
The company posted an 84% adjusted EBITDA margin in Q4 and generated $1.309 billion in free cash flow, up 88% year-over-year, contributing to $3.952 billion in annual free cash flow.
3. Competitive and Regulatory Risks
Alphabet’s $402.8 billion in trailing revenue and 32.8% profit margin position it to challenge high-margin ad platforms, while AppLovin’s own filings warn of a competitive ecosystem and potential adaptation issues.