Return on Equity (ROE)
since 2021
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AppLovin Corp. pages available for free this week:
- Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Short-term (Operating) Activity Ratios
- Common Stock Valuation Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Price to FCFE (P/FCFE)
- Selected Financial Data since 2021
- Return on Assets (ROA) since 2021
- Price to Earnings (P/E) since 2021
- Price to Sales (P/S) since 2021
- Analysis of Revenues
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Calculation
AppLovin Corp., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net income (loss) attributable to AppLovin1 | ÷ | Stockholders’ equity1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2024 | = | 100 | × | ÷ | |||
| Dec 31, 2023 | = | 100 | × | ÷ | |||
| Dec 31, 2022 | = | 100 | × | ÷ | |||
| Dec 31, 2021 | = | 100 | × | ÷ |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 US$ in thousands
The return on equity (ROE) exhibited significant fluctuations between 2021 and 2024. These movements correlate with substantial changes in net income attributable to AppLovin and stockholders’ equity over the same period.
- ROE Trend
- In 2021, the ROE stood at 1.66%. This increased to a negative value of -10.13% in 2022. A substantial recovery occurred in 2023, with the ROE rising to 28.39%. The most dramatic increase was observed in 2024, where the ROE reached 144.96%.
- Net Income Impact
- The ROE’s negative value in 2022 aligns with a significant net loss attributable to AppLovin during that year. Conversely, the positive and increasing ROE values in 2023 and 2024 correspond with increasing net income, culminating in a substantial profit in 2024.
- Stockholders’ Equity Impact
- Stockholders’ equity decreased from 2021 to 2024. Despite this consistent decline, the ROE increased significantly, particularly in 2024. This suggests that the substantial increase in net income in 2024 had a disproportionately positive effect on ROE, outweighing the impact of the decreasing equity base.
The considerable volatility in ROE highlights the sensitivity of this metric to changes in profitability. The substantial ROE observed in 2024 warrants further investigation to determine the sustainability of the factors driving this performance.
Comparison to Competitors
AppLovin Corp., ROE, long-term trends, comparison to competitors
| AppLovin Corp. | Accenture PLC | Adobe Inc. | Cadence Design Systems Inc. | CrowdStrike Holdings Inc. | Datadog Inc. | International Business Machines Corp. | Intuit Inc. | Microsoft Corp. | Oracle Corp. | Palantir Technologies Inc. | Palo Alto Networks Inc. | Salesforce Inc. | ServiceNow Inc. | Synopsys Inc. | Workday Inc. | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Dec 31, 2024 | ||||||||||||||||
| Dec 31, 2023 | ||||||||||||||||
| Dec 31, 2022 | ||||||||||||||||
| Dec 31, 2021 |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
Comparison to Sector (Software & Services)
AppLovin Corp., ROE, long-term trends, comparison to sector (software & services)
| AppLovin Corp. | Software & Services | |
|---|---|---|
| Dec 31, 2024 | ||
| Dec 31, 2023 | ||
| Dec 31, 2022 | ||
| Dec 31, 2021 |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
Comparison to Industry (Information Technology)
AppLovin Corp., ROE, long-term trends, comparison to industry (information technology)
| AppLovin Corp. | Information Technology | |
|---|---|---|
| Dec 31, 2024 | ||
| Dec 31, 2023 | ||
| Dec 31, 2022 | ||
| Dec 31, 2021 |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).