On February 26, 2025, AppLovin faced significant scrutiny as two short-seller firms, Fuzzy Panda Research and Culper Research, published reports alleging fraudulent advertising tactics. Fuzzy Panda claimed AppLovin's AXON model was the 'nexus of a House of Cards' built on data theft from Meta in its e-commerce push and exploitation of consumer data in violation of Google and Apple's app store policies.
Culper Research further alleged that AppLovin systematically exploits app permissions to force-feed 'silent, backdoor app installations' onto users' phones, generating profits from unsolicited installations. The report also cast doubt on AppLovin's e-commerce initiative, suggesting it takes undue credit for sales generated by Meta ads by requiring advertisers to spend on Meta first.
Following these reports, the Law Offices of Howard G. Smith announced an investigation into AppLovin Corporation concerning possible violations of federal securities laws. The allegations suggest that AppLovin's reported financial growth and stability may have been based on dishonest advertising practices, potentially misleading investors.
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