AppLovin shares tumble 13% as short sellers question its centerpiece AXON ad software

Core Insights - AppLovin's shares fell 13% following allegations from short-seller reports questioning the integrity of its AI-powered AXON advertising software, which had previously contributed to the company's strong performance in 2024 [1] - Fuzzy Panda accused AppLovin of employing fraudulent advertising tactics and claimed that the AXON model is fundamentally flawed [1][2] - The reports suggest that AppLovin is involved in unethical practices, including data theft from Meta and violations of Google and Apple's app store policies [2] Financial Performance - AppLovin reported a significant 73% increase in advertising revenue for the fourth quarter, reaching nearly $1 billion [2] - The company had recently announced plans to spin off its mobile gaming segments and expand the AXON model into other sectors such as healthcare and automotive [2]