Applovin faced significant challenges in March, with shares falling 18.2% following a series of damaging short-seller reports. Notably, Muddy Waters published a report accusing the company of using unethical practices to inflate its digital advertising revenues. These tactics allegedly include scraping user data from competing platforms and misrepresenting the effectiveness of its advertising products. The report suggests that e-commerce advertisers are seeing only a fraction of the incremental demand that Applovin claims. This scrutiny could lead to broader concerns about Applovin's compliance with app store regulations and overall business sustainability.
Applovin's shares plummeted 18.2% in March amid multiple short-seller reports questioning its digital advertising tactics, impacting investor confidence and stock performance.
Muddy Waters accused Applovin of engaging in unethical practices by scraping user data from other platforms, allegedly violating app store rules.
The short-selling firm claims Applovin's new e-commerce advertisers see only 25% to 35% incremental demand compared to the claimed 100% by Applovin's management.
Muddy Waters, alongside previous short-seller reports, believes Applovin's software should be removed from app stores due to serious privacy policy violations.
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