AppLovin's 59% revenue jump in Q1 and 28x sales multiple contrast with Fastly's 20% growth and 4x multiple, after Wall Street punished the latter's 2026 guidance.
Alpha Score of 45 reflects weak overall profile with weak momentum, poor value, strong quality, moderate sentiment.
AppLovin (APP) reported a 59% year-over-year revenue jump in the first quarter of 2026, reaching roughly $1.9 billion. The mobile advertising platform has posted sequential gains every quarter last year and expects that trend to continue in the current period. Fastly (FSLY), by contrast, recorded 20% revenue growth in the same quarter. Wall Street sold the stock after the company guided for 2026 revenue of $710 million to $725 million, implying about 16% growth from the prior year's $624 million.
AppLovin's net income margin hit 65% in the quarter ended March 31, 2026. The company launched a social networking app called Gist and faces ongoing regulatory inquiries. Its valuation reflects the strong revenue trajectory: the stock trades at roughly 28 times trailing sales. AppLovin carries an Alpha Score of 45 out of 100, rated Mixed, reflecting the tension between the growth momentum and the regulatory overhang and rich multiple.
Fastly posted a net loss margin of 12% in the first quarter. The edge-cloud provider opened a data center in West Florida and resolved a performance incident in Tokyo. Its gross margin hit a record 62.5% in the period, helped by a shift to higher-margin products. The slower growth outlook disappointed investors hoping for a faster acceleration. Fastly's stock trades at about four times sales, a fraction of AppLovin's multiple.
The divergent revenue trajectories highlight the different dynamics in mobile advertising versus edge computing. AppLovin's growth is tied to the broader mobile ad market, which has been resilient. Fastly's growth depends on enterprise adoption of its content delivery and security services, where competition is intense. The market's reaction to the two companies' guidance suggests investors are prioritizing near-term momentum over valuation discounts.
AppLovin expects second-quarter revenue of about $1.9 billion, which would represent another sequential increase. The company's ability to sustain that pace will depend on maintaining advertiser spend and navigating regulatory scrutiny. Fastly's 2026 revenue forecast of $710 million to $725 million implies a 14% to 16% increase from 2025, a deceleration from the 20% growth rate in the first quarter. The company's path to profitability remains a focus, with a target to achieve positive net income later this year.
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