Up Over 2,000% in a Year, Digital Turbine Stock Might Just Be Getting Started | The Motley Fool Nicholas Rossolillo March 24, 2021
The company's media discovery platform was a big winner last year, but this small company could be just getting started in its growth story -- perhaps hastened by Apple (NASDAQ:AAPL) and Alphabet's (NASDAQ:GOOGL)(NASDAQ:GOOG) Google deciding to eliminate on-device activity tracking.
The future of retail is ... hardware?
Before delving into some recent and notable developments for Digital Turbine, it's important to understand the role the company plays in the digital economy. App and software developers are a type of modern manufacturer -- but of digital goods and services.
And think of the mobile device as a kind of modern take on the retail store. It's the method of selling virtual apps and services to consumers, and the device maker (and/or the app store, like Apple's App Store or Google Play) takes a cut of the final sales price just like an actual retailer does.
Digital Turbine acts like a logistics operation (like a delivery truck hauling goods to a store) that helps app developers get their creations onto the virtual "shelves" of devices -- and for device makers to get more efficient at monetizing the retail of the apps consumers want.
It helps device manufacturers and *** mobile operators *** get content in front of users via things like pre-loaded apps on devices (all that stuff already there when you first turn on your new phone, tablet, smart TV, etc.), an "app wizard" that recommends downloads during device setup, or an app "discovery widget" on the home screen of a device.
Three quick acquisitions to strengthen app discovery
Is the hefty price tag for Digital Turbine stock worth it? With Apple and Google phasing out individual app and device tracking (a key component of marketing and monetization campaigns for software developers), Digital Turbine's growth could have legs under it. Device manufacturers and developers will be in need of new ways to make money, and Digital Turbine's platform could continue to pick up new business as a result.
It's done some work of its own to double down on its app discovery platform. It acquired peer Mobile Posse last March, and it announced three more takeovers of digital advertising and engagement firms since February 2021 (AdColony for up to $375 million, Triapodi for $22.5 million, and Fyber for $600 million). Most of these deals will be paid by the issuance of new Digital Turbine stock, but likely some debt will be raised as well. It remains to be seen how all the pieces will work together and what kind of financial results they'll deliver, but the result will be one of the largest mobile ad tech firms around.