AppLovin jumps after CapitalWatch announces “significant revisions” to negative report but says stance on company “remains unchanged”
AppLovin is trading to the upside on Monday morning after a financial research agency issued a “correction and apology” regarding some of the claims in its negative report on the company and its principals.
Shares of the ad tech firm tumbled in January as CaptialWatch called it “the ultimate monument to 21st-century new-type transnational financial crime.”
But after “a rigorous internal review,” CapitalWatch determined that the allegations of money laundering directed at one of AppLovin’s largest shareholders, Hao Tang, were based on a judicial document that was interpreted erroneously, and that his connections with other parties in the report “were inaccurate and failed to meet our publication standards.”
However, the outlet still argues that it’s right on the company, but just didn’t have enough evidence to single out Tang individually. Per CapitalWatch:
“Our review concluded that while the macro data and transaction structures highlighted in the original report warrant market scrutiny, the information currently available is legally insufficient to attribute these complex capital operations directly and exclusively to Mr. Tang. We have chosen to retract the allegations directed at Mr. Tang personally out of strict adherence to evidentiary principles, not as a denial of the objective market phenomena observed.”
“Our stance regarding the complex financial structure of AppLovin (NASDAQ: APP) remains unchanged.”
AppLovin forcefully denied the original report, saying it was “rife with false, misleading, and nonsensical allegations.”
The firm, like most in the software space, has floundered recently amid potential disruptive threats from AI tools and new entrants.
