Munger Mode rating: 3 out of 5 — Hold. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
Written in the first person by Warren Buffett and Charlie Munger, working only from the company's regulatory filings, earnings communications, and current market data. We have spent our careers saying we don't understand technology businesses well enough to own them, and then occasionally making exceptions when the economics shouted loudly enough. AppLovin shouts louder than almost any business we have ever examined. On the numbers alone — 84% EBITDA margins, 66% net margins, essentially zero capital expenditure, returns on equity north of 100% — this is one of the most profitable enterprises, per dollar of capital employed, in the history of American business. That is not hyperbole; it is arithmetic from the June 30, 2026 10-Q. And yet we arrive at a Hold, not a Buy.
Recent filings analysed: 10-Q (2026-08-05), 8-K (2026-08-05), 8-K (2026-06-05), 10-Q (2026-05-06).
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