Applovin saw its shares plummet 18.2% in March following allegations of deceptive practices from Muddy Waters. This report claimed that the company misrepresented its digital advertising performance by using questionable tactics, undermining user privacy. Furthermore, Muddy Waters echoed previous concerns raised by other short-sellers about Applovin's inflated claims of client demand, stating that actual demand was significantly lower. These troubling allegations prompted calls for Applovin's software to be removed from major app stores. In addition to these issues, the tech sector faced broader market turbulence related to looming tariffs from the Trump administration.
"According to Muddy Waters, Applovin's new digital advertising engine engages in a number of irreputable tactics in order to make its digital advertising revenue look better than it otherwise would be..."
"All in all, Muddy Waters thinks that Applovin's new e-commerce advertisers are only seeing 25% to 35% 'incremental' demand to their existing social media advertising..."
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