BTIG analyst Clark Lampen downgraded AppLovin to Neutral from Buy without a price target. The analyst reduced estimates for the company to reflect the potential for pressure on the mobile gaming space to last another 12-24 months. Headwinds started to emerge with Q2 channel checks, continued into Q3, and most recent developer discussions suggest revenue growth could lag pre-COVID rates for another 12-24 months, Lampen tells investors in a research note. In addition, the analyst sees near- and medium-term headwinds "that skew revision risk to the downside." Consumer spending and traffic data is pacing flat to down in Q4, and while the probability could be low at this stage, there is risk of further near-term deterioration, says Lampen. He sees an extended gaming mobile industry recovery, which prompts the downgrade of AppLovin.
Published first on TheFly
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