AppLovin Shares Plunge Amid SEC Probe into Data Collection Practices

Mark Eisenberg
Photo: Finoracle.net

The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

Contents
FinOracleAI — Market ViewCompany Statement and OutlookFinOracleAI — Market ViewCompany Statement and OutlookFinOracleAI — Market ViewCompany Statement and OutlookFinOracleAI — Market ViewShort-Seller Reports Question AppLovin’s PracticesCompany Statement and OutlookFinOracleAI — Market ViewShort-Seller Reports Question AppLovin’s PracticesCompany Statement and OutlookFinOracleAI — Market ViewInclusion in S&P 500 Amid ControversyShort-Seller Reports Question AppLovin’s PracticesCompany Statement and OutlookFinOracleAI — Market ViewInclusion in S&P 500 Amid ControversyShort-Seller Reports Question AppLovin’s PracticesCompany Statement and OutlookFinOracleAI — Market ViewMarket Reaction: Sharp Decline Following ReportInclusion in S&P 500 Amid ControversyShort-Seller Reports Question AppLovin’s PracticesCompany Statement and OutlookFinOracleAI — Market ViewMarket Reaction: Sharp Decline Following ReportInclusion in S&P 500 Amid ControversyShort-Seller Reports Question AppLovin’s PracticesCompany Statement and OutlookFinOracleAI — Market ViewMarket Reaction: Sharp Decline Following ReportInclusion in S&P 500 Amid ControversyShort-Seller Reports Question AppLovin’s PracticesCompany Statement and OutlookFinOracleAI — Market ViewSEC Investigates AppLovin Over Data-Collection PracticesMarket Reaction: Sharp Decline Following ReportInclusion in S&P 500 Amid ControversyShort-Seller Reports Question AppLovin’s PracticesCompany Statement and OutlookFinOracleAI — Market View

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects. In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects. AppLovin has recently been the target of several critical reports by prominent short-seller firms. In March, Muddy Waters Research accused the company of systematically violating app store terms of service by extracting proprietary user IDs from platforms such as Meta, Snap, TikTok, Reddit, and Google without consent. !-- wp:paragraph --> These practices allegedly enable AppLovin to deliver targeted advertisements without user approval, a claim the company has disputed. !-- wp:paragraph -->
  • Fuzzy Panda and Culper Research previously criticized AppLovin’s AXON software, which has been central to its revenue growth and stock appreciation.
  • The release of these critical reports led to significant stock price volatility, including a 12% drop on February 26.
In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects. AppLovin has recently been the target of several critical reports by prominent short-seller firms. In March, Muddy Waters Research accused the company of systematically violating app store terms of service by extracting proprietary user IDs from platforms such as Meta, Snap, TikTok, Reddit, and Google without consent. !-- wp:paragraph --> These practices allegedly enable AppLovin to deliver targeted advertisements without user approval, a claim the company has disputed. !-- wp:paragraph -->
  • Fuzzy Panda and Culper Research previously criticized AppLovin’s AXON software, which has been central to its revenue growth and stock appreciation.
  • The release of these critical reports led to significant stock price volatility, including a 12% drop on February 26.
In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects. Last month, AppLovin was officially added to the S&P 500 index, replacing MarketAxess Holdings. This inclusion was notable as it occurred despite opposition from short-seller groups attempting to block its entry. !-- wp:paragraph --> Robinhood also joined the S&P 500 at the same time, taking the place of Caesars Entertainment. Earlier in the year, Fuzzy Panda Research had urged the index committee to exclude AppLovin, citing concerns about its business practices. !-- wp:paragraph -->

Short-Seller Reports Question AppLovin’s Practices

AppLovin has recently been the target of several critical reports by prominent short-seller firms. In March, Muddy Waters Research accused the company of systematically violating app store terms of service by extracting proprietary user IDs from platforms such as Meta, Snap, TikTok, Reddit, and Google without consent. !-- wp:paragraph --> These practices allegedly enable AppLovin to deliver targeted advertisements without user approval, a claim the company has disputed. !-- wp:paragraph -->
  • Fuzzy Panda and Culper Research previously criticized AppLovin’s AXON software, which has been central to its revenue growth and stock appreciation.
  • The release of these critical reports led to significant stock price volatility, including a 12% drop on February 26.
In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects. Last month, AppLovin was officially added to the S&P 500 index, replacing MarketAxess Holdings. This inclusion was notable as it occurred despite opposition from short-seller groups attempting to block its entry. !-- wp:paragraph --> Robinhood also joined the S&P 500 at the same time, taking the place of Caesars Entertainment. Earlier in the year, Fuzzy Panda Research had urged the index committee to exclude AppLovin, citing concerns about its business practices. !-- wp:paragraph -->

Short-Seller Reports Question AppLovin’s Practices

AppLovin has recently been the target of several critical reports by prominent short-seller firms. In March, Muddy Waters Research accused the company of systematically violating app store terms of service by extracting proprietary user IDs from platforms such as Meta, Snap, TikTok, Reddit, and Google without consent. !-- wp:paragraph --> These practices allegedly enable AppLovin to deliver targeted advertisements without user approval, a claim the company has disputed. !-- wp:paragraph -->
  • Fuzzy Panda and Culper Research previously criticized AppLovin’s AXON software, which has been central to its revenue growth and stock appreciation.
  • The release of these critical reports led to significant stock price volatility, including a 12% drop on February 26.
In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects. AppLovin’s stock dropped 14% in regular trading shortly before the market closed on Monday and fell an additional 5% in after-hours trading. This decline interrupted a remarkable rally, as the shares had soared nearly 80% so far in 2025, building on a 700% surge in 2024. !-- wp:paragraph --> The company’s stock momentum has been largely attributed to its advancements in artificial intelligence technology, which have enhanced its capabilities in delivering targeted advertisements for brands. !-- wp:paragraph -->

Inclusion in S&P 500 Amid Controversy

Last month, AppLovin was officially added to the S&P 500 index, replacing MarketAxess Holdings. This inclusion was notable as it occurred despite opposition from short-seller groups attempting to block its entry. !-- wp:paragraph --> Robinhood also joined the S&P 500 at the same time, taking the place of Caesars Entertainment. Earlier in the year, Fuzzy Panda Research had urged the index committee to exclude AppLovin, citing concerns about its business practices. !-- wp:paragraph -->

Short-Seller Reports Question AppLovin’s Practices

AppLovin has recently been the target of several critical reports by prominent short-seller firms. In March, Muddy Waters Research accused the company of systematically violating app store terms of service by extracting proprietary user IDs from platforms such as Meta, Snap, TikTok, Reddit, and Google without consent. !-- wp:paragraph --> These practices allegedly enable AppLovin to deliver targeted advertisements without user approval, a claim the company has disputed. !-- wp:paragraph -->
  • Fuzzy Panda and Culper Research previously criticized AppLovin’s AXON software, which has been central to its revenue growth and stock appreciation.
  • The release of these critical reports led to significant stock price volatility, including a 12% drop on February 26.
In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects. AppLovin’s stock dropped 14% in regular trading shortly before the market closed on Monday and fell an additional 5% in after-hours trading. This decline interrupted a remarkable rally, as the shares had soared nearly 80% so far in 2025, building on a 700% surge in 2024. !-- wp:paragraph --> The company’s stock momentum has been largely attributed to its advancements in artificial intelligence technology, which have enhanced its capabilities in delivering targeted advertisements for brands. !-- wp:paragraph -->

Inclusion in S&P 500 Amid Controversy

Last month, AppLovin was officially added to the S&P 500 index, replacing MarketAxess Holdings. This inclusion was notable as it occurred despite opposition from short-seller groups attempting to block its entry. !-- wp:paragraph --> Robinhood also joined the S&P 500 at the same time, taking the place of Caesars Entertainment. Earlier in the year, Fuzzy Panda Research had urged the index committee to exclude AppLovin, citing concerns about its business practices. !-- wp:paragraph -->

Short-Seller Reports Question AppLovin’s Practices

AppLovin has recently been the target of several critical reports by prominent short-seller firms. In March, Muddy Waters Research accused the company of systematically violating app store terms of service by extracting proprietary user IDs from platforms such as Meta, Snap, TikTok, Reddit, and Google without consent. !-- wp:paragraph --> These practices allegedly enable AppLovin to deliver targeted advertisements without user approval, a claim the company has disputed. !-- wp:paragraph -->
  • Fuzzy Panda and Culper Research previously criticized AppLovin’s AXON software, which has been central to its revenue growth and stock appreciation.
  • The release of these critical reports led to significant stock price volatility, including a 12% drop on February 26.
In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects. According to sources familiar with the matter, the SEC’s inquiry was triggered by a whistleblower complaint filed earlier this year, alongside multiple reports from short-seller firms. Neither AppLovin nor its executives have been formally accused of any wrongdoing at this stage. !-- wp:paragraph --> An AppLovin spokesperson declined to confirm or deny the existence of regulatory investigations but affirmed the company’s policy of cooperating with regulators and disclosing material developments through proper channels. !-- wp:paragraph -->

Market Reaction: Sharp Decline Following Report

AppLovin’s stock dropped 14% in regular trading shortly before the market closed on Monday and fell an additional 5% in after-hours trading. This decline interrupted a remarkable rally, as the shares had soared nearly 80% so far in 2025, building on a 700% surge in 2024. !-- wp:paragraph --> The company’s stock momentum has been largely attributed to its advancements in artificial intelligence technology, which have enhanced its capabilities in delivering targeted advertisements for brands. !-- wp:paragraph -->

Inclusion in S&P 500 Amid Controversy

Last month, AppLovin was officially added to the S&P 500 index, replacing MarketAxess Holdings. This inclusion was notable as it occurred despite opposition from short-seller groups attempting to block its entry. !-- wp:paragraph --> Robinhood also joined the S&P 500 at the same time, taking the place of Caesars Entertainment. Earlier in the year, Fuzzy Panda Research had urged the index committee to exclude AppLovin, citing concerns about its business practices. !-- wp:paragraph -->

Short-Seller Reports Question AppLovin’s Practices

AppLovin has recently been the target of several critical reports by prominent short-seller firms. In March, Muddy Waters Research accused the company of systematically violating app store terms of service by extracting proprietary user IDs from platforms such as Meta, Snap, TikTok, Reddit, and Google without consent. !-- wp:paragraph --> These practices allegedly enable AppLovin to deliver targeted advertisements without user approval, a claim the company has disputed. !-- wp:paragraph -->
  • Fuzzy Panda and Culper Research previously criticized AppLovin’s AXON software, which has been central to its revenue growth and stock appreciation.
  • The release of these critical reports led to significant stock price volatility, including a 12% drop on February 26.
In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects. Shares of mobile advertising firm AppLovin plunged sharply on Monday following Bloomberg’s report that the U.S. Securities and Exchange Commission (SEC) is investigating the company’s data-collection methods. The probe centers on whether AppLovin violated agreements related to targeted advertising to consumers. !-- wp:paragraph --> According to sources familiar with the matter, the SEC’s inquiry was triggered by a whistleblower complaint filed earlier this year, alongside multiple reports from short-seller firms. Neither AppLovin nor its executives have been formally accused of any wrongdoing at this stage. !-- wp:paragraph --> An AppLovin spokesperson declined to confirm or deny the existence of regulatory investigations but affirmed the company’s policy of cooperating with regulators and disclosing material developments through proper channels. !-- wp:paragraph -->

Market Reaction: Sharp Decline Following Report

AppLovin’s stock dropped 14% in regular trading shortly before the market closed on Monday and fell an additional 5% in after-hours trading. This decline interrupted a remarkable rally, as the shares had soared nearly 80% so far in 2025, building on a 700% surge in 2024. !-- wp:paragraph --> The company’s stock momentum has been largely attributed to its advancements in artificial intelligence technology, which have enhanced its capabilities in delivering targeted advertisements for brands. !-- wp:paragraph -->

Inclusion in S&P 500 Amid Controversy

Last month, AppLovin was officially added to the S&P 500 index, replacing MarketAxess Holdings. This inclusion was notable as it occurred despite opposition from short-seller groups attempting to block its entry. !-- wp:paragraph --> Robinhood also joined the S&P 500 at the same time, taking the place of Caesars Entertainment. Earlier in the year, Fuzzy Panda Research had urged the index committee to exclude AppLovin, citing concerns about its business practices. !-- wp:paragraph -->

Short-Seller Reports Question AppLovin’s Practices

AppLovin has recently been the target of several critical reports by prominent short-seller firms. In March, Muddy Waters Research accused the company of systematically violating app store terms of service by extracting proprietary user IDs from platforms such as Meta, Snap, TikTok, Reddit, and Google without consent. !-- wp:paragraph --> These practices allegedly enable AppLovin to deliver targeted advertisements without user approval, a claim the company has disputed. !-- wp:paragraph -->
  • Fuzzy Panda and Culper Research previously criticized AppLovin’s AXON software, which has been central to its revenue growth and stock appreciation.
  • The release of these critical reports led to significant stock price volatility, including a 12% drop on February 26.
In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects. Shares of mobile advertising firm AppLovin plunged sharply on Monday following Bloomberg’s report that the U.S. Securities and Exchange Commission (SEC) is investigating the company’s data-collection methods. The probe centers on whether AppLovin violated agreements related to targeted advertising to consumers. !-- wp:paragraph --> According to sources familiar with the matter, the SEC’s inquiry was triggered by a whistleblower complaint filed earlier this year, alongside multiple reports from short-seller firms. Neither AppLovin nor its executives have been formally accused of any wrongdoing at this stage. !-- wp:paragraph --> An AppLovin spokesperson declined to confirm or deny the existence of regulatory investigations but affirmed the company’s policy of cooperating with regulators and disclosing material developments through proper channels. !-- wp:paragraph -->

Market Reaction: Sharp Decline Following Report

AppLovin’s stock dropped 14% in regular trading shortly before the market closed on Monday and fell an additional 5% in after-hours trading. This decline interrupted a remarkable rally, as the shares had soared nearly 80% so far in 2025, building on a 700% surge in 2024. !-- wp:paragraph --> The company’s stock momentum has been largely attributed to its advancements in artificial intelligence technology, which have enhanced its capabilities in delivering targeted advertisements for brands. !-- wp:paragraph -->

Inclusion in S&P 500 Amid Controversy

Last month, AppLovin was officially added to the S&P 500 index, replacing MarketAxess Holdings. This inclusion was notable as it occurred despite opposition from short-seller groups attempting to block its entry. !-- wp:paragraph --> Robinhood also joined the S&P 500 at the same time, taking the place of Caesars Entertainment. Earlier in the year, Fuzzy Panda Research had urged the index committee to exclude AppLovin, citing concerns about its business practices. !-- wp:paragraph -->

Short-Seller Reports Question AppLovin’s Practices

AppLovin has recently been the target of several critical reports by prominent short-seller firms. In March, Muddy Waters Research accused the company of systematically violating app store terms of service by extracting proprietary user IDs from platforms such as Meta, Snap, TikTok, Reddit, and Google without consent. !-- wp:paragraph --> These practices allegedly enable AppLovin to deliver targeted advertisements without user approval, a claim the company has disputed. !-- wp:paragraph -->
  • Fuzzy Panda and Culper Research previously criticized AppLovin’s AXON software, which has been central to its revenue growth and stock appreciation.
  • The release of these critical reports led to significant stock price volatility, including a 12% drop on February 26.
In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects.

SEC Investigates AppLovin Over Data-Collection Practices

Shares of mobile advertising firm AppLovin plunged sharply on Monday following Bloomberg’s report that the U.S. Securities and Exchange Commission (SEC) is investigating the company’s data-collection methods. The probe centers on whether AppLovin violated agreements related to targeted advertising to consumers. !-- wp:paragraph --> According to sources familiar with the matter, the SEC’s inquiry was triggered by a whistleblower complaint filed earlier this year, alongside multiple reports from short-seller firms. Neither AppLovin nor its executives have been formally accused of any wrongdoing at this stage. !-- wp:paragraph --> An AppLovin spokesperson declined to confirm or deny the existence of regulatory investigations but affirmed the company’s policy of cooperating with regulators and disclosing material developments through proper channels. !-- wp:paragraph -->

Market Reaction: Sharp Decline Following Report

AppLovin’s stock dropped 14% in regular trading shortly before the market closed on Monday and fell an additional 5% in after-hours trading. This decline interrupted a remarkable rally, as the shares had soared nearly 80% so far in 2025, building on a 700% surge in 2024. !-- wp:paragraph --> The company’s stock momentum has been largely attributed to its advancements in artificial intelligence technology, which have enhanced its capabilities in delivering targeted advertisements for brands. !-- wp:paragraph -->

Inclusion in S&P 500 Amid Controversy

Last month, AppLovin was officially added to the S&P 500 index, replacing MarketAxess Holdings. This inclusion was notable as it occurred despite opposition from short-seller groups attempting to block its entry. !-- wp:paragraph --> Robinhood also joined the S&P 500 at the same time, taking the place of Caesars Entertainment. Earlier in the year, Fuzzy Panda Research had urged the index committee to exclude AppLovin, citing concerns about its business practices. !-- wp:paragraph -->

Short-Seller Reports Question AppLovin’s Practices

AppLovin has recently been the target of several critical reports by prominent short-seller firms. In March, Muddy Waters Research accused the company of systematically violating app store terms of service by extracting proprietary user IDs from platforms such as Meta, Snap, TikTok, Reddit, and Google without consent. !-- wp:paragraph --> These practices allegedly enable AppLovin to deliver targeted advertisements without user approval, a claim the company has disputed. !-- wp:paragraph -->
  • Fuzzy Panda and Culper Research previously criticized AppLovin’s AXON software, which has been central to its revenue growth and stock appreciation.
  • The release of these critical reports led to significant stock price volatility, including a 12% drop on February 26.
In response, CEO Adam Foroughi published a blog post defending the company’s technology and condemning the short sellers’ attempts to undermine AppLovin’s market value. !-- wp:paragraph -->
Company Statement and Outlook
“As a global public company, we regularly engage with regulators and address inquiries in the ordinary course. Material developments, if any, would be disclosed through the appropriate public channels,” an AppLovin spokesperson said.
The company’s future performance will depend on the outcome of the SEC investigation and its ability to maintain trust with consumers and regulators amid increasing scrutiny of data privacy and advertising practices. !-- wp:paragraph -->

FinOracleAI — Market View

The SEC investigation into AppLovin highlights growing regulatory focus on data privacy and targeted advertising within the mobile ad industry. While AppLovin’s AI-driven technology has driven significant growth, the allegations from whistleblowers and short sellers pose reputational and regulatory risks. !-- wp:paragraph -->
  • Opportunities: Continued innovation in AI-powered ad targeting could sustain revenue growth if regulatory concerns are resolved.
  • Risks: Potential regulatory penalties or restrictions could impact AppLovin’s business model and market valuation.
  • Ongoing scrutiny may increase compliance costs and affect investor confidence.
  • Short-seller activism could amplify volatility and pressure management to improve transparency.
Impact: The investigation introduces near-term uncertainty, likely weighing on stock performance. However, clear resolution and compliance could restore confidence and support long-term growth prospects.
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Mark Eisenberg is a financial analyst and writer with over 15 years of experience in the finance industry. A graduate of the Wharton School of the University of Pennsylvania, Mark specializes in investment strategies, market analysis, and personal finance. His work has been featured in prominent publications like The Wall Street Journal, Bloomberg, and Forbes. Mark’s articles are known for their in-depth research, clear presentation, and actionable insights, making them highly valuable to readers seeking reliable financial advice. He stays updated on the latest trends and developments in the financial sector, regularly attending industry conferences and seminars. With a reputation for expertise, authoritativeness, and trustworthiness, Mark Eisenberg continues to contribute high-quality content that helps individuals and businesses make informed financial decisions.​⬤