Key Takeaways
- Shares of AppLovin rose Friday morning, reversing some of Thursday’s 20% decline following a new short report.
- AppLovin said Friday it has hired an attorney to investigate the recent reports and “false narratives.”
- Three short reports in recent weeks have accused AppLovin of a variety of deceptive business practices.
AppLovin (APP) shares rebounded Friday morning after losing one-fifth of their value in Thursday trading as the company said it has hired an attorney to investigate recent short seller reports.
The online ad seller said on Friday that it has hired Alex Spiro to “conduct an independent review and investigation” into the recent short seller reports. Spiro has represented a number of high-profile clients in a variety of cases, including Tesla (TSLA) CEO Elon Musk, New York City Mayor Eric Adams, and Jay-Z.
“We are fully committed to defending the Company, its operations, and its reputation from those seeking to manipulate the market through false narratives,” AppLovin CEO Adam Foroughi said in a statement.
AppLovin shares were up around 4% on Friday. They have gained nearly 300% over the last 12 months, but are down sharply from a Feb. 14 record close of $510.13.
Recent Short Reports Have Targeted AppLovin
AppLovin has been the target of three reports from short sellers over the last month, with the latest published by Muddy Waters on Thursday. The latest report called AppLovin’s business practices “scammy,” and said the company could face repercussions from its business partners.
In a pair of reports released last month, short sellers from Culper Research and Fuzzy Panda Research alleged that AppLovin engaged in a range of fraudulent or deceitful practices.
Investopedia has not independently verified the allegations in any of the short reports.
:max_bytes(150000):strip_icc()/GettyImages-2201540452-8fccc673b4de49448c64b019231cb55f.jpg?w=1200&resize=1200,0&ssl=1&description=AppLovin+Stock+Rebounds+as+Company+Hires+Attorney+to+Investigate+Short+Reports){kind=link}