AppLovin Corporation faced a sharp decline in its stock price on October 6, 2025, following revelations of an SEC investigation into its data-collection practices. The news has raised concerns among investors and analysts alike, particularly given the company's recent inclusion in the S&P 500 index. The source reports that this investigation could have significant implications for the company's future operations.
Stock Plummet Amid SEC Investigation
The mobile advertising giant saw its stock plummet by 14% during regular trading hours, with an additional drop of 3.28% in premarket trading. The SEC's investigation stems from allegations that AppLovin may have breached service agreements with its platform partners by collecting user identification data without obtaining proper consent.
Whistleblower Complaint and Short-Seller Reports
This inquiry was prompted by a whistleblower complaint and has been further fueled by reports from short-sellers who have been targeting the company. In response to the investigation, AppLovin has emphasized its commitment to transparency, stating that it regularly engages with regulators and is prepared to address any inquiries that arise.
Significance of the Timing
The timing of the SEC's scrutiny is particularly significant, as it comes shortly after AppLovin's recent addition to the prestigious S&P 500 index, raising questions about the company's compliance practices and future prospects in the competitive mobile advertising landscape.
