Applovin Corporation

Greetings, and welcome to the AppLovin first quarter 2021 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star 0 on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Tori Valenzuela, Chief Legal Office and Corporate Secretary for Applovin. You may begin.

Thank you, and welcome to the Applovin Earnings Call for the quarter ended March 31, 2021. Joining me today to discuss Applovin's results and key business initiatives are co-founder, CEO, and chairperson, Adam Ferughi, and President and Chief Financial Officer, Harold Chen. Before we begin, I'd like to take this opportunity to remind you that during the call, we will be making forward-looking statements including statements related to the expected performance of our business, future financial results and guidance, strategy, long-term growth and margin targets, and overall future prospects, the expected benefits of our acquisition of Adjust, as well as the impact of the COVID-19 pandemic and Apple's iOS 14.5 rollout. These statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those we projected or implied during this call. In particular, those described in our risk factors, included in our final perspectives related to our initial public offering filed on April 15, 2021, and in our Form 10Q for the first quarter of 2021 that will be filed following this call, as well as the current uncertainty and unpredictability in our business, the markets, and the economy in general. You should not rely on our forward-looking statements as predictions of future events. All forward-looking statements that we make on this call are based on assumptions and beliefs as of the date hereof, and App 11 disclaims any obligation to update any forward-looking statement except as required by law. Our discussion today will include non-GAAP financial measures. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from our GAAP results. Information regarding our non-GAAP financial results including a reconciliation of our historical GAAP to non-GAAP results, may be found in our shareholder letter, which was furnished with our Form 8-K filed today with the FCC, and may also be found on our investor relations website at investors.applevin.com. Finally, a recording of this conference call will also be available on our investor relations website shortly after this call has ended. And now I'll turn it over to Adam.

Thank you for joining us today for our first public company earnings call. I want to begin by thanking our amazing teammates around the world who continue to push relentlessly to execute on our vision. Of course, we wouldn't be here without our partners who trust us as an integral part of their growth and monetization strategy. And thank you for the support from our new investors. We are very much focused on the long-term and appreciate that you recognize our competitive advantages and long-term opportunities. We are looking forward to sharing details about Applovin's first quarter results. While I don't want to steal Harold's thunder by covering financial metrics, I do want to say that we are very proud of our record first quarter, growing revenue and EBITDA over 100% year over year. I also want to highlight the three primary objectives that we focus on in driving long-term growth. We review each objective in detail in our shareholder letter on the website, but I want to touch on each at a high level here. First, we're a marketing software company that helps mobile app developers attract new users and grow their businesses. Our most important objective is to focus on growing our software platform, and our key business decisions always link back to this objective. We accelerated to 90% growth year over year in Q1 in our business software segment. Unlike many tech companies, the pandemic had negligible impact on our business since our audiences play casual games on the go. Our growth the last two quarters was primarily driven by technological improvements from our machine learning engine, Axon, which we launched late in 2020 and continues to improve dramatically. These improvements helped us significantly grow our customer base and average revenue per customer. We're also excited about closing the Adjust acquisition in April. The acquisition provides us access to their leading attribution analytics products, over 2,000 potential clients, and a sales force for the first time in our company's history. With these new Adjust assets under App11, we are excited to grow both their solutions and our Axon-powered software. Our second objective is to continue to expand our portfolio of apps to generate more first-party data for Axon. Since 2018, we built a high-growth, diversified portfolio. Our combined business apps and consumer apps include over 200 games and nearly 40 million daily active users. We work with 15 studios around the globe that have a workforce of approximately 2,000 game creators. Today, our apps are some of the world's most popular mobile games, including Project Makeover, Wordscapes, Matching to Mansion, Clockmaker, Bingo Story, Final Fantasy XV, and many others. We're able to grow these games because of our seasoned team, a creative M&A, and most importantly, our marketing expertise and cost synergies we get from marketing our apps on our software platform. our scaled first-party data advantage feeds our software engine and also insulates our business model from privacy changes relative to peers. We've already seen over 10% of iOS users update to iOS 14.5 or later, and within that audience, we're not seeing any material impact to our business. Our third business objective as a platform business with high margins is to create shareholder value through long-term growth and increasing cash flows. We believe predictable growth in cash flow is the ultimate determinant of shareholder value. The combination of our machine learning software, our first-party data advantage, and our massive TAM gives us confidence in our long-term annual cash flow growth target of over 30%. We've made great progress in Q1, but believe we're just getting started. At App11, we've built market-leading tools that help our customers grow their businesses. We've recently put all the pieces together in our business model that has evolved over a decade of investment. As you evaluate our results, we believe you will see the strength of our platform and why we're excited about our path of growth for years to come. With that, I'll now turn the call over to Harold.