AppLovin Stock Plummets Amid SEC Investigation into Data Collection Practices
AppLovin Faces SEC Scrutiny Amid Data Privacy Concerns
AppLovin Under Investigation by SEC for Data Practices
Shares in AppLovin, the prominent mobile advertising firm, experienced a sharp decline after reports surfaced that the Securities and Exchange Commission (SEC) is investigating the company’s data-collection practices. According to a report from Bloomberg, the SEC is examining whether AppLovin breached agreements related to delivering targeted advertisements to consumers.
Whistleblower and Short-Seller Reports Trigger SEC Action
The investigation comes in response to a whistleblower complaint filed earlier this year, bolstered by multiple short-seller reports. The news of the investigation had an immediate impact on AppLovin’s stock, which has shown significant growth in the past year.
AppLovin Stock Remains Volatile Amidst Growth
Despite recent challenges, AppLovin’s stock had surged approximately 80% in 2025, following an impressive rise of over 700% in 2024. The remarkable growth has been largely attributed to the company’s advanced artificial intelligence technology, which enhances ad targeting capabilities for brands.
AppLovin Joins S&P 500 Index
In a recent milestone, AppLovin was eligible for inclusion in the prestigious S&P 500 Index, replacing MarketAxess Holdings. This achievement marked a significant step in acknowledgment of the company’s market presence, occurring simultaneously with Robinhood’s entry into the index over Caesars Entertainment, despite substantial resistance from certain investment communities.
Challenges From Short-Seller Firms
AppLovin has faced criticism from several notable short-seller firms, including Fuzzy Panda Research and Muddy Waters Research. These firms have accused the company of violating app store terms of service by misusing proprietary identification data from major platforms such as Meta, Snap, TikTok, Reddit, and Google. Such practices allegedly allowed AppLovin to serve ads without user consent.
AppLovin’s Defense Against Allegations
AppLovin CEO Adam Foroughi has staunchly defended the company’s technological practices and business strategies. In a blog post, Foroughi addressed the recent short-seller reports, emphasizing AppLovin’s commitment to maintaining ethical data practices and criticized those aiming to profit from the company’s fluctuating stock prices.
This situation remains dynamic, with further updates expected as more information becomes available.
