AppLovin Stock (NASDAQ:APP) Sharply Lower on SEC Probe

AppLovin's stock (NASDAQ: APP) fell sharply to start the new trading week, closing 14.03% lower yesterday following reports that the Securities and Exchange Commission (SEC) is investigating the mobile advertising technology company's data-collection practices. The probe is centered around allegations of service agreement violations with platform partners.

The stock price closed at $587, a $95.76 drop, and has begun this morning's pre-market in similar fashion, with a further 2.68% drop so far. Monday's action saw the price hit an intraday low of $548.09, with a substantial volume of 14,417,706 shares changing hands. 

The SEC's investigation reportedly stems from concerns that AppLovin pushed more targeted advertising to consumers in a manner that breached agreements with its platform partners.

This development follows earlier scrutiny from short-seller firms like Fuzzy Panda Research and Culper Research, which accused the company of deceptive advertising practices and unauthorized data collection. These allegations had previously contributed to a 12% stock decline back in February.

The stock's sharp decline is a clear reflection of the market's concern over the potential impact of the SEC investigation on AppLovin's future prospects, highlighting the sensitivity of tech companies to regulatory scrutiny regarding data privacy and advertising practices.