AppLovin stock tanks on report SEC is investigating company over data-collection practices

"AppLovin shares plummeted on Monday after Bloomberg reported that the SEC has been probing the mobile advertising company over its data-collection practices. The agency has been looking into whether the company violated agreements on pushing targeted ads to consumers, Bloomberg reported, citing people familiar with the matter. The report said that the SEC is responding to a whistleblower complained filed this year along with multiple short-seller reports, and added that neither the company nor its officials have been accused of wrongdoing."

"An AppLovin spokesperson said the company doesn't typically comment on the "existence or non-existence" of regulatory matters. "That said, as a global public company, we regularly engage with regulators and if we get inquiries we address them in the ordinary course," the spokesperson said in a statement. "Material developments, if any, would be disclosed through the appropriate public channels." The stock dropped 14% in regular trading after the report, which landed shortly before market close. It fell another 5% in extended trading."

"AppLovin's stock has been on a tear, jumping about 80% this year after soaring more than 700% in 2024. The surge has been driven by the company's artificial intelligence technology that's allowed it to provide better ad targeting capabilities to brands. Last month, AppLovin was added to the S&P 500, replacing MarketAxess Holdings, at the same time that Robinhood joined the index in place of Caesars Entertainment."

U.S. regulators have probed AppLovin over its data-collection and targeted-ad practices following a whistleblower complaint and multiple short-seller reports. The SEC examined whether AppLovin violated agreements on pushing targeted ads to consumers, and neither the company nor its officials have been accused of wrongdoing. An AppLovin spokesperson said the company typically does not comment on regulatory matters but engages with regulators and would disclose material developments through proper channels. The stock dropped 14% in regular trading and fell another 5% in extended trading after the report. AppLovin's shares rose about 80% this year after a 700% surge in 2024 driven by AI ad-targeting technology. AppLovin was recently added to the S&P 500, replacing MarketAxess Holdings, despite short-seller efforts to prevent its inclusion.

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