This 400-Person Company Makes $5.6M Per Employee… And It's an AI Monster

Everybody is looking at the big AI companies, but no one is looking at the app layer. Yes, things like biotech are solving some big problems, but if you dig deeper, there are companies using AI to make a lot of money, and there's one in particular that may be about to double its business. What's up everybody? It's LG here and welcome to Milk Road Stocks, the daily market show that's looking for hidden gems, but not the Adam Sandler kind. Today is September 1st, 2026. Apploving may be the greatest company you've never heard of and it just barely missed earnings last month and the market is just kind of looking the other way right now. Today, our lead researcher, Martin, is going to dive into this hidden giant for us, explain what the hell they do, why they make so much money, why they have access to 1.6 billion people on Earth, and why they are a competitor for the Facebooks and Googles of the world. And if you want to see Martin's moves, including if he holds this stock and what other stocks he holds, it's all in Milk Road Pro for just a dollar at the link below. All right, Martin, I'm excited to talk about a company that I feel like nobody has ever heard of. Uh probably the biggest like $300 billion company or whatever it is, uh that no one's ever heard of. Um but I think is a very important part of a lot of things that people do on a daily basis and also is using AI a lot to make money. So I feel like this is this is great to hear a little bit more on the SAS side today. Uh so I'll I'll throw it over to you. >> Yeah, let me actually tell you a story how I got interested in this company. I'm listening a lot of podcasts pretty much every day. I listen a few of them and I was listening podcast with CEO of Applvin Adam and I was blown away blown away right away. And it only happened to me twice in my life. Once it was when I was listening podcast podcast with with lighter and then it happened with Applovin as well. So I'm gonna tell you like why I'm bullish here, why I think that Adam is likely one of the best CEOs in the market right now and why I think that the company is very good um very good investment at this point because the prices are down quite badly. So that's going to be the whole bookcase for Applian. >> Awesome. Well, I you said Lighter was the other time that you got turned on to a company by the Wow. Okay. Well, Lighter is absolutely killing it. Uh for anybody who pays attention to crypto, they're they're they're moving up the ranks on the on the leverage leverage volume side. So, we're here to talk App. So, um go ahead. Also, which show is he what show was this App Leven guy on? We got to get people like that on Milk Road. >> I don't remember which one was that. We can share the link later, but >> no, I just I just want to know what it takes for us to get those people. >> Let's share the link anyway. And if anyone's interested in Applovin, you should go and listen that podcast. And I promise you that after you hear that podcast, you are you are sold. You want to own that stock because Adam is is just good. >> Excellent. All right. Well, go ahead, man. I want to tell you um some context about Applovin because the the history is quite interesting. Adam who is a CEO, Adam Forogi who is a CEO and co-founder of Apploving um has built two businesses before AppLin. He sold both of them. So he made a lot of money before and I believe that he started Apploving like something around 2010 or something. So it's pretty old company at this point and then so he has already successful entrepreneurship career before Apploving and then here we are looking at the company they they did IPO in 2021 and right after they did IPOed the stock went down 92%. So it's like okay it's it's you know classic IPO like everything is overhyped and the company is bust nobody pays attention to it anymore but it's not actually the case with applovin because at this point you can see huge price drop so cost price was something below $10 and at that point the company was making something around 1 billion eida which is earnings before interest, taxes, depreciation, amortization and at that point the company market cap valuation was 4 billion. So I was like hold on so we are making 1 billion AIDA and our market valuation is 4 billion. It just doesn't make sense. So and it was actually there they because they didn't know how to do IPO properly. It meant that there were a lot of sellers who wanted to to exit because of the private investments or you know um maybe some founders wanted to exit. So there was a lot of sell pressure and also because they decided that they wanted to do IPO with a low float. So it means that there is only a certain portion of stocks on the market available. So they did couple of mistakes and there there were a lot of sell pressure but they were no biders. So they said okay we our business is doing really well so let's just do buybacks and so they decided that they started to do buybacks and again like I was telling like they were doing 1 billion AIDA the valuation was around 4 billion so they could pretty much buy back like 20 25% of the company just using those buybacks so they said like okay we don't need actually external buyers we can just go out there and just buy our stocks ourselves. So, fast forward to today, the company is trading, you know, you can see it right here. It's trading at $300 or something like that, but it's probably one of the most successful buyback stories in the world. So, you can see they started to buy back somewhere here. >> Oh god. >> And >> what was that price? What was the price? went all the way down to like $50, $40 or something like that. >> Right here it was around 10 bucks. >> Oh. >> And then >> it grew all the way to almost 800. >> Wow. Okay. So, this is and this is on buybacks and they must have they must have rolled out some new business lines or something like that like it was it or was it entirely buybacks and >> they were using the cash because uh you know I said that they are making um 1 billion um in Abida. So after they they can they keep about 70 80% in cash because they don't really have any like investments or costs or whatsoever. So they have a lot of cash. So they were using that cash for the buybacks. Plus they also get some debt to buy more of their stocks because the team really believe that the business is doing well and they have a you know thriving business that's going to keep continuing. So they were okay to leverage and take that and buy back. And so I think they spent 6 billion um on those buybacks. And Adam said that he thinks that it added value of around 50 to 60 billion. So something around 10x is pretty pretty pretty good I think. And so it just shows the if you listen that podcast I was referring to earlier, it just shows how Adam is thinking about the market. And also I I need to tell you that right now the company is at 105 billion and it's just 400 people. So it's not like you would maybe think that it's, you know, thousands of employees or something. It's just 400 people. This is pretty insane. And it's because the CEO uh or you know Adam is just a very good leadership and he describes how he manages his employees and the team the the changes and the approaches that he's taking. So he's pro he's saying something like he doesn't care if you are average person or average employee. He wants a A-level people only like A-level plus people and every everyone else doesn't really matter but you need to make sure that those people are incentivized enough to stay in the company because otherwise they are you know smart they are good so they have incentives to go elsewhere and start their own businesses. So his whole sort of premise is that I need to make sure I have only eight people plus and they want to stay here. I keep them in incentivized and motivated to stay here and that's his whole kind of version how he is leading the company and the fact that they are just 400 people it shows that it's probably working. Just going to pause there for a second to point out that the market is showing signs of something kind of different happening and our analysts at Milkro Pro are all over it. They spent the last couple weeks making a lot of trades, getting out of some positions and getting into a lot of new ones, getting ready for the next wave of robotics, space, or even kind of picking some different AI winners. If you want to see what they have in their portfolios, what positions they're opening, it's just a dollar in Milkroad Pro at the link below. >> Dude, that's $10 million of EBDA per employee. It's like an insane amount, man. That's crazy. Or at least No, more than that. That must be wrong. That does that math doesn't make any sense. >> Something around that. It's an obscene amount. It's a lot of money per employee. >> They are actually one of the mo the most profitable companies in the world on the public markets at least. So you can see the comparison of like you know some big giants in the market and epin is like really exceptional. So, you know, it's not just that I got impressed by how he's able to, you know, answer on the podcast, but it's also seen in the numbers that this company is run really well, very effectively. And so I think >> people still do not really talk about this, but I think once you know the price will start to do well again, I think this narrative can pretty quickly catch up and like wow epin is the most profitable company per employee on the world. I want to own that part or at least I want to learn what is going on, how they are able to do it. And so I think Adam, that's why I said I think that this is one of the best CEOs on the market right now. >> You know, Martin, we've we you've kind of given us already like a really good business case and and tell told this little story about Applov1 about, you know, kind of messing up their their IPO, having a big dip and and huge opportunity for anybody who got in years ago for anybody who knew what it was. But what what what does the company do? I feel like we just kind of have to like zoom out for a second and just understand. Oh, you're telling us that they they're making5 half million dollars a year per employee. Like what what is it? >> Yeah, I think the way they put it is they sell revenues. Okay, but let me elaborate because that sounds super easy. Well, in fact, it is easy because they are pretty much a marketplace for advertisers and um publishers. So you can see on this chart here they have supply those are gaming apps those are you know app developers who who have some games and they are they want to sell the slots in these games and get as as much money as possible for each slot. So usually these gaming developers they connect to some marketplaces where there are auctions happening so they will you know get returns for for for their money. So on the other side you can see the demand here. You have advertisers who are companies who want you know advertise their products and so they go to the very same marketplace and they are competing for for those slots. So you can think of it as as ad as ad as ad as ad as ad as ad as ad as ad as ad as ad as marketplace pretty much and they have I think two assets you need to understand in case of epovin. One of them is the exchange itself. It's called Max and it's a mediation platform where you know advertisers and these gaming apps just connect together. you can see bits and they there's an auction happening every every day every second actually there are hundreds hundreds of thousands of auctions happening and then because if you only have the the exchange that's great but imagine that you also have the engine that's going to like reading the whole the whole data behind that engine that will give you the data to train your own model that's going to make sure that okay because I see all the data I can build a recommendation model for all the advertisers. So I will give them return on asset spend that they they get no nowhere else. Okay. In fact, if you go to AppLin, you will probably get 50% higher returns than if you go to Meta for example or I think the numbers are you get 120% higher returns if you go to AppLin than if you go to Tik Tok or Snapchat. Snapchat. So let me explain how it actually works because the Exxon that's Exxon is their recommendation engine model and it's basically that if I'm gaming developer let's play I um let's say I play solitire okay and then maybe there are some ads and so I go to um Max I want to auction that slot and whoever gets the best offer they will be able to show the ads. there and because they built the axon which is kind of their recommendation model or prediction model they are able to always like not always but most of the time win these auctions and yet they are still able to deliver the best returns for these advertisers. So that's when I say that they are selling revenues. They really are because they don't even have a Salesforce team or anyone. Adam's strategy is hey we don't need people to knock on doors and saying like hey come and try our platform. No because our product is good enough which means that people will come eventually and once they start to spend their money they will spend more. So like the deeper the pockets the better and you will do this until you know until you reach a certain point that it's already kind of limit for for your particular business. So is that clear or do do you need some um explanation? >> I I mean it's clear to me because I I I've I've you know read a report that you wrote months ago on this company but I think maybe maybe I can kind of summarize it as well from my end just how I understand it. You can tell me if I'm right or wrong. uh is that basically App 11 is this kind of like basically like an ad advertising marketplace that is something you never see. But when you're playing any kind of mobile games and listen even listen we were traveling last week both of us and walking through the airport so many people are sitting there playing like the gem game where you connect and they explode or whatever. People are sitting around playing games on their phones. They're using their apps. Oh, go ahead. >> I didn't say that. They have access to 1.6 six billion users on the planet. >> There you go. Okay. So, they have huge. >> So, they are the advertising they are an advertising marketplace that's that's in games that are accessed by 1.6 billion people uh on the planet. So, basically like I don't know like 15 to 20% of people on the planet are being exposed to this somehow or ads that are being run through apploving. Um and they basically let advertisers come and and bid on ads. And if you don't know how mobile ads work, how how online advertising works, that's basically the model that Meta and Google have used to make an obscene amount of money over the last like 25 years is people have used mobile apps and and and desktop apps and everything else, browser apps. Anytime you see ads, that's like Facebook like basically the Facebook ad marketplace is something that is one of the main reasons that Facebook is worth so much uh is that they have a ton of demographic data on their users and all that kind of stuff. You can target them with advertising. Um just understand that. So, AppLoving does the same thing but for mobile games. Uh, and what you're telling me is that they also offer generally a much better return on investment for advertisers than these major ones. Um, because and I'm assuming maybe maybe I haven't explained why they're able to do that. So maybe that's something we could dive into >> because they they pretty much only focus on that prediction model on that axon and they see all the bits in that auction. So that gives you that, you know, advantage that nobody else have. >> That's exactly it. So they kind of have they have they have an edge in the market on the companies that are also hyperscalers but who also have this as a major part of their business. So they're basically beating them at their own game. Uh and as a result that's why they're able to have like just such a crazy amount of money uh per employees because um they're in your they're in your phone. They're they're everywhere where mobile game players are going >> and because the gamings like you have to use that SDK. So the games the the gaming apps pretty much if you run the campaign those gaming studios they will have to give you all the results. So like they collect all the data so they close the loop and the model can still improve you know. So it's kind of that's the thing you need to do to ensure that your model your prediction model will keep improving because that's pretty much the key to their business. If they keep their model uh the performance that it keeps improving all the time that's the core. If that premise is gone then this is not a growth story then they might start going to struggle and like whatever. But so far this is happening and it's happening because they are able to like leverage the access to all the data they need to close the loop to make to make to train a new better model and just do that all the time. >> Right? So they have it they have a they their recursive model for building this this auction marketplace and for returning value to the apps is is is basically really strong, right? Like they've invested a lot. They have an advanced model and as a result um they're they're able to continue delivering a really strong ROI to their customers and as a result they continue to to rake in the cash. Does this cost them a lot of money? Like do they spend a lot of money Martin to do this? Because even though they have 400 per employee like this is also something that you and Kyle talked about for a long time, right? that, you know, a big part of the SAS apocalypse is that SA software companies won't need as many people and there's going to be a transition period where they're able to increase their their revenue per employee, but also on the back end, they're probably spending a lot of money on tokens, right? >> They are, but it's not seen in in their, you know, numbers. I mean, they keep the margins the same, so it's not showing in a bad way in the in the balance sheet or um P&L income statement. So, >> okay. Okay. But they are I mean obviously this is this is a huge AI play that they're using like their model is an AI model to do this. >> Yeah. >> Yeah. Yeah, again uh Adam said that because there is AI the engineers will not be two times more um you know efficient but they are going to be 10 times or 100 times more efficient because that's the thing when you have a players like yes your your outputs will grow but not linearly but exponentially so that that's that's a big um statement but I think like if you look at the numbers and what the company is doing, how they keep growing while their you know employees count is 400 then it it tells you that story and it's not just a you know marketing kind of um say but it it's really happening and there is one more thing I want to mention here and it's until this summer most of the demand most of the advertisers were gaming studios only so you know you play solitaire but maybe some other game gaming developer would like to, you know, attract you to play some of the other some of similar game or something like that. But now they open that to pretty much everyone. So it's not because I think they already sort of um penetrated that gaming market and so like they they have something around 12% of the gaming market already. So at some point you start you are you know saturated and you need to expand that market. And so this summer they actually say hey we are confident that Axon is good enough to expand beyond just gaming. And so now it's going to be the story. Is it true or is it not? And that's what the market is right now pricing in. Do we believe in that growth in that story or not? again like we are going to see the numbers in Q3 but I tend to believe that this is going to work even beyond gaming. So you know that just expanded the the total addressable market by a lot because gaming market is I don't know 100 billions but if you expand into e-commerce and everything else it's like 10x plus total this market. I know there are people listening to this right now who work at AI companies. So, this one is specifically for you. If you're trying to get your company in front of people who are completely obsessed with AI and actually investing in this stuff, well, you found them. Milkroad reaches more than 500,000 investors across our newsletters, podcast, YouTube, and X and Q4 is filling up. So, don't be the brand that waited too long. Go to milkroad.com/sponsor. Oh, yeah. That's So, this is so this is this their reach so far has been entirely on gaming only. Yeah. Nothing else, right? So, yeah, that's that's a big deal. They can unlock that. Where did they where have they been talking about that? Because was that just the interview with Adam or did they because they reported earnings I think a month ago, like August 4th or 5th. Is this actually I'd love to learn about that. Like would their most recent earnings were I'm assuming they were positive, right? That they were good. And also like is this what they discussed that they are have they started to see revenue from other apps or is that just their their kind of um what they're building into? Like when does that kind of start? >> It's it's already growing. I actually have another chart here >> that is just showing that this is showing how um that Axon installs. So because now more people you know beyond gaming want to install Axon to get access to that you can see the installs are growing pretty significantly week over week which means like probably that non-gaming part is actually working at least we can see like you know those are initial signal that like e-commerce businesses are downloading the app and trying you know experimenting and in fact I saw a a one one guy who was a big um advertiser on Meta, he said that his experience with Applavin was very exceptional. And so he went from $200 spent on Meta every week, he just moved over to Applavin like in four weeks or something because the returns were so good. So he just keep keep uh increasing his budgets and yet he was still you know getting better results than Meta while he was also like raising budgets like crazy. So I think those are like small pieces but like if you because the whole story is now about if they are able to expand beyond that gaming and those are like small details that are important but those are early signals that it's going to work also for e-commerce and and other businesses. >> Absolutely right. Yeah. E-commerce like that's that's the big giant right is like that's the other I think that's the two things that people do online where you can make money with this. I mean, there's lots of other stuff, but gaming and shopping is really what it's all about. And these guys are only doing one of those, right? So, uh, if they can show some excellence there, then then I guess the assumption is that as they go into e-commerce and other stuff, they they can do similar and and already, like you said, there's there's some proof that some devs are enjoying it and saying it's a better experience. And also, there's a lot of growth in the chart. So, um, that seems that seems pretty healthy. >> Let me show you some numbers. Um, so these are the revenues. You can see blue bars are revenues. So they just keep growing up. And this pink one uh or purple one, it's revenue growth. So you can see that in the last quarter, they were still growing 52% year-over-year revenues. And I also added Aida margins to see how much money out of those revenues they can keep as a company. You can see Aida margins around 80%. So that means that out of each $1 of revenue they keep 80 cents. I think the margins are just just impressive and not many companies are able to have margins like that. I think like Nvidia and you know maybe memory memory names are around like similar range but everyone else is like much much lower. So, and then you can see the purple line that shows revenue growth. And yes, it's declining, but it's declining because the numbers are already pretty high. So, the higher uh the number then you know, but it's still very decent 52% revenue growth. And some people like companies and kind of assess them through the lens of um rule of 40, which is revenue growth plus the margins. And here because we were talking about maybe Poland here we are talking about figure and here if we look at rule of 40 you can see 52% growth plus um margins around 80% so we get to something around 130 that's that's pretty sick I think and then I think the valuation still makes sense um because if you look at this chart here I have um price earnings ratio which is using the last 12 months and then I have forward price earnings ratio that's looking forward and you can see that we are right now trading at kind of um low multiples and I think that's because one the market participants do not believe in that growth beyond gaming which I don't think is the case we are going to see um the numbers in in Q3 and second they missed their own guidance in Q2 which caused a big stock selloff and they just missed the revenue uh by 10 million LG they they they made revenue almost 2 billion then you missed your own guidance by 10 million and people are going to sell your stock it doesn't make sense and they actually provide um a clear explanation why they missed um their own guidelines and that is if you remember LG I said that they need to improve their model frequently to deliver that you know good performance for the ads >> and they said that there was some delay in that model update so the model only updated right after the Q2 ended and so it caused that you know gap so they missed the the revenue guidelines but that's okay like now for Q3 guidance they said that they are going to grow and keep growing the way uh the the growth will continue and you will be able to see that shortly in Q3. So I think all in all people do not believe in the growth story anymore. They think the the business uh is broken because they missed their own guidance. that in fact I think this was just a you know small exception because of delayed um model upgrade which is okay um but we are going to see the results and confirmation in Q3. So I think Q3 is going to be really important for Apploven specifically because it will just prove that you know that perception that they are not able to grow and that it wasn't break of their business is going to kind of justify and say like hey you are you guys are wrong and you know our business keeps thriving. >> Mhm. Well that's interesting. I mean it looks like so they've dropped like you're saying obviously the market didn't like them just barely missing their earnings right like you said 10 million on on a 2 billion projection uh and they're down 30% basically starting that day which is only a month ago right so it's not it's not that long ago um but you're you're basically telling me that in their next earnings or you know for Q3 or even for Q4 uh so sometime in the next 6 months they should start to show some decent revenue numbers coming from a whole new sector their business and that's something that's going to bring a lot of market participants back. So, uh that we should have here over the next couple months should have a pretty decent entry if you follow that, right? >> Yeah. >> Exc Martin, then or maybe that's something we keep for pro members only, but I think this is you know I think this is the kind of hidden gem that a lot of people are looking for in the AI race and it's also something that uh Kyle's talked about for a long time, a lot of the other AI guys talk about on our shows is is the app. the app layer, not app, but like the app layer, like applications that are actually using AI to make a lot more money and and this is clearly one of them, but being a SAS company, I think it's it's getting overlooked because we're still in this narrative of of of software being dead. So, what's your move, Martin? Is this is this is this somewhere or or maybe you keep that as a secret, but I feel like people might already figure out what you're doing with it. >> Yeah, like obviously I'm bullish on the stock here. Um I think the team is full of you know PhD and like really smart smart people and I think when you kind of empower those people with AI you will see you see the results in their prediction engine you know in that axon and which is so to put it simply I said in the beginning that they are selling revenues through their axon which is their prediction model and you can only have such a good model because you smart people working with AI and so yes as you said this is the application uh that is taking advantage of the AI and you might not see it like right away it's not you know front acing um application but at at the end like on the background those are super smart guys that are now doing amazing things and they are you know beating like everyone else and I think they are led by incredible incredible leader. And so I'm probably add going to add to my bags here because um yeah, I'm extremely bullish. >> Well, if you guys want to follow Martin's move for that and and see whether he has it or not, which shouldn't be a mystery at this part, but it's also worth always worth checking out his whole portfolio. Uh you can do that at Milk Road Pro. It's just a dollar at the link below. Uh and also to track Martin what what what your moves are for this over the next couple months, right? because obviously there's a lot more uh potentially to come and and those that next earnings call is going to come pretty soon probably in two months time. So that's going to be a big moment for them and you've been really good at providing updates for our pro community uh for our Milk Road Pro community about this one and a lot of your other uh really good plays. So guys check it out. Milk Road Pro is just a dollar at the link below. Otherwise, Martin, uh good to see you again, man. Thanks for explaining this one to us. I feel like again, like I said, I think there's a lot of hidden gems in the market right now that people are just >> people are just too blown away by by memory and neoclouds and stuff like that to really dig a little deeper into stuff that that is legitimately making money and making a lot of money. So, I appreciate the breakdown. >> Yeah. Uh you're welcome. I think as you said, the opportunity right now moves from, you know, like picks and shovels into the applications that are really able to take advantage of that um AI boom. And so I think this is one of the best examples here. >> Excellent. Well, thank you, Martin. >> Thank you, sir. That was fun. >> Thanks for listening to Milk Road. If you enjoyed the show, make sure you like and subscribe. And if you're struggling to find winners in the market, that's exactly what Milkro Pro is built for. Our analysts have called some of the biggest winners early, and Pro lets you see what they're buying next, every trade they make, and the research behind every position. Check out Milk Road Pro at the link below. Everything you hear on Milk Road is forformational purposes only. These are our personal opinions, not financial advice, and we may own some of the investments we talk about. Always do your own research and make the decisions that are right for you.