2 Red-Hot AI Growth Stocks to Buy in 2024 and Beyond

When it comes to investing in growth stocks, sometimes it is best to let your winners run. This looks to be the case with two red-hot growth companies whose stocks have performed strongly over the past year.

1. AppLovin

It’s not a well-known company, but AppLovin (NASDAQ: APP) stock is certainly getting some attention and its price is up about 375% over the past year. The company has been a big beneficiary of artificial intelligence (AI), which helped reinvigorate its growth.

AppLovin is an adtech company whose solutions are used by mobile app developers to improve the marketing and monetization of their apps. The company also owns a portfolio of apps as well.

The company started to gain a lot of momentum following the release of its AXON 2 AI-based advertising technology in the second quarter of 2023. The new AI engine is more predictive and increases the use of automation, which is allowing AppLovin to work with a wider breadth of advertisers in different verticals outside its core gaming customer base.

The results so far have been outstanding. For the third quarter, the first full quarter AXON 2 was available, its software platform revenue surged 65% year over year to $504 million, while adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the segment climbed 92% to $364 million.

The momentum continued into the fourth quarter, with software platform revenue soaring 88% year over year to $576.5 million, while segment-adjusted EBITDA jumped 126% to $420 million. Overall revenue grew 36% year over year in Q4.

The company will also look to use its AXON 2 engine in other products, including one it has for connected TV, as well as for its end-to-end app management suite Array.

Image source: Getty Images.

AppLovin has also started to benefit from the shift to real-time bidding in mobile auctions. This helps the company in two ways.

First, its Max solution, which is used to drive in-app revenue, only charges for real-time bidding. Second, real-time bidding clears auctions more quickly, which allows publishers to show more advertisements to…

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