Sarah Travers
Artificial intelligence (AI) has become the buzzword of the decade, captivating the attention of investors worldwide. However, amidst the frenzy surrounding big-name AI companies, two lesser-known contenders have quietly emerged as potential stars of the AI market: AppLovin and Xometry.
AppLovin: Unveiling the Power of AI in Mobile Apps
AppLovin, a company that initially made its mark in the mobile gaming industry, has swiftly shifted its focus towards AI-powered software development. With a portfolio boasting over 200 mobile games, AppLovin generated revenue surpassing $1.4 billion in 2023. However, its strategic vision extends beyond gaming.
AppLovin leverages its vast collection of mobile apps to gather data for training AI models, paving the way for innovative software solutions. Their flagship product, AppDiscovery, powered by AI, has witnessed remarkable success since its launch in 2023, driving revenue growth of 76% year over year to $1.8 billion. Despite a slump in the mobile app economy, AppLovin’s exponential growth trajectory remains unscathed.
Furthermore, the company’s transition towards a higher-margin software business has propelled profitability, with net income exceeding $350 million in 2023. With a forward-looking approach and a reasonable valuation of 15 times expected earnings, AppLovin emerges as a promising player in the AI market.
Xometry: Revolutionizing Manufacturing Through AI
Xometry stands at the forefront of AI-driven disruption in the manufacturing sector. Unlike its counterparts, Xometry’s business model has been deeply rooted in AI since its inception. The company operates an online marketplace where customers can obtain instant bids for custom manufacturing, facilitated by AI-driven pricing algorithms.
Xometry’s AI software not only determines pricing but also identifies third-party manufacturers willing to undertake projects at competitive rates, enabling the company to capitalize on the spread. Despite the traditional resistance to tech disruption in the manufacturing industry, Xometry’s financials paint a picture of progress. Consistently rising revenue and improved gross margins indicate the effectiveness of its AI software in optimizing pricing strategies.
Trading at less than 2 times sales, Xometry presents an enticing investment opportunity for those seeking exposure to the AI revolution in manufacturing.
Investing in AI Beyond the Surface
In the fast-paced world of AI investing, discerning investors are turning their attention to hidden gems like AppLovin and Xometry. These companies, though lesser-known, possess the innovation and foresight to redefine their respective industries through the power of AI.
As the allure of AI continues to captivate the market, investors are reminded that true value often lies beneath the surface. By identifying promising AI stocks like AppLovin and Xometry, investors can position themselves at the forefront of this transformative trend, poised to reap the rewards of technological innovation and sustainable growth.
