AppLovin shares soared 45% on Thursday after the online gaming and advertising company issued guidance that was well above estimates and reported better-than-expected earnings and revenue.

The stock jumped past $245 in early afternoon trading. It’s now up 515% this year, far outpacing all other tech companies valued at $5 billion or more, according to FactSet data. The rally has lifted AppLovin’s market cap to over $80 billion.

Revenue in the third quarter climbed 39% to $1.2 billion, topping the $1.13 billion average estimate, according to LSEG. Earnings per share of $1.25 exceeded the 92-cent average estimate.

For the fourth quarter, AppLovin sees revenue of $1.24 billion to $1.26 billion, representing growth of about 31% at the middle of the range. Analysts were expecting about $1.18 billion.

Founded 12 years ago, AppLovin went public in 2021, riding a Covid-era wave of excitement in online games. Now, the company’s games unit generates relatively slow growth, but its online ad business is bustling from advancements in artificial intelligence that have improved ad targeting.

AppLovin attributes much of its growth to its AI advertising engine called AXON, particularly since releasing the updated 2.0 version last year. The technology helps put more targeted ads on the mobile gaming apps the company owns, and it works for other studios that license the software.

The company said software platform revenue in the quarter increased 66% to $835 million, driven by improvements in AXON’s models.

“As we continue to improve our models our advertising partners are able to successfully spend at a greater scale,” the company said in a letter to shareholders.

While revenue is increasing at a rapid rate, Wall Street is most attracted to AppLovin’s profitability. Net income in the quarter increased 300% to $434.4 million, or $1.25 a share, from $108.6 million, or 30 cents a share, a year earlier. The software platform had an adjusted profit margin of 78%.

“AppLovin continues to impress with outsized revenue growth and incredible EBITDA conversion,” analysts at Wedbush wrote in a report on Thursday. They recommend buying the stock and increased their price target from $170 to $270.

AppLovin CEO Adam Foroughi, whose net worth swelled on Thursday by more than $2 billion to about $7.4 billion, provided an update on the company’s pilot e-commerce project. The technology allows businesses to offer targeted ads in games.

“In all my years, It’s the best product I’ve ever seen released by us, fastest growing, but it’s still in pilot,” Foroughi said on the earnings call. E-commerce “is looking so strong that it’s something that we think will be impactful to the business financially in 2025 and then for the long-term.”

— CNBC’s CJ Haddad contributed to this report

WATCH: AppLovin is ‘killing Unity’

As Donald Trump celebrated his presidential victory early Wednesday morning, Elon Musk was right there with him.

“A star is born. Elon,” Trump said onstage at his Mar-a-Lago resort, thanking the world’s richest person for spending two weeks campaigning in Pennsylvania.

Musk, who poured at least $130 million into a pro-Trump campaign effort, turned Trump support into yet another full-time job in recent months, funding a swing-state operation to register voters and using his social media platform X to constantly tout his preferred candidate, frequently with misinformation.

Musk’s investment in Trump is already paying off, even though Trump doesn’t take office until Jan. 20.

Tesla shares soared 15% on Wednesday, adding roughly $15 billion in paper value to Musk’s net worth. The electric vehicle maker faces headwinds in the global market from China-based competitors, declining European sales and consumers’ growing distaste for his political views.

But with Musk cozying up to Trump, and the president-elect promising to slash the types of regulations that Musk abhors, Wall Street is betting Tesla, on balance, will be a beneficiary.

For Musk, the potential gains go well beyond Tesla.

During his victory speech, Trump also praised Musk’s SpaceX and thanked Musk for delivering Starlink Wi-Fi terminals to Hurricane-stricken parts of the U.S. That all leaves Musk with plenty of reasons to be optimistic that a second Trump administration will pay healthy dividends to him and his businesses.

Musk’s companies are currently embroiled in a range of probes and lawsuits from federal agencies pertaining to matters including alleged securities law violations, workplace safety, labor and civil rights violations, violations of federal environmental laws, consumer fraud and vehicle safety defects.

Given the executive branch’s outsized control over federal regulatory bodies, Musk can look forward to regulators and intelligence agencies winding down some or all of the 19 known ongoing federal investigations and lawsuits against Tesla, SpaceX and X, formerly known as Twitter.

At New York’s Madison Square Garden on Oct. 27, Musk was one of many Trump fans and surrogates to speak during an all-day rally. Much of the coverage of the event focused on comedian Tony Hinchcliffe’s bigoted quips, including his description of Puerto Rico as a “floating island of garbage.”

Musk was introduced by Cantor Fitzgerald CEO Howard Lutnick, who called the Tesla CEO the “greatest capitalist” in U.S. history. Lutnick said he and Musk were co-founders of the envisioned “Department of Government Efficiency” and he asked Musk how much he thought could be cut from the federal budget.

Musk answered “at least $2 trillion,” which is more than the federal government’s discretionary budget of $1.7 trillion. The remark received a scream from Lutnick and applause from the crowd.

Musk didn’t specify what he sought to cut, but he previously accused agencies including the SEC, Environmental Protection Agency and Federal Aviation Administration of regulatory overreach or infringing on his free speech rights.

He also accused the Biden administration of hiring too many IRS personnel, and has vocally objected to a so-called billionaires tax.

Having a role in a bespoke commission could give Musk power over federal agencies’ budgets, staffing and the ability to push for the elimination of inconvenient regulations.

Musk also said during a Tesla earnings call on Oct. 23, that he intended to use his sway with Trump to establish a “federal approval process for autonomous vehicles.” Currently, approvals happen at the state level.

Tesla has been working on driverless technology for more than a decade but hasn’t yet produced a robotaxi or vehicle safe to use without a human ready to steer or brake at any time.

Additionally, a Trump administration may agree to ramp up the government’s work with his companies.

Musk’s newest startup, xAI, is developing large language models and generative artificial intelligence software that aims to compete with similar products from Microsoft-backed OpenAI, Meta and others. 

Meta recently announced its open-source Llama models were available to U.S. government agencies in the areas of defense and national security. And OpenAI is already working with the U.S. military after adding a retired U.S. Army general and former director of the National Security Agency to its board in June.

Musk didn’t respond to a request for comment.

Regulatory credits were about 60% of Tesla’s net income in the second quarter of 2024, and 39% in the third quarter. Other government rebates on EV sales represented about 50% of Tesla’s third-quarter profit.

Trump hasn’t made clear whether he’ll maintain those rebates and regulatory credit programs. He previously said he may cut the federal $7,500 EV tax credit.

Additionally, Trump has promised to slash income taxes and to implement steep tariffs. While tariffs could help protect Tesla from Chinese competitors, such a move could involve significant disruption to Tesla’s automotive supply chain, which relies on some materials and parts from China.

When it comes to worker protections, Musk has been seeking to strike down the constitutional authority of the National Labor Relations Board through litigation. He may find such lawsuits are no longer needed if Trump is willing to eliminate or reduce the power of the agency, which is supposed to ensure that companies follow federal laws allowing workers to form unions and engage in collective bargaining with their employers.

Then there’s Musk’s involvement with sanctioned governments.

At SpaceX, Musk has withheld the use of Starlink, the company’s satellite internet service, over Taiwan, even for U.S. troops based there. The Wall Street Journal reported that Musk cut off access as a favor requested by Russian President Vladimir Putin allegedly on behalf of Chinese President Xi Jinping during a series of ongoing, frequent talks between the two men.

In response to the reports, NASA Administrator Bill Nelson said if they were true, Musk’s conversations with Putin should be be federally investigated.

According to analysis by NBC News, Musk has repeatedly posted pro-Kremlin content to his hundreds of millions of followers on X. He even engaged with content from Tenet Media and its creators at least 60 times on the social network. Tenet was at the center of an alleged Russian covert operation to manipulate U.S. public opinion ahead of the 2024 election, according to the Department of Justice. 

While Vice President-elect JD Vance recently called Putin a U.S. adversary, Trump has frequently spoken of his affection for the Russian president, even since Russia’s devastating invasion of Ukraine in 2022. Kremlin officials have celebrated Trump’s victory in this week’s election.

Musk, who publicly endorsed Trump moments after the first assassination attempt on the former president in July, has said he intends to remain involved in U.S. politics for the long haul.

He said in a discussion on X on Tuesday that his super PAC would continue its work after the presidential election and would seek to influence the outcomes of midterms, intermediate elections and elections of local prosecutors across the U.S.

A priority, Musk said, would be to help elect district attorneys “who prosecute repeat violent criminals who are obviously a danger to people.”

President-elect Donald Trump is unlikely to roll back the Biden administration’s CHIPS and Science Act, despite his campaign rhetoric on the bill, experts say. 

The legislation, which provides incentives for chipmakers to set up manufacturing in the U.S., became a point of contention in the final month of the election cycle.

Trump criticized the bill and its price tag. House Speaker Mike Johnson, a Republican, then said that his party “probably will” try to repeal the law. Johnson later walked the statement back.

Still, the key Biden policy, which has massive implications for Asian chips makers like TSMC and Samsung, is likely safe in the near term, according to chip experts. 

Despite signaling he’s “not thrilled” about the bill, Trump is probably not going to roll it back, Paul Triolo, senior vice president for China and technology policy lead at Albright Stonebridge, told CNBC’s “Squawk Box Asia” on Thursday.

“There’s support for this kind of onshoring of advanced manufacturing,” he added. 

The Biden administration signed the bipartisan CHIPS and Science Act in August 2022, committing almost $53 billion to invest in domestic semiconductor manufacturing and research with the aim of boosting  U.S. competitiveness with China.

The former president made headlines in October by attacking the legislation as a “bad” deal during a three hour interview with popular podcaster Joe Rogan. 

“We put up billions of dollars for rich companies to come in and borrow the money and build chip companies here, and they’re not going to give us the good companies anyway,” he said, arguing instead that his proposal to increase tariffs would attract chip companies for free. 

The allocation of the CHIPS Act has been slow, with the lion’s share of the earmarked funds yet to be doled out.

So far, the bill has attracted Asian chip makers such as Taiwan Semiconductor Manufacturing Company and Samsung to build U.S. facilities. The two companies have already been offered $6.6 billion and $6.4 billion, respectively. 

The largest CHIPS Act beneficiary has been the American chip maker Intel, which has been awarded $8.5 billion in funding.

While Trump may want to modify and change some of the priorities of the bill and its fund allocation, he’s expected to leave most of it intact.

The Trump administration will probably try to reinterpret the bill “so they can spread the money a little differently than Biden, but I don’t think they’re going to roll it back,” Adam Posen, president of the Peterson Institute for International Economics, told CNBC’s “Squawk Box Asia” on Thursday. 

Posen said that this would mirror what Biden had done by leaving Trump’s China tariffs in place when he took office, despite pivoting to a more industrial policy focused strategy. 

“But I do think there’ll be much more expansion on the tariff front, rather than industrial policy expanding,” he added.