12:03 PM EST, 12/10/2024 (MT Newswires) -- AppLovin ( APP ) is expected to see growth if it can expand its advertising product to non-gaming advertisers and if a TikTok ban is implemented in early 2025, Oppenheimer said in a note Tuesday.

The analysts said that if AppLovin ( APP ) can scale its advertising product to non-gaming advertisers, they see the potential for a more than two times increase in its total addressable market in the short term and more than 10 times expansion in the long term in the US alone. In 2024, US mobile game advertising is projected to reach $7.8 billion, compared to $19 billion for retail/e-commerce and $126 billion for total mobile programmatic ad spend, they added.

The analysts also said that the company's e-commerce business could benefit from a potential TikTok ban. They estimate TikTok currently accounts for about $1.07 billion, or 5%, of US mobile programmatic e-commerce ad spend. If a TikTok ban occurs in early 2025, they project AppLovin ( APP ) could see an additional $60 million to $320 million in e-commerce revenue, representing a 20-107% increase from their current 2025 revenue forecast.

"We see AppLovin's ( APP ) entry e-commerce developing into a self-fulfilling prophecy that both capitalizes on and accelerates the secular shift of ad spend to games. APP's first-mover advantage and strong management execution are likely to enable it to maintain above-industry growth and margins in the medium to long term," the analysts said.

Oppenheimer reiterated its outperform rating on AppLovin ( APP ) with a price target of $480.

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