AppLovin Ads Week #42: US Store Growth Accelerating

As of Oct 16 (Week #42), Store Leads indicates AppLovin has 18,450 global eCommerce clients, up 11.5% w/w, with US stores at 6,472, up 3.9% w/w. Although lower-quality APAC store growth, led by Hong Kong, has inflated total store growth, US store growth has accelerated from an average of 1.5% weekly in 3Q26 to 3.3% in 4Q26 quarter-to-date. Citi believes concerns over AppLovin's 3Q26 guidance of 7%-8% sequential growth are overdone, given typical 2Q seasonality and the July 2026 Axon model improvement, and expects eCommerce to eventually overtake gaming as the primary growth driver by 2028. Maintain Buy with a $500 target price, implying 87.9% upside from $266.13.