Key Takeaways
- AppLovin shares gained 2.21% in Wednesday’s premarket session to $406.80, showing signs of recovery after a 40.93% decline year to date.
- Technology stocks rallied broadly as Middle East geopolitical concerns appeared to ease, supporting market sentiment.
- Evercore ISI interviewed 10 user acquisition operators and determined the stock’s drop doesn’t align with underlying business strength.
- 80% of surveyed contacts anticipate increasing their AppLovin user acquisition spending over the coming 6 to 12 months.
- Technical indicators show weakness — APP trades 26.9% under its 100-day moving average with RSI at 40.80 and negative MACD readings.
AppLovin shares showed modest strength in Wednesday’s premarket session, climbing 2.21% to reach $406.80 following a challenging period that saw the stock retreat nearly 41% from the beginning of the year.
The recovery aligned with a wider tech sector bounce, as Nasdaq futures advanced 1.10% early Wednesday while S&P 500 futures climbed 0.80%. Market optimism grew on indications that Middle Eastern conflicts may be de-escalating.
President Donald Trump indicated the U.S. military operation in the region could conclude “within two or three weeks.” Meanwhile, Iranian President Masoud Pezeshkian expressed willingness to pursue peace if security assurances are provided. Trump is scheduled to deliver a national address at 9:00 p.m. ET Wednesday.
Interest rate expectations remained stable, with the CME FedWatch tool indicating a 99.5% probability the Federal Reserve will maintain current rates in April. Economist Jeremy Siegel recommended investors adopt a cautious approach until energy market volatility subsides.
Evercore Research Points to Disconnect Between Price and Performance
Despite the significant stock decline, Evercore ISI analyst Robert Coolbrith believes the market reaction has been excessive based on field intelligence.
Between March 18 and March 30, Evercore conducted 10 comprehensive discussions with user acquisition operators — key stakeholders from game publishers, developers, and gaming-focused agencies spanning North America, Europe, and MENA regions. These contacts collectively oversee approximately $1.9 billion in annual user acquisition expenditures.
Eight out of 10 respondents indicated they plan to increase AppLovin‘s portion of their UA spending over the next 6 to 12 months. Three of these eight anticipate wallet share increases of 3 to 5 percentage points. Two other contacts acknowledged AppLovin deserves 10 to 15 percentage points more of their budget based purely on return on ad spend metrics.
Multiple contacts highlighted late Q4 product enhancements as beneficial developments. One mentioned an adjustment to retargeting windows, while three others emphasized “creative clustering” as a significant improvement.
Recent Platform Updates Continue Influencing Spending Decisions
Product modifications implemented earlier in 2025 continue to shape budget allocations. Five of the 10 contacts reported that shifting campaign objectives from CPI to CPM has enhanced budget fulfillment and campaign scaling capabilities. Four highlighted the transition to D28 optimization from D7 as an ongoing positive factor. Two of these contacts expressed interest in seeing AppLovin extend the optimization window to D60.
Coolbrith maintained his Outperform rating and $750 price target on AppLovin shares.
Chart Analysis Shows Continued Pressure
From a technical standpoint, APP faces headwinds. The stock trades 11.2% beneath its 20-day moving average and 26.9% below its 100-day moving average. The RSI registers 40.80 — a neutral reading with bearish undertones. MACD stands at -19.09 and continues trading beneath its signal line.
APP’s 52-week trading range extends from $200.50 to $745.61. Critical resistance lies at $473.50, while support appears at $366.50. The stock has delivered a 40.79% return over the trailing 12 months despite the year-to-date pullback.
Coolbrith’s $750 price target implies an 84% upside from Wednesday’s premarket level.
