AppLovin Corporation's stock plummeted 6.17% during intraday trading on Wednesday, as the mobile advertising technology company faced significant selling pressure.
The sharp decline comes as AppLovin is scheduled to report its fourth-quarter financial results after the market closes. Analysts expect the company to report quarterly earnings of $2.94 per share on revenue of $1.61 billion. Market participants appear to be taking profits and adjusting positions ahead of the earnings announcement, following recent strength that saw the stock rally 13.2% on Monday and gain another 2.7% on Tuesday.
The selloff also aligns with broader weakness in AI software stocks, with sector peers including Unity, HubSpot, Figma, and C3.ai also trading lower. This reflects market concerns about the AI sector's growth prospects and a shifting focus from pure AI exposure to proof of return on investment.