SEC investigates AppLovin over alleged data misuse and partner agreement breaches

The U.S. Securities and Exchange Commission (SEC) has launched an investigation into AppLovin’s data collection practices following allegations that the company violated partner agreements to deliver more targeted ads to consumers, as reported by Bloomberg.

The probe, overseen by the SEC’s cyber and emerging technologies unit, was reportedly initiated after a whistleblower complaint and a series of short-seller reports accused AppLovin of using unauthorized tracking methods to gather user data. The regulator has not yet alleged wrongdoing, and the scope and progress of the review remain unclear.

AppLovin’s shares dropped as much as 19% following reports of the investigation — its steepest single-day fall in six months. The company, which helps app developers acquire users and sell in-app ads, has nearly doubled its market value this year, reaching over $230 billion and joining the S&P 500 index in September.

In a statement, AppLovin said it “regularly engages with regulators” and will disclose any material updates “through appropriate public channels.” The SEC declined to comment, citing limitations due to the ongoing U.S. government shutdown.

The allegations stem from claims that AppLovin breached service agreements with major platform partners, including Meta, Amazon, and Google, to collect user identifiers for ad targeting — a practice known as fingerprinting. Such activity is prohibited under Apple’s App Store rules and, until earlier this year, under Google’s policies as well.

AppLovin has previously denied these accusations, with CEO Adam Foroughi calling the short-seller reports “littered with inaccuracies.” In March, the company hired attorney Alex Spiro of Quinn Emanuel Urquhart & Sullivan to lead an independent review into what it described as “false reports” intended to manipulate its stock.