In a report published on Monday, Capitalwatch alleged that key AppLovin shareholders used the ad-tech company to facilitate money laundering.
- AppLovin's stock has declined 15% over the last three sessions.
- AppLovin has routinely faced allegations of fraudulent data practices.
- With strong financial and stock growth last year, retail investors appear upbeat despite the fresh allegations in the Capitalwatch report.
Applovin Corp. entered retail investors’ radar on Monday after a short report alleged money laundering by one of its major shareholders, with recent share-price weakness and analyst commentary also weighing on investor sentiment.
Stocktwits sentiment for APP climbed up in the ‘extremely bullish’ zone, while message volume remained ‘extremely high.’ The ticker was trending among the top five on the platform.
Fresh Alligations
Late Monday, Capitalwatch, a U.S.-based financial news site focused on Chinese companies trading on American equity markets, published a detailed report claiming that AppLovin’s primary shareholders, Hao Tang and his sister Ling Tang, used the company to launder billions of dollars in black money.
The report highlighted a "Mobius Loop," in which criminal organizations paid AppLovin massive sums for advertising through the company’s AXON algorithm and Array software, to launder illicit cash. It also said that, contrary to management's denials, AppLovin maintains a shadow operations team of more than 15 people in mainland China who handle sensitive U.S. user data, which could prompt action from the U.S. Department of Justice and a national security review.
To be sure, AppLovin has been accused in the past of inflating performance metrics and stealing customer data from social media, among other things, by notable financial blogs such as Fuzzy Panda Research, Culper Research, and Muddy Waters Research. Bloomberg reported in October that the U.S. Securities and Exchange Commission had opened a probe into the company’s business, following a whistleblower complaint.
Stock Weakness, Recent Updates
The development comes after AppLovin shares slid for a third straight session as of Friday, shedding about 15% in total over the period. While the U.S. market was closed on Monday, AppLovin’s Frankfurt shares shed nearly 6% on the day.
Notwithstanding the allegations, the mobile ad-tech company has been on a strong run. The APP stock rose 108% over 2025. The company delivered a strong third-quarter: revenue rose 68% to $1.4 billion – its second-best quarterly growth rate in the last four years – and net income increased 92% to $836 million.
In July, AppLovin completed the $800 million-sale of Tripledot Studios mid-last year, effectively pivoting from owning and operating mobile games to focusing on advertising technology. A month later, it increased its share buyback program by an additional $3.2 billion and joined the S&P 500.
AppLovin will report Q4 results on Feb. 11.
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