Item 1. Condensed Consolidated Financial Statements

AppLovin Corporation

Condensed Consolidated Balance Sheets

(In thousands, except per share data)

(Unaudited)

			March 31, 2026						December 31, 2025
Assets
Current assets:
Cash and cash equivalents			$	2,758,671					$	2,487,096
Accounts receivable, net			1,958,023						1,819,366
Prepaid expenses and other current assets			130,881						124,330
Total current assets			4,847,575						4,430,792
Property and equipment, net			114,820						122,445
Goodwill			1,523,050						1,539,986
Intangible assets, net			368,996						396,714
Equity method investments			288,669						287,666
Other non-current assets			564,595						482,007
Total assets			$	7,707,705					$	7,259,610
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable			$	697,524					$	746,977
Accrued and other current liabilities			796,858						586,811
Total current liabilities			1,494,382						1,333,788
Long-term debt			3,514,022						3,512,987
Other non-current liabilities			335,818						278,164
Total liabilities			5,344,222						5,124,939
Commitments and contingencies (Note 5)
Stockholders’ equity:
Preferred Stock, $0.00003 par value—100,000 shares authorized, no shares issued and outstanding as of March 31, 2026 and December 31, 2025			—						—
Class A, Class B, and Class C Common Stock, $0.00003 par value—1,850,000 (Class A 1,500,000, Class B 200,000, Class C 150,000) shares authorized, 336,294 (Class A 306,087, Class B 30,208, Class C nil) and 338,313 (Class A 307,955, Class B 30,358, Class C nil) shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively			11						11
Additional paid-in capital			504,342						446,550
Accumulated other comprehensive loss			(67,767)						(46,987)
Retained earnings			1,926,897						1,735,097
Total stockholders’ equity			2,363,483						2,134,671
Total liabilities and stockholders’ equity			$	7,707,705					$	7,259,610

The accompanying notes are an integral part of these condensed consolidated financial statements.

AppLovin Corporation

Condensed Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)

			Three Months Ended March 31,
			2026						2025
Revenue			$	1,842,449					$	1,158,974
Costs and expenses:
Cost of revenue			203,632						151,680
Sales and marketing			60,751						59,383
Research and development			94,104						56,406
General and administrative			44,029						51,523
Total costs and expenses			402,516						318,992
Income from operations			1,439,933						839,982
Other income (expense):
Interest expense			(51,159)						(52,888)
Other income, net			42,634						7,512
Total other expense, net			(8,525)						(45,376)
Income before income taxes			1,431,408						794,606
Provision for income taxes			225,795						71,068
Net income from continuing operations			1,205,613						723,538
Loss from discontinued operations, net of income taxes			—						(147,119)
Net income			$	1,205,613					$	576,419
Net income (loss) per share attributed to Class A and Class B common stockholders - Basic:
Continuing operations			$	3.57					$	2.13
Discontinued operations			—						(0.43)
Basic net income per share			$	3.57					$	1.70
Net income (loss) per share attributed to Class A and Class B common stockholders - Diluted:
Continuing operations			$	3.56					$	2.10
Discontinued operations			—						(0.43)
Diluted net income per share			$	3.56					$	1.67
Weighted-average common shares used to compute net income (loss) per share attributable to Class A and Class B common stockholders:
Basic			337,399						339,837
Diluted			338,729						344,878

The accompanying notes are an integral part of these condensed consolidated financial statements.

AppLovin Corporation

Condensed Consolidated Statements of Comprehensive Income

(In thousands)

(Unaudited)

			Three Months Ended March 31,
			2026						2025
Net income			$	1,205,613					$	576,419
Other comprehensive income (loss):
Foreign currency translation adjustment, net of tax			(20,780)						29,911
Other comprehensive income (loss), net of tax			(20,780)						29,911
Comprehensive income			$	1,184,833					$	606,330

The accompanying notes are an integral part of these condensed consolidated financial statements.

AppLovin Corporation

Condensed Consolidated Statements of Stockholders’ Equity

(In thousands)

(Unaudited)

			Three Months Ended March 31, 2026
			Class A and Class B Common Stock												Additional Paid-In Capital						Accumulated Other Comprehensive Loss						Retained Earnings						Total Stockholders’ Equity
			Shares						Amount
Balances as of December 31, 2025			338,313						$	11					$	446,550					$	(46,987)					$	1,735,097					$	2,134,671
Stock issued in connection with equity awards			214						—						597						—						—						597
Shares withheld related to net share settlement of equity awards			(63)						—						(26,177)						—						—						(26,177)
Repurchase of Class A common stock			(2,170)						—						—						—						(1,013,813)						(1,013,813)
Stock-based compensation			—						—						83,372						—						—						83,372
Other comprehensive loss, net of tax			—						—						—						(20,780)						—						(20,780)
Net income			—						—						—						—						1,205,613						1,205,613
Balances as of March 31, 2026			336,294						$	11					$	504,342					$	(67,767)					$	1,926,897					$	2,363,483

			Three Months Ended March 31, 2025
			Class A and Class B Common Stock												Additional Paid-In Capital						Accumulated Other Comprehensive Loss						Retained Earnings						Total Stockholders’ Equity
			Shares						Amount
Balances as of December 31, 2024			340,042						$	11					$	593,699					$	(103,096)					$	599,204					$	1,089,818
Stock issued in connection with equity awards			1,674						—						5,329						—						—						5,329
Shares withheld related to net share settlement of equity awards			(422)						—						(185,667)						—						—						(185,667)
Repurchase of Class A common stock			(2,932)						—						—						—						(1,001,670)						(1,001,670)
Stock-based compensation			—						—						61,281						—						—						61,281
Other comprehensive income, net of tax			—						—						—						29,911						—						29,911
Net income			—						—						—						—						576,419						576,419
Balances as of March 31, 2025			338,362						$	11					$	474,642					$	(73,185)					$	173,953					$	575,421

The accompanying notes are an integral part of these condensed consolidated financial statements.

AppLovin Corporation

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

			Three Months Ended March 31,
			2026						2025
Operating Activities
Net income			$	1,205,613					$	576,419
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization, depreciation and write-offs			33,665						79,887
Goodwill impairment			—						188,943
Stock-based compensation, excluding cash-settled awards			83,372						61,281
Other			(16,478)						8,086
Changes in operating assets and liabilities:
Accounts receivable			(138,098)						(167,382)
Prepaid expenses and other assets			(9,827)						(51,861)
Accounts payable			(49,556)						32,545
Accrued and other liabilities			182,702						103,794
Net cash provided by operating activities			1,291,393						831,712
Investing Activities
Purchase of non-marketable equity securities			—						(18,678)
Other investing activities			(5,247)						(3,986)
Net cash used in investing activities			(5,247)						(22,664)
Financing Activities
Repurchases of common stock			(981,723)						(1,000,911)
Payment of withholding taxes related to net share settlement			(26,874)						(185,667)
Payments of licensed asset obligation			—						(13,532)
Proceeds from issuance of debt			—						200,000
Other financing activities			(3,635)						(2,107)
Net cash used in financing activities			(1,012,232)						(1,002,217)
Effect of foreign exchange rate on cash and cash equivalents			(2,339)						2,782
Net increase (decrease) in cash and cash equivalents, including cash from discontinued operations			271,575						(190,387)
Less: net decrease in cash from discontinued operations			—						(35,873)
Net increase (decrease) in cash and cash equivalents			271,575						(154,514)
Cash and cash equivalents at beginning of the period			2,487,096						697,030
Cash and cash equivalents at end of the period			$	2,758,671					$	542,516

The accompanying notes are an integral part of these condensed consolidated financial statements.

AppLovin Corporation

Condensed Consolidated Statements of Cash Flows (Continued)

(In thousands)

(Unaudited)

			Three Months Ended March 31,
			2026						2025
Supplemental non-cash investing and financing activities disclosures:
Acquisitions not yet paid			$	—					$	20,368
Right-of-use assets obtained in exchange for lease obligations, net of modifications			$	58,027					$	3,967
Repurchases of common stock included in accrued liabilities			$	32,090					$	—
Supplemental disclosure of cash flow information:
Cash paid for interest			$	1,690					$	2,392
Cash paid for income taxes, net of refunds			$	106,677					$	5,597

The accompanying notes are an integral part of these condensed consolidated financial statements.

AppLovin Corporation

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

1. Description of Business and Summary of Significant Accounting Policies

Description of Business

AppLovin Corporation (the “Company” or “AppLovin”) was incorporated in the state of Delaware on July 18, 2011. The Company is a leader in the advertising industry providing end-to-end advertising solutions that allow businesses to reach, monetize, and grow their global audiences.

The Company is headquartered in Palo Alto, California, and has several operating locations in the U.S. as well as various international office locations in North America, Asia, and Europe.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, the unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K filed with the SEC on February 19, 2026 (the "Annual Report"). The condensed consolidated balance sheet data as of December 31, 2025 was derived from the audited consolidated financial statements at that date but does not include all disclosures required by GAAP. The accompanying unaudited condensed consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary for the fair presentation of the Company’s financial position, results of operations, cash flows, and stockholders’ equity for the interim periods presented. The results of operations for the three months ended March 31, 2026 shown in this report are not necessarily indicative of the results to be expected for the full year ending December 31, 2026 or any other period.

Certain prior period amounts reported in the Company's condensed consolidated financial statements and accompanying notes have been reclassified to conform to the current period presentation where applicable. Amounts presented may not sum due to rounding.

Basis of Consolidation

The Company's condensed consolidated financial statements include accounts and operations of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation.

Use of Estimates

The preparation of the Company's condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the condensed consolidated financial statements and accompanying notes. The Company bases its estimates on assumptions that are believed to be reasonable under the circumstances. On an ongoing basis, the Company evaluates its estimates, including, but not limited to, those related to valuation of long-lived assets and their associated estimated useful lives, valuation of goodwill, valuation of non-marketable equity securities and other financial instruments, valuation of equity method investments, income taxes, stock-based compensation, and other contingent liabilities. These estimates are inherently subject to judgment and actual results could differ materially from those estimates.

Significant Accounting Policies

There have been no material changes to the Company's significant accounting policies included in its Annual Report.

Recent Accounting Pronouncements (Issued and Adopted)

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software: Targeted Improvements to the Accounting for Internal-Use Software, which provides updated recognition and disclosure framework for internal-use software costs. The amendments will be effective for annual periods beginning after December 15, 2027, and interim periods within those annual reporting periods. The amendments may be

applied prospectively or retrospectively, and early adoption is permitted. The Company elected to early adopt this ASU on January 1, 2026 with no material impact on its condensed consolidated financial statements.

Recent Accounting Pronouncements (Issued Not Yet Adopted)

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies the applicability of the interim reporting guidance, the types of interim reporting, and the form and content of interim financial statements in accordance with U.S. GAAP. Per the FASB, the amendment does not intend to change the fundamental nature of interim reporting or expand or reduce current interim disclosure requirements but rather provide clarity and improve navigability of the existing interim reporting requirements. The amendments will be effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. The amendments may be applied prospectively or retrospectively, and early adoption is permitted. The Company is currently evaluating this ASU to determine its impact on the Company's disclosures.

2. Discontinued Operations

Divestiture

On June 30, 2025, the Company completed the sale of certain wholly-owned subsidiaries that operate the Company’s Apps business (the “Apps Business”), as part of its strategic effort to divest non-core assets and dedicate its resources to advancing its advertising business. In connection with the transaction, the Company received $715.6 million in total consideration, consisting of $430.6 million in cash and 596.9 million ordinary shares of Tripledot, valued at $285.0 million. The cash consideration of $430.6 million included $400.0 million as specified in the purchase agreement and $30.6 million in purchase price adjustments in accordance with the terms of the purchase agreement. The Tripledot shares received represented approximately 22% of its outstanding ordinary shares and 20% of its fully diluted equity capitalization as of the closing date, and were accounted for as an equity method investment.

For tax purposes, the transfer of certain Apps Business subsidiaries was treated as an asset sale, resulting in a $125.6 million write-off of deferred tax assets, which was included in the provision for income taxes from discontinued operations. The Company derecognized the remaining net assets of $591.2 million and recorded a pre-tax gain of $106.2 million in discontinued operations after giving effect to $18.3 million of transaction costs. The transaction also resulted in a capital loss for income tax purposes of $204.3 million, which was fully offset by a valuation allowance.

The following table summarizes the results of the Apps Business presented as loss from discontinued operations, net of income taxes, in the condensed consolidated statements of operations for the three months ended March 31, 2025 (in thousands):

			Three Months Ended March 31, 2025
Revenue			$	325,047
Costs and expenses:
Cost of revenue			119,552
Sales and marketing			123,573
Research and development			66,512
General and administrative			2,978
Goodwill impairment			188,943
Total costs and expenses			501,558
Loss from operations			(176,511)
Other income:
Other income, net			299
Total other income, net			299
Loss from discontinued operations before income taxes			(176,212)
Benefit from income taxes			(29,093)
Loss from discontinued operations, net of income taxes			$	(147,119)

The following table summarizes significant non-cash operating items and capital expenditures related to discontinued operations, as reflected in the condensed consolidated statements of cash flows for the three months ended March 31, 2025 (in thousands):

			Three Months Ended March 31, 2025
Amortization, depreciation and write-offs			$	47,941
Stock-based compensation			$	2,268
Goodwill impairment			$	188,943
Acquisition of intangible assets			$	1,542

Goodwill Impairment

The Company evaluates goodwill for impairment at the reporting unit level on an annual basis, or more frequently if events or changes in circumstances indicate that goodwill may be impaired.

On February 12, 2025, the Company entered into a non-binding term sheet to sell its Apps Business to Tripledot. As of March 31, 2025, the Apps Business was not classified as held for sale, as the criteria required for such classification had not yet been met. However, the Company identified the non-binding term sheet combined with negotiations throughout the first quarter of 2025 to sell the Apps Business as an indicator of impairment for the Apps reporting unit and performed an interim quantitative goodwill impairment test as of March 31, 2025. Based on this assessment, the Company determined that the carrying amount of the Apps reporting unit exceeded its estimated fair value and recorded a non-cash goodwill impairment charge of $188.9 million. This charge was included in loss from discontinued operations, net of income taxes, for the three months ended March 31, 2025.

At the time the interim impairment test was performed, the Company had not yet determined the fair value of the total consideration, which was subject to the valuation of the equity consideration at the closing of the transaction. As a result, the Company estimated the fair value of the Apps reporting unit using the discounted cash flow method of the income approach. Key valuation inputs included projected future cash flows, risk-adjusted discount rates and long-term growth rates, which were based on management’s estimates and assumptions believed to be reasonable and reflective of known market conditions as of the interim impairment test date. The resulting fair value measurement is classified as Level 3 within the fair value hierarchy due to the use of significant unobservable inputs.

3. Revenue

Revenue from Contracts with Customers

The Company generates substantially all of its revenue from Axon Ads Manager, the Company's AI-powered demand-side advertising solution that deploys advertiser capital at their return goals. The Company’s performance obligation is to provide customers with access to its advertising solution, which facilitates the advertisers’ purchase of advertising inventory from publishers primarily on an impression or action basis.

The Company does not control the advertising inventory prior to its transfer to the advertiser because it does not have the substantive ability to direct the use of, or obtain substantially all of the remaining benefits from, the advertising inventory. In addition, the Company is not primarily responsible for fulfillment. Therefore, the Company is an agent in these arrangements and presents revenue net of advertising inventory costs.

The transaction price is determined dynamically based on advertisers’ campaign goals, less consideration paid or payable to publishers. Revenue is recognized for impression-based arrangements when an ad impression is delivered, and for action-based arrangements when the specified action (such as a click or install) occurs.

The Company’s terms and conditions generally stipulate payment terms of 30 days after the end of the month. Substantially all of the Company's contracts with customers are cancelable at any time.

Revenue from other services was not material for any period presented.

The Company presents taxes collected from customers and remitted to governmental authorities on a net basis.

Disaggregation of Revenue

Revenue disaggregated by geography, based on user location, consists of the following (in thousands):

			Three Months Ended March 31,
			2026						2025
United States			$	907,219					$	615,703
Rest of the world			935,230						543,271
Total revenue			$	1,842,449					$	1,158,974

4. Financial Instruments and Fair Value Measurements

Financial Instruments Measured at Fair Value by Level on a Recurring Basis

As of March 31, 2026 and December 31, 2025, the Company held $200.0 million and $200.1 million in money market funds, respectively, which were classified as Level 1 within the fair value hierarchy.

Non-Marketable Equity Securities Measured at Net Asset Value

The Company held equity interests in certain private equity funds of $139.2 million and $118.7 million as of March 31, 2026 and December 31, 2025, respectively, which are measured using the net asset value ("NAV") practical expedient and accordingly, are not classified within the fair value hierarchy. Under the NAV practical expedient, the Company records investments based on the proportionate share of the underlying funds’ NAV as of the Company's reporting date. These investments are included in other non-current assets in the Company’s condensed consolidated balance sheets.

These funds vary in investment strategies and generally have an initial term of 7 to 10 years, which may be extended for 2 to 3 additional years with the applicable approval. These investments are subject to certain restrictions regarding transfers and withdrawals and generally cannot be redeemed with the funds. Distributions from the funds will be received as the underlying investments are liquidated. The Company’s maximum exposure to loss is limited to the carrying value of these investments of $139.2 million and the remaining unfunded commitments of $3.0 million as of March 31, 2026.

During the three months ended March 31, 2026, the Company made no capital contributions related to these investments. Unrealized gains on these investments were $19.3 million for the three months ended March 31, 2026, and were not material for the three months ended March 31, 2025.

Non-Marketable Equity Securities Measured at Fair Value on a Non-Recurring Basis

The Company's non-marketable equity securities are investments in privately held companies without readily determinable fair values. The Company elected the measurement alternative to account for these investments. Under the measurement alternative, the carrying value of the non-marketable equity securities is adjusted based on price changes from observable transactions of identical or similar securities of the same issuer or for impairment. Any changes in carrying value are recorded within other income, net in the Company's condensed consolidated statement of operations. These investments are classified as Level 3 when measured due to impairment or qualifying observable price changes, as the valuation incorporates observable transaction prices and significant unobservable inputs.

As of March 31, 2026 and December 31, 2025, the carrying amounts of the Company's non-marketable equity securities were $19.6 million and $19.6 million, respectively, and were included in other non-current assets in the Company’s condensed consolidated balance sheets. During the three months ended March 31, 2026, there was no impairment or adjustment due to observable prices related to these investments.

5. Commitments and Contingencies

Commitments

As of March 31, 2026, the Company's non-cancelable minimum purchase commitments were primarily related to a multi-year contractual arrangement with a cloud computing services provider. In August 2024, the Company amended its agreement with the provider, committing to spending a minimum of $1.3 billion over a three-year period. By March 31, 2026, the Company had made payments of $780.4 million towards this commitment.

Contingencies

From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of

business activities. The Company accrues a liability for such matters when it is probable that future expenditures will be made, and such expenditures can be reasonably estimated.

Legal Proceedings

The Company is involved from time to time in litigation, claims, and proceedings. The outcomes of the Company’s legal proceedings are inherently unpredictable and subject to significant uncertainty.

The Company records a liability for loss contingencies when it is probable that a loss has been incurred and the amount can be reasonably estimated. If a loss is reasonably possible and the amount or range of loss can be reasonably estimated, the Company discloses the estimated loss or range of loss. The Company monitors legal matters and evaluates developments that could affect previously accrued amounts or related disclosure, or whether a previously unaccrued or undisclosed matter requires accrual or disclosure, and adjusts accruals and disclosures as appropriate. Determining the likelihood of loss and the amount or range of loss involves significant judgment.

Based on its current knowledge, the Company does not believe the ultimate resolution of its outstanding legal and regulatory matters will have a material adverse effect on the Company’s business, financial position, results of operations, or cash flows. However, if one or more of these matters were resolved against the Company for amounts in excess of the Company’s expectations, the Company’s results of operations, financial position, or cash flows could be materially affected.

As of March 31, 2026 and December 31, 2025, the Company had no material loss contingencies related to legal proceedings for which accrual or disclosure was required.

The Company expenses legal fees in the period in which they are incurred.

Indemnifications

The Company enters into indemnification provisions under agreements with other parties in the ordinary course of business, including certain customers, business partners, investors, contractors and the Company’s officers, directors and certain employees. It is not possible to determine the maximum potential loss under these indemnification provisions due to the Company’s limited history of prior indemnification claims and the unique facts and circumstances involved in each particular provision. To date, losses recorded in the Company’s condensed consolidated statements of operations in connection with the indemnification provisions have not been material. As of March 31, 2026, the Company did not have any material indemnification claims that were probable or reasonably possible.

Non-income Taxes

The Company may be subject to audit by various tax authorities with regard to non-income tax matters. The subject matter of non-income tax audits primarily arises from different interpretations on tax treatment and tax rates applied. The Company accrues liabilities for non-income taxes that may result from examinations by, or any negotiated agreements with, these tax authorities when a loss is probable and reasonably estimable. If a loss is reasonably possible and the loss or range of loss can be estimated, the Company discloses the reasonably possible loss.

6. Goodwill and Intangible Assets, Net

The following table presents the changes in the carrying amount of goodwill (in thousands):

Balance as of December 31, 2025			$	1,539,986
Foreign currency translation			(16,936)
Balance as of March 31, 2026			$	1,523,050

Intangible assets, net consisted of the following (in thousands):

			Weighted- Average Remaining Useful Life (in years)						As of March 31, 2026																		As of December 31, 2025
			Gross Carrying Value						Accumulated Amortization						Net Book Value						Gross Carrying Value						Accumulated Amortization						Net Book Value
Customer relationships			6.1						$	524,716					$	(230,465)					$	294,251					$	528,207					$	(218,736)					$	309,471
Developed technology			1.5						209,134						(166,726)						42,408						210,708						(159,274)						51,434
Other			3.3						65,632						(33,295)						32,337						65,790						(29,981)						35,809
Total intangible assets									$	799,482					$	(430,486)					$	368,996					$	804,705					$	(407,991)					$	396,714

The Company recorded amortization expense related to intangible assets as follows (in thousands):

			Three Months Ended March 31,
			2026						2025
Cost of revenue			$	11,807					$	9,303
Sales and marketing			13,934						13,526
Total			$	25,741					$	22,829

7. Equity

The Company's board of directors authorized a share repurchase program in February 2022 for the Company's Class A common stock and has authorized additional amounts under the program from time to time, including an additional $3.2 billion authorized in 2025. As of December 31, 2025, $3.3 billion remained available for repurchases under the program. During the three months ended March 31, 2026, the Company repurchased and subsequently retired 2,170,041 shares of Class A common stock for an aggregate amount, including commissions, taxes, and fees, of $1.0 billion. As of March 31, 2026, $2.3 billion remained available for repurchases under the program.

Repurchases may be made from time to time through open market purchases or through privately negotiated transactions, subject to market conditions, applicable legal requirements, including surplus and solvency requirements, and other relevant factors. Open market repurchases may be structured to occur in accordance with the requirements of Rule 10b-18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Company may also, from time to time, enter into Rule 10b5-1 trading plans to facilitate repurchases of shares. The repurchase program does not obligate the Company to acquire any particular amount of Class A common stock, has no expiration date and may be modified, suspended, or terminated at any time at the Company's discretion.

The Company retires its Class A common stock upon repurchase, and records the excess of repurchase price over par value for shares repurchased to retained earnings to the extent the Company has retained earnings. If the Company has an accumulated deficit, the Company records the excess of repurchase price over par value for shares repurchased first to additional paid-in capital, to the extent the Company has additional paid-in capital, until depleted, and then to accumulated deficit in the Company’s condensed consolidated statements of stockholders’ equity.

8. Stock-based Compensation

The Company maintains three equity compensation plans that provide for the issuance of shares of its common stock to the Company’s employees, directors, consultants and other service providers: the 2021 Equity Incentive Plan, the 2021 Partner Studio Incentive Plan, and the 2021 Employee Stock Purchase Plan. There were no material equity award issuances during the three months ended March 31, 2026.

Stock-based compensation included in the Company's condensed consolidated statements of operations is as follows (in thousands):

			Three Months Ended March 31,
			2026						2025
Cost of revenue			$	59					$	1,100
Sales and marketing			3,232						15,966
Research and development			67,374						27,793
General and administrative			12,804						14,256
Stock-based compensation from continuing operations			83,469						59,115
Stock-based compensation from discontinued operations			—						2,268
Total stock-based compensation			$	83,469					$	61,383

9. Earnings Per Share

The rights, including the liquidation and dividend rights, of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one vote per share and each share of Class B common stock is entitled to 20 votes per share. Each share of Class B common stock is convertible into one share of Class A common stock voluntarily at any time by the holder, and automatically upon certain events. The Class A common stock has no conversion rights. As the liquidation and dividend rights are identical for Class A and Class B common stock, the undistributed earnings are allocated on a

proportional basis and the resulting net income per share attributable to common stockholders will, therefore, be the same for both Class A and Class B common stock on an individual or combined basis.

The following table sets forth the computation of basic and diluted net income per share attributable to common stockholders (in thousands, except per share data):

			Three Months Ended March 31,
			2026						2025
Basic EPS:
Numerator:
Net income from continuing operations			$	1,205,613					$	723,538
Less: income attributable to participating securities			—						(181)
Net income from continuing operations attributable to common stockholders - Basic			1,205,613						723,357
Loss from discontinued operations, net of income taxes, attributable to common stockholders - Basic			—						(147,082)
Net income attributable to common stockholders - Basic			$	1,205,613					$	576,275
Denominator:
Weighted-average shares used in computing net income (loss) per share - Basic			337,399						339,837
Net income (loss) per share attributed to Class A and Class B common stockholders - Basic:
Continuing operations			$	3.57					$	2.13
Discontinued operations			—						(0.43)
Basic net income per share			$	3.57					$	1.70
Diluted EPS:
Numerator:
Net income from continuing operations attributable to common stockholders - Basic			$	1,205,613					$	723,357
Re-allocation of participating securities considered potentially dilutive securities			—						3
Net income from continuing operations attributable to common stockholders - Diluted			1,205,613						723,360
Loss from discontinued operations, net of income taxes, attributable to common stockholders - Diluted			—						(147,083)
Net income attributable to common stockholders - Diluted			$	1,205,613					$	576,277
Denominator:
Weighted-average shares used in computing net income (loss) per share - Basic			337,399						339,837
Weighted-average dilutive stock awards			1,330						5,041
Weighted-average shares used in computing net income (loss) per share - Diluted			338,729						344,878
Net income (loss) per share attributed to Class A and Class B common stockholders - Diluted:
Continuing operations			$	3.56					$	2.10
Discontinued operations			—						(0.43)
Diluted net income per share			$	3.56					$	1.67
			As of March 31,
			2026						2025
Anti-dilutive potential common stock excluded			133						117

10. Income Taxes

The Company is subject to income taxes in the U.S. and in foreign jurisdictions. The Company bases the interim tax accruals on an estimated annual effective tax rate applied to year-to-date income and records the discrete tax items in the period to which they relate. Each quarter, the Company updates the estimated annual effective tax rate and makes a year-to-date adjustment to the tax provision as necessary. The Company’s calendar year 2026 annual effective tax rate differs from the U.S. statutory rate primarily due to jurisdictional mix of earnings, and foreign-derived income deduction.

During the three months ended March 31, 2026, there were no material changes to the Company's unrecognized tax benefits, and the Company does not expect material changes in unrecognized tax benefits within the next twelve months.

11. Segment

The Company determines its operating segments based on how its Chief Operating Decision Maker ("CODM") manages the business, allocates resources, makes operating decisions and evaluates operating performance. The Company’s CODM is its Chief Executive Officer.

The Company operates as a single operating and reportable segment, providing end-to-end advertising solutions through Axon Ads Manager, MAX, Adjust, and Wurl. Revenue is primarily generated from fees paid by advertisers for advertisements placed in mobile applications owned by third-party publishers. As described in Note 2 – Discontinued Operations, the former Apps Business is classified as discontinued operations and excluded from segment results for all periods presented.

As a single reportable segment entity, the Company has determined that its measure of profit or loss is net income from continuing operations, which is the measure most consistent with U.S. GAAP. The CODM uses net income from continuing operations to allocate resources during the annual budgeting and forecasting process, evaluate operating strategies, and assess performance across periods.

The table below is a summary of the segment net income from continuing operations, including significant segment expenses (in thousands):

			Three Months Ended March 31,
			2026						2025
Revenue			$	1,842,449					$	1,158,974
Less:
Datacenter costs			162,229						122,358
Personnel related expenses			51,513						55,191
Interest expense			51,159						52,888
Provision for income taxes			225,795						71,068
Amortization, depreciation and write-offs			33,665						31,946
Stock-based compensation			83,469						59,115
Other expenses1			29,006						42,870
Net income from continuing operations			$	1,205,613					$	723,538

1 Other expenses include professional services costs, facilities costs, advertising costs, software costs, and other individually insignificant costs.

12. Related Party Transactions

During the three months ended March 31, 2026, the Company recognized $24.8 million in revenue related to Tripledot and its subsidiaries’ use of Axon Ads Manager, reflecting their advertiser spend net of amounts paid or payable to them as publishers.

The Company had no other material related party transactions for the three months ended March 31, 2026 and 2025.